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Wall Street believes US corporate earnings can withstand rising oil prices
Wall Street believes that strong corporate earnings will boost stock prices, which have fallen since the Iran War began. They also believe that oil?prices will surge, reigniting inflation fears. Oil prices have risen by?more than 30 percent since the beginning of the war at the end February. LSEG data shows that despite the turmoil, the expected earnings growth for the S&P 500 in the first quarter is 14%. This compares to a?14.4% growth at the beginning of the year, and a 12.4% increase in the October 1 estimate. "So much happens, but nothing is happening." In an interview, Krishna Chintalapalli said that companies are becoming more resilient against geopolitical risk, especially U.S.-based firms. The war in the Strait of Hormuz has caused a surge in crude prices, which is fueling inflation fears and reducing the chances of Federal Reserve rate reductions this year. JP Morgan estimates "each sustained 10% rise in oil prices can yield a 15-20 basis point hit to the GDP". If oil prices remain?around $100 per barrel throughout 2026, consensus EPS estimations could be adjusted lower by 2%-5% or more if oil price moves higher. Brent crude, the global benchmark oil, was trading at around $103 and U.S. futures were near $91 on Wednesday. Investors are concerned that the surge in oil prices and other related products, such as fertilizer, could spark inflation again and dent consumer spending. They also worry about Fed rate cuts. Earnings expectations are largely unchanged. "The companies we talk to, regardless of whether they are in the middle of the AI boom or they are consumer oriented companies like Walmart or they're an industrial company like FedEx, take a certain amount of uncertainty going forward as normal," Chintalapalli stated. LSEG - data through Friday revealed that 48% of 120 earnings forecasts from S&P500 companies for the first quarter were positive and 44% were negative compared to analyst expectations. In a note that examined company comments, Lori Calvasina of RBC Capital Markets' head of U.S. Equity Strategy said, "Many companies stated?that it is early days or to soon to say?what the impact will be." She said that the outlook commentary she read made her think companies had good reason to remain calm, with earnings risk more likely to occur in the second half. The upcoming earnings season has been made less stressful by the fact that airlines are among the most vulnerable companies to the rising crude oil prices and the reduced discretionary consumer spending power. United Airlines and Delta Air Lines announced recently that demand was strong, allowing them the flexibility to increase fares despite surging fuel costs. Jim Baird is the chief investment officer of Plante Moran Financial Advisors, a Southfield, Michigan-based firm. "Companies generally play the expectations game pretty well, because they want to announce a beating in most cases," he said. "I wouldn't be shocked if some companies try to temper expectations to dampen excitement so that when they make the announcement, it is not as exciting." Mike Wilson, Morgan Stanley's chief U.S. Equity Strategist, stated in a report that, as the forward earnings?growth remained high, the 12-month forward -price-to -earnings for the S&P 500 had dropped 15% since its October highs. This "supports our stance" that it is unlikely that this oil spike will end the business cycle. Venu Krishna of Barclays' U.S. Equity Strategy raised Barclays' price target for the S&P 500 in 2026 from 7,400 to 7,650. This was due to the fact that the firm's?2026 S&P 500 price target has been raised from 7,400 to 7,650. In the end, optimism about company earnings is based on the hope that Iran's conflict will not drag out. Michael Arone is the chief investment strategist of State Street Investment Management, Boston. He said that everything suggests that investors or the market have convinced themselves that it's only a matter of weeks, perhaps a few months. There's nothing more to say from this perspective. This quarter's earnings will not be as impacted. That's why you haven’t seen an enormous negative reaction. What they say about the outlook will be critical to our next steps, especially given where we stand in mid-April on the conflict.
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Somalia's tuk-tuks stall as Iran war drives fuel price spike
Fuel prices are soaring in Somalia’s capital due to disruptions in oil shipments linked to the conflict with Iran. Many drivers in Mogadishu claim that they cannot keep their three-wheelers running because of the rising fares. Due to the conflict, around one-fifth of all oil and natural gas liquefied is now being shipped via the Strait of Hormuz. This has left African nations exposed and with rising fuel and food prices. There are no passengers. People walk or stay at home. "We raised the fares because of fuel price increases," Hasan Suleiman said in Mogadishu. The city is a small place and the passengers won't pay higher fares. He said that the tuk tuks had to be parked. Fuel prices have more than doubled in some areas of Somalia, increasing transportation costs for both?passengers? and?businesses? Already, 6.5 million people - or roughly one third of the Horn of Africa's total population - are suffering from severe hunger due to drought. "The tuk tuk needs to be fueled, and I have to support my family with the money it brings in." Jamal Omar is a 55 year old tuk-tuk. (Reporting and writing by AbdiSheikh; Editing and proofreading by William Maclean).
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China's Pony.ai will more than double the robotaxi fleet and debut in Zagreb
Pony.ai, based in Guangzhou, said that it expects its fleet of robotaxis to be able to double to 3,000 units this year across 20 cities worldwide. The company plans to launch Europe's very first robotaxi service in Croatia's capital Zagreb. Nearly half will be overseas. Pony.ai - which debuted its international operations in Doha in Qatar - joins other Chinese autonomous driving companies such as WeRide, Baidu's Apollo Go and Baidu, who are also expanding overseas. The fleet and operations will be managed by Croatian startup Verne. The service will be integrated into Uber's platform. This partnership creates an efficient and scalable path for international expansion. Pony.ai could share in the recurring revenue streams generated by local commercial services, said James Peng. The company has performed?on-road tests in regions like the Middle East and Singapore. Pony.ai's first profitable quarter was its fourth quarter net profit of $75.5 Million. The company achieved profitability in Guangzhou and Shenzhen by achieving single-unit profitability. The firm said that the increase in fair value of trading stocks was a major factor. The fourth quarter saw a six-fold increase in revenue from fare-charging, largely due to a larger fleet and higher adoption rates by users. As of Wednesday, the?company's total fleet size was 1,446 vehicles. This is up from fewer than 300 cars a year ago. (Reporting and editing by Qiaoyi Li, Ju-min Park)
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S.Africa is about to make its rate decision, and war worries are weighing on emerging market stocks
Investors flocked to safer assets as they awaited clearer signals on whether the Iran War was truly de-escalating. U.S. president Donald 'Trump' said Iran was eager for a?deal? after nearly four weeks fighting. This claim was in stark contrast with comments made by Iran’s foreign minister who stated that Tehran was reviewing an American proposal, but did not plan to enter into talks to end the conflict. Jim Reid, a Deutsche Bank analyst, said that the market's attention was quickly shifting to Trump's deadline of five days. "There is still plenty of uncertainty.. given that Iran has publicly rejected the US several times." South Africa's stocks fell nearly 2% and the rand dropped 0.4% before the central bank's rate decision. Policymakers are expected to keep the interest rates at 6.75%. The central bank has a target for inflation, and the annual rate is easing back towards that. However, economic growth remains slow. Rates will be closely monitored as policymakers attempt to regain momentum without reinitiating price pressures. This is especially true as an energy-driven inflation crisis has put the South African Reserve Bank and its peers in emerging markets into a 'uncomfortable' situation. Mexico's central banks is also expected to remain steadfast later in the day. The broad index that tracks emerging-market stocks fell 1.6%. This erased much of the gains made in the previous session. The index has fallen more than 10% in the last month, and is now only clinging to gains of 3% so far this year. It has lost much of its early-year strength. UBS analysts said: "Despite recent volatility due to geopolitical tensions, higher oil prices and other factors, we continue to maintain a positive outlook for EM equities." The zloty of Poland tried to rise but was stuck at a low level. Stocks fell as investors weighed up the possibility of a fuel-tax cut that would ease prices at the pumps - an action in a nation already struggling with one of Europe's largest budget deficits. The currencies of Central and Eastern Europe were also subdued. Hungary announced on Wednesday that it would gradually stop natural gas deliveries to Ukraine until the Druzhba Pipeline resumes crude oil flows. Kyiv’s international?dollar bond prices fell by a little over a cent. From Warsaw to New Delhi to Sao Paulo and Seoul, governments in the emerging world are scrambling to protect their economies from the effects of a conflict that has been raging for a month. Oil prices are soaring after the Strait of Hormuz was closed. This has rattled?markets, and forced central banks in emerging markets to rethink their policies. At the beginning of the year, some countries, such as Hungary and Brazil, were planning to reduce interest rates. As the inflation risk is increasing due to war, these countries are forced to think about the possibility of a move in the other direction. (Reporting and editing by Arun K. Koyyur in Bengaluru)
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Welcome to the 'New Russia:' How the Kremlin remade occupied Ukraine
Black smoke, burning tracks and blazing trains The footage posted by Ukrainian fighters online documents their repeated sabotage attack on a vast rail system being constructed by Russia in the occupied territory of Ukraine. Their efforts aren't enough to stop the rapid industrial expansion of Moscow. Orest, a Ukrainian fighter operating behind enemy lines, in the Donetsk Region, uses his military call sign for reasons of security. He said that the railroad was hundreds of kilometers long. "We're not all-powerful, unfortunately." According to the Kremlin these occupied areas represent "Novorossiya", New Russia. It's a hive of activity. A new investigation found that while Moscow is waging a brutal war against Ukrainian forces in the west, the country has been pouring hundreds and millions of dollars in a years-long aggressive buildup of transport and trading infrastructure in areas it?has captured to the east and south. Reporting shows that the spending spree dwarfs other Russian regions' development funds and facilitates transport of troops, military equipment, grain, and mineral resources. Moscow also has a long-term objective in mind with the construction projects: to weave the seized territory into Russia. This includes the Donbas region, whose fate is at the center of the U.S.-backed peace talks. Reporting provides the first detailed picture of how Russia-held Ukraine is changing under occupation. This analysis is based on the analysis of thousands satellite images, official Russian documents, public statements, freight and export data, and interviews with over three dozen Ukrainian officials. Volodymyr Zelenskiy, Ukrainian president, used Crimea to illustrate the Russian infrastructure building in occupied territories. He said that the Russian investments in Crimea are only a "facade", and don't actually benefit the residents of the Ukrainian Peninsula, which Moscow annexed in 2014. In an interview, he stated that "it doesn't seem like a modern resort." "It is all militarized." Zelenskiy’s office did not respond to an inquiry for comments on the findings of the investigation. Officials at the White House said that President Donald Trump wants to stop the senseless killing and is doing everything he can to bring an end to the war. Dmitry Peskov, Kremlin spokesperson, said that the four territories were an integral part and "subjects" of Russia. He added: "It's written in the Constitution of the Country." The construction of the Novorossiya Railways System is already underway. This system includes a 525 km (326 mile) planned line that will be completed in 2023, one year after Russia invaded Ukraine. The route will span the regions Donetsk, Luhansk (which comprise the Donbas), Zaporizhzhia, and Kherson. In the meantime, the Novorossiya highway is carving its way through those seized territory as part of an 1,400 km superhighway "Azov Circle" loop which will connect these regions with Russia and strategic Crimea. Under the Russian flag, occupied Ukrainian ports on the Sea of Azov (which connects the Black Sea to the inland Sea of Azov) that were mostly inactive during the early years of the conflict have been reopened and renovated. Satellite images from last August show that a new facility, about the size of a football field, has been built on the docks of Mariupol city in Donetsk during the Russian occupation. A mountain of coal-looking material is also visible in the area. Satellite analysis conducted by used a machine learning model to scan through thousands of radar and optical images in order to identify major construction. The analysis found that between 2022-2025, more than 2,500 km worth of roads, highways, and railroads were built, upgraded, or repaired in the four occupied territory and nearby Russian regions. According to Karolina HIRD, a Washington-based national security fellow with the Institute for the Study of War, the Kremlin's investment in infrastructure and its long-term nature show that it has no intention of returning the territories as part of a future peace agreement. She said that "the way Russia invests heavily in the industry and economy of occupied Ukraine so it can reap profit off the occupation also financially entangles Ukraine with Russia." This is a bad news for Ukraine, and its European allies. They insisted on Moscow returning the captured land, and rejected U.S. demands that Kyiv cede the entire Donbas to the United States as part of a deal to end this four-year conflict. Russian auction documents reveal that Moscow also has put up for sale dozens of valuable commodity assets located in occupied areas. Documents from the Russian state auction show that Moscow has also put dozens of prized commodity assets in the occupied?areas up for sale. The Russian Transport Ministry and Novorossiya Railways - a Russian state enterprise established in 2023 for the purpose of overseeing rail construction and maintenance on occupied territory - did not respond to questions about the status of infrastructure projects. Moscow is not shy about its claim on eastern Ukraine and the southeastern part of the country, or its desire to combine the two regions into what it calls the motherland. Vladimir Putin also has big plans for the "Novorossiya", a term that refers to Russia's imperial past, which modern nationalists have adopted. According to an online analysis of data from the government, Russia has allotted about $11.8 billion in federal cash between 2024-2026 to develop four occupied territories of Ukraine as part of its program of priority national development projects. The data show that this is nearly three times more than the money allotted to 20 other federal regions for similar projects. Putin's vision for the territories was outlined in a speech he gave on the 30th of September to mark the third anniversary since their "reunification". The president claimed that the regions suffered from decades of neglect and the effects of war. He said that Russia has built 6,350 km worth of roads in the region over the past three years. "A large-scale socio-economic program has been launched. It is essentially a programme of revitalizing our ancestral and historical Russian lands," declared?Putin. Moscow controls about one fifth of Ukraine. This includes the majority of four regions, Donetsk Luhansk Zaporizhzhia, and Kherson. It has also formally claimed that all four regions are part of Russia. Ukraine and its Western partners have condemned Russia's move towards annexing the territories as an illegal land grab. According to the local and Moscow authorities, vehicles and trains transporting people and goods into and out of Ukraine can already circumvent the Crimean Bridge. The bridge was Russia's sole road and rail connection to Crimea. It allowed the transportation of troops, fuel, and equipment via the peninsula. The bridge has been a major chokepoint in the Russian military and commercial flows. Ukrainian strikes have caused delays and disruptions. Vadym Skibiskyi, deputy head of Ukraine's HUR Military Intelligence Agency, which has been tracking enemy activity, said that the Russians were focusing on building up supply chains to support the war effort. Infrastructure is the most important issue for Russians. "It is the transport infrastructure," said he. SATELLITE IMAGERY REVEALS NEW RAILWAY According to online statements made by Novorossiya Railways in August of last year and the Russian Rail Watchdog, since 2023 Russia has spent $425 million for the construction and maintenance the railway network within the occupied territory. According to the official Russian media outlet, the centrepiece project is a main line connecting southern Russia with Crimea via occupied territories. The full cost was not specified. Satellite images taken between July 2023 to November 2025 show the gradual process of a new section of line being laid. This 60-km link between the towns Novoselivka, Kolosky, and Donetsk Region, north of Mariupol. An official of the Ukrainian intelligence service who monitors Russian activities said that this connection was an example of Russia building new rail connections further away from the front lines, at a safe distance from potential Ukrainian strikes, in order to deliver ammunition and military vehicle to its troops. Couldn't determine whether the line was in operation. State tender documents reveal that the Russian roads program also absorbs hundreds of millions of dollar, with the Novorossiya Highway Project leading this charge. According to Russia's official procurement website, 20 tenders totaling more than $214 millions have been awarded contractors. These projects are diverse, ranging from engineering studies to bridge maintenance. The Russian Transport Ministry announced late last year an additional $123 million will be spent on roads in 2026. UKRAINE OFFICIAL : IT'S LIKE CRIMEA BUT FASTER It is a mixture of upgraded and new roads that connects existing highway stretches. According to the Russian federal road agency and ministry of transport, it will cover 630 km when finished. The date of completion has not been announced. Satellite imagery shows the construction of new bridges and interchanges as well as the enlargement of roads. According to an analysis, road crews have finished the majority of a 100-km section between Taganrog (in southwestern Russia) and Manhush (in occupied Donetsk). The analysis also shows that Russia is building a new major bypass road around Mariupol which was levelled by early war fighting. The Novorossiya Highway is the leg of the Azov Ring that connects the occupied territories. Officials in Russia say that they intend to finish the highway by 2030. It will connect Rostov on Don in Russia to Mariupol, Donetsk as well as cities in Zaporizhzhia or Crimea. Olha Kuryshko, Ukraine's representative to Crimea is responsible for monitoring the rights and welfare of Ukrainians who live there. Kuryshko says that Russia is accelerating its efforts to build economic infrastructure across eastern and southern Ukraine, just as it did with Crimea. After annexing Crimea in 2014, Moscow embarked upon a number of ambitious projects, including a 19-km road span and two power plants to ensure stable electricity for the peninsula. Kuryshko said that, based on his analysis, "the?Russians" have achieved as much in the three years they've occupied these new territories as in the 10 years they occupied Crimea. She added, "They have done it so quickly, spent so many dollars, and taken everything to the next level from what they did before in Crimea." "Crimea served as their training ground." KREMLIN COMMANDERS UKRAINE'S PORKS Russia is also moving to reclaim the occupied Ukrainian ports on the Sea of Azov. The Sea of Azov is a shallow inland waterway that borders Russia and Ukraine, connecting to the Black Sea via the Kerch Strait. Since centuries, the Sea of Azov is a major trading route. Kyiv has condemned the addition of Mariupol and Berdiansk in the Azov Sea to a list of Russian ports that are open to international ships. The canals that lead to both hubs have been widened and deepened, allowing larger ships to pass through them again. These projects are part of the construction tenders worth over $13 million for the two Russian ports that have been listed on the Russian government procurement website since 2023. The port, according to two dock workers who requested anonymity and spoke about the port's recent growth, has been significantly busy in recent months. They said that vessels are arriving and departing loaded with grain or coal. However, activity is still below the pre-war level. According to an analysis of LSEG vessel tracking data, between July and November last, 18 cargo ships operated by Russian and other companies were recorded leaving Mariupol and Berdiansk ports. The majority headed for Turkish ports. We couldn't tell what the vessels were transporting. The Turkish authorities have not responded to our request for comments on these journeys. LSEG data shows that in 2024, there were no ships entering or leaving the two ports. The Russians extract valuable natural resources in the occupied territories. Russian customs data provided by an export data provider shows that, between March 2022 to March 2025 at least 508,500 tons of coal and coke, worth $13.2million, were exported from occupied areas. According to data, the main buyers of Ukrainian coke during this period were trading firms from Turkey and United Arab Emirates. According to the data, coal was also sold to companies in India and Indonesia as well as Egypt and Algeria. Indonesia's Foreign Ministry said that the country's trading relations are transparent and it imports coal, among others, from Russia, Australia, and China. The other countries that are the destination of coal imports did not respond to any requests for comment. GOLD MINING IN EASTERN UKRAINE Moscow also expanded its control over natural resources in the seized Ukrainian territory via state auctions. According to documents reviewed by the public auctions, state online auctions are selling dozens of assets, including mines, quarries, farmland, and more. The rights to extract sandstone from Luhansk's four mines, as well as crushed stone, chalk, and granite, have been sold. The rights to develop the Bobrykivske Gold Mine in Luhansk has been one of the largest sales so far. According to the documents of sale, it was purchased for $9.7million by Alchevskpromgroup which is owned by Russian mining company Polyanka. Polyanka mainly develops mines at the far east of Russia. Bobrykivske’s reserves consist of about 1.64 tonnes of gold. This would be worth nearly $260 million at current spot prices based on the documents. Korab Resources, an Australian mining company, had been developing the site. Korab Resources had been developing the site in the past. But the Australian mining company stopped its work when the area became seized by Russian-backed rebels. This made it impossible for Korab to gain access to the region which was under Western sanctions. Satellite images taken in September of the deposit showed tire tracks around the site. Karpinski said that the site had been in operation since June 2024 when asked to compare images taken then with those from September. He pointed out an excavator that appeared in the main pit, and shipping containers at the base of the stockpile. Alchevskpromgroup and Polyanka did not respond to any questions regarding the sale of Bobrykivske and whether or not work has begun on the site. Hird of the Institute for the Study of War said that occupying a large area of land comes with significant costs. She added that Russia's ability harness the natural resources and industrial potential of these regions could be important for its finances. These have been severely affected by the war effort as well as international sanctions. Hird stated that "that can start tipping scales to the point where occupation becomes profitable for Russia." Reporting by Anastasiia Melenko, FilippLebedev, GlebStolyarov and Mari Saito. Additional reporting by PolinaNikolskayaDevitt, Marian PrysiazhniukMarine Delrue, Dan Flynn and PravinChar.
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Poland considers a VAT cut on fuel but does not exclude windfall tax
Poland could 'cut its VAT on petrol to lower prices at the 'petrol pump,' said the country’s finance minister on Thursday. He added that a windfall levy on oil company profits had not been ruled out. Fuel prices have already been capped in Romania and Hungary, two countries that are part of the same region. He said that the?government was working on lowering petrol prices. "Reducing the VAT is being analysed in depth; it's a 'likely solution. Domanski responded that the government is not planning to impose a windfall tax on oil companies. However, he did say that a possible law could be enacted if an analysis showed that certain companies were making high profits because of current market conditions. He said, "We do not rule out a tax on profits in excess."
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Hungary restricts gas supply to Ukraine
Hungary has banned the gas transmission system operator of Hungary from holding auctions for shipments to Ukraine during the third quarter as it moves to reduce supplies to its neighbor in a dispute over oil flows. On Wednesday, Prime Minister Viktor Orban said that Hungary will gradually stop sending gas to Ukraine once oil flow to Hungary is restored through the Druzhba Pipeline. Hungary and Slovakia, who are the only countries in Europe to maintain relations with Moscow, have blamed Kyiv for a failure of?the Druzhba Pipeline, which supplies their refineries through Ukraine with Russian crude. Kyiv claims that a Russian drone attacked the pipeline in late January, and they are repairing it as quickly as possible. The decree signed by Orban stated that "the transmission system operator can't announce a... capacity auction to be shipped to the Ukraine for the third quarter in 2026." In addition to the previously required quantities, it was also stated in the decree that?another 800 million cubic meters of natural gas should be stored at Hungary's storage sites. Ukraine's Ministry of Foreign Affairs spokesperson said that if Hungary stops gas shipment to Ukraine it will rob Hungary of more than $1 billion in revenue it received last year. An industry source said earlier this month that Ukraine purchased 180 mcm (or 28%) of its gas in March from Hungary. This is slightly less than it did in February. Orban had also warned earlier that Hungary would cut its electricity exports to Ukraine in the event oil flow through Druzhba did not resume. Separately data from Ukraine's gas distribution operator showed that gas supply levels from Hungary would remain the same on Thursday. Data showed that 8.3 mcm gas was nominated for supply to Ukraine on Wednesday, compared with 8.2 mcm. It showed that Ukraine will receive 24.7 mcm total of gas on Thursday from Hungary, Poland. Slovakia and Romania. Anita Komuves, Pavel Polityuk (Reporting). Mark Potter edited the article.
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H&M Q1 profits grow more than expected; March sales are up 1%
H&M, the Swedish fashion retailer, reported a slightly higher?rise in operating profit than expected for 'December-February. '?and forecasted that March sales would rise by 1%. In a press release, CEO Daniel Erver stated that "at the end of the third quarter, our well-received Spring collections contributed to positive sales trends which continued into March." H&M’s operating?profit, which includes Christmas shopping, increased for a third quarter in a row to 1.51 billion crowns (about 162 million dollars) from a year earlier 1.20 billion. The average forecast of an LSEG survey of analysts was 1.39 billion. This is despite a 1% decline in organic sales. In January, the rival to Inditex reported that local currency sales were down by 2% in the first two quarters. H&M has said that it closely monitors developments in the Middle East, and their implications for global trade. It said that "good flexibility in the supply chains and a low percentage of air freight provide opportunities to adapt to changing conditions." The Middle Eastern market accounts for a very small part of the total sales. These markets are operated by franchise partners. On February 28, Israel and the United States launched coordinated strikes against Iran. Iran responded by launching strikes against 'Israel, U.S. base and Gulf States. The war has caused a spike in energy prices and hit global supply chains, causing an increase in the cost of fuel. Consumers are concerned about the impact of inflation driven by the war on their demand.
Cathay Pacific will increase fuel surcharges by 34% in response to the rising cost of jet fuel
Hong Kong-based Cathay Pacific Airways announced on Thursday that it will increase fuel surcharges across all routes by 34% starting April 1, and then review the charges every two weeks. The airline cited higher jet fuel costs due to the Middle East war.
According to the International Air Transport Association (IATA), the global 'average jet fuel price' has almost doubled since the start of the Middle East war on February 28. It reached $197 per barrel by the week ending March 20.
Fuel costs have risen by an unprecedented amount, accounting for up to 25% of industry operating expenses. This has forced airlines to increase fares, reduce capacity and re-evaluate financial forecasts.
Hong Kong's flagship carrier said that fuel accounted for about 30% of Cathay Pacific's operating costs by 2025. However, partial hedging, which excludes the refinery component, leaves it vulnerable to a spike in prices.
Cathay Pacific stated that if the steep rise in fuel costs could not be effectively mitigated, they would not be able to maintain the efficient operation of their network.
(source: Reuters)