Economics
Oil’s Tepid Rally Just Right for Islamic Debt Market Rebound
- Sukuk issuance rose 34% in 2016 on stimulus by oil producers
- Sales outlook ‘certainly positive’ given oil price: Templeton
This article is for subscribers only.
Oil’s rally from a 12-year low has gone far enough to revive demand for Islamic bonds -- but not so far that frequent issuers aren’t still in need of funds.
While Brent crude has climbed almost 40 percent this year, it’s still less than half the peak recorded in 2014, weighing on government revenues and economic growth in Malaysia and the Middle East. Stimulus efforts in oil-producing nations helped drive sales of Islamic bonds up 34 percent to $37.5 billion in 2016, after dropping to a five-year low in 2015, data compiled by Bloomberg show.