Good morning, nice people. It’s a fleet heavy news morning with planned air and sea fleet expansion updates rolling in from the UAE, Saudi, and Oman. But first, we have more (seemingly never-ending) developments on Trump’s multi-front trade war…

THE BIG LOGISTICS STORY- Trump’s trade warring remains the top story this morning, after striking an agreement to delay tariffs with Mexico and Canada in exchange for stricter border controls. China and the EU, however, are still in the ring as retaliatory measures spill over into the early morning hours...

MARKET REAX- Oil prices dropped in response to the delay on Mexican and Canadian tariffs, with Brent futures slipping USD 0.50 to USD 75.46 a barrel by GMT 04.32 and US West Texas Intermediate (WTI) futures dropping USD 0.89 to USD 72.27 a barrel, Reuters reports.

China hit back: China will impose a 15% duty on US coal and LNG and a 10% duty on oil, farm equipment, and some vehicles starting from 10 February, in response to the US slapping a 10% tariff on Chinese exports. The country is also implementing export controls on rare earth minerals, citing national security concerns. Trump is to speak with China’s Xi Jinping this week to reach an agreement, otherwise “tariffs are going to go substantially higher,” Trump said yesterday.

The EU also plans to “respond firmly” if the US follows through with plans to imposetariffs on the bloc, a spokesperson for the EU said, warning that tariffs would be “hurtful on all sides.” European leaders are also calling for the bloc to remain united, with Spanish Economy Minister Carlos Cuerpo saying the EU should not be “naive” and protect its firms.

What Trump said: US President Donald Trump has announced that he would “absolutely” launch tariffs on goods coming from the EU “pretty soon,” but that no timeline has been set. “They don’t take our cars, they don’t take our farm products, they take almost nothing, and we take everything from them,” Trump said.

Our region stands to benefit if the North American nations fail to reach a lasting agreement, with US oil refiners and aluminum importers reportedly considering turning to Iraq for crude and the UAE and Bahrain for aluminum, Bloomberg and Reuters reported.

This story is dominating the international press this morning: Reuters | AP | The New York Times | The Washington Post | Financial Times | Bloomberg | The Guardian | BBC | CNBC | CNN

WATCH THIS SPACE-

#1- Saudi national shipping company Bahri aims to boost its fleet by a minimum of 10 eco scrubber-fitted VLCC ships in 1H 2025, after uptaking five VLCCs last year, according to S&P Global tracking data. A dry-bulk carrier and three VLCCs that were delivered in 2024 will be operational in 1Q 2025, according to the firm’s financial statement (pdf).

Bahri has been doubling down on fleet modernization and expansions, increasing its fleet size from 88 to 93 by the end of 2024 with 11 new additions and five divestments. It also inked a USD 1 bn agreement for nine VLCCs back in August that is supported by a USD 756 mn Murabaha financing agreement with Alinma Bank. The shipping giant is also looking to build a fleet of 20-30 LNG tankers, CEO Ahmed Ali Al Subaey said back in September.

REMEMBER- Bahri’s bottom line surged 34% y-o-y to SAR 2.17 bn (c. USD 578.5 mn) in 2024, driven by higher freight rates and increased cargo volumes from fleet expansion. Bahri currently operates a fleet of 40 VLCCs with a 2.2 mn barrels capacity.

IN OTHER FLEET EXPANSION NEWS- Asyad to expand its fleet: Asyad Group is planning on adding 33 more vessels — a combination of oil, gas, and cargo tankers — to its 89-vessel fleet in 2025 to boost the firm’s network to Europe as well as Asian countries like Japan and South Korea, AGBI reported last week.

REMEMBER: Asyad Group issued its intention to float at least a 20% stake in Asyad Shipping (ASC) on the Muscat Stock Exchange last week, with the LNG transport unit reportedly seeking a valuation of USD 1 bn. ASC also plans to invest between USD 2.3 bn to USD 2.7 bn as part of its medium-term diversification and fleet expansion strategies.

#2- Egypt pitches SCZone as gateway for Ukrainian grain: Egypt’s Planning and International Cooperation Minister Rania Al Mashat touted the Suez Canal Economic Zone (SCZone) as a potential hub for Ukrainian grain storage and re-export to Africa during a high-level meeting in Cairo with Ukrainian Agrarian Policy and Food Minister Vitaliy Koval and senior officials, according to a statement.

The move comes amid ongoing disruptions in the global wheat market related to the Russia-Ukraine war, with Russia’s wheat harvest expected to have declined to 83 mn tons in 2024, down from 92.8 mn tons in 2023. Russian farmers ditching wheat to sow higher-yield crops may reduce the country’s 26% share of the global wheat market and inflate wheat prices, especially for major buyers like Egypt.

Ukraine also wants to set up its own logistics zone in Egypt: Koval, for his part, noted that Ukraine is interested in establishing a logistics zone in Egypt that would be a center for Ukrainian exports to the rest of Africa, amid a broader expansion of economic and trade relations between the two countries.

All part of the gov’t silo expansion plan: Egypt has been expanding silo infrastructure to secure Egypt’s wheat and grain reserves, Al Mashat added, pointing toward the EGP 520 mn West Port Said Silo, which broke ground back in 2021. The facility — located in West Port Said Port — has a 100k-ton storage capacity and was designed to ease pressure on existing port silos in Damietta, Dekheila, Alexandria, and Safaga. The project was backed by USD 538 mn in food security funding from the UAE, the Saudi Fund for Development, France, and multilateral lenders.

ICYMI- There are more private sector investments on the way, with Feerum Egypt — the local arm of Polish grain silo company Feerum — reportedly in talks with Banque Misr and Banque du Caire to secure funding for its long-awaited silo factory in East Port Said. The project, now valued at EGP 2.5 bn, aims to deliver 1.4 mn tons of storage capacity over three years, with production slated to start in 2026.

IN OTHER EGYPT NEWS- More vessels start passing through the Red Sea: The Liberian crude oil tanker Chrysalis passed through the Suez Canal yesterday for the first time since being targeted in a Houthi attack last July, according to a statement from the Suez Canal Authority. “The return of the tanker to transit through the Suez Canal is a strong message of reassurance regarding the positive developments towards the return of stability to the Red Sea region,” SCA head Osama Rabie said.

ICYMI- Traffic is picking up through the canal, albeit very slowly, with reports out last week that six US- and UK-linked ships passed through the Red Sea safely since 19 January, after Yemen’s Houthis announced they would only target Israeli-linked vessels following the ceasefire agreement between Israel and Hamas.

MARKET WATCH-

#1- Opec+ sticks to its guns: Opec+ decided to maintain its policy of capping oil supply in 1Q before starting to ramp up output in April, according to an Opec statement issued following the conclusion of yesterday’s Joint Ministerial Monitoring Committee (JMMC) meeting.

Opec+ is so far not heeding Trump’s calls to increase output and lower prices toUSD 60-70 per barrel, Bloomberg reports. “I don’t expect OPEC+ to heed Trump’s demands, or requests — whichever way you want to see it,” Vanda Insights founder Vandana Hari told the business information service.

Background: Opec+ initially planned to begin phasing out its production cuts in October, but later pushed the plans back as oil prices fell. Production increases are now slated to begin in April 2025 and to be gradually implemented until the end of 2026.

#2- Goldman Sachs keeps oil and gas forecasts despite US tariffs: Goldman Sachs is keeping its oil forecasts for 2025/2026 unchanged on the back of stable oil demand and production, indicating that new US tariffs will have a limited short-term effect on global prices, the bank said in a note seen by Reuters. The bank’s forecasts for Brent crude currently stand at about USD 78 and USD 73 for this year and 2026, respectively.

Who is paying for the tariff costs? Canadian oil producers are expected to take most of the hit of the tariff, “with a USD 3 to USD 4 a barrel wider-than-normal discount on Canadian crude given limited alternative export markets,” while US consumers of refined products will take on the remaining “USD 2 to USD 3 a barrel burden,” Goldman Sachs added.

REMEMBER- Oil and gas prices surged on Monday after US President Donald Trump imposedtariffs on Canada, Mexico, and China over the weekend.

DATA POINTS-

#1- Saudia Cargo’s air cargo volumes rose 13% y-o-y to 577k tons in 2024, and transit cargo increased by 18% y-o-y to 134.7k tons, according to a statement. The airline saw its transportation of Saudi exports bolstered by 14% y-o-y to 13.7k tons, with the number of flights increasing 6% y-o-y to 193k trips last year.

#2- Egypt’s processed food exports surged by 21% y-o-y to USD 6.1 bn in 2024, a new record for the nation, according to a statement. Arab countries accounted for 54% of Egypt’s total processed food exports, with exports to the bloc boosted by some 20% y-o-y to USD 3.28 bn last year. The EU received 19% of total exports, valued at USD 1.17 bn — a 32% y-o-y increase — followed by non-Arab African countries, which accounted for 8% of total exports at USD 513 mn, a 10% y-o-y rise.

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CIRCLE YOUR CALENDAR-

The UAE will host the Middle East Breakbulk Conference from Monday, 10 February to Tuesday, 11 February in Dubai. The event gathers giant manufacturers, EPCs, and service providers to discuss the latest solutions in breakbulk and heavy-lift logistics across the Middle East and Africa. The two-day event features an artificial intelligence (AI) seminar, a heavy lift workshop, a chartering workshop, and a women in breakbulk panel.

The UAE will host the MRO Middle East and Aircraft Interiors from Monday, 10 February to Tuesday, 11 February in Dubai. MRO Middle East will host leaders in aircraft maintenance, repair, and operations to explore the latest technologies and strategies in the industry.

The UAE will host the Sustainable Aviation Futures MENA forum from Monday, 10 February to Wednesday, 12 February in Abu Dhabi. The event aims to promote SAF partnerships, raise awareness, and support the integration of clean energy and sustainability in the aviation sector. The two-day forum will host key figures in the aviation industry, including notable speakers from Lufthansa Group, ACI World, Saudia Group, Arab Air Carriers’ Organization (AACO), and DHL Express.

The UAE will host the WCA Worldwide Conference from Tuesday, 25 February to Saturday, 1 March in Dubai. The event — set to bring together over 4.5k freight forwarders from 179 countries — will host several workshops and courses over one week.

Check out our full calendar at the bottom of this email for a comprehensive listing of upcoming news events and news triggers.

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