Saudi retrenchment hits New York’s Metropolitan Opera — but the kingdom is making bank with oil at USD 100

Good morning, friends. There’s been zero progress on talks to formally end the war in the Gulf, leaving oil stuck above USD 100 a week out from the next OPEC+ meeting.

What we’re watching this week: Qatar is sending signals it’s BAU, Dubai is in full bling mode (DIFC is apparently going to be the first of its kind in the world to go “AI native”) and Saudi? Well, Riyadh has gone from axing construction contracts to cutting back on soft power initiatives as it uses the war as a pretext to cut low-to-no ROI spending.

The latest casualty: A deal that would have seen KSA provide up to USD 200 mn to New York’s Metropolitan Opera. The breakup apparently took place over Zoom, which remains our least-favorite VC app.

In context: PIF’s new five-year strategy will see it deploy 80% of capital locally, with overseas allocations dropping to 20% as it focuses on projects that deliver financial returns and push economic diversification — think: AI + tech, infrastructure, and aerospace.

Watch this space #1- A Goldman Sachs report has the commentariat focused on how Saudi and Oman will make bank with crude prices stuck near the stratosphere at the same time as the UAE, Qatar, Kuwait, and Bahrain take it on the chin. Reuters sees Aramco reporting a nearly 14% bump in 1Q profits when the oil giant releases its results on 11 May.

Watch this space #2- We’re on the lookout this week for earnings from tech giants including Alphabet (which just said it would invest USD 40 bn in Anthropic), Apple, Meta, Microsoft, and Amazon.

And for our fellow peg-watchers: The US Fed is expected to leave rates on hold when it meets this week. The central banks of the UK, EU, and Canada will also set rates this week. –Patrick