Good morning, ladies and gentlemen. We have another busy issue for you on this fine Tuesday morning, leading with the latest state budget figures released by the Finance Ministry.

BUT FIRST- Is Washington discussing a security agreement with Riyadh that would bypass the normalization requirement with Israel? That’s what Axios reports, citing three sources as saying that the two countries could lock in “a set of security, technology and economic agreements” before the end of US President Joe Biden’s current term in office. National Security Adviser Musaad bin Mohammed Al Aiban reportedly met recently with US National Security Adviser Jake Sullivan and US Secretary of State Antony Blinken in Washington to discuss the agreements, which Axios said would not include the full defense scope initially discussed.

REMEMBER- A proposed defense pact between the two countries was originally envisioned to see Washington provide security assurances to Riyadh, along with cooperation on the development of a domestic nuclear power industry, as well as on artificial intelligence and other technologies. Saudi Arabia normalizing diplomatic ties with Israel was set as a precondition for the agreements, but the stipulation has caused negotiations to stall in the past several months as Israel continues its assault on Palestine. Saudi has been adamant in its stance that there would be no normalization with Israel without a credible pathway to a Palestinian state.

WEATHER- Riyadh is looking at a high of 32°C and a low of 20°C today. Over in Makkah, the temperature will peak at 36°C and hit a low of 23°C. Meanwhile, Dammam will see a high of 32°C and a low of 23°C.

WATCH THIS SPACE-

#1- Acwa Power is looking to triple its production capacity to 180 GW by 2030, and also increase its desalination production to 8 mn cubic meters per day — making it the world’s largest private desalination company, Argaam quotes its CTO Bart Bosmans as saying. The renewables giant’s investments are split right down the middle in their distribution across local and foreign markets, Bosmans said.

#2- The Saudi Power Procurement Company initiated the bidding process for four battery energy storage projects located in the Makkah, Qassim, and Hail regions, each with a capacity of 500 MW and a storage duration of four hours, according to a statement. The selected bidders will have full ownership and will develop the projects under a build-own-operate model. Each project will be part of a 15-year agreement with the main buyer, the statement read. No details regarding the investment tickets were disclosed. The project is part of the Energy Ministry’s national renewable energy program.

#3- Maaden draws closer to upping its stake in Mosaic + Sabic JV: Saudi Arabian Mining (Maaden) has lined up Capital Market Authority approval for a capital hike to fund its planned acquisition of an additional 25% stake in the Sabic-Mosaic JV Maaden Wa’ad Al Shamal Phosphate (MWSPC), the authority said in a statement. The move will see Maaden issue 111 mn new ordinary shares, bringing its total capital up nearly 3% to SAR 38 bn.

This has been brewing for months: The mining giant inked a share purchase agreement with Mosaic Phosphates BV to buy its entire stake in MWSPC back in April of this year. The agreement also includes Mosaic’s marketing rights, and will bring Maaden’s stake in MWSPC to 85%.

#4- Saudi and Turkey want to drive bilateral trade up to USD 10 bn by 2025, with that figure forecasted to surpass USD 8 bn this year, Turkish outlet TRT World quotes Commerce Minister Abdullah Al Qasabi and Turkish Trade Minister Omer Bolat as saying at the Türkiye-Saudi Arabia Business Forum.

#5- The Public Investment Fund signed an MoU with Mitsubishi UFJ Financial Group (MUFG) to “collaborate on opportunities of mutual interest to both MUFG and PIF,” according to a statement (pdf). The agreement will see MUFG facilitating investments for the PIF, with a focus “on sectors in which MUFG has strong expertise, notably infrastructure and project financing,” and will also see MUFG supporting PIF on potential investments in Japan as part of Saudi Vision 2030.

DATA POINTS-

#1- The Industry and Mineral Resources Ministry issued 28 new mining licenses in August, split between 10 exploration licenses, nine licenses for building material quarries, six surplus mineral raw material licenses, and three reconnaissance licenses.

#2- The Real Estate Development Fund deposited over SAR 8.8 bn in the accounts of Sakani program beneficiaries in 9M 2024, according to the program’s quarterly report. The program is part of a government-run housing initiative that facilitates homeownership for citizens via several financing options, including rent-to-own and mortgage loans.

OIL WATCH-

Oil prices were up nearly 3% yesterday following Opec+’s decision to postpone its output hike and markets buckled up for the US presidential elections, Reuters reports. Brent crude futures were up 2.7% to USD 1.98 per barrel (bbl), while West Texas Intermediate rose 2.9% to USD 71.47 / bbl, the newswire said.

Markets aren’t doing as bad as everyone thinks, Opec says: “There is a bit too much doom and gloom and pessimism in terms of the demand outlook,” Opec Sec-Gen Haitham Al Ghais told CNBC on the sidelines of the ADIPEC forum in Abu Dhabi (watch, runtime: 03:50). The group is pegging oil demand growth at 1.9 mn bbl / d this year, which exceeds pre-pandemic averages and the post-pandemic recovery rate of 1.2 mn bbl / d, Al Ghais said, citing China’s recent stimulus package and strong performance in the US economy as driving factors.

The Kingdom’s crude oil production slipped 9.3% y-o-y in 2023 to 3.5 bn bbl, with exports also down 9.6% at 2.4 bn barrels, according to the latest oil and gas statistics (pdf) from the General Authority for Statistics. Gasoline production fell 2.6% y-o-y in 2023 to 224 mn bbl, while kerosene and jet fuel output rose 2.7% to 57 mn bbl.

Meanwhile, total fuel exports declined 10.3% y-o-y in 2023 to 67 mn bbl, while imports jumped 25.9% to 88 mn bbl.

SPORTS-

#1- World no.1 Aryna Sabalenka is still on a tear at the WTA Finals in Riyadh, beating Italy’s Jasmine Paolini 6-3, 7-5 yesterday in her penultimate group stage match. Meanwhile, China’s Qinwen Zheng rebounded from her loss to Sabalenka earlier this week, beating Kazakhstan’s Elena Rybakina in a three-set match (7-6, 3-6, 6-1).

Coming up today: The US’ Jessica Pegula plays against the Czech Republic’s Barbara Krejčíková at 2:30pm, followed by Iga Swiatek vs. Coco Gauff at 5pm.

#2- English golfer Charley Hull secured a three-shot victory at the Aramco Ladies Team series in Riyadh, marking her first title in two years and a return to form after multiple runner-up finishes, BBC Sports reports.

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THE BIG STORY ABROAD-

It’s election day in the US of A, which means very few other stories will top headlines in the international press. Donald Trump and Kamala Harris were both in Pennsylvania overnight, where each candidate pushed final messaging in a bid to secure what is widely seen as one of the most critical swing states in the election. Meanwhile, both candidates’ campaigns continued to work on boosting voter turnout in the last stretch before today’s vote, with each taking different approaches, the New York Times notes. The Financial Times, the Wall Street Journal, Reuters, and Bloomberg also have coverage of the final campaigning push.

Speaking of (unorthodox) methods of boosting turnout: Elon Musk’s USD 1 mn daily voter giveaway — designed to encourage voter turnout — is being allowed to proceed after a Pennsylvania judge ruled that the contest was not designed as an “illegal lottery.” Reuters, Bloomberg, and Axios have more.

What we can expect: Politico has rundowns of each of Harris’ and Trump’s paths to securing the vote, while the Financial Times looks at what each outcome would mean for Trump.

REMEMBER: The Electoral College, not the popular vote, ultimately decides who becomes president. Each state is allocated electors equal to its congressional representation (senators plus representatives). Voters in each state choose electors, pledged to presidential candidates. Taking the popular vote in a state usually means a candidate gets all its electoral votes (except in Maine and Nebraska). A candidate needs 270 of 538 electoral votes to take the presidency. Bloomberg also goes deeper.

BELOW THE FOLD- Israel killed another 16 Palestinians in Gaza’s Beit Lahiya and Zawayda in airstrikes yesterday. Meanwhile, Tel Aviv has also limited aid trucks’ entry into Gaza even further, bringing the daily average to 30 — equivalent to “only 6% of the commercial and humanitarian supplies that used to enter Gaza before the war,” according to UNRWA head Philippe Lazzarini. Reuters has the story.

CIRCLE YOUR CALENDAR-

The Saudi Rail Conference and Exhibition will take place on 20-21 November at the Riyadh International Convention and Exhibition Center. The event will showcase developments in the railway sector and provide insights from over 150 local and international speakers.

The two-day Impact Makers Forum (ImpaQ) is set to open its doors on 18 December, bringing together media influencers, industry experts, and digital content creators in Riyadh’s Mayadeen Hall.

The 2025 Dakar Rally in Saudi is set to bring 14 days of racing to the Bisha and Shubaytah deserts, with its 12 stages taking place between 3-17 January. Scrutineering will start on the first day of the new year and close the following day, with the prologue to all the racing tacked on to the end of that on 3 January. All racing will conclude on Friday, 17 January.

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