+965 2224 8361
Daily Economic Update
14.10.2025
Oil: OPEC keeps near-term oil demand and supply growth estimates steady. In its October monthly report, OPEC held its 2025 & 2026 oil demand growth estimates steady at 1.3 and 1.4 mb/d, respectively, citing solid consumption in non-OECD economies. Demand growth this year was revised lower in China and India, but this was offset by stronger consumption in the rest of Asia, Africa, and Latin America. Transportation fuels and petrochemicals are the main drivers of oil demand growth in both years, with jet/kerosene (+380 kb/d y/y) and gasoline (+430 kb/d y/y) driving gains. The latter is surprising and a notable divergence from the International Energy Agency, which sees gasoline demand dropping next year due to ongoing structural shifts in oil consumption amid gains in renewables and electrification. On the supply front, OPEC maintained non-DoC (i.e. outside OPEC+) liquids production growth forecasts from the September report at 0.81 mb/d and 0.63 mb/d, for this year and next, respectively, with the US, Brazil, Canada, and Argentina accounting for most of this increase. DoC production, meanwhile, increased by 630 kb/d m/m in September, thanks largely to OPEC-8, which completed the unwinding in September of its 2023-2024 supply cuts worth 2.2 mb/d in just six months, raising output by a combined 571 kb/d m/m. Gains were led by Saudi Arabia (+248 kb/d), Russia (+148 kb/d), UAE (+98 kb/d), and Iraq (+65 kb/d). While actual production is slightly trailing quotas due to a combination of compensatory cuts and capacity constraints, it should begin to catch up, with October and November’s OPEC-8 monthly production quotas up by a smaller 137 kb/d in aggregate and as these compensatory cuts are completed.
Kuwait: KPC announces major offshore gas discovery. Kuwait Petroleum Corporation (KPC) announced yesterday the discovery of large quantities of gas in the offshore Jazza field, the reserves of which are comprised of 1 trillion standard cubic feet of natural gas and 120 million barrels of condensates (~350 million barrels of oil equivalent). The discovery follows on the successes KPC has had in the offshore scene since 2024 after discovering the Al-Nokhitha field in July 2024 (3.2 billion barrels of oil equivalent) and Al-Julia in January 2025 (950 million barrels of oil equivalent). The Jazza field, while the smallest of the new discoveries in terms of total reserves, has equivalent gas reserves to the Al-Nokhitha, and showed initial production of 29 million standard cubic feet per day and 5 kb/d of condensates. Continued offshore drilling and exploration will help KPC in achieving its “Strategy 2040” goals, of which on the main objectives is to raise non-associated gas production to 2 billion standard cubic feet by 2040, helping reduce the reliance on LNG imports, which rose to 7.23 million tons in 2024 (+1.1 y/y).
UAE: Domestic credit growth accelerated for the third consecutive month. Domestic bank credit growth increased in August to 7.5% y/y, accelerating for the third straight month from the 14-month low seen in May at 4.8% y/y. Credit to the private sector, which constitutes 74% of domestic credit, registered growth of 9.3% y/y, up from July’s 8.8% y/y due to a strong increase in credit to businesses to 5.4% y/y from 4.7% in the previous month, while credit growth to individuals was stable at 16.6% y/y. Moreover, credit to the public sector (government plus GREs) rebounded to 2.8% y/y from a yearly decline of -1.1% in the previous month. On the other hand, resident deposit growth remained very robust in August, rising to 13.6% y/y from 12.4% y/y in July. This increase came mainly due to a strong rise in public sector deposits by 5.6% y/y from meager growth of 0.2% y/y in the previous month. Private sector deposit growth remained very strong, though eased slightly to 16.5% y/y. The loan to deposits ratio was stable at 68.5% in August, falling from 72.4% a year ago (August), indicating at an ample liquidity in the market.
Egypt: Hot money flows lift the pound to a new yearly high last week before falling again this week. Foreign investors recorded net purchases of $570 million in Egyptian treasuries in the secondary market during last week’s trading, according to data from the Egyptian Exchange (EGX). The figures point to rising foreign appetite for local debt instruments, supported by improved risk sentiment and easing inflation pressures. Meanwhile, the cost of insuring Egypt’s five-year sovereign debt fell by roughly 1.2%, reaching 377 basis points, signaling stronger investor confidence especially after the recent credit rating upgrade from S&P. Since the start of October, Egypt’s debt market has witnessed heightened trading activity, led by heavy foreign institutional buying, which has in turn boosted market liquidity and trading volumes. On the back of these inflows, the Egyptian pound (EGP) appreciated by 1.4% m/m, reaching a new yearly high of EGP 47.55 per USD at the end of last week. However, the EGP lost these gains when it dropped at the beginning of this week by 0.7%. This volatility may be caused by the market demand and supply dynamics in the interbank market, keeping the volatility range of the EGP within acceptable levels.