The sun sets off to the side of two oil tankers, as they fill up at the Al Basrah Oil Terminal, off the Iraqi Coast Line, February 10, 2004, The Arabian Gulf. Bloomberg
The sun sets off to the side of two oil tankers, as they fill up at the Al Basrah Oil Terminal, off the Iraqi Coast Line, February 10, 2004, The Arabian Gulf. Bloomberg
The sun sets off to the side of two oil tankers, as they fill up at the Al Basrah Oil Terminal, off the Iraqi Coast Line, February 10, 2004, The Arabian Gulf. Bloomberg
The sun sets off to the side of two oil tankers, as they fill up at the Al Basrah Oil Terminal, off the Iraqi Coast Line, February 10, 2004, The Arabian Gulf. Bloomberg

Sailors say suspicious object found on oil tanker off Iraq


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Sailors transferring fuel oil from an Iraqi tanker in the Arabian Gulf to another vessel discovered a “suspicious object” they fear could be a mine.

The discovery, reported by authorities on Thursday, comes amid heightened tension between Iran and the US in the waning days of President Donald Trump’s administration.

Already, America has conducted B-52 bomber flyovers and sent a nuclear submarine into the Arabian Gulf over what Trump officials describe as the possibility of an Iranian attack on the first anniversary of the US drones strike in Baghdad that killed Iranian general Qassem Suleimani.

Two private security companies said sailors feared they found a limpet mine on the MT Pola, a Liberian-flagged tanker owned by a shipping company traded in the US. The Pola was receiving assistance on Thursday in the waters off Basra. A limpet mine is a type of naval mine that is attached to the side of a ship, usually by a military diver. It later explodes, and can significantly damage a vessel.

The two companies, Ambrey Intelligence and Dryad Global, say investigations are ongoing.

United Kingdom Marine Trade Operations, an organisation under Britain’s Royal Navy, said on its website that an unknown object had been attached to a ship’s hull in the vicinity of Iraq’s Khor Al Zubair Port.

The US Navy’s 5th Fleet, which patrols the Middle East, was monitoring the incident, said spokeswoman Cmdr Rebecca Rebarich. An Iraqi official declined to immediately comment.

The Pola, along with another tanker, serves as floating fuel oil storage of Iraq's State Organisation of Marketing of Oil, said Sudharsan Sarathy, a senior oil analyst at the data analysis company Refinitiv. Smaller vessels carry the fuel oil to the ship, which then conducts ship-to-ship transfers in the Arabian Gulf to clients.

Mr Sarathy said the Pola was conducting a ship-to-ship transfer with the MT Nordic Freedom, a Bermuda-flagged tanker. Dryad Global posted a satellite photo it said showed the Pola and the Nordic Freedom.

Stocks in the Nordic Freedom's owner, Nordic American Tankers, traded slightly down early on Thursday on the New York Stock Exchange at slightly under $3 a share.

In 2019, the US blamed Iran for a series of limpet mine attacks on oil tankers near the Strait of Hormuz, the narrow mouth of the Arabian Gulf through which 20 per cent of the world’s oil passes. Tehran denies being involved.

Iranian Foreign Minister Javad Zarif on Twitter earlier on Thursday criticised Mr Trump for wasting “billions to fly B52s & send armadas to our region”.

“Intelligence from Iraq indicate plot to fabricate pretext for war,” Mr Zarif wrote. “Iran doesn’t seek war but will openly & directly defend its people, security & vital interests.”

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Translated by Arunava Sinha
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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