Posts Tagged ‘LNG’

China U-turns on coal ban amid growing outcry over numbers left freezing in winter cold

December 7, 2017

Northern officials told that keeping people warm is ‘number one’ priority as dash for gas fails to ensure adequate power supplies

By Viola Zhou
South China Morning Post

PUBLISHED : Thursday, 07 December, 2017, 12:46pm
UPDATED : Thursday, 07 December, 2017, 8:52pm

China has relaxed a coal ban in northern cities designed to reduce air pollution amid a growing outcry from people left without a reliable energy supply as winter sets in.

The government’s initial restriction on burning coal led to millions of families being forced to convert to cleaner fuels, such as natural gas, for heating and cooking. However, delays in setting up pipelines and severe supply shortages have left many out in the cold.

In a “double urgent” letter dated Monday, the Ministry of Environmental Protection told authorities in 28 cities to relax the coal ban at places where the conversion process had not been completed, People’s Daily reported on Thursday.

 A boy in Hunan province tries to keep warm in front of a portable stove. Photo: Xinhua

The letter also called on local officials to ensure energy prices and supplies remained stable for those people who had already switched to using gas or electricity.

“Keeping people warm in winter should be the number one principle,” the letter said, adding that the ministry would pay special attention to the issue during future inspections.

It was unclear whether the easing of the ban would apply to other cities, but the ministry could not be immediately reached for comment.

Beijing has stepped up its efforts to phase out coal use ahead of this year’s deadline for air quality targets, vowing to switch 3 million households in the 28 northern cities to gas or electricity.

But while coal has been banned in villages and communities, many residents have yet to be provided with an alternative.

According to recent media reports, pupils at schools in some rural areas whose coal-fired heaters had been dismantled were forced to study outside – as it was warmer than inside – or run around to generate body heat.

The education ministry said it had ordered local governments to resolve the heating problem immediately after the reports prompted an outburst of criticism on social media.

“The children’s [suffering] has indeed hurt our hearts badly,” ministry spokeswoman Xu Mei said at a news briefing on Wednesday, according to Xinhua.

Meanwhile, the coal ban has led to gas shortages and surging prices since the onset of winter, forcing some cities to halt supplies to factories.

China National Petroleum Corp also warned on Thursday that China could see natural gas shortages if the country was hit by “extreme” weather this winter.

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The environmental campaign has helped push demand for gas to new highs, but a lack of storage and transport infrastructure means supply is failing to keep pace, the company said in a research report.

As a result, the government would help energy companies to increase imports of natural gas via cross-border pipelines and liquefied natural gas terminals, commerce ministry spokesman Gao Feng said on Thursday.

Gas imports in the first 10 months of the year rose 24.9 per cent from the same period of 2016, he said.

According to a Bloomberg report published on Thursday, China is on course to overtake South Korea to become the world’s second-largest importer of liquefied natural gas, behind Japan. It is already the world’s top energy user.

Tankers with a combined capacity of 33.6 million tonnes have visited China this year, just 1.7 million below South Korea’s total, the report said.

http://www.scmp.com/news/china/policies-politics/article/2123270/china-u-turns-coal-ban-amid-growing-outcry-over-numbers

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Rosneft deal boosts Russia-China relationship

November 20, 2017

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State group to supply CEFC with 61m tonnes of oil over next five years

By Henry Foy in Moscow
FT

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Russia’s state-run oil group Rosneft has agreed to supply its new partner CEFC China Energy with almost 61m tonnes of oil over the next five years, strengthening the most high-profile corporate link in the burgeoning relationship between Moscow and Beijing.

Russia has been keen to build stronger ties with its eastern neighbour as relations with the west have soured in recent years, encouraging its energy companies to strike trade and investment deals with Chinese partners and seeking funding from Chinese lenders to make up for credit lines severed by EU and US sanctions.

At the same time, China, which is the world’s largest oil importer, views Russia’s vast energy resources as useful for creating a fully-integrated crude supply chain.

Rosneft will supply CEFC, a private energy and financial services group that has grown rapidly in recent years thanks to overseas investments, with 60.8m tonnes of crude between 2018 and 2022, at a price determined by a formula pegged to the global oil market.

The deal will help Russia retain its current leadership over Saudi Arabia as China’s largest oil supplier, and represents a swift return on CEFC’s investment in Rosneft agreed in September.

CEFC is in the process of becoming a shareholder in Rosneft, having agreed to buy 14.16 per cent of the company for $9.1bn. The two companies have also said they will investigate joint projects in retail sales and petrochemical production.

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The supply deal will also boost CEFC’s status as an oil trader, giving it access to about 244,000 barrels a day of crude. While that is small in comparison to global trading companies such as Glencore and Vitol, it will give CEFC significant clout in the Chinese market.

The deal, which will come into force on January 1, was agreed by Rosneft’s board on Friday, the company said in a filing. CEFC did not respond to a request for comment.

Over the past 18 months, Chinese companies have spent almost $15bn on Russian energy projects, including CEFC’s decision this month to invest $500m in EN+, the Russian metals and energy group owned by Oleg Deripaska, through an associated venture.

State-owned China National Petroleum Corporation also owns a 20 per cent stake in Russia’s $27bn Yamal LNG production project, and Chinese lenders put up $12bn of the costs after western sanctions cut off access to European and US finance.

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Russia is also in the process of building a new gas pipeline to China, with a view to $400bn worth of supply deals over 30 years.

Separately, Rosneft said on Monday that it had signed an agreement with Greece’s Motor Oil Hellas that could see the company increase its annual imports of crude and crude products from the Russian supplier to 7.5m tonnes over the next five years, from 2m this year.

Additional reporting by David Sheppard in London

https://www.ft.com/content/dc1305ec-cddf-11e7-b781-794ce08b24dc

Qatar accuses Saudi Arabia of promoting ‘regime change’

October 18, 2017

Al Jazeera

Sheikh Mohammed bin Abdulrahman Al Thani says the blockading nations' plan is to 'disrespect and bully' [Naseem Zeitoon/Reuters]
Sheikh Mohammed bin Abdulrahman Al Thani says the blockading nations’ plan is to ‘disrespect and bully’ [Naseem Zeitoon/Reuters]

Qatar has accused Saudi Arabia of trying to engineer “regime change” during its four-month blockade of its Gulf neighbour.

Foreign Minister Sheikh Mohammed bin Abdulrahman Al Thani told CNBC on Tuesday that Riyadh is attempting to destabilise Qatar’s leadership.

“We see [Saudi] government officials talking about regime change… We see a country that is bringing back the dark ages of tribes and putting them together in order to create a pressure on connected tribes in Qatar,” he said.

Saudi Arabia, the United Arab Emirates, Bahrain, and Egypt severed diplomatic and trade links with Qatar on June 5, accusing Doha of supporting “extremism and terrorism” and cozying up to Iran – a regional nemesis.

Qatar has vehemently denied all allegations.

Sheikh Mohammed said the plan of the blockading countries was not to thwart terrorism but to “disrespect and bully”.

“It is nothing to do with stopping financing terrorism or hate speech while they are doing the same by promoting incitement against my country, promoting a regime change in my country,” he told the US broadcaster.

Qatar is the world’s largest exporter of liquefied natural gas, and also houses the region’s biggest US military base with more than 11,000 American troops.

READ MORE: Qatar-Gulf crisis: All the latest updates

Sheikh Mohammed said the blockade has impeded the fight against Islamic State of Iraq and the Levant (ISIL) in the region.

The airspace blockade meant that Qatari aircraft providing logistical support for the American military base have been diverted, and Qatari officers participating in operations against ISIL were expelled from the Bahrain-based US military headquarters.

“So there are a lot of things which undermine … the global efforts in countering … Daesh,” Sheikh Mohammed said, referring to ISIL by an Arabic acronym.

China Imposes Limit on Oil Supply to North Korea

September 23, 2017

BEIJING — China announced Saturday that it will limit energy supplies to North Korea and stop buying its textiles under U.N. sanctions imposed over its nuclear and missile development, further reducing support from Pyongyang’s last ally.

Exports of refined petroleum to the North will be limited to 2 million barrels per year, effective Jan. 1, the Commerce Ministry said. Sales of liquefied natural gas are banned outright.

North Korea depends on China for almost all its oil and gas but estimates of its consumption are low, leaving it unclear how Beijing’s new limit will affect them. The restrictions announced Saturday do not apply to crude oil, which makes up the biggest share of energy exports to the North.

China also will ban textile imports from the North, the ministry said. Textiles are believed to be the North’s biggest source of foreign revenue following rounds of U.N. sanctions under which Beijing cut off purchases of coal, iron ore, seafood and other goods.

China accounts for some 90 percent of the North’s trade, making its cooperation critical to efforts to derail Pyongyang’s nuclear and missile development.

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FILE – In this May 8, 2016, file photo, a North Korean solder stands guard near barrels stacked up near the river bank of the North Korean town of Sinuiju, opposite the Chinese border city of Dandong. China announced Saturday, Sept. 23, 2017 it will limit oil supplies to North Korea under U.N. sanctions starting Oct. 1, 2017, stepping up pressure on Pyongyang over its pursuit of nuclear and missile technology. (Chinatopix via AP, File) The Associated Press

Chinese leaders were long the North’s diplomatic protectors but express increasing frustration with the government of Kim Jong Un. They support the latest U.N. Security Council sanctions but are reluctant to push Pyongyang too hard for fear Kim’s government might collapse. They also argue against doing anything that might hurt ordinary North Koreans.

Chinese officials complain their country bears the cost of enforcing sanctions, which have hurt businesses in its northeast that trade with the North.

The U.N. Security Council voted Sept. 11 to limit fuel supplies and ban the North’s textile exports. China, one of five permanent council members with power to veto U.N. action, agreed to the measure after the United States toned down a proposal for a complete oil embargo.

Image: North Korean leader Kim Jong Un gives field guidance at the newly built Wisong Scientists Residential District  in this undated photo released by KCNANorth Korean leader Kim Jong Un at the newly built Wisong Scientists Residential District in this undated photo released by North Korea’s Korean Central News Agency (KCNA) in Pyongyang on Oct. 14, 2014. KCNA via Reuters

Petroleum exports for use in the North’s ballistic missile program or other activities banned by U.N. sanctions also are prohibited, the Commerce Ministry said.

The U.S. government’s Energy Information Agency estimates the North’s 2016 daily imports from China at 15,000 barrels of crude oil and 6,000 barrels of refined products. That would be the equivalent of almost 5.5 million barrels of crude and 2.2 million barrels of refined products for the full year.

North Korea has abundant coal but depends almost entirely on imports for oil and gas.

North Korean textile exports in 2016 totaled $750 million, according to South Korea’s Korea Trade-Investment Promotion Agency. It said nearly 80 percent went to China.

Lithuania Takes Delivery of US Gas to Cut Reliance on Moscow

August 21, 2017

KLAIPEDA, Lithuania — Lithuania has taken delivery of its first shipment of liquefied natural gas from the United States, a milestone that the Baltic state hopes will further reduce its reliance on Russia.

Independence, the U.S.-based tanker, docked Monday in the port of Klaipeda to offload some 150,000 cubic meters (200 cubic yards) of gas at a fully functioning offshore terminal that is capable of covering most of Lithuania’s annual energy needs.

Energy Minister Zygymantas Vaiciunas said the U.S. is already the country’s most-important strategic partner and now becomes “a reliable LNG supplier for the whole region.”

Moscow has used gas supplies to put pressure on Ukraine, which like the Baltic states was once part of the Soviet Union. That’s driven the urgency into projects to diversify sources to reduce dependence on Russia.

Locator map of Lithuania

Japan, Russia Need to Enhance Trust Before Gas Pipeline Plans: Minister

August 7, 2017

TOKYO — Japan and Russia need to work on building a more trusting relationship before any plans to build a natural gas pipeline between the two nations can be fulfilled, Japan’s Minister for Economy, Trade and Industry Hiroshige Seko said on Monday.

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Building a pipeline linking Russia and Japan is a long-standing idea, but a dispute over islands seized by Russia near the northern Japanese island of Hokkaido at the end of the World War Two has kept relations testy at times.

Japanese gas and electric utilities that have invested heavily in import terminals for liquefied natural gas (LNG) may also be reluctant to invest in a pipeline.

“Without a sense of further sense of trust such as a peace treaty, a pipeline would be no good,” Seko said during a speech in Tokyo while answering a question about Japan’s energy relationship with Russia.

Japan imports nearly all of its energy sources and is the world’s biggest buyer of LNG, which is natural gas cooled until it becomes a liquid and then transported on ships.

Japan’s Prime Minister Shinzo Abe said in April that Japan wants to resolve a territorial row that has over-shadowed ties with Russia since World War Two.

The islands were seized by Soviet forces at the end of the war and 17,000 Japanese residents were forced to flee.

Despite the lingering dispute, Seko said that Japan imports around 10 percent of its LNG from Russia and the country could increase its reliance on Russia’s LNG a little bit more.

(Reporting by Yoshifumi Takemoto; Writing by Osamu Tsukimori; Editing by Aaron Sheldrick and Christian Schmollinger)

Rosneft CEO: U.S. Sanctions Will Backfire, Hurt U.S. Energy Majors

August 3, 2017

NIZHNEBUREISKY, Russia — New U.S. sanctions imposed on Russia will have negative consequences for the United States and backfire on U.S. energy majors, Igor Sechin, chief executive officer of Russia’s largest oil producer Rosneft, said on Thursday.

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Igor Sechin, chief executive officer of Russia’s largest oil producer Rosneft speaking to Vladimir Putin

U.S. President Donald Trump grudgingly signed into law new sanctions against Russia on Wednesday, a move Moscow said amounted to a full-scale trade war and an end to hopes for better ties with the Trump administration.

“The sanctions are beginning to backfire on those who are introducing them, which is positive,” Sechin told reporters.

“The powers of the U.S. president are limited, and sometimes it seems to me that sanctions are imposed on him, not us.”

Sechin said in this situation he saw positive consequences for Rosneft. “As for the negative consequences, as I said, they (the U.S. sanctions) are starting to work against our American partners. As for the positive ones, you will learn about them in the next four weeks,” he said, without elaborating.

(Reporting by Polina Nikolskaya; Writing by Dmitry Solovyov; Editing by Maria Kiselyova)

Fragile Economy Restricts Putin’s Options in Stand-Off With U.S.

August 1, 2017

MOSCOW — Russian leader Vladimir Putin is unlikely to risk an escalating round of tit-for-tat sanctions with Washington because the only measures that would hurt the United States would also endanger Russia’s fragile economic recovery.

Russia last week ordered Washington to cut 755 of its 1,200 embassy and consular staff and said it was seizing two diplomatic properties, after U.S. lawmakers backed a new round of economic sanctions on Moscow.

Though an eye-catching gesture, Russia’s response does not pack the same punch as the U.S. penalties, which target Russian energy projects, make it harder for U.S. President Donald Trump to ease earlier sanctions, and could further restrict lending to Russia.

That partly reflects the fact that Russia has relatively few ways of hurting the United States, whose economy is around 14 times larger than Russia’s.

It also reflects worries in the Kremlin about the health of the economy ahead of a presidential election in March.

In 2014, when the United States and European Union imposed an earlier round of sanctions over Moscow’s annexation of the Crimea peninsula from Ukraine, the Kremlin’s main response was to limit Western food imports, a comparatively soft measure.

“It was a case of the head overruling the heart and I expect exactly the same response this time,” said Chris Weafer, senior partner at Macro-Advisory consultancy in Moscow. “Something which will cause some discomfort for the U.S. but which will not derail the Kremlin’s efforts to attract international investors and grow the economy.”

Weafer said Putin would probably take further retaliatory steps against Washington after Trump signs the new sanctions into law but he did not think the Kremlin would target U.S. firms with close ties to Russia.

Putin has not said whether he will fun for a fourth presidential term in 2018, but officials expect him to do so.

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Whereas Putin oversaw several years of growth above 5 percent in his early presidential terms, the Russian economy contracted in 2015 and 2016 and is seen growing only 1.4 percent this year.

Putin needs a strong economy if he is to win a convincing mandate, and the Kremlin has tried to show that Russia is open for foreign business despite tensions with the West.

Domestic Russian investors have only cautiously increased investment as the economy has recovered from recession, making foreign inflows more important.

An adviser to Putin, ex-finance minister Alexei Kudrin, told Reuters last week that domestic investors needed certainty that sanctions would not continue to be ratcheted up, otherwise the economic outlook would be weak.

RESTRICTING COOPERATION

Putin said in an interview aired on state TV on Sunday that Russia could restrict cooperation with Washington in “areas which would be sensitive to the American side” but he did not think that was yet necessary.

“That would not only hurt Russian-American relations, it would also inflict some damage on us,” Putin said.

Analysts cite energy and aviation as two sectors where Russia and the United States work closely and where Russian penalties could affect U.S. firms.

U.S. energy giant ExxonMobil is a partner of Russian oil firm Rosneft in the Sakhalin 1 project off Russia’s far east coast and has agreed to team up with Rosneft in North America and Mozambique.

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Russia’s VSMPO-Avisma, the world’s largest titanium producer, supplies up to 40 percent of U.S. planemaker Boeing’s titanium under long-term contracts, and the two firms have a joint venture in Russia.

In both cases, however, Putin is unlikely to bow to pressure from hawks in his administration and sever business ties.

Russia wants access to the technological know-how of firms like Exxon to help it maintain production of oil, its chief export, close to post-Soviet highs. It is also trying to revive its domestic aviation industry, which Boeing can help.

“What foreign investment does is that it not only brings money, it brings intangible benefits in terms of better management, knowledge, transfers of technology and that helps to raise productivity and living standards,” said William Jackson, senior emerging market economist at Capital Economics.

Putin, who built his high approval ratings on the rapid rise in Russians’ living standards during his first two terms, will be conscious of this when deciding on any further retaliation.

“So far Putin has been a lot more measured in his response than the demands of the nationalists,” Weafer said.

For all his power, Putin “sleeps with one eye on the voters”, Weafer added.

(Additional reporting by Natalia Shurmina and Elena Fabrichnaya; editing by Giles Elgood)

Pakistani lawmakers elect ousted PM Nawaz Sharif’s ally as replacement

August 1, 2017

Reuters

By Asif Shahzad and Drazen Jorgic

AUGUST 1, 2017 / 3:08 AM

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Shahid Khaqan Abbasi

ISLAMABAD (Reuters) – Pakistani lawmakers on Tuesday elected former petroleum minister Shahid Khaqan Abbasi, an ally of ousted leader Nawaz Sharif, to replace him and the new premier immediately sought to project an image of stability.

Lawmakers of the ruling Pakistan Muslim League (Nawaz) party banged on benches and chanted “Lion, lion Nawaz Sharif” after the vote, standing defiant in the wake of the Supreme Court’s decision to cut short his third stint in power.

A quick transition may ease fears that the nuclear-armed nation will be plunged into another bout of political turmoil, which could erode economic and security gains since the last poll in 2013.

Sharif resigned on Friday after the Supreme Court disqualified him for not declaring a source of income – which the three-time premier disputes receiving. He nominated staunch ally Abbasi as interim leader until his brother, Shahbaz, becomes eligible to take over, probably within two months.

Abbasi was confirmed with 221 votes in the 342-seat National Assembly as the PML-N used its hefty majority to push through his appointment. PML-N officials hugged each other and congratulated Abbasi even before the result was announced.

“Within four days the process of democracy is back on track,” Abbasi told lawmakers after being voted in. “Above all, I’m thankful to Muhammad Nawaz Sharif, the people’s prime minister.”

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Pakistan’s ousted prime minister Nawaz Sharif (R) and his brother Shahbaz. AFP photo

PML-N officials have privately spoken of plans for Sharif to wield huge influence in the party from behind the scenes.

“The prime objective is to give Pakistan stability,” said Rana Muhammad Afzal Khan, a PML-N lawmaker in the national assembly. “As a responsible party we have to take Pakistan ahead.”

But the plan to eventually install Shahbaz has also sparked anger among supporters of opposition leader Imran Khan, who has criticized another bout of dynastic politics, a trend with a long history in Pakistan and elsewhere in South Asia.

Khan, who agitated with street protests until the Supreme Court took up a corruption case against Sharif, has called the family a “monarchy” and accused it of trying to turn the country into a personal fiefdom.

Shahbaz, now chief minister of eastern Punjab province that is home to more than half of Pakistan’s 190 million people, will have to resign and fight a parliamentary by-election before he can take over as prime minister.

Aides say he is likely to favor a new personal style of government, while probably continuing his brother’s focus on huge infrastructure projects and policies favoring business.

Interim Leader

Western-educated Abbasi, who started his career as a businessman, has spent most of his political life by Sharif’s side. He was jailed after Pakistan’s powerful military staged a coup in 1999 to topple a previous Sharif government.

As minister of petroleum and natural resources in Sharif’s last cabinet, he championed a push to build liquefied natural gas (LNG) infrastructure and alleviate energy shortages.

The effort has attracted foreign companies, who now see Pakistan as one of the world’s fastest-growing markets. Growth will increase fivefold, Abbasi told Reuters last month.

The opposition has also accused Abbasi of corruption over the bidding for an LNG deal in southern Karachi, citing a National Accountability Bureau (NAB) inquiry case filed in 2015 that alleges procurement irregularities.

The NAB case has made little progress and Abbasi has denied wrongdoing, with PML-N allies saying the opposition wants to detract from the success of the LNG effort.

In Pakistan’s rough-and-tumble politics, charges of corruption against leading politicians are common and several figures, including opposition leader Khan, face court cases.

Besides ordering Sharif’s removal, the Supreme Court also ordered a criminal investigation into him and his family, as well as Finance Minister Ishaq Dar.

Gulf crisis to increase Qatar’s budget deficit

July 30, 2017

By SHABINA S. KHATRI

Jude Vincy/Flickr

Photo for illustrative purposes only.

Qatar’s efforts to ensure the ongoing blockade doesn’t affect residents is having a big impact on its budget, according to BMI Research.

In a new report this week, BMI forecasted a larger-than-projected deficit for 2017 due to the costs of the action against Qatar.

In its report, the group said this is because Doha will likely continue to foot the bill for rising prices of food and medicine “in order to maintain support for its authority among the Qatari population.”

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Construction on Al Bayt Al Khor stadium site

It also forecast that the government will postpone plans to lower public sector wages and decrease subsidies for now, while moving forward with spending on big projects like World Cup preparations.

This will put even more pressure on spending in the coming months.

However, Qatar should be able to absorb the extra expenditure without risking its stability due to its “large foreign reserves and undisrupted hydrocarbon exports,” the report added.

Budget planning

Earlier this month, Qatar’s foreign minister said the country now pays 10 times as much money to import food and medicine into the country due to the blockade.

Sheikh Mohammed bin Abdulrahman Al Thani added that the government was covering the “extra costs” for residents and that “Qatar has the resources to do that.”

Omar Chatriwala / Doha News

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That said, the boycott has put a big damper on Qatar’s budget planning, which has become more meticulous over the years.

In December, Qatar’s Emir approved a budget that slightly cut spending to help manage a forecasted QR28.3 billion ($7.8bn) deficit.

However, this figure was much smaller than the QR46.5 billion estimate Qatar made for 2016, when it saw its first deficit in 15 years.

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Photo for illustrative purposes only.

Whether 2017’s deficit is smaller than last year’s remains to be seen. BMI does not provide any actual figures in its forecast.

But it did say that Qatar will continue to fund any fiscal shortfalls by borrowing money, leaving its sovereign wealth fund untouched.

And it forecast that revenue growth should stay steady thanks to Qatar’s natural gas reserves and rebounding oil prices.

https://dohanews.co/report-gulf-crisis-to-increase-qatars-budget-deficit/

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