Comment: Middle East keeps wealth service providers afloat
Without oil money, the outlook would be far more bleak
Yesterday's biannual sale of Islamic art by auction house Sotheby's provided more evidence, if it were needed, of the oil-fuelled boom in Islamic wealth, mostly in the Middle East.
The sale was the most successful ever, realising £21.5m versus an estimate of £9.5m, and set a record for the most-expensive Islamic work of art sold at auction: an abbasid ka'ba key which fetched £9.2m.
Art collectors will no doubt be rushing to dump their contemporary Europeans in favour of Islamic works.
Bankers and investors of all kinds are likely to follow. With oil at $112 a barrel, the Middle East is one of the few regions globally where the liquidity party of the past five years remains in full swing.
As a global equities manager with $15bn in his portfolios commented to me last week: "The Middle East exists in its own economic micro-climate." He has 6% of his portfolio in the region and is thinking or raising this to 10%.
He is keen on the region's local banks, which are providing the services needed to recycle the oil wealth into assets.
Yesterday, Bahrain announced assets in its mutual funds industry grew nearly 80% last year. And there is no reason to expect a slowdown.
The region needs financial services and for international wealth managers it is an alluring prospect.
Oil money is also sustaining many luxury service providers elsewhere.
The latest development on London's billionaires' row, The Bishops Avenue, is targeted squarely at Middle Eastern buyers.
The 12 residences in Allingham Court are priced between £3.9m and £11m and will no doubt attract plenty of interest.
A listing on Middle East business news site, Zawya.com, gives a run-down of the 20 richest Arabs, according to Forbes magazine, with profiles of their recent activities. Together they account for $139bn.
For all the concerns about inflation from the price of oil and its impact on the slowing global economy, wealth service providers should pause to contemplate the likely result of oil back at $70.
Remove the Middle Eastern money, and things start to look very bleak indeed.
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