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Oct 01 - 07, 2001

Oil climbs, OPEC set to keep output unchanged

Volatile oil prices rebounded from their lowest level for nearly two years Wednesday as OPEC was set to leave production quotas unchanged.

OPEC ministers meeting in Vienna agreed to leave oil output steady at 23.2 million barrels per day (bpd) but will delay a formal announcement until Thursday, a senior delegate said.

Rising oil inventories in the United States and reduced refinery processing rates in Asia underlined a tailing off in petroleum demand, but a two-week slump of over $6 a barrel was finally met by a wave of buying interest just above $20.

In London, Brent crude futures ended 67 cents higher at $23.05 a barrel having earlier hit an intra-day low of $20.70 the lowest level since October 1999, when prices were clambering back up from sub-$10 levels seen the winter before.

That compares to a peak of $31.05 traded in the immediate aftermath of the suicide plane attacks on the United States on 11 September, but few traders expected an extended recovery with the global economic condition still grave.

"It's really too early to say if this is the end of the downward trend, the market needs to stabilise for a few days to bring in a bit of confidence," said one IPE trader.

Profit-taking on short positions and trade buying helped lift the market in the last few hours of activity, traders said.

Oil markets have been in a steep decline for two weeks as concerns over economic weakness have replaced fears that US military retaliation for the September 11 attacks would cause disruption to Middle East crude supplies.

Policy makers for the world's leading economies were battling to bolster confidence in the global outlook on Wednesday as consumer sentiment slid and a global ratings agency warned of recession in the US German Chancellor Gerhard Schroeder joined a cluster of European officials who said the recent attacks on the US would fail to undermine world economic growth.

Cyprus, Egypt, Syria to build gas pipeline

Egypt will cooperate with Syria and Cyprus to build a gas pipeline and will join efforts to tap lucrative oil deposits off the eastern Mediterranean island, a senior Cypriot official said Tuesday.

"It is agreed that Cyprus, Egypt and Syria will move forward with a tripartite committee to pursue the important issue of building a gas pipeline," Commerce Minister Nicos Rolandis told reporters in Nicosia.

"The Cyprus government has decided to replace crude oil used by the electricity authority with natural gas by 2006," he added.

The announcement was made after talks with Egypt's Petroleum Minister Sameh Fahmy during a brief visit to the island to discuss the exploitation of oil and gas reserves in the sea area between Cyprus and Egypt.

After talks with Rolandis, Fahmy said his country would assist the search for oil by offering its expertise and experience in discovering energy reserves.

Kenya, China to further bilateral ties

The friendly relations between Kenya and China have gained fresh and strong momentum of development in the new century, with both governments on Thursday pledging further efforts to enhance their ties.

Henry Kosgey, Kenyan Minister of Education, Science and Technology, said the relations between the two countries are strong and expanding rapidly, and the frequent exchange of visits involving top ranking government officials and business people underlines the bonds of solidarity and understanding between Kenya and China.

Addressing a ceremony here at the Chinese Embassy marking the 52nd anniversary of the founding of the People's Republic of China, Kosgey said the enhanced partnership between the two countries is further exemplified by what has been achieved in bilateral trade and investment this year.

Official figures indicate that in the first half of this year, trade volume between China and Kenya reached 68.51 million U.S. dollars, up 21.3 per cent over the same period last year. In 2000, the bilateral trade volume totaled 137 million dollars. Chinese Ambassador to Kenya Du Qiwen, on his side, said the Chinese government has always attached great importance to the development of Sino-Kenyan friendly relations of cooperation.

"China's cooperation with the wide developing world, including Kenya, is South-South cooperation based on sincere friendship, equality and mutual benefit," Du said, pledging that China will continue to make its contribution to the cause of world peace and development under new historical circumstances in the 21st century.

Kosgey said Kenya welcomed the decision of the Chinese government, following the Sino-African Cooperation Forum held in Beijing in October last year, to make available special funds to encourage Chinese enterprises to invest in African countries including Kenya.

French 'weapons grade' exports to Iraq blocked

Britain and America have accused France of mounting a billion-pound export drive to Iraq that they fear could help Saddam Hussein build weapons of mass destruction.

A confidential list of 6,000 contracts signed by Baghdad, obtained by The Sunday Times, reveals that French companies have agreed to supply Iraq with chemicals, refrigerated trucks and sophisticated pumps that British security sources believe could be used to make chemical weapons.

The planned exports which under United Nations sanctions must be approved by the security council also include fast computers and high-speed communications equipment that could be employed in making missiles.

British and American diplomats are blocking 117 French contracts worth 200m containing components thought to be of potential use in making missiles or chemical, nuclear or biological weapons. They are among 965 contracts being challenged from the 18-month period to February 2001. All but one challenge has been instigated by officials in London or Washington.

Iran's Khatami warns of clash of civilizations

Iranian President Mohammad Khatami warned on Thursday of "evil hands'' trying to use the deadly attacks on the United States to create a clash of civilizations, the official IRNA news agency reported.

Iranian attitudes to a U.S.-led international coalition against terrorism have hardened since a speech on Wednesday by Supreme Leader Ayatollah Ali Khamenei, who ruled out helping Washington in any attack on neighboring Muslim Afghanistan (news - web sites).

"Evil hands and others who do not like to see improvement through new thoughts in the world are trying to take advantage of the sensitive situation and cause confrontation between Islam and other beliefs,'' IRNA quoted Khatami as telling visiting Qatari Foreign Minister Sheikh Hamad bin Jassim bin Jabr al-Thani.

He did not mention Italian Prime Minister Silvio Berlusconi who unleashed a firestorm of protest by saying on Wednesday that Western civilization was superior to that of Islam.

The reformist Khatami quickly condemned the devastating attacks on New York and Washington two weeks ago, prompting many in Iran and the West to believe the crisis might lead to closer ties. Khamenei's speech appeared to close that door.

Iran has consistently expressed concern that the latest crisis would turn into a clash of civilizations, but these worries have been brought to the fore since Khamenei chaired an emergency Supreme National Security Council on Tuesday.

Khamenei reacted angrily to a statement by Secretary of State Colin Powell in which he accused Iran of supporting ''terrorism'' through its backing of Lebanon's Hizbollah and Palestinian militant groups Hamas and Islamic Jihad.

The supreme leader, who has the final word on Iranian policy, replied: "America has its hands deep in blood for all the crimes committed by the Zionist regime.''

Khatami in turn rejected any link between the attacks in United States and the Middle East crisis.

Israeli troops kill five Palestinians

Israeli troops killed five Palestinians in the Gaza Strip on Thursday, rattling a fresh accord to secure a lasting truce on the eve of the first anniversary of the uprising in the West Bank and Gaza Strip.

The latest deaths came just a day after Israeli Foreign Minister Shimon Peres and Palestinian leader Yasser Arafat agreed to work to consolidate an elusive ceasefire.

They met under strong US pressure for a drop in regional tensions, viewed as crucial to its bid to pull together a global coalition against terrorism.

Muslim states plan to revive tourism industry

Muslim nations who rely on tourist dollars are fighting a rearguard action after the New York attacks to convince the world that Islam does not mean terrorism.

Some of the badly hit nations are getting together on the sidelines of the World Tourism Organization (WTO) general assembly here this week to plan their campaign.

"The crisis in the travel sector is of an international dimension. But the image of the Middle East has been particularly badly hit," said Taleb Rifai, Jordan's tourism minister. "We have been doubly affected. We have got to rebuild our image so we are preparing a collective plan," he told AFP.

The WTO's Middle East committee which groups Egypt, Dubai, Bahrain, Jordan and Syria will lead the campaign to reassure travel agencies in western nations, the main source of tourist cash.

UAE snaps ties with Taliban

The UAE Ministry of Foreign Affairs has asked the acting charge d'affaires at the embassy of Afghanistan to leave the country within 24 hours, following the decision on Saturday to cut diplomatic ties with the Taliban government.

Foreign ministry under-secretary Saif Saeed Bin Sa'ed, summoned in the afternoon the Afghan diplomat Azizur Rahman, to convey him the UAE's decision. Rahman and other members of the embassy staff were asked to leave the country within 24 hours.

According to protocol, the Afghan embassy is regarded closed from Saturday.

Saudi shares

A volatile Saudi stock market slumped a further 5.6 per cent in the week closing Thursday, unnerved by fears of US retaliatory strikes for the September 11 terror attacks on New York and Washington.

The NCFEI all-shares index dropped to 2,278.75 points from 2,415.03 the previous Thursday, Bakheet Financial Advisors (BFA) reported.

Beirut International Film Festival 2001

With the perplexing film "No Man's Land" by Bosnian director Danis Tanovic ushering in this year's Fourth Beirut Film Festival, the stage has been set for the current state of affairs that illustrates life for many people in the 21st century. The Festival is slated to take place from 3-10 October at various venues in Beirut.

The film, winner of the Best Script Award at the Cannes Film Festival 2001, takes place in the heart of war-torn Bosnia in 1993, and depicts the story of two soldiers, one Bosnian and one Serbian whose lives, separated by the frontline with the onset of the war, are brought together by circumstance or fate.

Russia to sell Mig-29 fighter jets to Yemen

Russia is to deliver Mig-29 fighters to Yemen in a 300 million dollar deal, the business daily Vedomosti reported Wednesday, quoting sources in the Russian presidency.

Contacted by AFP, the Kremlin and the Mig aircraft constructor refused to comment.

The deal for the 15 fighter planes was signed shortly before or just after the September 11 terror attacks on the United States, the newspaper said, quoting unidentified presidential sources.

US strike may cause human catastrophe

The United Arab Emirates' defence minister urged the United States on Wednesday to think very carefully before attacking Afghanistan, saying a strike could trigger a "human catastrophe" affecting millions.

"I call on the United States to pause for reflection and give chance to diplomacy and all legal means before it resorts to military action, which could have grave repercussions on world peace and security," Sheikh Mohammed bin Rashid Al Maktoum said in a statement.

He said Washington should also provide decisive evidence that Afghanistan's ruling Taliban movement were involved in the terror attacks on New York and Washington.

The United States believes Afghanistan is sheltering Osama Bin Laden, its alleged suspect in the September 11 attacks.

Saudi orders Afghan diplomats out of the country

The Saudi government, which Tuesday severed its diplomatic relations with Afghanistan's Taliban regime, gave Afghan diplomats 48 hours to leave the country, the foreign ministry said.

"Tuesday night, the foreign ministry summoned the second secretary of the Afghan embassy in Riyadh, Mulawi Mutih Allah Khalawi, to inform him of the kingdom's decision to break off diplomatic relations, and asked for the diplomats to leave in 48 hours," a ministry statement said.

Islamic banks deny financing terrorism

Islamic banks and financial institutions are not financing terrorism, the Bahrain-based General Council for Islamic Banks And Financial Institutions (IBFI) said Monday.

"All Islamic banks operate in respectable countries that are under the control of the central banks, and accusations that they finance terrorist activities does not even merit a response," IBFI president Saleh Kamel told a press conference in Manama.

"Accusations against Islamic banks and financial institutions come within the campaign launched against Islam" in the aftermath of the devastating September 11 terror attacks in the United States, Kamel said.

"There are huge Arab investments, including some by Islamic financial institutions in the West, and I don't believe these funds are in danger," he added.

Saudi Arabia bars cargo of Australian offal

A ship carrying 16 containers of Australian offal has been barred from Saudi Arabia on health grounds, an Australian trade spokesman said on Wednesday.

The vessel carrying the offal worth A$3 million ($1.5 million) was banned from Saudi ports and has been left waiting for access.

Saudi Arabia is Australia's largest Middle Eastern export market, taking A$2.3 billion in Australian exports in 2000.

Exports of offal the edible organs of animals, such as kidneys or liver to Saudi Arabia are worth A$30 million a year.

Australia's largest offal exporter, Fletchers International, which shipped the containers, said no good reason was given.

Cairo shares end weak

Cairo shares, led by blue-chips, closed lower for the fourth consecutive session on Tuesday on concerns over possible U.S. retaliation for terror attacks, but a rebound in U.S. markets cushioned the decline, traders said.

The benchmark Hermes index closed down 70.82 points, or 1.2 per cent, at 5,817.27 points, off a day low of 5,764.93. The broader CIBC index ended 0.04 points lower, or 0.1 per cent, at 67.09 points.

Egypt offers airlines $5b insurance guarantees

The Egyptian government has offered locally registered airlines at least $5 billion in war insurance guarantees so they will avoid being grounded, an official at Egypt's flag carrier EgyptAir said on Tuesday.

"The government offered more than $5 billion in guarantees for four main companies and other smaller ones registered in Egypt on Monday," said the official, who asked not to be named.

Insurance companies, bracing for potential record payouts following the September 11 suicide attacks in the United States, want to cap airlines' third-party war and terrorism insurance at $50 million from Tuesday.

EgyptAir, whose assets value about $13 billion, received liability guarantees of $1.2 billion, the official added.

Truce brings Mid-east talks

Urged on by the US, Palestinian leader Yasser Arafat and Israeli Foreign Minister Shimon Peres held long-awaited truce talks aimed at ending a year of fighting.

Last night, Mr Arafat and Mr Peres issued a brief statement at Gaza International Airport, saying they would meet again in a week.

US Secretary of State Colin Powell had called Mr Arafat and Israeli Prime Minister Ariel Sharon repeatedly this week, urging them to go ahead with the talks.

Emirates gets $2b guarantee

Emirates airlines said on Tuesday it has received a $2 billion war insurance guarantee from the Dubai government to prevent any interruption to its operations following the suicide attacks in the United States.

"The government of Dubai (which owns the airline) placed the $2 billion liability guarantee on Monday night," said Mike Simon, director of corporate communications at Emirates.

Kuwait stock market pursues upward trend

The Kuwait Stock Exchange (KSE) went up for a second day Monday, closing 1.56 per cent higher in what analysts described as increased investor confidence in the local political situation.

The KSE index closed at 1656.2 points, up 25.5 points from Sunday when the index also gained 10.1 points.

Kingdom joins coalition

Foreign Minister Prince Saud Al-Faisal said that Saudi Arabia's joining of the anti-terror coalition reflected its stand on the US-led campaign to fight terrorism. Speaking to reporters after meeting with an EU delegation, he said a Washington Post report that Riyadh had expressed reservations on the use of its air base for the campaign was not true.