THE EUROPEANS

thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

REUTERS

"Industry says EU plan to tackle energy crisis falls short"


By Kate Abnett

September 16, 2022

BRUSSELS, Sept 16 (Reuters) - Industry groups have warned the European Union's package of emergency measures to bring down energy costs does not go far enough, and they urge Brussels to do more to tame gas prices.

The European Commission on Wednesday proposed cuts in electricity use and applying windfall-profit levies on energy firms, which it said would raise 140 billion euros ($140 billion) for governments to rechannel into helping businesses and citizens with soaring energy bills.

"These measures are not enough and will not save the energy-intensive aluminium industry from further production cuts, job losses, and possibly a complete breakdown," industry group European Aluminium said in a statement.

The energy-intensive sector urged EU energy ministers to take "additional measures" when they meet on Sept. 30 to negotiate the plans - in particular, to tackle high gas prices, which are the main driver of rocketing electricity costs.

"We need a physical supply of competitively priced gas for the European fertilizer producers to restart production," Fertilizers Europe director general Jacob Hansen said.

The group called for "further steps" targeting the gas market.

Around 70% of European ammonia production had halted since August due to soaring gas prices, Fertilizers Europe said.

Gas is a key ingredient in current methods of producing ammonia.


Dutch front-month gas prices have dipped this month, but are still around 14 times higher than two years ago.

The leap in prices has been fuelled by Russia slashing gas deliveries to Europe following Moscow's invasion of Ukraine in February.

European steel sector lobby Eurofer said the EU plans "fall short of securing affordable energy supplies" and were unlikely to prevent production cuts and temporary lay-offs in the sector.

A European Commission spokesperson declined to comment on reactions to the proposals, but said Brussels had already put in place numerous measures to deal with high energy prices, and was working on further relief concerning liquidity for companies and state aid.

Yet calls to curb gas prices have divided EU countries.

Italy and Poland are among those in favour of a price cap on imported gas.

The idea is opposed by Germany, Europe's biggest gas buyer, and countries, including the Netherlands, that fear it would drive supply away from Norway, Algeria and other non-Russian producers.

The Commission left gas price caps out of its proposals, and some EU officials echoed concerns that capping prices would compromise Europe's ability to shore up supplies.

The EU also shelved an earlier plan to cap only Russian gas prices.

It did so after opposition from central and eastern European countries that were worried Moscow would retaliate by halting what little supplies it still sends to the bloc.


Still, some diplomats are cautiously optimistic the Commission's proposals would be approved at the Sept. 30 meeting, even if some countries have raised concerns about the plans.

For example, Poland and Hungary have questioned plans to enforce a windfall-profit levy on fossil fuel firms with support from a reinforced majority of EU countries, rather than the unanimous approval that tax laws usually require.

Reporting by Kate Abnett; Additional reporting by Marwa Rashad; Editing by Bradley Perrett and Mark Potter

https://www.reuters.com/markets/europe/ ... 022-09-16/
thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

REUTERS

"German nuclear reactor leak poses no safety threat but complicates plans"


Reuters

September 19, 2022

BERLIN, Sept 19 (Reuters) - E.ON has informed the German government of a leak at the Isar 2 nuclear power plant which has not compromised security but could complicate the government's winter energy plan, the environment ministry said on Monday.

Isar 2, in the southern state of Bavaria, had been scheduled to go offline at the end of the year under Germany's plan to phase out nuclear power.

But the war in Ukraine and the subsequent plunge in energy imports from Russia prompted a policy change, with Berlin now planning to keep two of Germany's three remaining reactors, including Isar 2, on standby into next year.

The ministry said that a week-long repair period is needed in October at the Isar 2 plant, which is run by E.ON subsidiary PreussenElektra, during which operations would stop completely.

A spokesperson for E.ON said it was confident that a framework allowing Isar 2 to add to Germany's power supply security beyond Dec. 31 could be agreed with the government.

"Due to the necessary lead times, however, it is now necessary for the ongoing political discussions to quickly lead to a clear result and for all those involved to create planning security as quickly as possible," the spokesperson added.

Germany's environment ministry said that together with the economy ministry it was "examining the new situation and its implications for the design and implementation of the standby reserve" of the Isar 2 development.

The EEX transparency site, where operators have to place mandatory messages on plant outages to the wholesale power market, did not show an entry on Isar 2 for October.

E.ON's spokesperson said it has informed authorities as required by German law.

Reporting by Markus Wacket and Vera Eckert; Writing by Rachel More; Editing by Riham Alkousaa, Raissa Kasolowsky and Alexander Smith

https://www.reuters.com/world/europe/le ... 022-09-19/
thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

REUTERS

"Europe burns cash to help businesses in energy crisis"


By Kirsti Knolle and Paul Sandle

September 21, 2022

Summary

* European gas prices have soared amid Ukraine crisis

* Utilities face liquidity crunch

* Germany will 'do everything possible' to help firms

* Russian mobilisation triggers oil price jump


BERLIN/LONDON, Sept 21 (Reuters) - Germany nationalised gas importer Uniper on Wednesday and Britain said it would halve energy bills for businesses in response to a deepening energy crisis that has exposed Europe's reliance on Russian fuel.

Russian President Vladimir Putin added to the upward pressure on energy prices by announcing a partial military mobilisation, in the biggest escalation of the Ukraine war since Moscow's Feb. 24 invasion.

European governments had already earmarked almost 500 billion euros ($496 billion) in the last year to shield citizens and companies from soaring gas and power prices, according to research by think-tank Bruegel.

Uniper has been among the biggest corporate casualties, with Germany earmarking an additional 8 billion euros on Wednesday in the latest step in a 29 billion euro bailout.

France, also among the high spenders, will allocate 9.7 billion euros to take full control of utility EDF.


Britain said its new plan to help businesses would cost "tens of billions of pounds."

"We have stepped in to stop businesses collapsing, protect jobs, and limit inflation," Britain's finance minister Kwasi Kwarteng said of the cap on wholesale electricity and gas costs for businesses, which is set to apply from Oct.1.

More than 20 British power providers have collapsed, many crumbling because a government price cap prevented them from passing on soaring prices.

Uniper's full nationalisation will involve the German government buying out Finland's Fortum to give the state a 99% holding.

"This is clearly not sustainable from a public finance perspective," Bruegel senior fellow Simone Tagliapietra said of Europe's overall energy crisis bill.

"Governments with more fiscal space will inevitably better manage the energy crisis by outcompeting their neighbours for limited energy resources over the winter months."

'DO EVERYTHING POSSIBLE'

German Economy Minister Robert Habeck, announcing the Uniper move and other steps to avoid energy rationing this winter, said: "The state will ... do everything possible to always keep the companies stable on the market."

The Uniper nationalisation gives the German government control of some assets in Russia, a government spokesperson said, adding that it was examining what to do with these.

Germany was more reliant than many others in Europe on Russian gas, mostly supplied via the Nord Stream 1 pipeline.

Russia halted flows through the pipeline, blaming Western sanctions for hindering operations.

European politicians call that a pretext and say Moscow is using energy as a weapon.

The German government has already put Gazprom Germania, a unit of Kremlin-controlled Gazprom, and a subsidiary of Russian oil company Rosneft under trusteeship - a de facto nationalisation.

Including Uniper's bailout, the bill amounts to about 40 billion euros.

WINDFALL TAX

Meanwhile, a debate is raging in Europe over whether oil companies making record profits because of the energy crisis should pay additional taxes to help consumers cope with soaring inflation.

TotalEnergies' CEO Patrick Pouyanne said on Wednesday that the French energy group was likely to face more than 1 billion euros in additional levies if a proposed EU scheme to impose extra taxes on oil and gas companies was approved.

European gas prices on Wednesday hit 212 euros per megawatt hour (MWh), below this year's peak of around 343 euros but up more than 200% from a year earlier.

Oil prices rose by as much 3% in early trading, but later gave up these gains.

"The partial mobilisation (in Russia) is definitely a bullish factor as it increases the risks of a prolonged war in Ukraine," said Viktor Katona, lead crude analyst at Kpler.

Russia's gas flows to Europe via Ukraine were steady on Wednesday while eastbound gas flows via the Yamal-Europe pipeline to Poland from Germany were halted.

In the United States, Democratic and Republican senators on Tuesday proposed that President Joe Biden's administration use secondary sanctions on international banks to strengthen plans for a price cap by G7 countries on Russian oil.

Moscow has said it would cut all oil and gas flows to the West if such a cap was implemented.

Several countries have banned imports of Russian crude and fuel, but Moscow has managed to maintain its revenues through increased sales to Asia.

The move by U.S. lawmakers came hours before Putin ordered Russia's first mobilisation since World War Two, warning the West that if it continued what he called its "nuclear blackmail" Moscow would respond with its vast arsenal.

Reporting by Reuters bureaux; writing by Ingrid Melander; editing by Edmund Blair, Jason Neely and Jane Merriman

https://www.reuters.com/business/energy ... 022-09-21/
thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

REUTERS

"Germany takes over Uniper, raising rescue bill to $29 bln"


By Kirsti Knolle and Anne Kauranen

September 21, 2022

Summary

* Germany confirms nationalisation of gas importer Uniper

* Berlin to spend 8 billion euros to assume 99% ownership

* Finland says will have to live with deal with Fortum

* Fortum shares +9.5%, Uniper -25.3%

* German gas levy to be imposed from October


BERLIN/HELSINKI, Sept 21 (Reuters) - Germany on Wednesday agreed to nationalise Uniper, raising the bill to rescue the gas importer to 29 billion euros ($28.7 billion) amid an escalating energy crisis that shows just how much Europe's top economy has relied on Russian fuel.

The deal brings the total cash pumped into Germany's three biggest Russian gas importers - Uniper, former Gazprom unit Sefe and EnBW's VNG division - to at least 40 billion euros.

Nationalising Germany's largest importer of Russian gas is the second move in a week by the government to take control of an energy business and is part of a wider European response to the winter crisis, including France taking over EDF.

Germany last week also took control of a Russian-owned oil refinery, which supplies 90% of the capital's fuel, putting a Rosneft unit under the trusteeship of the industry regulator and taking over the Schwedt plant.

Uniper, whose shares closed 25.3% lower, burned through its cash buying alternative supplies after Moscow cut gas flows to Germany, triggering an initial 15 billion euro state rescue package in July.

But as with other European energy companies hit by soaring gas prices, it became clear the bailout was not enough to cover Uniper's deepening losses.

Germany will now inject yet more cash, partly by buying out Finnish utility Fortum's 56% holding for 500 million euros, or 1.70 euros per share.

'CLEAN BREAK'

Fortum shares ended the day up 9.5% on the news, with analysts at Bernstein saying the deal "allays investor fears and provides a clean break" for the Finnish group.

After completing a capital increase and the Fortum share buy, which excludes the Finnish firm's subscription rights, Germany will hold 99% of Uniper, its economy ministry said.

"The state will - that's what we're showing now - do everything possible to always keep the companies stable on the market," German economy minister Robert Habeck told reporters.

Berlin has said it would review an application earlier this month by VNG which asked the government for aid to stay afloat.

Habeck also said Berlin will impose a gas levy on consumers as planned from the start of October to help importers with the additional costs of replacing Russian gas.

However, there will be an analysis of whether it is in accordance with German law after the nationalisation of Uniper, which could take about three months, he said.

German Finance Minister Christian Lindner meanwhile said that the levy was finalised and there would be no further assessment, apparently contradicting Habeck.

German gas importers face losses because they cannot directly pass the higher gas prices on to their customers.

Uniper will continue to pursue legal action against Gazprom, its former main supplier, to claim back damages, Chief Executive Klaus-Dieter Maubach told reporters.

'WE CANNOT BE HAPPY'

While German consumers have been largely protected from the price hikes so far, other Europeans are paying very high prices for their energy.

Fortum has taken on sizeable Uniper losses, which has caused discontent in Finland.

Fortum said that under the deal it will be paid back a 4 billion euro parent company loan and released from a 4 billion euro parent guarantee it had given Uniper earlier this year.

"We are investing in Uniper with 8 billion in equity and are effectively buying Fortum out," Habeck said, while Finland's government, which has a 50.76% holding in the Finnish utility, said it would have to live with the deal.

Fortum said in March 2020 it had made investments worth 6.5 billion euros to give it a 69.6% stake in Uniper.

It later raised its stake to 80%, which it held until the July dilution.

"We have invested around 7 billion (euros) into the equity and we got about 900 million in dividends throughout the years of ownership and now we would recover through this agreement half a billion for the shares," Fortum CEO Markus Rauramo said.

"It is clear that we cannot be happy about what has happened," he added on a call with investors.

For years, Fortum has been a significant contributor to the Finnish state budget through dividends, but in the second quarter of this year alone, it reported a loss of 9.1 billion euros due to Uniper's losses in gas trading.

Under Wednesday's agreement, Fortum will not take on Uniper's losses for the third quarter, as it would have under the July deal.

This will free up 5 billion euros to Fortum, Rauramo said.

Reporting by Essi Lehto and Anne Kauranen in Helsinki, Kirsti Knolle, Markus Wacket and Christian Kraemer in Berlin, Tom Kaeckenhoff in Duesseldorf and Christoph Steitz in Frankfurt; Editing by Stine Jacobsen, Paul Carrel, Alexander Smith, Jan Harvey and Jane Merriman

https://www.reuters.com/business/energy ... 022-09-21/
thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

REUTERS

"Euro zone likely entering recession as price rises hit demand"


By Jonathan Cable

September 23, 2022

LONDON, Sept 23 (Reuters) - A downturn in business activity across the euro zone deepened in September, according to a survey which showed the economy was likely entering a recession as consumers rein in spending amid a cost of living crisis.

Manufacturers were particularly hard hit by high energy costs after Russia's invasion of Ukraine sent gas prices rocketing, while the bloc's dominant services industry suffered as consumers stayed at home to save money.

S&P Global's flash Composite Purchasing Managers' Index (PMI), seen as a good gauge of overall economic health, fell to 48.2 in September from 48.9 in August, as expected by a Reuters poll.

"The third decline in a row for the euro zone PMI indicates business activity has been contracting throughout the quarter."

"This confirms our view a recession could have already started," said Bert Colijn at ING.


A reuters poll earlier this month gave a 60% chance of a recession in the euro zone within a year.

The downturn in German business activity deepened as higher energy costs hit Europe's largest economy and companies saw a drop in new business, data showed.

However, in France activity was higher than expected although its PMI showed the euro zone's second biggest economy was still struggling as a modest rebound in services offset a slump in the manufacturing industry.

"It's possible German GDP fell in Q3 whereas France's economy eked out a small expansion, consistent with our view Germany will suffer more than most over the coming quarters as high energy costs weigh on energy-intensive industry as well as household budgets," said Jack Allen-Reynolds at Capital Economics.

The euro, German government bond yields and stocks all fell after the PMI data.

In Britain, outside the European Union, the economy worsened as firms battled soaring costs and faltering demand, hammering home the rising risk of recession there too.

In a bid to spur growth, new UK finance minister Kwasi Kwarteng on Friday was detailing close to 200 billion pounds ($223.2 billion) of tax cuts, energy subsidies and planning reforms.


PRICE PRESSURES

Overall demand in the euro zone fell to its lowest since November 2020, when the continent was suffering a second wave of COVID-19 infections.

The new business PMI fell to 46.0 from 46.9.

The euro zone services PMI fell to 48.9 from 49.8, its second month sub-50 and the lowest reading since February 2021.


The Reuters poll had predicted a more modest fall to 49.0.

With prices on the rise again and demand falling, optimism about the coming 12 months waned.

The business expectations index fell to 53.8 from 56.6, its lowest since May 2020.

Manufacturers also had a worse month than predicted.

Their PMI sank to 48.5 from 49.6, compared to the 48.7 forecast in the Reuters poll and the lowest since June 2020.

An index measuring output, which feeds into the composite PMI, nudged down to 46.2 from 46.5.

Likely of concern to the European central bank, which raised its key interest rates by 75 basis points earlier in September to try and tame inflation running in August at over four times its target, the survey showed prices had risen faster this month.

Both the input and output manufacturing prices indexes reversed a downward trend and rose.

The input price index reached a three-month high of 76.4 from 71.7.

Reporting by Jonathan Cable; Editing by Susan Fenton

https://www.reuters.com/markets/europe/ ... 022-09-23/
thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

REUTERS

"EU executive proposes eighth batch of sanctions against Russia"


By Gabriela Baczynska, Sabine Siebold and Marine Strauss

September 28, 2022

Summary

* EU states start negotiating new package of Russia sanctions

* 27 member countries split on oil price cap

* Ukraine: It's needed to stop 'blood money' flowing to Russia


BRUSSELS, Sept 28 (Reuters) - The European Union executive proposed on Wednesday an eighth round of sanctions against Russia over its invasion of Ukraine, including tighter trade restrictions, more individual blacklistings and an oil price cap for third countries.

The proposal will now go to the bloc's 27 member countries, which will need to overcome their differences to implement the new sanctions on top of seven sets of punitive measures imposed on Russia since its forces swept into Ukraine on Feb. 24.

That may take time despite the EU being spurred into action by Russia's military mobilisation last week, nuclear threats and steps to annex a swathe of Ukraine, after invading the former Soviet republic that aspires to join the EU.

"We do not accept the sham referenda (in Russian-occupied areas of Ukraine) nor any kind of annexation..."

"And we are determined to make the Kremlin pay the price for this further escalation," European Commission President Ursula von der Leyen told reporters.

"We are proposing a new package of biting sanctions."

The Group of Seven major industrialised countries - which includes EU countries Italy, France and Germany - have already agreed to put an oil price cap in place via insurers.

Earlier on Wednesday, a senior economic adviser to Ukrainian President Volodymyr Zelenskiy called on the EU to further cut money flows to Russia from fossil fuel sales.

"If you are doing nothing it means you are just prolonging this war with Ukraine."

"This is just ridiculous."

"The whole civilised world has to be united on that," said Oleg Ustenko.

While the EU already agreed to stop importing Russian oil starting later this year, Ustenko said "blood money" would keep on flowing to Moscow unless European companies were banned from insuring Russia's seaborne shipments to other countries.

UNANIMITY

The proposed sanctions fall short of harder-hitting measures, including a ban on importing Russian diamonds, sought by Russia hawks Poland and the three Baltic countries.

But EU states need unanimity to impose sanctions and the oil cap might be too much for Hungary, where Prime Minister Viktor Orban, who cultivates close ties with Russian President Vladimir Putin, has been a vocal critic of economic restrictions.

Ustenko hoped Hungary would eventually agree, and that EU countries with large shipping fleets - Greece, Malta and Cyprus - would also back more measures hitting Russian oil revenues.

Speaking next to von der Leyen, EU foreign policy chief Josep Borrell said the bloc was also blacklisting more individuals from Russia's defence sector, those involved in ad hoc votes organised by Moscow in occupied Ukrainian territories, those the West blames for spreading Russian propaganda and those helping to circumvent sanctions against Moscow.

Poland's EU ambassador said the proposed individual sanctions would include Patriarch Kirill, head of the Russian Orthodox Church and a close Kremlin ally, after previous attempts to blacklist him in the EU were blocked by Hungary.

Von der Leyen said a new imports ban would cost Russia 7 billion euros in lost revenues and that the EU would also expand the list of prohibited exports "to deprive the Kremlin's war machine of key technologies".

Under the proposal, European companies would be barred from providing more services to Russia and European citizens would not be allowed to sit on boards of Russian state companies.

This would be a nod to popular outrage over the cases of Gerhard Schroeder and Francois Fillon - former top European politicians who subsequently took jobs on Russian boards.

The Commission was due to present details of the proposal to member states at a closed-door meeting later on Wednesday and the 27 were expected to have a first discussion on Friday before national EU leaders meet in Prague on Oct. 6-7.

Additional reporting by Philip Blenkinsop and John Chalmers, Writing by Gabriela Baczynska; editing by John Chalmers, Alex Richardson and Mark Heinrich

https://www.reuters.com/world/europe/uk ... 022-09-28/
thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

City AM

"Gas prices spike 30 per cent amid explosion reports at Nord Stream pipeline"


Nicholas Earl

27 SEPTEMBER 2022

Gas prices have skyrocketed this afternoon, following reports of explosions at the sites of reported leaks in the Nord Stream pipeline under the Baltic Sea.

UK and Dutch benchmarks have soared 33 and 19 per cent respectively, as the continent investigates the explosions and leaks amid concerns of potential sabotage to the pipelines.


While the pipelines have not been supplying gas into Europe for several weeks, this has raised fears of potential supply shortages and escalation in the economic conflict between Russia and the West.

Gas is now pouring into the sea from three separate leaks from Nord Stream pipelines, with a Danish military flight over the leaks confirming the ruptures with striking images – including one showing an area of bubbling gas a kilometre wide on the sea’s surface.

Ukrainian presidential adviser Mykhaylo Podolyak has called the damage to Nord Stream 1 and 2 “an act of aggression” and a “terrorist attack” caused by Russia and directed towards the EU.

He warned that the Kremlin wanted to cause pre-winter panic and urged the EU to increase military support for Ukraine.

Other European leaders have also raised the idea that the damage to the pipelines was deliberately inflicted.

Polish Prime Minister Mateusz Morawiecki blamed the explosions on sabotage and argued it was probably linked to the war in Ukraine.

Denmark’s Prime Minister, Mette Frederiksen said it was hard to imagine the multiple leaks could be a coincidence.

The European Union has previously accused Russia of using a reduction in gas supplies as an economic weapon, in response to Western sanctions following the country’s invasion of Ukraine.

However, Moscow denies this, saying the sanctions have made it impossible to maintain the gas infrastructure properly.

A Kremlin spokesperson, Dmitry Peskov, said he was “extremely concerned” about the incident, and the possibility of a deliberate attack could not be ruled out.

https://www.msn.com/en-us/money/markets ... 16d57dbc7d
thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

REUTERS

"Russia says Nord Stream leaks occurred in zone controlled by U.S. intelligence"


Reuters

September 29, 2022

Sept 29 (Reuters) - Russia's foreign ministry on Thursday said ruptures to the Nord Stream pipelines that have caused gas leaks off the coasts of Denmark and Sweden occurred in territory that is "fully under the control" of U.S. intelligence agencies.

Foreign Ministry spokeswoman Maria Zakharova told a pro-Kremlin broadcast that Washington had "full control" over the waters around Denmark and Sweden where four leaks have been detected on the Nord Stream 1 and Nord Stream 2 pipelines, which cross the floor of the Baltic Sea between Russia and Germany.


"It happened in the trade and economic zones of Denmark and Sweden."

"There are NATO-centric countries," Zakharova said an interview with the Soloviev Live online broadcast on Thursday.

"They are countries that are completed controlled by the U.S. intelligence services."

Denmark is a member of the NATO military alliance, while Sweden's membership is pending after it abandoned its historic policy of non-alignment following Russia's invasion of Ukraine.

Zakharova did not provide evidence of U.S. control over Sweden and Denmark.

Russia frequently rails against American influence and military support for Europe.

The European Union suspects sabotage was behind the gas leaks on the subsea Russian pipelines to Europe and has promised a "robust" response to any intentional disruption of its energy infrastructure.

While neither pipeline was in use at the time of the suspected blasts, they were filled with gas that has been spewing out in the Baltic Sea since ruptures were first detected on Monday.

Reporting by Reuters; Editing by David Goodman and Jan Harvey

https://www.reuters.com/business/energy ... 022-09-29/
thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

REUTERS

"Putin accuses West of blowing up pipelines as Europe steps up vigilance"


By Jake Cordell and Nina Chestney

September 30, 2022

Summary

* Putin blames West for wrecking Nord Stream

* EU still investigating cause of pipeline leaks this week

* Europe scrambles to secure other energy infrastructure

* Italy strengthens surveillance on gas pipelines

* Infrastructure attacks threaten regional conflict: analyst


TBILISI/LONDON, Sept 30 (Reuters) - Russian President Vladimir Putin on Friday blamed the United States and its allies for blowing up the undersea Nord Stream pipelines, raising the temperature in a crisis that has left Europe racing to secure its energy infrastructure and supplies.

In a speech to mark the annexation of four Ukrainian regions invaded by Russian forces, Putin offered no evidence for the claim.

Russia has previously said the United States would profit from attacks on Europe's energy infrastructure.

"The sanctions were not enough for the Anglo-Saxons: they moved onto sabotage," Putin said.

"It is hard to believe but it is a fact that they organised the blasts on the Nord Stream international gas pipelines."


"They began to destroy the pan-European energy infrastructure," Putin said.

"It is clear to everyone who benefits from this."

"Of course, he who benefits did it."

Putin's accusation is likely to be strongly resisted by European countries.

The United States, which has said it was too early to confirm it was sabotage, has dismissed talk it was responsible.

European Union states, once heavily reliant on Russia and now trying to find alternative gas supplies, say they believe leaks were caused by sabotage, but have stopped short of naming anyone.

They are racing to secure other energy infrastructure.

The Nord Stream pipelines, which were not pumping gas to Europe when the leaks were found but had gas in them, have been flashpoints in an energy standoff between the West and Russia since its invasion of Ukraine, fuelling a cost-of-living crisis.

The EU is still investigating how Russia's Nord Stream 1 and Nord Stream 2 pipelines burst this week, draining gas into the Baltic Sea off the coast of Denmark and Sweden.

Seismologists registered explosions in the area.

The ruptures might mark the biggest single release of methane ever recorded, the United Nations Environment Programme said on Friday, as researchers detected a huge plume of methane in satellite imagery this week.

Gas will continue to pour out of Nord Stream 1 until Sunday, the Danish energy agency said on Friday, though the leak on Nord Stream 2 is expected to cease on Saturday.

WIDER CONFLICT

The pipeline incident has prompted European countries to step up vigilance over other critical infrastructure, which looks suddenly much more vulnerable.

Italy, which was an early starter in weaning off Russian supplies, has strengthened naval surveillance and controls on pipelines bringing gas to the country from the south and east, senior officials told Reuters.

That includes the TransMed pipeline, which connects Algeria to Sicily, the Trans Adriatic Pipeline (TAP) running from Azerbaijan to Apulia, and the GreenStream connection between Libya and Sicily.

Rome also raised its alert on the Trans Austria Gas (TAG) pipeline that brings fuel from the Nordics to the north-east of Italy.

Poland's electricity grid operator on Friday meanwhile announced checks on an undersea cable carrying power from Sweden that crosses the damaged Nord Stream pipelines.

There is also heightened focus on the Baltic Pipe, a project that was unveiled this week.

A rival to the Nord Stream network, the Baltic Pipe will transport gas to the Danish and Polish markets and end-users in neighbouring countries from Oct. 1.

"The risk to near-term gas flows has risen sharply on fears that further sabotage could occur on critical gas import pipelines," Fitch Solutions said in a note, citing the Baltic Pipeline.

"The possibility of additional acts of sabotage on critical infrastructure is a growing risk that would raise the risk of tipping the war into a wider regional conflict."

Norway, a major Russian rival on gas supplies, will deploy its military to protect oil and gas installations against possible sabotage after warnings of unidentified drone sightings in September.

Britain, France and Germany will also help.

Germany's energy regulator called in a Reuters interview for more protection for critical energy infrastructure.

With no gas flowing through Nord Stream for the foreseeable future, European countries are racing to secure more energy supplies and trying to cushion households from an explosion in prices since last year.

European Union countries on Friday agreed to impose emergency levies on energy firms' windfall profits and began more fraught talks on imposing a bloc-wide gas price cap.

In the Netherlands, citizens have started stockpiling wood and coal to save on rocketing gas bills.

Poland and the Czech Republic have asked the European Commission to revive a stalled gas pipeline project connecting the two countries.

The gas network operators of Bulgaria, Romania, Hungary and Slovakia have also proposed shipping additional natural gas supply pledged by Azerbaijan to Europe.

Reporting by Reuters bureaux; Writing by Matthias Williams; Editing by Jan Harvey and Emelia Sithole-Matarise

https://www.reuters.com/world/europe/ru ... 022-09-30/
thelivyjr
Site Admin
Posts: 73424
Joined: Thu Aug 30, 2018 1:40 p

Re: THE EUROPEANS

Post by thelivyjr »

REUTERS

"Credit Suisse in market spotlight despite moves to calm concerns"


By Oliver Hirt and Michael Shields

October 3, 2022

Summary

* Credit Suisse caught in market turbulence ahead of revamp

* Shares fell as much as 11.5% before recouping losses

* Bank's euro-denominated bonds reach record lows

* Swiss bank says its capital, liquidity are strong


ZURICH, Oct 3 (Reuters) - Credit Suisse Group AG saw its shares slide by as much as 11.5% and its bonds hit record lows on Monday before clawing back some of the losses amid concerns about the lender’s ability to restructure its business without asking for more money.

The situation prompted Swiss regulator FINMA and the Bank of England in London, where the lender has a major hub, to monitor what was happening and work closely together, one source familiar with the matter said.

Some analysts and industry sources said the bank had enough capital and cash to deal with any crises.

One analyst said investors feared the bank's ability to execute on a turnaround strategy, which it is due to reveal on Oct. 27.

Broader market malaise is also likely adding to investor worries, they said.

Global financial markets have been particularly fragile of late, where rapidly rising interest rates, policy inconsistencies, recession fears and the war in Ukraine have unnerved investors.

"The key issue is the viability of the bank following its upcoming strategic review," wrote ABN AMRO analyst Joost Beaumont, who added that adverse market conditions have raised the "execution risk of any strategic review."

The Bank of England, FINMA and the Swiss finance ministry declined to comment.

Analysts at Citi said that widening credit spreads could exacerbate market fears and damage counterparty confidence, as well as drive funding costs higher.

"In the long-term the further the share price falls the more dilutive any capital raise becomes (and vice versa), which constrains the magnitude of any investment banking restructuring that CS can undertake," the analysts said.

Credit Suisse, one of the largest in Europe and one of Switzerland's global systemically important banks, has had to raise capital, halt share buybacks, cut its dividend and revamp management after losing more than $5 billion from the collapse of investment firm Archegos in March 2021, when it also had to suspend client funds linked to failed financier Greensill.

In July, Credit Suisse announced its second strategy review in a year and replaced its chief executive, bringing in restructuring expert Ulrich Koerner to scale back investment banking and cut more than $1 billion in costs.

The bank is considering measures to scale back its investment bank into a "capital-light, advisory-led" business, and is evaluating strategic options for the securitised products business, Credit Suisse has said.

Citing people familiar with the situation, Reuters reported last month that Credit Suisse was sounding out investors for fresh cash as it attempts its overhaul.

FALLING SHARES

Credit Suisse shares fell as much as 11.5% before coming off early lows to end down just 1%.

Its international bonds also showed the strain, with euro-denominated bonds dropping to record lows before clawing back some losses in the afternoon.

The embattled lender's longer-dated bonds, suffered the sharpest declines.

Spreads on Credit Suisse's U.S. dollar bonds were quoted on Monday morning about 40 to 90 basis points wider across their outstanding bonds.

Their bonds maturing 2027 were about 365 bps over Treasuries vs 290 bps bid on Friday while the Credit Suisse 6.537% bond maturing August 2033 was bid at 460 bps over Treasuries vs 420 bps on Friday, one syndicate banker said.

"It is pretty ugly for CS bonds," said the banker.

Credit Suisse credit default swaps soared higher on Monday, adding 105 basis points from Friday's close to trade at 355 bps, their highest level in at least more than two decades.

The bank's CDS, which measure the cost to insure its bonds, stood at 57 bps at the start of the year.

Bank executives spent the weekend reassuring large clients, counterparties and investors about its liquidity and capital, the Financial Times reported on Sunday.

That followed Chief Executive Koerner’s telling staff last week that the bank, whose market capitalisation dropped to a record low of 9.73 billion Swiss francs ($9.85 billion) on Monday, has solid capital and liquidity.

Some investors said they were not panicking.

"They’ll be recapitalised by the public markets if the environment is good in a month or two, or they’ll be backstopped by the Swiss government if the environment is bad," said Thomas Hayes, chairman and managing member of New York-based Great Hill Capital.

LIQUIDITY 'HEALTHY'

JPMorgan analysts said in a research note on Monday that, based on its financials at the end of the second quarter, they view Credit Suisse's capital and liquidity as "healthy".

Given the bank has indicated a near-term intention to keep its CET1 capital ratio at 13% to 14%, the second-quarter end ratio is well within that range and the liquidity coverage ratio is well above requirements, the analysts added.

Credit Suisse had total assets of 727 billion Swiss francs ($735.68 billion) at the end of the second quarter, of which 159 billion francs was cash and due from banks, while 101 billion francs was trading assets, it noted.

Still, investors are questioning how much capital the bank may need to raise to fund the cost of a restructuring, analysts at Jefferies wrote in a note to clients on Monday. Also, the bank is now potentially a forced seller of assets, they said.

Deutsche Bank analysts in August estimated a capital shortfall of at least 4 billion francs.

Reporting by Michael Shields and Oliver Hirt in Zurich; Additional reporting by Lucy Raitano, Huw Jones and Karin Strohecker in London and Davide Barbuscia and Shankar Ramakrishnan in New York; Editing by Noele Illien, David Goodman, Elisa Martinuzzi, Alexander Smith and Jonathan Oatis

https://www.reuters.com/business/financ ... 022-10-03/
Post Reply