Oil producing countries gain from Arab unrest

KUWAIT: Oil producing countries like Kuwait and Saudi Arabia are somehow silently benefiting from the unrest in the Middle East, admits financial expert. Speaking to reporters at the Q2 Business Optimism Index presented at the JW Marriott in Kuwait City yesterday, Manjeet Chhabra-Dun & Bradstreet General Manager Middle East said oil economies are profiting to a certain extent. “Whether we accept it or not, whenever a political turmoil emerges, the oil prices go up and oil economies like Kuwait benefit from it,” he told local press.

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Chhabra said that strong oil prices and the government’s stimulus to the economy help maintain business optimism in Kuwait. “Kuwait is an oil-based economy and their GDP’s are mainly from the oil sector; so they gain from the price rise,” he added. “If more money flows in, then it will be invested in the infrastructure and various services; therefore positively affecting other sectors too” he explained. Chhabra pointed out that concerns about the political issues faced by a number of countries in MENA regi ons do not appear to be impacting the sentiments of business people in Kuwait.

He explained that during recession, oil prices face a downward trend over global consumption. “Everywhere the sentiment is gloomy, so it has a negative impact on the economy of the world. Now, there is a current geo-political turmoil in nature, but the oil prices are getting higher and their economies are getting better too; there are some concerns, but optimism remains positive overall,” he added. According to Chhabra, the latest estimates by OPEC, Kuwait oil production increased by 27,500 bpd, from Janu ary to February 2011.

Ahamd Abu Blan, Business Development Manager of the Dun & Bradstreet, echoed the same sentiment explaining some details from the graph they provided. “Business optimism in Kuwait remains very positive with indices of 46 and 51 respectively for the hydro-carbon and non-hydrocarbon sectors. The indices are very optimistic if you notice the graph; it’s all bears with above 50’s.” “Within the non-hydrocarbon sector, results are mixed with manufacturing remaining constant at 50, construction at 62, trade and ho spitality sectors at 55, transport and communications at 54, finance and real estate and business services at 47,” he added.

Ahamd Abu Blan, Business Development Manager of the Dun & Bradstreet, echoed the same sentiment explaining some details from the graph they provided. “Business optimism in Kuwait remains very positive with indices of 46 and 51 respectively for the hydro-carbon and non-hydrocarbon sectors. The indices are very optimistic if you notice the graph; it’s all bears with above 50’s.” “Within the non-hydrocarbon sector, results are mixed with manufacturing remaining constant at 50, construction at 62, trade and ho spitality sectors at 55, transport and communications at 54, finance and real estate and business services at 47,” he added.

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