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US safety board criticizes Boeing and FAA for 737 MAX panel blowout
Officials said that a U.S. National Transportation Safety Board (NTSB) investigation found that Boeing's ineffective actions and the Federal Aviation Administration's ineffective oversight led to a midair cabin panel explosion of a new 737 MAX 9 in January 2024, which spun the planemaker in a major crisis. The board criticised Boeing's safety culture, and its failure to properly install four bolts on a new Alaska Airlines MAX 9 plane. The NTSB chair Jennifer Homendy stated at a Tuesday meeting to determine the probable causes that the accident was completely avoidable. She said that Boeing should have addressed the unauthorized production work that was identified by numerous Boeing internal audits reports, quality alerts, and regulatory compliance issues long ago. Homendy stated that "the safety deficiencies which led to this incident should have been obvious to Boeing and the FAA." It's a miracle no one was killed or suffered serious injuries. The accident led the Justice Department (JD) to launch a criminal probe and declare Boeing in violation of a deferred prosecution 2021 agreement. Dave Calhoun, the CEO of Boeing, announced that he would resign within a few month after the mid-air panels blew out. Homendy praised the new Boeing CEO Kelly Ortberg, but added that "he's got his work cut out, there are a lot challenges to be addressed, and it will take time." The incident severely damaged Boeing's image and resulted in the MAX 9 being grounded for two weeks. In addition, the FAA imposed a monthly production limit of 38 aircraft by the FAA. This cap is still in place. Boeing did not create any paperwork to document the removal or reinstallation of the 737 MAX 9 emergency exit door plug – a metal piece shaped like a small door – during production. The NTSB also stated that Boeing was unaware of which employees were involved. Boeing has not commented on the meeting. Michael Whitaker, the then FAA administrator in June 2024, said the agency had been "too hands-off" with Boeing oversight. It has increased the number of inspections at Spirit AeroSystems and Boeing factories. Boeing agreed to plead guilty last July to a criminal conspiracy charge following two fatal 737 MAX crash in Indonesia and Ethiopia. Last month, it struck a deal to avoid a plea of guilty with the Justice Department. The Justice Department asked a court to approve the agreement, which would allow Boeing to avoid having to plead guilty or face oversight by an external monitor. However, it will also require that Boeing pay an extra $444.5 in a fund for crash victims to be split equally between each crash victim. (Reporting and editing by Jamie Freed, Margueritachoy and David Shepardson)
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El Al increases flights to bring back stranded passengers following the Iran-Israel ceasefire
El Al Israel Airlines has announced that it is working to organize an airlift for tens and thousands of passengers who have been stranded in Israel due to widespread flight cancellations since the beginning of the Israel-Iran War on June 13. El Al, Israel’s flag carrier, announced that following a 12-day ceasefire, and the gradual opening up of Ben Gurion Airport in Tel Aviv, the airline would increase its schedule and use its entire fleet, and add thousands of additional seats within the next 24 hour. The airline, which cancelled all regular flights until June 27, said that it would offer one-way flights to and from New York City, Los Angeles (Bangkok), London (Paris), Rome, Athens (Bucharest), Bucharest, Tbilisi, Bangkok, Bucharest, Bucharest, Bucharest, Bucharest, Bucharest, Bucharest, Bucharest, Bucharest, Tbilisi. Israel's airspace was largely closed for nearly two weeks as Israel and Iran exchanged air attacks. However, Israeli carriers began rescuing passengers in the last few days. Flight frequencies increased Tuesday, after U.S. president Donald Trump announced an agreement between Israel and Iran on a ceasefire. Israel has not yet fully opened its airspace. El Al's fleet consists of Boeing 787 Dreamliner aircraft and 737 aircraft. Israel's Airports Authority said earlier that day it was working to return to normal operations in the next few hours and was working with all airlines and partners in Israel's airports, "to ensure a safe and orderly process for passengers." Other smaller Israeli carriers also operated rescue flights. Arkia Airlines reported that it was returning passengers from Milan, Athens and Vienna, as well as Larnaca, Cyprus. Israir will operate flights on Wednesday from Varna in Bulgaria and on Friday from Baku. Israel is also working to allow nearly 40,000 tourists leave Israel. Many left Israel via the border crossings to Egypt and Jordan as well as by boat to Cyprus.
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US and European airline shares rise amid hopes for an Israel-Iran truce
On Tuesday, shares of U.S. airlines and European airlines increased while oil prices fell on the expectation that a ceasefire would be maintained between Israel and Iran. Air France KLM and British Airways' owner, Lufthansa, all saw gains between 6-10%, while Wizz Air grew by 3.2%. In the morning, Delta Air Lines, American Airlines and United Airlines all saw gains of about 4%. The U.S. president said that Israel has stopped its attack after his order to maintain a ceasefire of several hours. Iranian and Israeli media both reported that Israel had launched new airstrikes on Iran just minutes after Trump's comments, before he left for The Hague to attend a NATO summit. Susannah Streeter is the head of money markets and currency at Hargreaves-Lansdown. As several countries shut down their airspace following the attack on Al Udeid U.S. base in Qatar by Iran, airlines worldwide have cancelled flights to many Middle Eastern destinations including major international hubs like Dubai and Doha. Qatar and the United Arab Emirates reopened since their airspace. Russ Mould, investment director at AJ Bell, said: "Travel stocks have moved higher both because of the implications on fuel costs as well as because the potential impact to foreign travel that could have been caused by any further escalation in Middle East tensions has seemed to be swerved." The Energy Stocks Take a Hit The oil majors were hit hard after crude prices dropped to their lowest level in two weeks. In the last seven days, oil has lost 10% of its value. In a recent note, Mukesh SAHDEV, Rystad's global head of commodities markets, stated that a de-escalation of tensions was more likely to occur than a complete blockade of Strait of Hormuz, which would have caused a spike in oil price. Assuming the ceasefire is maintained, we expect the oil price to remain near $70 per barrel until a US-Iran agreement becomes clear. European energy stocks fell 3%. BP and Shell were down around 5% each, while Equinor in Norway was down around 7%. Exxon shares were down about 1%, and Chevron's as well.
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Doha airport chaos: Thousands of passengers stuck at the airport and long queues in Dubai
The operations at the two busiest airports on the planet, Doha and Dubai, slowed down to a crawl Tuesday. Thousands of passengers faced long delays and cancellations due to the temporary closure of the airspace the day before. Qatar, Bahrain and Kuwait closed their airspace on Monday night after Iran struck a U.S. base in Doha, the capital of Qatar. This forced airlines to cancel hundreds of flights or reroute them, creating a queue of passengers stranded. Dubai airports in the United Arab Emirates temporarily halted their operations. U.S. president Donald Trump announced that a ceasefire had been reached between Israel and Iran and asked for both sides to respect it. This raised hopes of a peaceful end to the 12-day conflict, but violence continued with reports of deadly attacks in both countries. "I haven’t slept in 19 hours." "I've been standing in this queue for nine hours," said Lily Rogers (21), who was waiting in a 200 metre (656 foot) long line at Doha's Hamad International Airport. The psychology student was on her way to Southeast Asia for a holiday. She said that those waiting in line received only water. Virgin Australia estimates that more than 25,000 passengers are stranded in Doha Airport. According to a witness, the lines were so long some passengers had to jump queues. This led them into arguments. FlightRadar24, a flight tracking website, reports that around 250 flights at Hamad Airport were cancelled, and another 238 were delayed. FlightRadar24 showed that long queues also formed at Dubai International Airport, the busiest in the world. There, 145 flights had been cancelled and more than 450 were delayed. Qatar Airways announced that it is "making progress" in restoring the schedule, with possible disruptions up until June 26. Dubai Airports, as well as the Dubai Government Media Office, were not available to comment immediately. BUSY HUB Middle East airports are among the busiest on the planet. They cover an area that stretches from Iran and Iraq all the way to the Mediterranean, and serve as a hub for connecting flights between Europe and Asia. Since the beginning of the conflict between Russia and Ukraine airlines have been forced to avoid the airspace above both countries. Dubai transported over 92.3 million passengers in the last year. The average daily passenger count was more than 25,000. Airline companies from British Airways to Lufthansa have already stopped flights to Middle East destinations because of airspace closures and safety concerns following Israel's strike against Iran on 13 June. Many airlines have cut flights to Dubai and other hubs that are usually resilient, following the U.S. attack on Iran. According to independent aviation analyst Brendan Sobie, based in Asia, the restrictions and closures had ripple effects throughout the region as most passengers transit through Hamad Airport on their way to other destinations. Airport data shows that only 22% of passengers who travel through the airport in 2024 have Qatar as their destination. Air India has suspended all flights between the Indian Subcontinent and destinations such as the U.S. East Coast and Canada. Analysts say that this poses a problem for Indian carriers, as they don't have access to Pakistani skies. After a short military conflict, the two neighbours in April blocked each other's access to airspace. Air India announced on Tuesday that it would resume these flights as soon the airspaces are reopened, while other airlines such as flydubai warned of delays due to congestion in airspace. It's frustrating," said Julien Moutte. The Paris bound passenger had been stuck in Doha's terminal for 15 hours. Reporting by Luke Tyson, Amr Alfiky and Mark Bendeich from Dubai and Doha; Additional reporting by Allison Lampert from Montreal; Writing and editing by Joseph Mason and Bernadettebaum.
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Carnival increases profit target for the year on stable cruise demand
Carnival Corp. raised its annual profit estimate after beating revenue estimates for the second quarter on Tuesday, driven by resilient demand among travelers booking cruises in destinations such as the Caribbean and Mediterranean. In premarket trading, shares of the company rose 6.5%. Its cruise portfolio includes Holland America, Princess and Princess Cruises. Carnival Corp. and Royal Caribbean Group, a rival cruise operator, have expanded their portfolios of private islands themed with carnival to meet the demand from cruisers who want exclusive destinations. Carnival has committed to spending $600 million on the development of Celebration Key, a private resort destination in Grand Bahama that includes water slides, entertainment venues and dining establishments. The facility will debut in July. Packages that include drinks, Wi-Fi and excursions encourage guests to spend more money onboard. This increases revenue for cruise lines. According to data compiled and analyzed by LSEG, the cruise operator reported sales for the quarter ending May 31 of $6.33 Billion, compared with analysts' expectations of $6.21 Billion. The company forecasts adjusted earnings per share in fiscal 2025 of approximately $1.97. This compares to the previous expectation of $1.83. (Reporting from Savyata Mihsra in Bengaluru, Editing by Tasim Zaid)
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New England Electric Grid operates on precautionary alert
On Tuesday, the electric grid in Boston and its surrounding area was on precautionary alert as it was anticipated that the surplus power would narrow to a razor's edge due to the high temperatures. ISO New England, which operates the electric grid for six states, started operating on a precautionary basis late Monday, as the energy supply tightened. The wholesale electricity prices in the last 24 hours indicate a tightening of supplies. The grid reported nearly $430 per Megawatt Hour (MWh), which is a tenfold increase compared to prices when the system was not stressed. In order to prepare for the scorching heat of Tuesday, the grid instructed power plant operators to refrain from any testing or maintenance which could affect electric reliability. New England has adopted the same strategies as other grids in the east half of the United States to balance supply and demand for electricity. They also asked power plant operators to postpone maintenance and increased imports from neighboring regions. According to the National Weather Service, temperatures in Boston will reach 100 degrees Fahrenheit on Tuesday afternoon. ISO New England predicted that the electricity demand late Tuesday would reach 26,000 megawatts. This is short of August 2006's record of 28,130 megawatts. ISO New England forecasted that electricity demand would reach 24,803MW in normal weather conditions and 25,886MW during periods of weather above average, like a prolonged heat wave. According to the latest forecast, demand will peak at 25,800MW on Tuesday evening. The surplus capacity was predicted to drop to 266MW, which is a significant decrease from the typical margins of several thousand megawatts in more temperate weather.
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India aviation regulator says multiple defects reappearing on aircraft
India's aviation regulator announced on Tuesday that it found "multiple instances" of aircraft defects recurring at Mumbai and Delhi Airports, the two busiest in the country. It attributed this to inadequate checks of jetliners. The Directorate General of Civil Aviation's (DGCA) special audit was conducted to improve safety following the recent terrorist attacks. Air India crashes into deadly crash This month, 271 people were killed. The regulator did neither name the airlines or specify the types of defects that were found. Two airports serve the largest Indian airlines, such as IndiGo and Air India, as well many international carriers. The DGCA stated that the repeated occurrences of defects showed "ineffective monitoring" and "inadequate rectification actions". The government agency also found violations, such as a maintenance engineer failing to follow safety procedures prescribed by the manufacturer. The regulator found that no survey was conducted at one airport, which it did not name. This is despite the fact that new construction had taken place in the area. This issue has been brought to light after an Air India plane crashed into a doctor's office. hostel , killing dozens. The DGCA stated that the findings were communicated to operators concerned so they could take corrective actions within seven days. These shortcomings were discovered as part of "a comprehensive surveillance" conducted at night and in the early morning at major airports, including those in Delhi and Mumbai. After the crash of June 12, the regulator ordered Air India said it had carried out new checks on its Boeing 787 fleet, but that these tests revealed no major safety issues. DGCA was reported to have said, citing sources. You can cancel your order if you wish. Air India's planned visit to its headquarters in New Delhi on Tuesday to conduct an annual regulatory audit, as the airline dealt with the fallout of several Middle Eastern countries closing their airspace temporarily due to the Israel-Iran conflict. Reporting by Abhijith Ganadavaram, edited by Andrew Heavens and Mark Heinrich
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Con Edison of New York urges its customers to conserve electricity during heatwave
Con Edison, a New York-based utility, has asked its customers to conserve electricity during the current heatwave. It has also reduced voltage by 8 percent in certain parts of east Brooklyn to protect equipment while crews make repairs. AccuWeather meteorologists predicted that temperatures in New York City - the largest city in America - could reach 98.6° Fahrenheit on Tuesday. The use of air conditioning by both homes and businesses is increasing as temperatures rise, putting extra strain on the grid. In some areas, the heatwave has pushed up power prices to their highest levels since January. New England's next-day electricity prices The spot power price at the PJM West hub rose by about 17% on Tuesday to $189 per megawatt-hour The price of the cheapest car in America remained above $200 for the second consecutive day. This compares to an average price of $81 per megawatt-hour in New England this year, and $47 for calendar 2024. In PJM this year alone, the average is $56 and in calendar 2020 it's $42.
What are China's interests in Iran economically?
China, which is one of Iran's most important allies, and its biggest oil buyer, has been urging for a diplomatic resolution to the conflict between Iran and Israel.
Here are some details about its investment in Iran.
COOPERATION PACT
Beijing has long supported the U.S. sanctioned Tehran in its efforts to increase its economic and strategic clout in the Middle East. They signed a 25 year cooperation agreement in 2021. However, full details have never been disclosed, and analysts claim that the implementation of this deal has been poor.
The Chinese investment in Iran is still far behind what Beijing invests in other nations of the region.
Bill Figueroa is a China-Middle East specialist at the University of Groningen, in the Netherlands.
Chinese Commerce Ministry data show that its direct investment in Iran at the end of 2023 will total $3.9 billion.
The think-tank claims that Beijing has invested almost $15 billion between 2007-2024 in Saudi Arabia and more than $8 billion between 2013-2022 in the United Arab Emirates.
ENERGY:
China purchases roughly 13,6% of its crude oil from Iran, which accounts for 90% of Iran's exports.
According to Vortexa, around 65% of the total crude and condensate that is shipped through the Strait of Hormuz near Iran is bound for China.
China National Petroleum Corp. (CNPC), in 2016, signed a $4.8 Billion deal with France’s Total for the development of the South Pars offshore gas field in Gulf with an Iranian State firm.
CNPC's 30% stake was valued at around $600 Million. Despite this, the state-owned oil giant withdrew from the project in 2019 due to pressure by the United States.
CNPC signed a contract in 2009 for the development of the North Azadegan Oil Field, the first phase being valued at around $2 billion. In 2016, the first shipment of 2,000,000 barrels of oil was sent to China.
Sinopec, China's largest refiner, signed a deal worth $2 billion in 2007 to develop the Yadavaran Oil Field. Sinopec signed in 2017 a $2.1 billion contract to upgrade Abadan refinery near the Gulf Coast. The refinery is still under construction.
China's LDK Solar and Iran's Ghadir Investment Group have signed a 2024 agreement for a large photovoltaic plant. The investment is expected to be around 1 billion euro ($1.16 billion). The plant was to produce 2 billion kilowatt hours of solar energy annually.
RAILWAYS:
China National Machinery Industry Corporation, a subsidiary of the China National Machinery Corporation, signed a deal in 2018 worth 5.3 billion yuan (738 million dollars) to renovate and expand a railway that connects Tehran to Hamedan and Sanandaj. This will improve connectivity throughout west Iran.
A subsidiary of China Railway Construction Corporation also signed a contract in the same year for a 263 km Kermanshah to Khosravi rail project in west Iran. The construction period was 48 months.
China's Norinco International, a Chinese company, signed an agreement with the Iranian city Qazvin in 2018 for the construction of the first tramway in Qazvin. The contract was worth about $150 million.
China Eximbank and a state-owned Iranian bank signed in 2017 a $1.5billion deal to upgrade and electrify the 926 km rail between Tehran and Mashhad, as part of Beijing’s Belt and Road Initiative. The project is stalled due to financing negotiations.
Metals
China's Metallurgical Corporation invested $350 million into the Sepid Dasht Steel Plant in 2017 and won a contract to design a pelletising system. Local media, however, reported that financing issues had delayed the projects.
(source: Reuters)