Good morning, folks. The week is ending with a robust news cycle. In today’s issue, debt, shipping, and earnings updates from UAE and Egypt take the lead. We also have the latest PMI reports from Kuwait, Qatar, and Lebanon — and they’re looking good. Let’s get the ball rolling.

HAPPENING TODAY-

The Sustainable Maritime Industry Conference (SMIC) will close its doors today at the Ritz Carlton, Jeddah. The two-day event brings together more than 50 transport ministries, ambassadors, and maritime leaders, along with 60 sponsors and 3k participants. Discussions cover maritime decarbonization, digitalization and security, regulatory frameworks, and sustainable marine practices, alongside workshops and site visits.

WATCH THIS SPACE-

#1- UAE expands eligibility for freezones’ corporate tax: The Finance Ministry has broadened the scope of activities eligible for exemption from corporate tax in freezones to include industrial chemicals, environmental commodities, and by-products, state news agency Wam reports. The requirement that commodities be traded in raw form has been removed, though they must still carry a quoted price on a recognized exchange or price reporting agency.

REFRESHER- Under the Federal Tax Authority’s Qualifying Freezone Person Regime, eligible firms can claim a 0% corporate tax rate on qualifying income from freezone operations, versus the standard 9% rate.

#2- US sanctions Iraqi oil mogul in Iran network crackdown: Washington has sanctioned Iraqi crude oil tycoon Waleed Al Samarra’i for allegedly selling Iranian oil under the pretense of it being Iraq-sourced, according to a statement by the Treasury Department. The scheme reportedly generates some USD 300 mn for Iran and its partners every year.

Modus operandi: Al Samarrai — who also holds citizenship in St Kitts and Nevis — is allegedly the mastermind behind a network that covertly blends Iranian oil with Iraqi oil via two UAE-based firms — Babylon Navigation, which handles shipping, and trading outfit Galaxy Oil. Al Samarrai’s operations utilize Liberian-flagged vessels engaging in ship-to-ship transfers in Iraqi ports and the Arabian Gulf — relying on Marshall Islands-based shell corporations to register the vessels.

Latest sanction salvo: Late last month, Washington sanctioned 13 entities and eight vessels operating in the UAE, China, Hong Kong, and the Marshall Islands, which it said were facilitating the trade of Iranian crude oil.

#3- Air cargo players brace for potential capacity crunch: Major air cargo operators are concerned they could face tightened capacity over the next few years as new deliveries fail to keep up with the pace of aging freighter jets, Financial Times reports. Some 150 jets of the nearly 650 freighters in active operation globally are closing in on or have already entered into their retirement window, US-based Atlas Air CEO Michael Steen told the news outlet.

The scramble is real: “Airlines are scrambling for [freight] capacity,” Saudia Cargo chief executive and managing director Loay Mashabi said, adding the airline expects a “few years of challenge… it will hit us severely before we know it.” The supply-demand imbalance for large wide-body freighters is expected to “intensify over the next several years,” Steen also added.

What’s at stake: Shrinking air cargo capacity risks disrupting about one third of the world’s trade — USD 8.3 bn — that is moved by air. This is especially true for e-commerce-driven flows from Asian markets to the West, the outlet said, citing International Air Transport Association data.

Mitigation is the only option for now: Operators have been extending the life of aircrafts in their fleet to address the limited replacement options. However, these carriers are “extremely expensive to continue to operate… even if technically you make it safe, financially it becomes such a big burden,” Mashabi told the outlet.

MARKET WATCH-

#1- Oil prices dipped this morning amid reports that Opec+ may roll out another production hike in its meeting on Sunday, Reuters reports. Brent crude futures went down by USD 0.46 to reach USD 67.14 / bbl by 04.16 GMT, while US West Texas Intermediate (WTI) dropped by USD 0.47 to trade at USD 63.50 / bbl.

The chatter: Opec+ could weigh another output hike when it meets on Sunday, Reuters reported yesterday, citing two sources familiar with the matter. This stands in contrast to Bloomberg’s survey, which found a strong consensus that Opec+ would hold supply steady. Analysts in the survey said Riyadh was unlikely to push more barrels into the market immediately, as the Kingdom seeks to balance its market-share play against the risk of adding to a surplus and pressuring prices further.

Another hike now would accelerate the unwinding of an additional 1.65 mn bbl / d of cuts — equal to 1.6% of global demand — more than a year ahead of schedule. The bloc has already added some 2.5 mn bbl / d since starting output hikes in April, reversing its 2023 supply curbs. Crude has stayed near USD 70/bbl, supported by Western sanctions on Russia and Iran, and by Opec+ supply falling short of pledges.

#2- Baltic index drops: The Baltic Exchange’s dry bulk sea freight index — which tracks rates for the capesize, panamax, and supramax vessel segments — fell around 2.3% to 1,940 points on Wednesday. The capesize shed 101 points to reach 2,773 points, while the panamax index dipped 23 to 1,719 points. The smaller supramax index increased by 1 point to 1,467 points.

***YOU’RE READING EnterpriseAM Logistics, the essential MENA publication for senior execs who care about the industry that connects producers and retailers to global markets. We’re out Monday through Thursday by 9:15am in Cairo and Riyadh and 11:15am in the UAE.

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CIRCLE YOUR CALENDAR-

Saudi Arabia will host the Smart Ports and Logistics Transformation Summit on Monday, 15 September and Tuesday, 16 September in Jeddah. The summit will host over 40 global and local speakers, industry experts, and policymakers to explore smart port solutions, port operations, and logistics within Saudi Arabia.

The UAE will host the Syria Recovery and Investment Forum on Wednesday, 24 September in Abu Dhabi. The forum will host leaders in business, regional investors, policymakers, and advisory experts to develop practical solutions for Syria’s road to recovery and economic revival.

The UAE will host the Global Rail Transport Infrastructure Exhibition and Conference on Tuesday, 30 September until Thursday, 2 October in Abu Dhabi. The event will be hosted by Etihad Rail and is set to welcome over 200 global speakers and upwards of 20k industry attendees to share innovative solutions and develop partnerships.

Saudi Arabia will host the Saudi Maritime and Logistics Congress on Wednesday, 1 October and Thursday, 2 October in Dammam. It will host over 200 registered exhibitors and some 15k attendees from over 90 countries to discuss AI-powered fleet optimization, shifts in global trade, and intelligence-driven infrastructure.

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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