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Shipping data shows that Saudi Red Sea oil exports will reach a record high in March.
Shipping data revealed on Tuesday that Saudi Arabia's oil exports via the Red Sea are on track to reach record highs in March, despite the fact they remain far below levels required to compensate for the decline in the Strait of Hormuz. The Kingdom relies on Yanbu, a port located at the Red Sea to boost its exports and avoid steep production cuts. This is because?its neighbours Iraq Kuwait and United Arab Emirates already have reduced their output due to the U.S./Israeli war against?Iran. LSEG data shows that Yanbu loadings in the first nine of March averaged 2.2 millions bpd, up from 1.2 million bpd and nearly 2?million bpd during last week. Saudi Arabia exported approximately 6 million bpd via the Strait of Hormuz, before the war closed the narrow passageway in late February. Aramco announced on Tuesday, during its results call, that it can transport up to 7,000,000 bpd into the Red Sea. Of this amount, 5,000,000 bpd is available for exports while the remaining feeds domestic refineries along the western coast. Energy Aspects estimates that the kingdom has reduced production to 9.8 million bpd from 10.9 millions bpd, in February when it boosted exports over its OPEC quota to prepare for possible supply interruptions. LSEG data shows that a total of 37 tankers will be expected to load at Yanbu during March, 11 of which have already left. According to the 'Kpler shipping data', at least 40 tankers could load in March and push exports over 4 million bpd. Traders said the port can handle?more 4.5 million bpd. However, it has never?loaded more that 2.5 million bpd. Security risks also exist along the Red Sea route, including from Yemeni Houthi forces. Their attacks disrupted shipping during Israel-Gaza's conflict. The West's Navy Information Center JMIC stated on Sunday that no attacks have been reported in the Red Sea since the Iran War began. However, threats remain.
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What are the challenges of securing shipping in the Strait of Hormuz?
Dan Caine, Chairman of the Joint Chiefs of Staff of the United States, said that the Pentagon was looking into ways to safely escort vessels through the Strait of Hormuz. Iran, located on the northern coast of the country, has effectively closed this strait. According to United Nations data, traffic through the strait is down 97% since February 28 when the U.S. and Israel war against Iran started. The U.S. aims to calm the oil markets, as they are concerned that a prolonged war could cause a global crisis of energy. What is at stake? The Strait of Hormuz is a "narrow" passage of water that connects the Gulf of Oman with Iran. It's the only sea route for countries like Kuwait, Iran, Iraq and Qatar, which produce oil and gas. On Monday, oil prices briefly rose to their highest levels since 2022. According to the United Nations, high oil prices may trigger a new cost of living crisis similar to what happened in 2022 after Russia invaded Ukraine. A prolonged conflict may also lead to a fertilizer shortage, putting the global food supply at risk. According to Kpler, about 33% of all fertilisers in the world, including ammonia and sulphur, travel through the Strait. A prolonged war could cause fears of an economic crisis in the world similar to the ones that followed the Middle East oil shocks in the 1970s. What has Iran threatened? The Iranian Revolutionary Guards warned that ships passing through the Strait would be shot at. Since the conflict began, at least 11 ships were attacked. Most of the traffic is halted. This is partly due to caution, but also because insurance premiums have been raised by up to 300%. What have the US and other countries promised? On March 3, President Donald Trump announced that the U.S. will provide protection for oil tankers through the Strait of Hormuz. He said that he also ordered the United States Development Finance Corporation (USDFC) to provide insurance and guarantee for shipping companies. Emmanuel Macron, the French president, said that several European countries as well as India and other Asian nations were planning a mission to provide security. He said that such a mission could only be carried out once the conflict is over. France has deployed about a dozen navy vessels, including an aircraft carrier strike group to the Red Sea, the Eastern Mediterranean and possibly the Strait of Hormuz. A spokesperson for the British Prime Minister Keir starmer said that he had spoken to the German and Italian leaders on options of providing support?for commercial shipping within the Strait. General Caine, speaking to reporters at the Pentagon Tuesday without giving any details, said: "We are looking at various options." Why is it so difficult to secure the HORMUZ? It is difficult to defend the Strait of Hormuz. According to shipping broker SSY Global, the shipping lanes are only two nautical miles wide. Ships must turn around and face Iranian islands as well as a mountainous coastline that offers cover for Iranian forces. IS IT POSSIBLE TO PROTECT SHIPS TRAVELING THROUGH HORMUD? Tom Sharpe (a retired Royal Navy Commander) said that although Iran's conventional naval force has been largely destroyed, the Islamic Revolutionary Guard Corps has plenty of weapons to do damage. These include fast attack craft, uncrewed surfaces vessels, speedboats mini submarines mines and even explosive-packed jet skis. According to the Centre for Information Resilience (a non-profit group of researchers), Tehran is able to produce 10,000 drones per month. Sharpe stated that it would be possible to air-cover three or four vessels a day in the short term using seven or eight destroyers. However, doing this for several months would require additional resources. Adel?Bakawan is the Director of the European Institute for Middle East & North African Studies. Kevin Rowlands is the Editor of RUSI's Journal, at the Royal United Services Institute. He said that "the world needs oil flowing through the Gulf and so there are plans in place to put protective measures in place." What happened in other shipping chokepoints in the region? Yemen's Houthis - a group allied to Tehran - but with a much smaller arsenal than Iran - managed to close down the majority of traffic through the Red Sea, Bab al-Mandab Strait, and on the way to the Suez Canal, for over two years despite the protection provided by U.S.-led forces and European Union-led troops. The majority of?shipping firms still use a much longer route via southern Africa. Danish shipping company Maersk announced that it would return to the Suez route in phases starting January. The EU-led force that countered piracy off the coast of Somalia has had more success than Iran's Revolutionary Guards, despite being a far inferior force. AREN'T THERE OTHER WAYS TO USE THE STRAIT? The UAE and Saudi Arabia are looking for ways to bypass this strait. They have built more oil pipelines. These alternatives are also not operational at the moment. An attack by Houthi militants on a Saudi east-west pipeline in 2019 proved that they were vulnerable. (Additional reporting from Renee Maltezou, Kate Holton and Charlie Devereux. Editing by Timothy Heritage.)
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IndiGo CEO Elbers exit brings India's airline industry into focus
IndiGo, an Indian budget airline, announced on Tuesday that Pieter Elbers would step down from his position as CEO. This comes months after regulatory scrutiny was raised over a series of'mass cancellations' which left tens and thousands stranded. Here's an overview of India's airlines as Elbers' tenure at IndiGo comes to a close. INDIGO IndiGo, India's largest airline with a 64% market share and a fleet of 440 aircraft as of the end of December, is India's most popular airline. The airline operates over 2,200 flights daily, connecting 95 domestic destinations and more than 40 international ones. IndiGo's international network expanded under Elbers, with the launch of long-haul European flights using aircraft leased from Norway's Norse Atlantic. IndiGo placed its first ever long-haul, wide-body jet order of 500 Airbus A320 aircraft under Elbers. AIR INDIA Air India Group has a combined fleet size of 290 aircraft. This includes 104 aircraft at the 'budget carrier Air India Express. Air India is owned by India's Tata Group, and Singapore Airlines. It operates non-stop flights between 42 international destinations across five continents. AKASA AIR A relatively recent entrant into the?sector Akasa has a market-share of almost 5%. This makes it India's 3rd largest airline. Its fleet consists of 35 aircraft. It also connects Indian cities with?locations throughout the Middle East including Jeddah and Riyadh as well as Doha, Abu Dhabi and Phuket in Thailand. SPICEJET SpiceJet, a budget carrier,?held a?market share of about 4% as of the end of December with a fleet of 33 operational aircraft. The airline mainly operates domestic flights with some international destinations like Dubai and Fujairah. (Reporting by Nandan Mandayam in Bengaluru)
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Russian oil prices rise, but tanker costs reduce gains
The war in Iran has pushed up the price of Urals oil from Russia, which was shunned due to sanctions imposed on Ukraine. However, costs are also increasing, traders reported Tuesday. After Iranian threats against Gulf shipping effectively stopped tankers from Saudi Arabia, the second largest seller in the world, Russia, was brought to attention. Urals crude On Monday, barrels from Russian ports were being sold at $76 on a FOB basis. Data showed that the price of a barrel in Russian ports was around $76 on Monday, free-on-board (FOB). Calculations show that the price of an Urals cargo?loading out of the Baltic Sea Port of Primorsk jumped from $35 million to $54 million last week. Russian exporters faced negative margins in the early part of this year on their?exports, traders reported. The price of Urals crude oil for delivery to Indian port is now higher than Brent crude benchmark for the first ever time, despite efforts by the G7 and others to limit Russian seaborne prices. The United States granted Indian refiners last week a temporary waiver allowing them to resume the import of Russian crude oil already on tankers. Traders said that Russian sellers face a sharply higher cost. The traders said that several vessels had been fixed at $22-23million?from Russia to India's Baltic Sea port due to a shortage of vessels. This is nearly double the rates of early February, and an increase of $5-8 million since late last week. The cost of shipping to India from the Black Sea port of Novorossiysk in Russia, which resumed its loadings after recent drone damage, has also risen above $20 million, traders reported. Brent oil rose to $119 per barrel on Monday, its highest level since mid-2022. This was due to supply cuts by Saudi Arabia and other Gulf producers. Prices fell after U.S. president Donald Trump said the Middle East war could be over soon. (Reporting and editing by Guy Faulconbridge, Jason Neely).
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Stellantis Jeep taps Toyota's Bosch-backed firm for hybrid and extended range technologies
CNBC reported on Tuesday that Jeep maker Stellantis is using automotive suppliers Blue Nexus and Bosch to develop its 'new hybrid SUVs. The report said that Stellantis uses Blue Nexus technology in its extended-range electric vehicles and Bosch technology in its newly launched Jeep Cherokee. Stellantis spokesperson told Blue Nexus that they were a supplier to Jeep Cherokee, Bosch and the upcoming Grand Wagaoneer EREV Jeep SUV. They did not provide any further information. Stellantis has launched the Grand Wagoneer EREV and Jeep's Cherokee EREV in North America this year, as it seeks to gain market share in its historically most profitable market. Stellantis announced 22.2 billion euro ($25.8billion) in charges last month as it scaled back on its EV ambitions. Antonio Filosa will present the new business plan of the group on May 21. In December, Filosa said that the automaker would focus on hybrid production on the U.S.'market,' a shift from Carlos 'Tavares,' who focused on fully-electric models.
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Fuel costs are increasing, so airlines are reducing their prices and cutting back on their outlook.
The global aviation industry has been thrown into chaos by a surge in jet fuel prices caused by the U.S./Israeli war against Iran. Airlines have raised fares and revised their financial forecasts. In recent days, jet?fuel costs have increased from $85 to $90 per barrel to $150 to $200 per barrel for an industry that accounts for as much as a quarter its operating expenses. Here is an alphabetical list of the ways airlines are responding to this issue: AIR NEW ZEALAND On March 10, the airline was one of the first airlines to announce a broad increase in ticket prices. It also suspended its fiscal earnings forecast for 2026 due to an unprecedented?volatility on global jet fuel markets. Price increases for economy one-way fares will be NZ$10 ($6) in domestic routes, NZ$20 ($6) in short-haul international flights and NZ$90 ($9) on long-haul services. Further price, network and schedule changes are possible if jet-fuel costs continue to rise. CATHAY PACIFIC AIRWAYS Hong Kong Airlines announced on March 10 that it would be adding additional flights to London and Zurich to accommodate the disruptions in travel routes. The airline stated that it reviews fuel surcharges every month and kept them at $72.90 for flights between Hong Kong, Europe and North America. HONG KONG Airlines Local carrier announced that it will increase fuel surcharges up to 35.2% starting March 12. The biggest increases are on flights between Hong Kong, the Maldives and Bangladesh. British Airways' owner IAG stated on March 10, that it did not plan to increase ticket prices immediately as it had hedged a large amount of fuel for the short-to-mid-term. QANTAS AIRWAYS On Tuesday, the Australian airline announced that it will increase fares for its international routes during the week of March 9. It also said it was considering increasing capacity on existing Europe routes over the next few months. SAS (Scandinavian Airlines). The dominant airline in the Nordic countries announced on 10 March that it had made a "temporary" price adjustment because of rising jet fuel costs. UNITED AIRLINES Scott Kirby, the airline's CEO, said on 6 March that he expected a "meaningful hit"?to its first-quarter results due to the soaring fuel prices. VIETNAM Airline Local officials claim that the Vietnam-based airline has asked for government help to eliminate an environmental tax on jetfuel, because operating costs have risen by 70% as a result of rising jet fuel prices. (Reporting and editing by Matt Scuffham; Marleen Kaesebier, Mireia Merido)
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Spirit Airlines recalls furloughed Pilots as it Prepares to Emerge from Bankruptcy
Spirit Airlines announced on Tuesday that it had called back nearly 500 pilots who were furloughed last year as it prepares to emerge from its second bankruptcy. Last?month?the carrier reached a restructuring deal with its lenders, which would allow it exit bankruptcy before late spring or early?summer. The airline plans to focus on its routes and peak travel times where the demand is highest. Spirit Airlines said that "recalled pilots received a notice of recall on March 9, 2026. Those who accept the notice will return to duty within the timeframe specified in the Collective Bargaining Agreement." CNBC reported on Tuesday that the?recall? was due to a higher than expected pilot attrition. Spirit has not commented on the memo, nor provided any further information. Spirit Aviation Holdings, the parent company of the carrier, filed for bankruptcy in August for a second time. It was struggling to cope with diminishing cash reserves and mounting losses. The ultra-low cost carrier has taken several steps to reduce cash burn and increase funding, but it has struggled to gain traction as travelers have shifted to premium offerings. Spirit Airlines, known for its brightly colored 'all-Airbus' fleet, has built its brand on affordable fares, aimed at budget-conscious travellers who are willing to forgo add-ons such as checked baggage and seat assignments. After the pandemic, passengers chose to travel in comfort and for an experience, rather than opting for ultra-low cost carriers.
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Frontera accepts Parex’s $525 million offer for its Colombian oil and gas assets
Frontera Energy has accepted a $525m offer from Canada's Parex Resources to purchase its Colombian exploration and production assets on Tuesday, beating out a competing bid from GeoPark. The amount is more than Parex's previous offer on February 23, which was $500 million. It covers 17 exploration and production block in Colombia including the Quifa field and the Cubiro Block. *?Parex stated that the combined portfolios would create the largest independent energy company focused on Colombia. *?GeoPark refused?Monday? to increase its $325-million offer. It will receive its $75 million deposit, plus interest, and a $25,000,000 termination payment. Frontera, Colombia's largest private producer, is included in the Parex offer with a contingent payment of $25 million. Parex will assume the outstanding bonds of Frontera for 2028, totaling $310 million. $80 million is covered by a prepay line from Chevron Products Company. Frontera, a Toronto-listed company, said it plans to sign definitive agreements with GeoPark and with?Parex. The agreement is expected to be completed on Tuesday. (Reporting from Nelson Bocanegra, Bogota. Editing by Sarah Morland.)
TSX opens higher on mining gains that offset energy losses
Canada's main index of stocks edged up on Tuesday after the U.S. Gold prices and mining shares rose after President Donald Trump hinted that the Middle East conflict might end soon.
At 11:03 am. At 11:03 a.m. ET, the S&P/TSX composite index was up 0.85%, at 33,473.03, with four out of ten major sectors in green.
TSX Materials Index, which includes precious-metal miners, jumped by 1.6%, supported by high?gold prices, and had its best day for more than a week.
Spot gold prices rose by around 1.4%.
The energy stocks were also down by 0.2% due to a drop of?nearly 10 percent in oil prices.
Trump claimed on Monday that the conflict would end earlier than his original four to five week timeline. However, U.S. Secretary of Defense Pete Hegseth and top general Dan Caine said that U.S. attacks on Iran are intensifying.
In a recent note, analysts at BofA Global Research stated that they expect the Bank of Canada will hold rates at 2.25 percent through 2026. They have retracted their previous call for two 25 basis-point reductions this year.
They said that the surge in oil prices due to the conflict with Iran could boost both growth and inflation. This would leave policymakers little room to ease rates.
The bar has been raised for rate cuts, despite the fact that we don't expect any - given anchored expectations and weak growth.
Other notable movements include a?2.4% drop in the technology index, which was dragged by a?nearly 5% decline?in Descartes Systems Group, whose business is supply chain technology.
Air?Canada fell 2% when?Scotiabank lowered the stock from "sector performance" to "sector underperform". Fairfax Financial, a Canadian investment company, rose 2% following the agreement to sell a portion of its Poseidon Corp. stake for $1.91 billion.
(source: Reuters)