Latest News
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The exchange rate for uranium remains unchanged and western exports are steady in October, despite sanctions
In a low-volume trading environment, the differential between Brent and Urals crude remained stable on Wednesday. Meanwhile, Russia's oil exports to western countries in October were in line with their initial plan despite new Western sanctions. LSEG data indicate that despite weather-related restrictions and sanctions pressure, October's exports from the western ports of Primorsk and Ust-Luga, and Novorossiisk, are expected to be around 2.33 million barrels a day. This is in line with Russia’s revised monthly program. Last week, Britain, the U.S. and the European Union imposed sanctions on Russia, including the two largest oil producers, Lukoil, and Rosneft. The U.S. gave companies until November 21, 2011 to end their transactions with Russian oil producers. PLATTS WINDOW There were no bids or offers reported for Urals, Azeri BTC Blend or CPC blend crude in the Platts window. Sources with direct knowledge on the matter say that Indian Oil is planning to sign a joint-venture agreement with Vitol early next year in order to increase its presence in the international crude and fuel trade. (Reporting and Editing by Lisa Shumaker).
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After fatal accident, NTSB advises Learjet owners to check the main landing gear of their aircraft.
The National Transportation Safety Board issued an urgent warning to 10 Bombardier Learjet aircraft models on Wednesday to ensure that the main landing gear was attached correctly. The Federal Aviation Administration's recommendation that landing gear manufacturer service bulletins be followed would apply to 1,883 aircraft currently in operation. The recommendation is based on an investigation into a fatal runway incident that occurred in Scottsdale, Arizona in February involving a Learjet 35A. It also stems from three previous incidents in which Learjet's landing gear detached from the airframe due to a retaining pin not being engaged. In February, the Learjet 35A skidded of the runway and hit a Gulfstream 200, killing the captain. Three others aboard and an occupant in the parked plane sustained serious injuries. Bombardier did not comment immediately, but in 2022, the production of Learjet aircraft was stopped. FAA did not comment immediately either. The NTSB cited accidents in 1995, 2001, and 2008 in Oklahoma City (Oklahoma), Florida, and Recife (Brazil). Bombardier's service bulletin, issued in the wake of the Scottsdale accident, asked operators to check that landing gear was attached correctly. However, only 12% had been checked, according to Bombardier. The NTSB called on the FAA also to require Bombardier revise its procedures so that a visual inspection of the pin and retaining screw is performed after maintenance. This is because a mechanic may inadvertently install a retaining screw without passing it through the pin.
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Alaska Airlines website and app are down due to global Azure outage
Alaska Airlines reported that its website and mobile app were unavailable on Wednesday. This comes days after an outage in technology grounded the airline's flights across America. The airline stated that the latest disruption was caused by a global outage of Microsoft's Azure Platform, which affected key systems including its websites. As a response to customers experiencing problems accessing the website, the carrier told X that the issue is being investigated. JetBlue Airways warned Wednesday that passengers flying through Orlando International Airport may have to wait longer than usual for their check-in due to a computer issue. Last week's technical outage caused the ground stop, which forced the carrier cancel more than 400 flights. This resulted in travel disruptions for over 49,000 passengers. Alaska Airlines shares fell 2.2% during afternoon trading. JetBlue fell 1.3%. (Reporting and editing by Leroy Leo and Shakesh Kuber in Bengaluru, and AnshumanTripathy and Nathan Gomes in Bengaluru)
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Italy's auditors reject plans for a Sicily bridge, but the government vows to fight it back
The Italian Court of Auditors refused on Wednesday to approve a government plan for a bridge linking Sicily with the mainland. This casts serious doubt on whether the $15.7 billion project, which is estimated to cost 13.5 billion euros, will be viable. Salvini, the Deputy Italian Premier, denounced this ruling as "a serious blow" for the country. He called it a decision made on a more political basis than a technical one. However, he vowed to use all means possible to bring the decades-old project to fruition. After an earlier hearing, the court issued a short statement announcing its decision. It added that its reasoning would be published within 30 days. The rejection does not necessarily mean that the project is over, but it casts a shadow on its future. Salvini may seek cabinet approval to override court objections, but this could open the project up to legal action. Salvini, who is the leader of the conservative bloc headed by Giorgia Meoni, has been championing the project ever since 2022 when the coalition led by Meloni came to power. He says it's vital for Italy’s underdeveloped southern region. Eurolink won the contract to build the bridge over the Strait of Messina after an international bid. The consortium is led by Italy's Webuild and includes the Spanish group Sacyr, as well as Japan's IHI. The Court had earlier expressed doubts regarding the total costs of the bridge, and stated that the government failed to include a technical assessment by a consulting agency. The judges also questioned if the project was compliant with EU competition laws, referring specifically to the sharp increase in costs from the original 3.8-billion-euro bid awarded to Webuild (known at the time as Salini Impregilo) in 2005. Reporting by Angelo Amante Editing and Crispi Balmer by Keith Weir
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Microsoft Azure, 365 Outage Impacting Businesses Globally Starting to Ease
According to the outage tracking website Downdetector.com, an outage at Microsoft Azure and its suite productivity software that affected a variety of industries around the world had started to ease. Alaska Airlines, Vodafone UK, and Heathrow Airport all reported experiencing disruptions to their key systems due to an Azure outage on Wednesday. Microsoft's outage comes after last week's Amazon AWS disruption, which affected thousands of websites and popular web apps such as Snapchat and Reddit. Microsoft 365 stated that its services are experiencing downstream impacts related to the Azure outage. The outage is caused by a recent configuration change made to a part of Azure infrastructure, Microsoft said on its status webpage. Starting at around 12 p.m. ET, Azure said that its customers and Microsoft services that leverage Azure Front Door, a global cloud-based content and application delivery network, had experienced issues resulting in timeouts and errors. Azure reported that its customers, as well as Microsoft services, which leverage Azure Front Door - a cloud-based global content and application delivery system - had experienced problems resulting in errors and timeouts. Azure's status page stated that its customers had also experienced problems with accessing the Azure Management Portal and that the company has taken steps to resolve the issue. As of 1:27 pm, the number of users who reported issues with Azure was down to only 3,299 users. ET from over 18,000 at its peak, according to Downdetector. It tracks outages through status reports compiled from multiple sources. Azure said that "customers should be in a position to access the Azure Management Portal directly. While all portal extensions work correctly, there could be a few endpoints (i.e. Marketplace)," Azure said. As of 1:27 p.m., Microsoft 365 was experiencing an outage. Downdetector’s website shows that the number of users affected is down to 3,858 from 11,700 at one point. The numbers on the website are based upon reports submitted by users, and may not reflect the true number of users affected. AWS's outage is the biggest internet disruption since CrowdStrike's failure last year, which impacted technology systems at hospitals, banks, and airports. It highlights the vulnerability of interconnected technologies around the world. (Reporting and editing by Shailesh Kumar and Alan Barona in Mexico City)
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Stocks and the US dollar gain after Fed cut rates
The global stock market was on track to gain for a fifth consecutive session on Wednesday. Meanwhile, the U.S. Dollar remained high after the U.S. Federal Reserve lowered interest rates. It also rose ahead of the earnings reports from several U.S. Megacap companies. The central bank reduced rates by 25 basis point, citing the lack of data visibility caused by the government shutdown. It also announced that it would stop the quantitative tightening, or QT, process, which involves reducing the $6.6 trillion in assets on its balance sheet. It was only logical to stop QT rather than risking a crash in the short-term bond markets. "There were already signs of stress so it was not worth pushing QT any further", said Brian Jacobsen. Chief economist at Annex Wealth Management, Menomonee Falls in Wisconsin. The Fed qualified the statement with 'available indicators' to acknowledge the lack of data due to the shutdown of the federal government. This statement was not surprising because the dissents were not unexpected. Wall Street saw a rise in U.S. stock prices, which continued their recent rally, which has driven major indexes up to record levels. This was due to a cooling of trade tensions between China and the U.S., the expectation of a Fed rate cut, the outsized expenditures related to artificial-intelligence, and the solid start for the earnings season. Investors are now awaiting comments from Fed Chairman Jerome Powell to get a sense of the direction interest rates will take following the announcement. They also want any updates about the quantitative tightening program. The shutdown has resulted in a lack of data on the economy, and the labor market is no exception. However, several major U.S. firms, including Amazon, announced layoffs earlier this week. Nvidia was the first company on Wednesday to reach the $5 trillion valuation. Shares rose 4.7%, building on a previous session's 5% increase. CEO Jensen Huang announced that the AI chip maker will build seven supercomputers, including one for the U.S. Department of Energy. The company also has 500 billion dollars in orders for its chips. Microsoft, Alphabet, and Meta will report their earnings on Wednesday after the closing bell. The Dow Jones Industrial Average rose by 119.78, or 0.25 percent, to 47.826.58, while the S&P 500 gained 10.58, or 0.15 percent, to 6.901.47, and the Nasdaq Composite advanced 121.47, or 0.51% to 23948.97. MSCI's global stock index rose 1.69 points or 0.17% to 1,015.29, after reaching an intraday high of 1,017.24. The pan-European STOXX 600 closed at 0.06%. The Bank of Japan will announce its policy later this week. Dollar index, which measures greenbacks against a basket currencies, maintained gains following the Fed's statement. It was up last 0.18% at 98.85. The euro fell 0.07% to $1.1642. The dollar gained 0.17% against the Japanese yen to 152.36. Sterling lost 0.41% at $1.3213. The Canadian dollar gained 0.21% against the dollar to C$1.39 after the Bank of Canada cut its overnight rate on Wednesday to 2.25%, as expected. It also signaled that this could be the end of its interest rate-cutting cycle, unless inflation and the economy outlook changes. U.S. Donald Trump and South Korean president Lee Jae Myung finalized the details of their fraught deal during a summit held in South Korea. The U.S. leader also sounded optimistic about a looming meeting with China's Xi Jinping. The yield on the benchmark 10-year U.S. notes continued to rise after the policy announcement. It was last up 3.5 points at 4.018%, and is near the lowest levels since April. The yield on the 2-year note, which moves typically in line with expectations of interest rates for the Federal Reserve (which is usually a good indicator), gained 2.6 basis point to 3.52%. U.S. crude oil rose 0.73% to 60.59 per barrel. Brent climbed to $65.02 a barrel, up by 0.96%.
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Sources: Germany considers nationalising Rosneft after Trump sanctions
U.S. sanctions against Russian oil producer Rosneft rekindled German discussions about nationalising its business, including the refinery on which Berlin relies for the majority of its fuel. Two sources familiar with these talks said that the U.S. sanctions had prompted the discussion. The situation reveals the complex web of links between Germany and Russia that supplied Europe's industrial superpower with energy during the decades preceding the war in Ukraine. The U.S. Treasury announced on Wednesday that it had granted a license exempting Rosneft’s German arm of the U.S. Sanctions until April 2026. The two sources said that Berlin prefers to secure a permanent exemption, but German officials also consider the possibility of seizing operations and selling them off to an investor from abroad. A spokesperson from the Economy Ministry said that it received a letter of the United States which would be a "temporary fix". Rosneft’s German arm has a controlling interest in Schwedt Oil Refinery, which supplies the majority of Berlin’s fuel including petrol for the pumps throughout eastern Germany, and essential ingredients to the local chemical industry. The company also owns stakes in the refineries MiRo and Bayernoil. After the Russian invasion of Ukraine in 2014, these assets were put in a trust giving German control by 2022. This was in response to Russia's attack on Ukraine which shook Germany's long-standing energy relationship with Russia. Every six months, the trusteeship arrangement must be renewed. However, it could be challenged in court, as each renewal involves a review of the legal basis behind what was meant to be an emergency, temporary measure. Berlin is still hesitant to seize Rosneft assets in Berlin, as it fears having to compensate Moscow. MULTI-BILLION DOLLAR BUSINESS The Russian media has estimated the value of Rosneft’s German assets to be around $7 billion. However, one of two sources stated that the real value could be less than half. Moscow has warned Europe of any seizure. German companies that have factories or other investments in Russia may be the first to suffer a response from the Kremlin. Rosneft is trying to sell its business, but to no avail. It didn't respond to a comment request on Wednesday. Michael Kellner of the Green Party, who was a member of the German parliament and worked for the previous coalition government overseeing Rosneft urged the federal government to nationalise Rosneft. Kellner said, "It's systemically important to Germany." "The government must nationalise Rosneft in Germany to ensure its future." Kellner stated that he wanted to nationalize the business when he was in government, and that Qatar and Kazakhstan have expressed interest in purchasing it in 2024. However, it is not clear if these countries are still interested. Germany used to purchase oil directly from Russia. Rosneft, a German oil company, now purchases oil from Kazakhstan. The pipeline that delivers it is controlled by Russia.
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Croatia opens Rijeka Port Terminal to serve as regional logistics hub
In a press release, the port authorities announced that Croatia opened the Rijeka Container Terminal on Wednesday, an investment of 600 million euros built to position Croatia's largest port as a logistics hub for the region. The Rijeka Gateway Terminal, developed by APM Terminals & ENNA Group, represents Croatia's biggest private investment in logistic infrastructure, according to the statement. The total investment is 600 million euro, including the roads and railways around and in the port. The terminal will employ 300 people once it's fully operational. The terminal began operating in September and offers a 400-meter quay with a capacity of 650,000 20' equivalent units (TEUs). There are plans to increase this to 680 meters, and eventually to more than 1 million TEUs. The first 5G private industrial network in Croatia is also equipped with remote-controlled cranes and renewable energy systems. Bostjan Napa, CEO of ENNA Group, said: "Geographically we are in a great position. We are closer to Asia and closer to Europe." It is time for Rijeka to regain its position as the port of the northern Adriatic and to return to the global logistics map.
Singapore port blockage reveals worldwide ripple impact of Red Sea attacks
Congestion at Singapore's container port is at its worst because the COVID19 pandemic, a sign of how extended vessel rerouting to avoid Red Sea attacks has actually disrupted worldwide ocean shipping with bottlenecks likewise appearing in other Asian and European ports.
Merchants, producers and other markets that rely on massive box ships are once again fighting surging rates, port backups and scarcities of empty containers, even as many consumer-oriented companies seek to develop inventories heading into the peak year-end shopping season.
International port congestion has reached an 18-month high, with 60% of ships waiting at anchor situated in Asia, maritime information company Linerlytica said this month. Ships with a total capability of over 2.4 million twenty-foot comparable container systems (TEUs). were waiting at anchorages as of mid-June.
However, unlike during the pandemic, it is not a purchasing flurry. by house-bound consumers that is swamping ports.
Rather, ship schedules are being interrupted with missed out on. sailing schedules and fewer port calls, as vessels take longer. paths around Africa to prevent the Red Sea, where Yemen's Houthi. group has actually been attacking shipping because November.
Ships are therefore offloading larger amounts at once at big. transhipment centers like Singapore, where freights are unloaded and. refilled on various ships for the final leg of their journey,. and forgoing subsequent trips to catch up on schedules.
( Shippers) are attempting to handle the situation by dropping. packages at transhipment hubs, stated Jayendu Krishna, deputy. head of Singapore-based consultancy Drewry Maritime Advisors.
Liners have been collecting boxes in Singapore and other. centers.
Typical Singapore cargo offload volume leapt 22% between. January and May, substantially affecting port efficiency,. Drewry said.
SERIOUS CONGESTION
Singapore, the world's second-largest container port,. has seen particularly severe congestion in recent weeks.
The typical wait time to berth a container ship was two to. three days, Singapore's Maritime and Port Authority (MPA) said. in end-May, while container trackers Linerlytica and PortCast. said hold-ups might last up to a week. Usually, berthing should. take less than a day.
Neighbouring ports are likewise backing up as some ships skip. Singapore.
The strain has actually moved to Malaysia's Port Klang and Tanjung. Pelepas, said Linerlytica, while wait times have actually also climbed up at. Chinese ports, with Shanghai and Qingdao seeing the longest. delays.
Drewry anticipates congestion at significant transhipment ports to. remain high, however anticipates some reducing as carriers add. capability and restore schedules.
Singapore's MPA stated that port operator PSA had actually re-opened. older berths and backyards at Keppel Terminal and would open more. berths at Tuas Port to tackle extended waits.
Maersk, the world's second-largest container. provider, stated this month it would avoid 2 westbound cruisings. from China and South Korea in early July due to serious. blockage in Asian and Mediterranean ports.
PEAK SEASON
The annual peak shipping season has also shown up earlier. than anticipated, exacerbating port congestion, carriers and. research companies stated
This seems to be driven by restocking activities,. particularly in the U.S., and by consumers delivering items early. in anticipation of stronger need, said Niki Frank, CEO of DHL. Global Forwarding Asia Pacific.
Container rates, meanwhile, have surged, raising the danger of. another spate of price boosts for purchasers like the. post-pandemic inflation spike which reserve banks are still. attempting to tame.
Rates had actually stabilised into April however in May there was a. significant boost in ocean freight exports of Chinese. e-commerce, electrical lorries, and sustainable energy-related. products, Asia-focussed freight forwarder Dimerco stated.
The peak season, which traditionally starts in June, was. advanced by a full month, causing ocean freight rates to skyrocket.
Container import volume at the 10 biggest U.S. seaports in. May increased 12%, sustained by the second-highest monthly import. volumes considering that January 2023, stated data service provider Descartes.
( U.S.) customers are continuing to spend more than last. year, and sellers are stocking up to fulfill demand, said. Jonathan Gold, a National Retail Federation vice president.
Ocean imports into Europe from Asia are likewise revealing signs. of a re-stocking season running into peak season - pressing rates. to 2024 highs, Judah Levine of freight platform Freightos stated.
Container freight prices from Asia to the U.S. and Europe. have actually tripled because early 2024.
Rates from Asia and Singapore to the U.S. East Coast are at. their highest considering that September 2022, while rates into the U.S. West Coast are highest because August 2022, freight platform. Xeneta stated.
Some industry players believe part of the reason for the. bottlenecks at China ports is sustained by U.S. importers rushing. to purchase Chinese items such as steel and medical products that. will go through steep tariff walkings from Aug. 1.
However recently enforced U.S. tariffs would impact only about 4% of. Chinese imports to the U.S., said Jared Bernstein, chair of the. Council of Economic Advisers.
Gene Seroka, executive director of the Port of Los Angeles,. the largest U.S. gateway for Chinese ocean imports, also anticipates. a restricted effect.
We might see some of this cargo been available in, but it is not going. to be a deluge, he said.
Issues about possible strikes at U.S. ports this year. could also be pulling the peak season forward, while DHL said. German port strikes were adding to the gridlock.
All of those interruptions will likely indicate higher rates for. consumers, specialists warn.
These are substantial monetary hits for carriers to take in,. stated Peter Sand, primary expert at Xeneta.
(source: Reuters)