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Alaska Air reaffirms its profit forecasts as travel demand increases
Alaska Air Group reinstated on Wednesday its profit forecast for the full year, citing an increase in passenger traffic. Seattle-based airline Alaska Airlines, however, predicted a lower than expected profit for the third-quarter. Alaska Airlines, like most U.S. carriers, canceled its full-year financial projections in April due to President Donald Trump's Trade War creating the greatest uncertainty for the industry ever since the COVID-19 Pandemic. Alaska Chief Financial officer Shane Tackett said that reduced macroeconomic uncertainties has led to an increase in bookings since June. West Coast technology companies in the U.S. have begun to travel more. This has led to an increase in bookings nearer to the date of travel. Tackett stated that the company is "cautiously confident" about the demand for travel continuing through the remainder of the year. Alaska expects to have a profit of more than $3.25 per share for the full year 2025. According to LSEG, analysts had estimated an average profit of $3.41 per share. The company anticipates a profit adjusted in the third quarter between $1.00 and $1.40 per share. According to LSEG, the midpoint of this forecast is $1.20 a share, compared to analysts' average estimates of $1.65. (Reporting and editing by Chris Reese, Jamie Freed, and Rajesh Kumar Singh)
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Southwest fails to meet profit expectations due to weak domestic demand.
Southwest Airlines missed Wall Street expectations for its second-quarter profits on Wednesday due to weak domestic travel demand, which has resulted in more empty seats and lower fares. In aftermarket trading, shares of the airline were down by 2%. LSEG data shows that the budget airline reported a profit adjusted per share of 42 cents, compared to analysts' average expectation of 51 cents. In April, major U.S. airlines canceled their financial predictions, citing the uncertainty caused by President Donald Trump's tariffs and spending cuts. This led consumers to reduce travel plans. Analysts and airline executives have since indicated that the travel market and demand trends are stabilizing. The domestic market is still under pressure. Cost-conscious consumers continue to be cautious as household budgets are tightening. The summer, usually the airline's peak season of profit, has been a disappointment this year. A lackluster demand for economy seats is forcing carriers to reduce fares and undermine their pricing power. Delta Air Lines (DAL) and United Airlines (UAL) have both seen significant revenue increases from their premium cabins. This is due to wealthy travelers who are willing to upgrade. Low-cost carriers, such as Southwest Airlines, who rely heavily on standard economy seating, are also under pressure to maintain profits as price-sensitive consumers remain conservative with discretionary expenditure. Southwest Airlines reported an operating revenue of $7.24 Billion in the three months ending June. This compares to $7.35 Billion a year ago.
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Railroad operator CSX exceeds profit forecasts on higher volumes
CSX announced a second-quarter profit that was above analyst estimates on Wednesday. This was due to an increase in intermodal volumes. Volumes of intermodal shipping, which includes two or more modes of transport for goods, and will account for 14% in its total revenue by 2024, increased 2% during the third quarter. CSX Chief Executive Joe Hinrichs stated on Wednesday that despite the continued uncertainty in certain industrial markets, the firm remained focused to complete two major infrastructure projects which will "strengthen [our] position to execute many profitable growth opportunities that lie ahead." In extended trading, shares of the Jacksonville-based Florida company rose by 2%. According to reports, the railroad operator has been in talks with financial advisers about exploring strategic options. This is amid speculation that BNSF Railway owned by Warren Buffett’s Berkshire Hathaway could merge with its West Coast counterpart. According to reports, Union Pacific, the larger rival, is looking at a possible acquisition of Norfolk Southern. This could create a coast-to-coast railroad network worth $200 billion and reshape U.S. Freight Industry. According to its website, CSX has a fleet that includes more than 3500 locomotives as well as 51,000 freight vehicles. Surface Transportation Board is a regulator that oversees the railroads. Any merger must be approved by this body. According to LSEG, the adjusted profit per share was 44 cents, which is higher than the average analyst estimate of 42 cents. The company's revenue for the quarter ending June 30 was $3.57 billion, which fell short of expectations of $3.58. The operating margin for the company was 35.9%, down 320 basis points compared to last year.
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US cuts minimum New York flights requirements until late 2026
Federal Aviation Administration (FAA) agreed Wednesday to extend the cuts in minimum flight requirements for congested New York City Airports until October 2026. The reason given was a significant shortage of air traffic controllers. If they don't use their slots 80% of time, under minimum flight requirements airlines may lose them. The FAA waiver allows airlines 10% fewer flights. The FAA issued several waivers in the past to address staffing problems at JFK Airport and LaGuardia. The FAA has said that it will not be issuing any more broad slots waivers, as it continues to work on a long-term solution for the "chronic low level of air traffic controllers fully certified" who oversee New York traffic. Airlines for America is a trade association that represents American Airlines, United Airlines Delta Air Lines Southwest Airlines. In April, they asked for a further extension until October 2027, and to also cover flights in Newark. The FAA issued an order in May. Newark Airport, the main airport serving New York City, has experienced flight disruptions Following a series major disruptions. According to the airlines, 75% of the delays that occur in the National Airspace System are caused by delays in NYC Airspace. The group stated that "delays and cancellations within the NYC Airspace have a ripple effect throughout the NAS, so it's important to maintain the health of this part of system." The FAA has also extended flexibility to affected flights between Ronald Reagan Washington National Airport (Ronald Reagan Washington National Airport) and New York Airports. In recent years, a number of near miss incidents have raised concerns about the FAA's staffing levels. Congress has approved $12.5 billion to increase hiring and revamp the system. The report states that a persistent shortage of flight controllers has caused delays. In addition, many controllers work six-day weekends and mandatory overtime at their facilities. Report Last month, the FAA found that its In 2024, the air traffic workforce will have logged 2.2 millions hours of overtime at a cost of $200 million. (Reporting and editing by Chris Reese, Diane Craft and David Shepardson)
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Ceyhan oil loadings resumed after suspension of Russian Black Sea oil exports
Azeri BTC crude oil loadings resumed from Ceyhan on Wednesday, after several days of delays caused by an increased check for chloride contamination. Meanwhile, Russian Black Sea oil loadings have been suspended. Two industry sources said that the two major Russian terminals, Novorissiisk in Russia and Yuzhnaya Ozereevka in Yuzhnaya Ozereevka, were suspended due to paperwork relating to new regulations regarding tankers' access into ports. The suspension will increase the uncertainty on the Mediterranean oil market, which is already jittery after a contamination scare led to the recent delay in loadings of Azeri BTC Crude Oil from the Turkish Port of Ceyhan. PLATTS WINDOW On Wednesday, there were no bids or offers made on Urals, Azeri BTC Blend or CPC blend in the Platts Window. * BP, operator of the Baku, Tbilisi, Ceyhan (BTC), has been informed of a possible quality issue related organic chlorides found in some of its blended loadings. BP is assessing crude oil quality at all facilities along this pipeline. Oil prices fell on Wednesday for the fourth session in a row as investors evaluated a U.S. trade deal with Japan, ahead of the scheduled talks between EU officials and U.S. representatives later that day. Mark Porter (Reporting)
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US Senators introduce bill to shorten airport security lines
Bipartisan senators from the United States proposed on Wednesday new baggage screening systems at airports and technological updates at checkpoints in order to improve security while reducing wait times. Air travel is reaching record levels. Senator Jerry Moran (Republican), chair of the subcommittee for aviation, and Democratic Senators Chris Van Hollen, Michael Bennet, and Republican John Boozman proposed spending $500,000,000 annually on explosive detection devices for checked luggage and $250,000,000 annually on technology improvements at airport security checks. The money will come from the existing fees that passengers pay -- $5.60 for each one-way ticket. The fees raised $4.5billion last year. Senators claimed that since 2014, more than 13 billion dollars in revenue generated by the fees have been diverted for non-security purposes. The air travel industry has seen a boom in the summer of 2024, and it is expected that this will lead to a new record this year. Moran stated that "increased air travel combined with a lack of investment in checkpoints for security and outdated systems has resulted into outdated screening technology and long security lines." Airlines for America, a group of airlines including American Airlines, Delta Air Lines and United Airlines, praised the bill for being "common sense legislation that returns fees travelers pay for security back to their intended purpose, improving security and facilitation for travellers." Transportation Security Administration and the Transportation Security Administration share the same goal to reduce delays. This month, the government announced that it would no longer require Passengers are required to remove their footwear at security checkpoints. Kristi Noem, Homeland Security Secretary, has also suggested that passengers could be allowed to carry more liquids through the security checkpoints. (Reporting and editing by Franklin Paul, Cynthia Osterman, and David Shepardson)
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Chinese engines shipped as "cooling units" power Russian drones in Ukraine
According to documents and three European security officials, Chinese engines are being shipped covertly via front companies, to a Russian state-owned drone maker, labeled as "industrial refrigeration units", to avoid detection following the Western sanctions. Despite the U.S. & E.U. sanctions, the shipments allowed Russian weapons maker IEMZ Kupol increase production of its Garpiya A1 attack drone. According to sources and documents including contracts, invoices, and customs paperwork, sanctions were imposed on October to disrupt the supply chain. A document reviewed by showed that Kupol had signed a contract for the production of more than 6,000 Garpiya in this year. This is up from 2,000 Garpiya in 2024. Document stated that over 1,500 drones were already delivered in April. In a recent statement, the Ukrainian Military Intelligence Agency said that Russia uses around 500 long-range drones per month to target civilian and military targets in Ukraine. Due to the sensitive nature of the information, the European security officials requested that they and their organization not be identified. The European security officials also asked that certain details of the documents, like dates and costs of contracts, be kept secret. The European Union and U.S. sanctioned a number of companies that were involved in the production of the drones including Xiamen. According to invoices, a Kupol letter and documents on transportation, a Chinese company called Beijing Xichao International Technology and Trade began supplying L550E engines for Kupol in the wake of sanctions. First time, Garpiya has reported the increase in production and the addition of new intermediaries who supply parts for drones. The news agency was unable to determine how Xichao acquired the engines from Xiamen Limbach. Xiamen Limbach didn't respond to a comment request and couldn't reach Xichao. IEMZ Kupol and Russia's Trade and Industry Ministry did not reply to a comment request. China's Foreign Ministry said in a statement that it had no knowledge of the exports of parts for Garpiya, and has regulated the sales of dual-use products abroad to comply with China's laws and international obligations. The statement read: "China has always opposed unilateral sanction that are not based on international law or authorized by the U.N. Security Council." The European Commission didn't immediately respond to an inquiry for a comment. The U.S. as well as the E.U. The U.S. and E.U. have both imposed sanctions repeatedly on companies from third-party countries including China that are alleged to be providing dual-use technologies to Russia. Kupol is sanctioned by the EU since December 2022 and by the U.S. since December 2023 for its involvement in Russia’s defence sector. DIPLOMATIC AWARNINGS Ursula von der Leyen, President of the European Commission, is scheduled to visit China on Thursday for a meeting with Chinese President Xi Jinping. Premier Li Qiang will also attend. The trip comes amid tensions surrounding Beijing's support to Russia's military effort. Kaja Kallas, top EU diplomat, told Chinese Foreign Minister Wang Yi that Chinese companies' support of Russia in the war was a threat to European Security. She urged China to stop trade that supports Russia's military apparatus. Meia Nouwens said that China's primary concern is to sustain Russia's military effort in order to keep the United States focused on Ukraine. She said, "This doesn't help China and Europe to come closer together diplomatically." China claims it controls the export of drones, their parts and that they have never supplied either side in the Ukraine war with lethal weapons. According to a person who is familiar with Beijing's views on the matter, China produces about 75% of the world's drones. The majority of them are not used for military purposes. If Russia uses them as weapons then Ukraine also does, said the person. One European official stated that the EU did not ask China to cut its economic ties to Russia, but rather to tighten the financial and customs controls in order to reduce the flow specific dual-use products. Three European sources confirmed that the Garpiya (which means harpy) is based on Iranian Shahed drones, but uses Chinese technology. According to the Ukrainian military intelligence agency, the Chinese components included the drone's engine, navigation system, and control systems. According to a document seen by Kupol, the engines were sent by Xichao by a Russian front firm called SMP-138. This company then passed them on to a second Russian company LIBSS. Abram Goldman registered as the owner SMP-138 did not reply to an email request for comments. LIBSS did not answer any of the questions either. The contract that LIBSS signed to supply Kupol the engines was reviewed by us. It stated that they would be referred to as cooling units on shipping documents due their high sensitivity. Kupol's manufacturing facility in Izhevsk is located near the delivery route from Beijing to Moscow. Three security officials stated that by describing the products as cooling units, they were able to export them to Russia without alerting Chinese Authorities. Transport documents examined by revealed that Sichuan Airlines, China Southern Airlines, China’s largest airline, and other Chinese carriers had been transporting drone components to sanctioned Russian firms since October. China Southern has not responded to questions, and Sichuan was not available for comment. (Additional reporting from John Irish in Paris; Andrew Gray in Brussels; Tom Balmforth, in Kyiv; Qiaoyi LI, in Beijing. Editing by Daniel Flynn.
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Sources say that Clearlake, a private equity firm, has bid on Forward Air.
Three sources with knowledge of the situation said that a handful of private equity companies, including Clearlake Capital and Platinum Equity, had submitted bids for the purchase Forward Air. The process to sell this U.S. trucker is gaining speed. Forward Air, a company that specializes in moving shipments which don't take up an entire truckload, has signaled investors that it wants to wrap up the strategic alternatives review announced in January in a matter of weeks. This could be around the time when the company expects to announce its earnings on August 11th. According to sources, Apollo Global Management and AIP are also bidding for Forward Air. The sources claimed that it was not immediately possible to determine what bidders offered to pay. AIP and Forward Air representatives declined to comment. Clearlake, Apollo Platinum and EQT have not responded to our requests for comment. Sources spoke under the condition of anonymity in order to discuss private talks. They cautioned that no deal was guaranteed, and other bidders may still appear. Reports in June indicated that Apollo and Blackstone as well as Platinum and Clearlake had expressed an interest in bidding on the company. They signed confidentiality agreements to review documents which would inform their decision. Forward Air, based in Greeneville, Tennessee, has seen its share price plummet by 75% since it announced two years ago that it would be acquiring Omni Logistics. The deal was completed at the beginning of 2024. It has increased by 27% in the last month due to expectations that the company would eventually be sold. On Wednesday, it traded at $28.14. Analysts estimate that the enterprise value of the company, when fully diluted, includes net debt and other factors, is closer to 3 billion dollars. In frustration over the acquisition's unpopularity, several investors began to push for the sale of the firm last year, which was announced officially in January. Ancora Holdings (which owns 4%) pushed for the removal of 3 long-serving Directors in May, blaming them for signing the Omni deal, and for stalling sales. They resigned shortly after the annual meeting of the company.
Sources say that the US EPA will withdraw its foundation rules for greenhouse gas regulations
Two sources with knowledge of the discussions said that the U.S. Environmental Protection Agency (EPA) plans to reverse the scientific determination that greenhouse gases endanger the public's health. This will remove the legal basis that supports all major climate regulations.
The reversal of "endangerment findings" would undermine one of the most important federal standards, which had allowed the U.S. combat climate change through regulation of vehicles, industries and energy-producing plants that emit heat trapping greenhouse gases. The sources claimed that without the finding, it would be easier for the EPA to undo major regulations limiting emissions of greenhouse gases. A spokesperson for the EPA said that the agency had sent its proposal to reconsider the endangerment findings to the White House Office of Management and Budget on June 30, and other federal agencies are currently reviewing it.
In an email, an EPA spokesperson stated that the proposal would be made public for public comment and notice once it had been approved by all agencies and signed by Administrator.
The Washington Post was the first to report on this decision.
The International Court of Justice issued a statement on Wednesday.
A landmark advisory opinion
The world faces a "real existential threat" from greenhouse gas emissions, and all countries must work together to reduce them.
Sources said that the proposal would be based on EPA's legal authority, and not its scientific basis, to regulate greenhouse gas emission. Lawyers said it would be hard to challenge the scientific basis for the findings because the evidence is "unambiguous" that humans cause climate change.
It would be an unjustifiable denial of overwhelming scientific evidence and a shocking breach of a clear duty under the law to protect the public. "It would be a national disgrace," said Sean Donahue. He is a lawyer at Donahue Goldberg & Herzog who has represented environmental organizations in cases before Supreme Court.
The United States is currently the second largest emitter of greenhouse gases after China. The United States is the second largest emitter of greenhouse gases after China.
In its landmark Massachusetts vs. EPA decision in 2007, the U.S. Supreme Court said that the EPA had authority under the Clean Air Act, to regulate greenhouse gases emissions. The court also required the agency make a scientific determination on whether these emissions endanger the public's health.
In 2009, under the former president Barack Obama, the EPA issued a conclusion that emissions from motor vehicles contributed to pollution and endangered public health and welfare. The EPA's findings were upheld by several legal challenges, and they influenced subsequent greenhouse gas regulations.
During the first term of President Donald Trump, the EPA did not take any action regarding its endangerment findings because industry expressed concerns. Trump's current administration has been focusing on the endangerment conclusion since its inception.
In January, EPA administrator Lee Zeldin said at his confirmation hearing that the agency has
Authority but not obligation
to regulate greenhouse gas emissions. In March, the EPA began a review, following a Trump executive order.
Ross Vought, White House Budget Director, said that the review had been "long overdue," because it led to regulations he claimed were harmful to the economy.
Zeldin announced more than two dozen de-regulatory measures aimed at "
Driving a dagger into the heart
"The climate change religion." Reporting by Valerie Volcovici, Editing by Chizu nomiyama and David Gregorio
(source: Reuters)