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Kinder Morgan's profits in the first quarter beat estimates due to strong gas demand
Kinder 'Morgan exceeded Wall Street expectations for first-quarter profits on Wednesday. This was aided?by the higher volumes of?natural gas transported through its pipelines. U.S. Pipeline companies benefit from the booming oil and natural gas production in the Permian basin, and from rising?natural?gas demands due to record LNG shipments and increasing electricity usage from AI operations and cryptocurrency mining. The company reported that it transported approximately 49,475 billion British thermal units (Btu) of natural gas per day during the quarter. This compares to 45,978 Btu/day a year earlier. Natural gas futures in the U.S. averaged $9.54 for a million British thermal unit (btu) during the quarter of January-March, an increase of 9.5% over last year. Natgas prices were boosted by the surge in spot prices that occurred during Winter Storm Fern in early quarter. According to LSEG, the Houston-based company posted an 'adjusted' profit of 48 cents per share for three months ending March 31. This was compared to analysts' estimates?of 40 cents per share. Varun Sahay, Bengaluru. Vijay Kishore, editing.
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Southwest Airlines' second-quarter profits are expected to be below estimates due to fuel prices.
Southwest Airlines predicted a second-quarter loss below analysts' expectations on Wednesday as rising jet fuel costs due to the war in Iran have pushed up costs and reduced margins. In extended trading, the shares of?company fell 2.9%. According to data compiled by LSEG, the Texas-based carrier is expecting a profit per share between $0.35 and $0.65 during the April-June period. This mid-point is below analysts' expectations, which were for a profit of 55 cents. After U.S. and Israeli strikes on 'Iran,' the Strait of Hormuz was closed. This caused a rise in jet fuel prices for airlines worldwide. Jet fuel prices have nearly doubled since the Iran conflict started, and airlines are now dealing with one of the biggest financial shocks they've experienced since the COVID-19 epidemic. Fuel costs account for about a quarter of the operating expenses of airlines. The rise in fuel prices has made it impossible for carriers to re-price tickets that were sold months prior to the conflict. Southwest Airlines and its competitors are raising their fares to reflect the increased costs. They also increase fees for extra services, such as checked baggage. In its annual report, the airline stated that it expected to consume approximately?2.2 billion gallons jet fuel by 2026. The cost of fuel would increase by $22 million if the price of jet fuel increased one cent per gallon. The company expects fuel prices to be between $4.10 - $4.15 per gallon during the second quarter. Southwest used to hedge jet fuel, but stopped doing so in 2025 because it was too expensive and unreliable. Southwest reported a net profit of $227m, or $0.45 a share, which was lower than the analysts' expectations of 47c, according to LSEG data. (Reporting by Nandan Mandayam in Bengaluru; Editing by Maju Samuel)
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White House shows skepticism as United Airlines CEO downplays merger talk
Scott Kirby, CEO of United Airlines, played down speculation on Wednesday about a possible tie-up with American Airlines. He also declined to comment on reports that he floated the idea at the White House. We've seen lots of media coverage about consolidation rumors. Kirby stated on United's earnings conference call that the company has not made any comments on these reports. He said that his comments were a reflection of long-held opinions about the airline industry, but they had been interpreted differently after the merger reports. Kirby raised the possibility of merging with American Airlines during a late-February meeting with U.S. president Donald Trump, according to people familiar with the situation. The meeting was scheduled to discuss Washington's Dulles Airport. American has said it's not interested in pursuing any deal. Kirby explained that "all of my comments... have been made in the past" and that the comments are being viewed differently because of "the rumors that were spread last week." Sean Duffy, the U.S. Transportation secretary, called Tuesday's proposal "interesting", but added that United would have to make a better case for its consumers. Trump stated on Tuesday that he is opposed to a possible merger between two airlines. Focus on Global Competition Kirby's thinking was framed in terms of competition over the long term, and he argued that U.S. carriers face structural disadvantages compared to large carriers in Asia?and the Middle East. He did not specify what changes would be required, saying that any solution would bring "complications." He said that United's success has come from winning customers in different segments, rather than through consolidation. He cited?investments in onboard technology and products as the reason for the airline's strong performance despite the sharp increase?in fuel prices. Kirby also highlighted 'the role of partnerships', saying that United's global reach would be impossible without its Star Alliance partnership, which allows them to serve destinations they could not otherwise afford. He said: "It's highly unlikely that we will open a foreign hub anywhere." (Reporting and editing by Rod Nickel.)
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United Airlines warns that fuel prices may rise by up to 20% in order to offset the increase.
United Airlines CEO Scott Kirby stated on Wednesday that ticket prices could rise as much as 15 to 20% in order to offset the surge in jet fuel costs. This is a test for consumers to see if they are willing to pay higher prices as the oil industry struggles to deal with volatile prices. Kirby stated that United aims to recover all fuel cost increases "as soon as possible". It also expects to move towards a 100% pass through,?as the company targets double-digit margins before taxes next year. Kirby stated that "yields must increase by approximately 15% to 20%" and added that the company assumes fuel prices will remain high for a longer period of time. United Airlines' comments follow its forecast of second-quarter and annual profits that were below Wall Street expectations due to higher jet fuel costs, which squeezed margins and impacted the near-term outlook. Demand for premium travel remained robust. United's shares fell by about?6% during morning trading. The Chicago-based carrier said that its forecast was based upon the Gulf Coast Jet Fuel Forward Curve as of April 17. It warned that results could fall at either end depending on fuel prices. Fuel costs are expected to rise by about $4.30 per gallon in the current quarter. United has said that it already began raising its prices. It implemented five fare increases in the last quarter of the first year, along with increased baggage fees. These have "started" to offset increasing fuel costs. The airline expects to recover 40% to 50% of the fuel price increase through fares in the second quarter. This will improve to 70% to 80% by the third quarter, and up to 85% to 100 percent in the fourth quarter. Executives at the company said that ticket yields increased by 12% early in March, and then climbed to 18% during?the second part of the month. Kirby stated that the airline hasn't seen a decline in demand despite rising prices, but admitted that consumers would be tested eventually by higher fares. He said that as yields increased, the demand would be elastic. (Reporting and editing by Aurora Ellis; Reporting by Rajesh Kumar Singh)
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Sources say that Black Sea CPC blend oil exports will rise to 1.8 millions bpd by May.
Two industry sources said that the Caspian Pipeline Consortium plans to export 1.8 million barrels of CPC Blend crude per day in May, up from 1.65 million barrels expected in April. This is because Kazakhstan will divert oil from Russia's Druzhba Pipeline Oil previously scheduled for Germany. Calculations show that May loadings will rise daily by?9% compared to April and reach a record for a number of months. Alexander Novak, Russia's deputy prime minister, said that from May 1, the Druzhba Pipeline will be diverted onto other routes. According to two sources, volumes rerouted out of?Druzhba are expected to enter CPC. CPC Blend is now more expensive than Brent due to supply disruptions in the Middle East. One?trader stated that the Russian gas producer,?Novatek, will also contribute to increased CPC shipments by exporting condensate while undergoing maintenance at its Ust-Luga processing complex. The CPC consortium doesn't comment on operational loading data.
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Trump administration nears deal to rescue Spirit Airlines, WSJ reports
Wall Street Journal reported on Wednesday that the Trump administration is close to a deal with Spirit Airlines. The Wall Street Journal quoted people who are familiar with the matter. According to a report, the U.S. Government will loan Spirit up to $500 million in exchange of warrants that would allow it to potentially take a stake in the airline. After U.S. and Israeli strikes on Iran, global carriers are now dealing with a?surge in jet fuel prices? after the disruption of?traffic along the Strait of Hormuz. Spirit Airlines has stated that it will'shrink their fleet to approximately one-third the size of its pre bankruptcy fleet, and retain roughly 76-80 aircraft by third quarter 2026. According to the March disclosures, the?carrier's turnaround?plan was based on fuel prices averaging $2.24 a gallon in 2026. And $2.14 if you include 2027. By mid-April jet fuel was around $4.24 per gallon. This is roughly twice the price assumed in the?projections. Spirit Airlines, known for its all-Airbus fleet in bright yellow, has built its brand on affordable fares. This is especially appealing to budget-conscious travelers who are willing to do without add-ons like?checked baggage? and seat assignments. Spirit refused to comment but stated that it operated 'normally. The White House didn't 'immediately reply to a request for comment. Donald Trump, the U.S. president, told CNBC that he'd like to see a company acquire Spirit and that it is possible that federal government might get involved. Reporting by Nathan Gomes, Bengaluru. Editing by Shreya Biwas and Devika Syamnath.
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Druzhba Pipeline restarts Russian oil flow to Europe and unblocks EU loan for Kyiv
Officials said that Russian oil began flowing through the Ukrainian portion of the Druzhba Pipeline on Wednesday, after a halt which lasted months. This allowed Hungary to lift its veto over a 90 billion euro ($105.79billion) EU loan, which Kyiv urgently needs. Since a Russian drone attack damaged the Druzhba pipe in western Ukraine, and stopped Russian oil delivery to Hungary and Slovakia, the Druzhba has become one the most political pieces of infrastructure across Europe. The Hungarian oil company MOL announced on Wednesday that Ukraine informed them that Russian crude deliveries had resumed via the pipeline. MOL said that it expected the first crude oil shipments to arrive in Hungary or Slovakia 'at least tomorrow' following the restarting of the Ukrainian pipeline section. EU LOAN ADVANCEMENT SHORTLY FOLLOWING PUMPING RESUMED An industry source, who asked not to be identified because they weren't authorized to speak in public, said that pumping started at 0935 GMT. The loan was approved shortly after by EU ambassadors in Brussels. The 27 members of the European Union are expected to sign it off by Thursday afternoon. Volodymyr Zelenskiy, the Ukrainian president, said that the EU's announcement was "the right signal in the current circumstances". Zelenskiy wrote on X that Russia's war in Ukraine can only be ended if both the support for Ukraine as well as pressure from Russia is sufficient. Last year, the EU agreed to the loan in principle, to maintain Ukraine's liquidity through 2026-2027. But Viktor Orban, the Prime Minister of Hungary, and the Slovak Government blocked it. They accused Ukraine of delaying the repairs to the pipeline. Kyiv denied this. Orban's support for Russia is consistent. Both Hungary and Slovakia are heavily dependent on Russian crude oil. Change of Prime Minister in Hungary Ukraine's chances of receiving the loan improved after Orban's loss in Hungary's parliamentary elections on April 12. Peter Magyar the leader of the winning political party said that he will no longer obstruct?the EU funding for Kyiv. He is expected to come into power next month. Druzhba (which in Russian means "friendship") has a capacity of 1.2 to 1.4 millions barrels?of oil per day. This can be increased to as much as 2 million barrels?per day. The flow of oil has fallen to a fraction of what it was due to Western sanctions and repeated drone attacks. Separately Germany confirmed that no Kazakh crude will reach its PCK Schwedt refinery, one of the largest in the country, from May. Industry sources had said on Tuesday, Russia would stop Kazakhstan's exports through the Druzhba Pipeline.
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Top shipping executives say they are waiting for "safe and sustainable" strait crossings
Two top executives in the shipping sector said that they wanted to see a safe and sustainable passage through the Strait of Hormuz before much oil or cargo leaves or enters?the Gulf. We thought that there was some hope when, two weeks ago, the temporary ceasefire came into view. In reality, the agreement did not translate into safety and passage for the vessels", Jotaro Tamura, chief executive officer of Japan's Mitsui O.S.K. Lines in an interview conducted on the sidelines the Singapore Maritime Week. MOL is the largest shipping company in the world and also the owner of the most oil and LNG tankers. Tamura said that even if the Strait is reopened, there would still be questions about safety. The Iranian Islamic Revolutionary Guard Corps warned that there are mines in the area. It's about the definition of "open". Is it open or half-open? "Is it really open or is there a risk?" Tamura stated. "At a certain point, (voyages will resume) and normalisation is in sight. It's difficult to predict how the reality will be." He said that MOL adheres to international law which allows for freedom of movement through the Strait. CMB.Tech in Belgium, another large and diversified maritime firm with more than 250 vessels, is waiting as well for clarity. "We cannot hedge." Alexander Saverys, CEO of Saverys Group, said that we should wait and see what happens in the Middle East. It creates a lot of uncertainty. He said, "We must be confident we can travel without any problems." Today, we are not reassured in any way. Reassurance will come only if we can see that the ships are able to pass through the Straits in a sustainable and safe manner. Saverys stated that "the 'Strait of Hormuz' is a free passage, where no toll normally should be paid." If that changes in the future we will investigate. He refused to comment on how many ships his company has stranded in the Gulf. "We are in constant communication with all the governments to ensure that our ships can navigate. As you may know, right now the situation is still not safe. Since the U.S. - Iran war broke out 'on February 28th, energy supplies from Gulf have been disrupted. About 130 ships a day pass through the strait to enter or exit the Gulf. This translates into about 20% of daily global oil and LNG supply. (Reporting from Siyi Liu in Singapore and Florence Tan; editing by Jason Neely).
Argentina truckers, farmers to hold talks on Quequen port protest
Julian Kristansen of the Necochea City Council, the chair of the Transportation Committee, said on Wednesday that Argentine truckers who have protested 'higher freight rates' have agreed to meet with farmers in order to resolve the dispute.
Truck drivers protesting have camped along a road leading into the port. They are blocking grain trucks and disrupting logistics. The Quequen Terminal handles 20 percent of Argentina's soy exports.
Argentina is the world's?third-largest soybean exporter and the biggest global supplier of soy oil and meal.
On Monday, the Argentine Chamber of Private Commercial Ports announced that?the protests had?originally affected the port of Bahiablanca.
Exports of approximately $450 Million were prevented.
Kristansen stated that "in the coming days there will be another call for a table of negotiation to listen to all parties and to try to achieve a consensus." Necochea, in southern Buenos Aires, is home to the port city of Quequen.
Kristansen claims that truckers in the rural areas are accepting a 14% rate increase due to a global increase in fuel prices since the start of the Iran war. The Buenos 'Aires transport ministry and the truckers' unions ATCADE & FATRAC did not respond to our inquiries.
The dispute did not affect ports in the Rosario region, which ship nearly all of Argentina's soymeal and oil exports as well as more than 85% of Argentina's grain. (Reporting and editing by Brendan O'Boyle, Maximilian Heath)
(source: Reuters)