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Republican state AGs express concerns over Union Pacific's deal with Norfolk Southern
Nine Republican attorneys general raised concerns on Friday about Union Pacific's plans to purchase smaller rival Norfolk Southern for $85 billion, creating the first U.S. Coast-to-Coast freight rail operator. In a letter sent to the Surface Transportation Board by Tennessee Attorney-General Jonathan Skrmetti, and Kansas Attorney-General Kris Kobach that was seen by, the officials expressed concern about the deal, which they said would result in "undue market consolidation" and "stifle competition, resulting in higher prices, less reliability and less innovation, at the expense America's producers and consumers." If approved, the tie-up could help streamline operations, eliminate delays at key hubs such as Chicago, and help reduce congestion. Attorneys general from Ohio, Florida and other states, including North Dakota, South Dakota Mississippi, Montana, and Iowa, said that the merger could lead to high shipping costs, which could "kneecap American manufacturers' ability compete with foreign companies." The group also stated that "the downstream impact of the merger poses a significant risk, not only for our industrial base, but also for our agricultural producers." This merger, in the end, could compromise our national safety. Union Pacific responded on Friday by saying that it is looking forward to submitting their application to the STB to "detail how this combination will be good for America, meet the threshold to advance public interest and increase competition." The railroad said it has won the support of key unions as well as others in order to "ensure that rail is not forgotten." Norfolk Southern has not yet commented. The railroads announced earlier on Friday that over 99% of both companies' shareholders voted for the merger. The STB could take between 12 and 18 months to review the deal. Railroads have been struggling with volatile freight volumes and rising fuel and labor costs. Shippers are also increasing their pressure on service reliability. After meeting with Union Pacific CEO Jim Vena in September to discuss the largest U.S. railroad merger for decades, Donald Trump stated that the merger "sounds great to me". Union Pacific is the dominant freight rail carrier in Western United States. Norfolk Southern, on the other hand, is the leading carrier in Eastern United States. Together, the two railroads form one of four major U.S. class I railroads along with BNSF Railway, CSX Corp and BNSF Railway.
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Airlines urge FAA to stop flight cuts because controllers are paid
After the government shutdown ended, major U.S. Airlines are asking the Federal Aviation Administration (FAA) to remove the mandatory 6% domestic flight reductions at 40 major airports. The cuts were imposed in order to address safety concerns regarding air traffic. The FAA's order, which requires far more drastic cuts, is not being followed by most airlines. Cirium, a firm that provides aviation analytics, reported airlines cancelled just 2% of flights on Friday, down from 3.5% Wednesday and Thursday. The FAA and union officials announced that air traffic controllers, and other FAA staff, began receiving their back pay on Friday. This is equal to approximately 70% of the amount they owe, excluding overtime. Officials told that airlines have privately argued to the FAA to stop the cuts, and some plan to cancel few or no flights this Saturday. After Congress voted for reopening the government following a 43-day shut down, FAA decided to reduce those cancellations on Wednesday. The FAA did not increase the cuts to 8% or 10% as announced previously. Instead, they remained at 6%. Transportation Secretary Sean Duffy stated Friday that only a handful of controllers had been absent on Thursday, as operations have improved dramatically. Duffy stated, "We are reviewing the data and working hard to restore the airspace to normal." Separately, on Friday, a group led by Rick Larsen (the ranking member of Transportation and Infrastructure Committee) asked the administration to provide specific safety data and compare it to the previous six months. The Democrats said that it appeared the administration took this decision without consulting key aviation stakeholders. United Airlines announced that it had cancelled 134 flights for the Friday after canceling 222 flights Thursday. There are about 3,500 fewer air traffic controllers than the FAA needs to meet its target staffing levels. Before the shutdown, many had already been working six-day weekends and mandatory overtime. Since October 1, when the 43 day shutdown began, there have been tens or thousands of cancellations and delays in air traffic. (Reporting and editing by David Shepardson, William Maclean.)
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Lukoil Moldova grants free fuel use to the government in spite of US sanctions
The Moldovan energy minister announced on Friday that Lukoil Moldova has agreed to give the government of Moldova free access to its fuel terminal located at the airport in Chisinau. Energy Minister Dorin Junietu stated in a press release that the move was made to ensure stable airport operations when U.S. Sanctions against the Russian owned company come into effect later this month. The U.S. sanctions against Lukoil and Rosneft were linked to the Russian war in Ukraine. The company is the only supplier of fuel to Eugen Doga Airport, Moldova's sole airport. Moldova's pro European authorities announced this week that they have proposed to buy the airport infrastructure of the firm, including storage facilities, in order to guarantee aviation fuel supplies in the country located between Ukraine and Romania. Junghietu said on Friday that the government had reached an agreement to supply fuel at the airport with a Romanian firm in the near future.
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CMA CGM warns of a tough year as the shipping industry faces overcapacity and falling demand
French group CMA CGM warned on Friday that the container shipping industry faces a difficult year, as new vessels increase capacity, while demand is slowing. Early orders for 2025 are being driven by trade tensions. CMA CGM reported core EBITDA of $2.96bn for the third quarter, which is the same as the previous quarter but down 40.5% from a year ago. This was down by 40.5% compared to a year ago, but an increase from the prior quarter as volumes recovered after a stoppage in April of China-U.S. Trade due to a tariff dispute. Ramon Fernandez said that the group, which is controlled by the Saade Family, expects its fourth-quarter results will be below those of the third quarter due to the falling freight rates. This could lead to a difficult shipping environment in 2026, Ramon Fernandez added. He said: "We anticipate that freight rates will continue to normalise as there is less demand, and capacity increases due to new vessels being delivered. There may also be a reopening the Suez route in 2026." Maersk and other rivals have warned about the pressure of falling freight rates. The disruption to shipping in the Red Sea and Suez Canal due to attacks by Houthi Rebels in Yemen has reduced capacity. Ships are now taking a longer journey around southern Africa. The Houthis' claim that they targeted vessels because of a ceasefire in Gaza, a war which the Houthis blamed on the Houthis, has raised hopes for resuming normal traffic. Fernandez stated that CMA CGM will continue to maintain limited transits through Suez as long as security permits. The tensions between Washington, DC and Beijing have also affected the industry. Both sides announced that they would charge port fees for vessels that had ties to the other nation. CMA CGM reorganised their fleet to avoid these fees. Fernandez stated that the company has no plans to change its fleet after the port charges were suspended for one year. Fernandez said that the company had contributed to the rising supply of ships and, based on the current orders, will surpass Maersk by the end 2027 as the second largest container line in the world based upon capacity. CMA CGM, along with the Saade Family, have pursued diversification in logistics, port terminals, and non-transport related activities. This includes the acquisition of Carrefour, Europe's biggest food retailer.
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Sources say that Italy's Snam is set to cancel German gas deal due to Berlin's concerns over China
Sources say that Italian gas grid operator Snam will abandon its plans to acquire a minority stake of Germany's largest independent transmission company, despite the German Economy Ministry's opposition. Two sources with knowledge of the situation said that Berlin's concern over the 920 million-euro ($1.1billion) deal stems from China's State Grid being an indirect shareholder in Snam. Germany's Economy Ministry, which is in charge of foreign direct investment clearances, has been reviewing this deal since it was agreed on in April. The German government's reluctance to sign the deal reflects a more aggressive stance taken by European governments against Chinese investments in Europe because of security concerns. The German Economy Ministry declined to comment. Snam did not respond to a request for comment. State Grid holds 35% of CDP Reti - an investment vehicle controlled and managed by Italian state lender CDP - which, in turn, owns 31.4% Snam. This gives the Chinese state owned group the right of appointment a representative to the board of Italian gas grid operator. The Italian group has agreed to buy Open Grid Europe for 24.99% in April, with the aim of entering the largest gas market in Europe, Germany. Germany has extended its review of the transaction and asked for additional documentation from the Italian Group. Luca Passa, Snam's Chief Finance Officer, said this month that the company hoped for a German decision by November 17th when the extended deadline for finalising the acquisition expires. Agostino Scrnajenchi, CEO of the Group, had previously indicated that the group would not pursue acquisitions "come hell and high water" during the lengthy approval process. Germany has blocked China's State Grid from buying a stake in the power grid operator 50Hertz.
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US Postal Service reports a $9 billion annual loss and seeks reforms
The U.S. The U.S. David Steiner, the new Postmaster General of USPS, said that USPS needs to be more efficient. It still has "a significant systemic annual cost and revenue imbalance." He said: "To correct financial imbalances we must explore revenue opportunities and make public policy changes in order to improve our business models." USPS has lost over $100 billion since 2007, despite major restructuring and legislative reforms. In 2022, the U.S. Congress provided financial relief to the Postal Service of about $50 billion over a ten-year period. USPS wants reforms, including changes in the rules for funding retiree pension benefits, diversification of pension assets and raising the debt ceiling. It also wants reforms to workers' compensation administration. In February, Republican president Donald Trump called USPS "a tremendous loser for this nation" and said that he was looking into merging the Postal Service and the U.S. Commerce Department. Democrats argued that such a merger would be in violation of federal law. Louis DeJoy resigned as USPS's previous chief in March under White House pressure. He was just one of the many officials who were forced out by Trump. DeJoy was responsible for the drastic restructuring of the USPS, which has been losing money since the 1960s. He reduced the forecasted cumulative losses from $160 billion to $80 billion over the next decade even though mail volumes dropped to their lowest level since 1968. USPS decided not to increase the price of first class mail stamps in January. The price rose to 78 cents in early this year from 73 cents. Stamp prices have increased by 46% from 50 cents in early 2019. USPS, a 635,000-strong agency, has reduced its workforce this year by 10,000 employees through a voluntary program.
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The EU wheat market is subdued as it awaits U.S. statistics, and shrugs off Russian port attacks
The European wheat futures market was steady on Friday, as traders focused their attention on delayed U.S. grains data. They also saw that the attack on a Russian port had no impact on grain flow. Euronext's December wheat futures fell 0.1% to 189.25 euro ($220.70), while March futures also dropped 0.1%, at 193.50 euro. The grain markets were waiting for the U.S. government's data, due on Friday after the end of the federal shutdown. The U.S. Department of Agriculture is set to publish its first report on supply and demand since September. It will also release a backlog of daily announcements of export sales. Participants are also shifting their positions to March as a result of the expiry on Monday of options on Euronext December Futures. The wheat markets received some support in the morning session after news broke that a Ukrainian Drone attack had caused damage to the Russian Black Sea Port of Novorossiysk. Some debris fell on a grain storage terminal. While the attack resulted in the suspension of oil deliveries, which supported a rise in oil prices. Grain traders did not see any signs that the large wheat trade out of the port had been disrupted. The grain infrastructure in Novorossiysk appears to be functioning, and the loadings continue. This was the statement of a German grain trader. Wheat prices were held back by the ample global supply. This is expected to be further bolstered as a result of bumper harvests in Argentina, Australia and other countries. The Buenos Aires Grain Exchange announced on Thursday that Argentina's 2025/26 wheat harvest is expected to be a record 24,000,000 metric tons. This comes a day after Rosario Grain Exchange in Argentina also predicted a record crop. FranceAgriMer, the farm office, said that 98% of France's soft wheat had been rated in excellent or good condition by Monday. Farmers were wrapping up their sowing. The German wheat exports have been modest. Only one large shipment of around 50,000 tons has been loaded for Nigeria in November. The November barley exports from Germany were however brisk. 65,000 tons of barley was loaded for Saudi Arabia and 30,000 for Algeria, while two shipments totaling 80,000 tons went to Turkey. Reporting by Gus Trompiz and Michael Hogan, both in Hamburg. Editing by Susan Fenton.
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Iberia plans to increase Brazil capacity by 25% in 2026 with the help of Airbus jets
Iberia, the Spanish airline, aims to expand in Brazil substantially for the second consecutive year in 2026. New Airbus jets will help IAG open more routes. Juan Cierco, the company's Corporate Director, said in an exclusive interview that it expects a 25% increase in the number of seats on its flights from Brazil to Spain. This follows a 27% growth this year. Iberia has launched routes that connect Madrid with Fortaleza and Recife - two popular beach resorts in the northeast of Brazil. In addition to the two daily flights it already operates to Sao Paulo, the carrier plans to expand its service in Rio de Janeiro to daily flights. Cierco stated on Tuesday that "Brazil is a destination Iberia has always considered very important." "The commitment to Brazil is very strong and long-term." Air France-KLM, TAP and other major European airlines have expanded in Brazil, despite the high ticket prices and operating costs. According to the industry group IATA this year, Brazil's international travel increased 18% from January-September compared to last year. Iberia will be largely driven by its long-range, narrowbody Airbus A321XLR planes. The Spanish carrier was one of the first customers for the aircraft last year. The A321XLR is able to serve routes that were previously only available to larger widebody aircraft, which allows airlines to fly long routes without needing to fill up a bigger plane. Iberia said that it would fly the plane both on the Fortaleza route and the Recife route. (Reporting and editing by Brad Haynes, Richard Chang, and Gabriel Araujo)
White House claims that Alibaba is assisting Chinese military to target US, reports FT
Financial Times reported on Friday that Washington accused the online marketplace Alibaba of providing technology support to Chinese military operations targeting targets in the United States. The memo was cited by the White House.
The FT reported that the national security memo contains declassified top-secret intelligence about how the Chinese group provides the People's Liberation Army (PLA) with capabilities the White House believes could threaten U.S. Security.
The report didn't specify what capabilities or operations are involved or if the U.S. is trying to respond.
Alibaba shares in the U.S. fell 4.2% following the news.
Alibaba issued a statement saying that "the assertions and innuendos contained in the article were completely false."
"We doubt the motivation behind this anonymous leak which The FT admits they can't verify. This malicious PR campaign clearly came from an rogue voice that was looking to undermine President Trump’s recent trade agreement with China.
The Chinese Embassy in Washington has not responded to an immediate request for comment. (Reporting and editing by Susan Heavey, Matthew Lewis, and Jasper Ward from Washington)
(source: Reuters)