OPEC+ Faces Output Decision After Biden’s Saudi Trip

In this file photo taken on November 29, 2016, the logo of OPEC is pictured at the OPEC headquarters on the eve of the 171th meeting of the Organization of the Petroleum Exporting Countries in Vienna, Austria. JOE KLAMAR / AFP
In this file photo taken on November 29, 2016, the logo of OPEC is pictured at the OPEC headquarters on the eve of the 171th meeting of the Organization of the Petroleum Exporting Countries in Vienna, Austria. JOE KLAMAR / AFP

 

The OPEC+ group of oil exporters meets Wednesday to discuss another output increase, weeks after US President Joe Biden sought to persuade Saudi Arabia to boost production during a controversial visit to the country.

The White House has been pressing the oil cartel to step up production to tame prices that have surged since Russia invaded Ukraine in late February.

But the group, which is led by Saudi Arabia and Russia, has stuck to modest increases so far.

The 13-member Organization of the Petroleum Exporting Countries, along with 10 allies that include Russia, had slashed production at the height of the Covid pandemic in 2020 after a plunge in demand caused prices to sink.

The group began to raise production last year, agreeing to add 400,000 barrels per day to the market. It backed an increase of nearly 650,000 barrels per day in June, still not enough to spark a big drop in oil prices.

The alliance’s output is back to pre-virus levels, but just on paper as a few members have struggled to meet their quotas.

All eyes will be on whether OPEC+ sticks to the same output policy or steps it up.

READ ALSO: First Grain Shipment Leaves Ukraine As Southern City Pounded

Biden’s Saudi Voyage 

Biden travelled to Saudi Arabia in mid-July to meet Crown Prince Mohammed bin Salman despite his promise to make the kingdom a “pariah” in the wake of the 2018 killing of journalist Jamal Khashoggi.

Part of the reason for the controversial trip was to convince Riyadh to continue loosening the production taps to stabilise the market and curb rampant inflation.

After his meetings with Saudi leaders in mid-July, Biden said he was “doing all I can” to increase the oil supply but added that concrete results would not be seen “for another couple weeks” — and it was unclear what those might be.

Wednesday’s meeting will reveal whether his efforts were successful.

“The US administration appears to be anticipating some good news but it’s hard to know whether that’s based on assurances during Biden’s trip or not,” Craig Erlam, analyst at OANDA trading platform, told AFP.

Stephen Innes, managing partner at SPI Asset Management, said it “wouldn’t be a surprise to see the Saudis announce something that Biden could tout as a win to voters at home.”

Sceptical Market 

According to the London-based research institute Energy Aspects, OPEC+ could adjust its current agreement in order to keep raising crude production volumes.

However, analysts warn against expecting any drastic increases.

OPEC+ has to take into account the fact that the interests of Russia — a key player in the alliance — are diametrically opposed to those of Washington.

“Saudi Arabia has to walk a fine line,” said Tamas Varga, analyst at PVM Energy.

Any decision on Wednesday will have to be unanimous, which may lead to a longer meeting than normal.

“Any new OPEC+ deal aimed at further ramping up supplies is likely to be met with market scepticism, considering the supply constraints already evident within the alliance,” said Han Tan, chief market analyst at Exinity.

The group will decide output policy under a new secretary general, Kuwait’s Haitham Al-Ghais, who took office on Monday following the death of Nigeria’s Mohammed Barkindo last month.

“I look forward to working with all our Member Countries and our many partners around the world to ensure a sustainable and inclusive energy future which leaves no one behind,” Al-Ghais said in a statement.

AFP

Russia Cuts Gas Supplies To Poland, Bulgaria Over Ukraine


Greenpeace environmental activists stage an action against the ship Ust Luga, which will reportedly unload Russian oil in the harbour of Aasgaardstrand, Norway, on April 25, 2022, amid the Russian invasion of Ukraine. Ole Berg-Rusten / NTB / AFP

 

Russia halted gas supplies to Poland and Bulgaria on Wednesday, after blasts in a breakaway region of neighbouring Moldova led Kyiv to accuse Moscow of seeking to expand the Ukraine war further into Europe.

The Russian energy giant Gazprom said it had cut supplies to Poland and Bulgaria, in Moscow’s latest use of gas as a weapon in a conflict that has now dragged into its third month and claimed thousands of lives.

Explosions this week targeting the state security ministry, a radio tower and military unit in neighbouring Moldova’s region of Transnistria — occupied by Moscow’s forces for decades — followed a Kremlin commander’s claims Russian speakers in the country were being oppressed.

That triggered alarm that Moldova could be Russia’s next target in its push into Europe, with Moscow having exploited similar fears after launching its bloody invasion of Ukraine on February 24.

READ ALSO: Nearly 5.3 Million Flee Ukraine War As Refugees – UN

“Russia wants to destabilise the Transnistrian region,” Mykhaylo Podolyak, a Ukraine presidential aide, wrote on Twitter.

“If Ukraine falls, tomorrow Russian troops will be at Chisinau’s gates,” he said, referring to Moldova’s capital.

The United States echoed similar concerns — though stopped short of backing Kyiv’s contention that Russia was responsible.

“We fully support Moldova’s territorial integrity and sovereignty,” State Department spokesman Ned Price told reporters.

‘Heaven And Earth’

Ukraine leader urges Russian soldiers to lay down arms
In this file photo, Ukrainian President Volodymyr Zelensky addresses the nation in Kyiv early on February 25, 2022. Handout / UKRAINE PRESIDENCY / AFP

 

Ukraine’s President Volodymyr Zelensky has been lobbying for heavier firepower to push back the Russian advance now focused on the eastern region of Donbas.

Western allies are wary of being drawn into an outright war with Russia, but Washington pledged Tuesday at a summit to move “heaven and earth” to enable Ukraine to emerge victorious.

“Ukraine clearly believes that it can win and so does everyone here,” US Defence Secretary Lloyd Austin told 40 allies gathered at the Ramstein Air Base in Germany.

With arms flowing into Ukraine, Germany announced Tuesday it would send anti-aircraft tanks — a sharp U-turn dropping its much-criticised cautious stance.

Britain will also on Wednesday urge Kyiv’s allies to “ramp up” military production including tanks and planes to help Ukraine, with Foreign Secretary Liz Truss set to call for a “new approach” to confront Russian President Vladimir Putin.

“We must be prepared for the long haul and double down on our support for Ukraine,” she is set to say, according to pre-released remarks.

“Heavy weapons, tanks, aeroplanes — digging deep into our inventories, ramping up production. We need to do all of this,” she will add.

“There must be nowhere for Putin to go to fund this appalling war.”

Truss will also urge Europe to cut off Russian energy imports “once and for all” — a move that would deprive Moscow of a key source of leverage over its dependent western neighbours.

Underlining that precarity, energy giant Gazprom said Wednesday it had informed Bulgaria’s Bulgargaz and Poland’s PGNiG about the “suspension of gas supplies from April 27 until payment is made” in rubles.

President Putin last month said Russia would only accept payment for deliveries in its national currency.

On The Brink 

Russian President Vladimir Putin chairs a meeting on aviation via a video link at the Novo-Ogaryovo state residence outside Moscow on March 31, 2022. Mikhail KLIMENTYEV / SPUTNIK / AFP
In this file photo, Russian President Vladimir Putin chairs a meeting on aviation via a video link at the Novo-Ogaryovo state residence outside Moscow on March 31, 2022. Mikhail KLIMENTYEV / SPUTNIK / AFP

 

Fighting continues to rage across Ukraine’s east, Kyiv’s defence ministry said, announcing Wednesday that Russian forces had pushed deeper into the east of the country and captured several villages as part of its offensive to take control of Donbas.

Russia said it had carried out high-precision missile strikes against 32 Ukrainian military targets including four ammunition depots on Tuesday.

It also launched air strikes against 33 targets, as well as 100 artillery and rocket strikes.

In the south, two Russian missiles struck the industrial city of Zaporizhzhia, which has welcomed many civilians fleeing Mariupol, regional authorities said.

Russian forces are expected to soon advance on the city, which is located near Ukraine’s largest nuclear power plant.

And at the site of the world’s world-ever atomic disaster, Chernobyl in northern Ukraine observed the 36th anniversary of the meltdown back under Kyiv’s control.

The sprawling complex fell into Russian hands on the day Moscow’s troops began their invasion in February, suffered a power and communications outage that raised alarm about a possible new calamity at the site.

That put the world “on the brink of disaster”, Zelensky said at a press conference with UN atomic watchdog chief Rafael Grossi, adding that Russian troops’ conduct showed that “no one in the world can feel safe.”

“For the Russian military, the Chernobyl zone and the plant was like a normal battleground, territory where they didn’t even try to care about nuclear safety,” he said.

To the east, at the entrance to Barvinkove, six Ukrainian soldiers were ready at any moment to dive into their trench, which they dig every day with a shovel.

“Otherwise, we’re dead,” said Vasyl, 51, who serves with his 22-year-old son Denys.

Ukraine officials said there was fighting all along the frontlines in the Donetsk region, and that resistance in the Azovstal factory in the besieged port city of Mariupol was still holding out.

The country’s best-known singer Sviatoslav Vakarchuk made a morale-boosting visit to the eastern front, where a military press officer admitted the situation was difficult.

“It’s far from rosy,” Iryna Rybakova, of the 93rd brigade, told AFP.

“Of course, we were prepared for this war, especially the professional army, but for those who’ve been recruited, it’s more complicated.”

The UN’s refugee agency said it now expects more than eight million Ukrainians to eventually flee their country, with nearly 5.3 million already out, and that $1.85 billion would be needed to host them in neighbouring countries.

In a meeting with Putin, UN Secretary-General Antonio Guterres called for Moscow and Kyiv to work together to set up aid and evacuation corridors in war-torn Ukraine.

He also called for an independent investigation into “possible war crimes” in Ukraine.

“I am concerned about the repeated reports of violations of international humanitarian and human rights law and possible war crimes,” Guterres said.

“And they require independent investigation for effective accountability.”

burs-oho/je

© Agence France-Presse

Libya Oil Firm Closes Major Oil Field

Libya flag

 

Libya’s National Oil Corporation announced Sunday the closure of production at a major oil field in the country’s south, declaring a “force majeure”.

“On Saturday… the Al-Fil field was subjected to arbitrary closure attempts, due to the entry of a group of individuals and the prevention of the field’s workers from continuing production,” the NOC said on Facebook.

It added that the field was shut down on Sunday — marking the second closure in a matter of weeks — “making it impossible for the NOC to implement its contractual obligations”.

READ ALSO: More Rain Lashes South Africa’s Flood-Ravaged Southeastern Region

The firm said it “is obliged to declare a state of force majeure” and would no longer be able to provide crude to the Mellitah complex on the country’s northwestern coast.

Declaring force majeure is a legal move allowing parties to free themselves from contractual obligations when factors such as fighting or natural disasters make meeting them impossible.

According to Libya’s state news agency, the closure comes after a group of individuals declared that they were halting production “until a government appointed by parliament takes office in the capital”.

Libya has recently once again found itself with two rival governments after the eastern-based parliament in February appointed a new prime minister in a direct challenge to the UN-brokered government in Tripoli.

The move underlines the extent of divisions in the war-wracked country as observers fear a renewed descent into violence.

Al-Fil, some 750 kilometres southwest of Tripoli, is jointly managed by the NOC and Italian energy giant ENI and produces around 70,000 barrels of oil per day.

The field had already been forced to close temporarily in early March when an armed group shut down valves delivering crude.

Oil revenues are vital to the economy of Libya, a country sitting on Africa’s largest known reserves.

AFP

Pregnant Lady, Others Feared Dead As Fire Guts Jetty In Port Harcourt

Fire incidents are common in jetties in Rivers State.

 

Several persons, including a pregnant woman and a toddler, have been reportedly burnt to death in an early morning fire at the popular Bonny-Bille-Nembe jetty in the Port Harcourt, Rivers State.

Several fibre and wooden boats are also said to be destroyed in the inferno which started at about 2 am on Monday.

The cause of the massive blaze is not known. However, previous fire outbreaks at the jetty had been attributed to the storage of inflammable substances like petroleum products used in powering the speed boat engines in makeshift buildings within the slump.

READ ALSOGunmen Attack Imo Commissioner Father’s House, Burn Down Buildings, Cars

The last fore outbreak at the jetty was in November during which several persons were burnt and properties estimated at several millions of naira, destroyed.

The jetty is usually a busy transit point for thousands of residents traveling from Port Harcourt by sea to Bonny, Bille, Nembe, and other riverine communities.

The effects of these disasters are usually massive due to slow response to emergencies by the authorities or difficulties accessing the scene due to the terrain.

National Grid Collapse, Fuel Shortage: Relief Is On The Way – Buhari

The fuel scarcity led to a hike in transportation fares across the country.

 

President Muhammadu Buhari has assured Nigerians that the inconveniences caused by the prolonged shortage of petroleum products, and the collapse of the national grid, would soon be a thing of the past.

In a statement by his spokesman, Garba Shehu on Wednesday, the president while apologizing to Nigerians, promised that “relief is on the way”.

Buhari expressed sadness at the fact that Nigerians are experiencing at the moment something which he says his administration has successfully averted within its seven years in office.

President Buhari said: “The government is working round the clock to attend to this issue. An action plan agreed earlier this month is being implemented to address the scarcity. Working together with the Major Oil Marketers Association of Nigeria (MOMAN) and the Independent Petroleum Marketers Association of Nigeria (IPMAN), this plan is now bearing fruit”.

[READ ALSO] ‘Businesses Are Suffering,’ Elumelu Laments Over Hardship, Poverty In Nigeria

He said sufficient fuel supply has returned to a handful of states with reduced queues at stations falling, adding that in the coming days, that would be the case across the rest of the country.

“Looking to the longer term, funds are being targeted toward keeping fuel availability affordable for the country. The international energy markets have surged drastically in recent months; the government will however ensure that consumers are protected against these price spikes,” he said.

The President added that he has received information that some people are not behaving properly at the depots and among owners of petrol stations and in this regard, he has directed the Ministry of Petroleum Resources, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), the NNPC and the entire security apparatus of the nation to take strong action against those responsible.

On the issue of electricity blackouts experienced across the nation, President Buhari remarked that the situation is also being addressed.

“A dip in hydroelectric generation due to seasonal pressures has coincided with technical and supply problems at thermal stations. On this, the government is also working tirelessly to resolve the issues at the latter to guarantee sufficient power flows into the national grid,” Buhari said.

President Buhari disclosed that as part of emergency measures put in place following a meeting convened with key stakeholders to address the low power generation in the country, the main challenge was identified as being one of low gas power generation due to sabotage of gas pipelines leading to a shutdown of power plants coupled with ongoing routine maintenance on other gas power plants.

“To recover over 1000MW, actions were agreed upon between the players in the Nigerian Electricity Supply Industry (NESI) and also NNPC. The actions targeted the National Integrated Power Project (NIPP) plants, (Niger Delta Power Holding Company (NDPHC) and power plants run under NNPC Joint Ventures, Agip and Shell (NAOC and SPDC) and progress on the key actions have already ensured the restoration to the grid of 375MW after the pipeline from “Okpai 1” was repaired.

“To also ramp up the underutilised capacity of the NDPHC capacity, a USD 50 Million Gas Supply agreement is being finalized to secure the sustainability of up to 800MW of underutilized NIPP assets,” he explained.

The President assured Nigerians that the government’s attention to these problems will bear fruits very soon.

Tokyo Shares Slump As Oil Surges On Ukraine Crisis

File photo: A pedestrian walks past an electronic board displaying share prices on the Tokyo Stock Exchange in Tokyo on November 4, 2020.  Behrouz MEHRI / AFP

 

Tokyo stocks slumped Tuesday as surging oil prices and the Russia-Ukraine crisis continued to drag down global markets.

The benchmark Nikkei 225 index dropped 1.71 percent, or 430.46 points, to 24,790.95, while the broader Topix index gave up 1.90 percent, or 34.17 points, to 1,759.86.

The dollar fetched 115.52 yen, up from 115.27 yen in New York Monday.

The Tokyo market opened in negative territory, tracking falls on Wall Street, although bargain-hunters temporarily lifted the Nikkei above water by mid-morning.

But Russia’s intensifying assault on Ukraine continued to weigh on the market, with many investors already jittery about taking risks as they braced for possible further losses on Wall Street later in the day.

“Particularly in the afternoon session, investors increased their wariness about rising oil prices, and the Nikkei again extended its losses,” Okasan Online Securities said.

“Near the closing bell, the index was hovering near the intra-day low,” the brokerage added.

All sectors of the Tokyo market faced selling pressure but energy-related issues were among the hardest hit, as were steel, maritime shipping and finance related stocks.

Energy firm INPEC gave up 6.09 percent to 1,341 yen. Nippon Steel fell 6.54 percent to 1,972.5 yen.

SoftBank Group plunged 4.95 percent to 4,474 yen and construction equipment maker Komatsu fell 3.67 percent to 2,545.5 yen.

Toyota accelerated its losses in the afternoon, ending down 1.84 percent to 1,811 yen. Rival automaker Nissan gave up 5.51 percent to 438.8 yen.

Nintendo surrendered earlier gains and fell 1.42 percent to 56,410 yen, but Sony managed to stay above water and ended up 0.36 percent at 11,150 yen.

AFP

Ban On Russian Oil Will Have ‘Catastrophic Consequences’, Moscow Warns

Indigenous Firms Plan To Increase Oil Output
File photo used to illustrate this story.

 

Russian Deputy Prime Minister Alexander Novak warned Monday that a ban on Russian oil imports would have “catastrophic” consequences, as Western allies consider further sanctions on Moscow over Ukraine.

“A ban on Russian oil will lead to catastrophic consequences for the global market. The surge in prices will be unpredictable — more than $300 per barrel, if not more,” Novak said in remarks carried by Russian news agencies.

Novak added that it would be “impossible” to quickly replace Russian oil on the European market.

“It will take more than one year and it will be much more expensive for European consumers,” he said.

“European politicians should then honestly warn their citizens, consumers what awaits them and that prices at gas stations, for electricity, for heating will skyrocket,” he said.

READ ALSO: More Than 1.7 Million People Flee War In Ukraine, Says UNHCR

Novak said talks of an embargo on Russian oil creates “instability and leads to significant harm for consumers”.

He added that in retaliation for the halt on the Nord Stream 2 pipeline project, Russia could stop supplies via the Nord Stream 1 pipeline.

“So far we have not made this decision. Nobody will benefit from this,” Novak said.

“Although European politicians are pushing us to this with their statements and accusations against Russia,” he added.

AFP

As Ukraine Pushes Oil Over $100, Nigerians See Mixed Blessings

A motorist fill his tank with fuel bought with a jerrycan to avoid long queues formed during a fuel shortage in Lagos and neighbouring Ogun State, on March 3, 2022.  PIUS UTOMI EKPEI / AFP

 

Weaving in between the Lagos traffic, hawkers selling plantain snacks and water more recently offer drivers another treat: jerry cans filled with petrol to help with fuel shortages.

Petroleum-producing nations may be reaping extra revenue since Ukraine’s crisis pushed oil prices above $100 a barrel, but Nigerians this week were struggling with yet another round of fuel scarcities.

President Muhammadu Buhari says Africa’s top producer has a “great opportunity” with higher oil prices, but that was a hard sell for Lagos accountant Abdulazeez Oyefeso after three hours in a line for fuel.

“It’s more revenue for the country, but it doesn’t get down to the common man,” Oyefeso said, leaning against his Lexus among the cars snaking along Lagos’s main Alfred Rewane road near a gas station.


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Russia, Ukraine Delegates Resume Peace Talks


 

On the opposite side of the major avenue, touts carrying plastic jerry cans filled with yellow fuel and funnels crafted from water bottles flagged down passing cars offering to fill tanks for a premium.

Oil sales account for nearly 90 percent of Nigeria’s export revenue. But soaring prices — the highest in ten years after the invasion — are a mixed blessing.

OPEC member Nigeria has little capacity to refine its own crude and relies heavily on fuel imports so higher oil prices mean more budget spending.

Nigeria also operates a byzantine system of fuel subsidies that costs the state billions of dollars to artificially keep fuel costs low.

In place since the 1970s, fuel subsidies are politically sensitive and Nigeria’s import reliance also leaves the domestic market open to sporadic fuel shortages.

Currently, a litre of gasoline costs an average of 165 naira (40 US cents). On the black market this week it was fetching between 350 to 500 naira.

Since last month, the government said a batch of adulterated fuel was removed from the market, causing a shortfall.

State-run Nigerian National Petroleum Corporation chairman Mele Kyari on Thursday said measures were in place to get adequate supplies to depots.

“I am very sure that very soon we will see relief from this,” he told reporters.

Sleeping In Car

A roadside fuel vendor popularly called ‘fuel tout’ sell fuel from jerrycans, sold at above official rate to motorists trying to avoid long queues of vehicles at filling stations following fuel shortages in Lagos, on March 3, 2022. PIUS UTOMI EKPEI / AFP

 

Unruly lines of cars searching for fuel caused massive traffic jams earlier this week in Lagos and other cities. Motorbikes ferrying men on the back clutching four or five jerry cans to find fuel were a common sight.

Some commuters just walked. Others jumped off Lagos’ typical yellow Danfo minibuses caught in jams to continue on foot.

“My gauge was on reserve when I left home early this morning but the car stopped mid-way. Luckily, I have a small keg,” said one Lagos driver Onifade. “The government has to do something.”

Around Awolowo district of Lagos, where several filling stations operate, roads were blocked early in the week. Drivers wait on the sidewalk under the sun. Some had slept in the line overnight.

“People that had fuel this morning are the ones that slept in the queue yesterday night,” taxi driver Ali said. “And those people you see right now might sleep here tonight.”

More Budget Costs

Nigeria approved a long-awaited new oil law last year that aims to improve operating conditions to bring in more foreign investment to the flagging sector.

But some of Nigeria’s production is tied up in deals with refining companies for fuel and swaps for infrastructure projects so oil high prices are not the revenue boon they should be.

Today, most of Nigeria’s 1.4 million barrels per day oil output comes from off-shore “deep water” projects, where the government takes only 20 to 30 percent of revenue, said Bismarck Rewane, an economist at Financial Derivatives Co.

“The increase in price is not enough to compensate for the loss in production,” Rewane said. “Theoretically the picture looks great, but in reality it is more complicated.”

Nigeria’s finance minister last year suggested the costly fuel subsidy programme would end in June as urged by the World Bank and IMF.

But in January, ministers delayed the plan, saying the timing was problematic.

Less than a year from an election, ending subsidies could be costly as Nigerians see cheap fuel as one tangible they get from oil wealth.

“Nigeria, however, is in the uncanny position of being stuck in a subsidy arrangement that guarantees that high oil prices leads to an exponential rise in government expenditure,” said local risk analyst group SBM Intelligence.

“Momentary gains in the government’s coffers, therefore, might not make a big dent in the fiscal deficit.”

Lagos hawkers, though, did not let macroeconomic concerns deter them from a another chance for a fast buck.

Sitting on an empty blue 10-litre jerrycan on the roadside, Ahmed said he came just to make cash to supplement his carpet business.

“This is just a hustle,” he said. “This is our oil, and it’s a way to make quick money.”

AFP

Oil Tops $100, Stocks Dive As Russia Invades Ukraine

Exporting crude oil has been Nigeria's main source of revenue for decades. Sodiq Adelakun/Channels Television
Exporting crude oil has been Nigeria’s main source of revenue for decades. Sodiq Adelakun/Channels Television

 

Oil prices soared past $100 and safe havens rallied while equities tumbled Thursday after Russian President Vladimir Putin sent forces into Ukraine, accelerating fears of a major war in eastern Europe.

After weeks of warnings from the United States and other powers, the Kremlin — which is said to have around 200,000 lined up — ordered a wide-ranging offensive into its neighbour, days after saying it would provide “peacekeepers” to two breakaway regions.

The Russian president said in a surprise statement on television: “I have made the decision of a military operation.”

He also vowed retaliation against anyone who interfered and called on the Ukraine military to lay down its arms.

READ ALSO: Russian Ground Forces Cross Into Ukraine, Says Kyiv

There were later reports of incursions from several directions, with Ukraine’s border guard service saying Russian tanks and other heavy equipment crossed the frontier.

The news sparked a furious reaction from world leaders and pledges to ramp up sanctions on Moscow.

Oil prices rocketed more than six percent with Brent cruising past $100, for the first time since September 2014, while other commodities including wheat rallied on fears about supplies from the resource-rich region. Aluminium hit a record high.

Safe have assets also surged, with gold hitting a more than one-year high, the Japanese yen piling higher against the dollar and the Swiss franc hitting a five-year high on the euro.

The dollar was up nine percent against the ruble, which has been battered in recent weeks on worries about the impact of sanctions on the Russian economy, while the Moscow Stock Exchange plunged almost 14 percent after suspending trading earlier in the day.

The country’s central bank said it was intervening to “stabilise the situation”.

Asian equities plunged, with Hong Kong, Sydney, Mumbai, Singapore and Wellington down at least three percent, while Seoul, Taipei, Bangkok and Manila fell more than two percent. There were also steep losses in Tokyo, Shanghai and Jakarta.

London lost more than two percent at the open while Paris and Frankfurt lost more than four percent.

“It is hard to find any reasons for the selloff to reverse now that it appears the tanks are rolling,” said OANDA’s Jeffrey Halley.

“Stronger sanctions are to come on Russia and energy prices will inevitably head higher in the short term.”

Ukrainian President Volodymyr Zelensky had earlier warned Russia could start “a major war in Europe” in the coming days.

US President Joe Biden deplored the Russian operation as an “unprovoked and unjustified” attack, adding that it would cause “catastrophic loss of life and human suffering”. Further stringent sanctions would be announced, he said.

He was joined by leaders around the world, with NATO ambassadors holding an urgent meeting and the European Union saying Moscow would face “unprecedented isolation”.

Earlier, the United Nations was told a full-scale Russian invasion would have a devastating global impact that would likely spark a new “refugee crisis”.

China called for “restraint” on all sides.

“Russia/Ukraine tensions bring both a possible demand shock (for Europe), and more importantly a much larger supply shock for the rest of the world given the importance of Russia and Ukraine to energy, hard commodities and soft commodities,” said National Australia Bank’s Tapas Strickland.

The crisis comes as governments struggle to contain runaway inflation fuelled by demand as life returns after recent Covid-19 lockdowns, with many fearing the fragile global economic recovery from the pandemic could be knocked off course.

After staging a slight bounce Wednesday in reaction to what were considered light sanctions against Moscow, Asian markets were back in the red after a hefty drop on Wall Street.

‘Policy mistakes’

The stand-off in Europe has provided central banks with a further headache as they move to lift pandemic-era financial support and tighten monetary policy.

Attention is on every utterance from Federal Reserve officials as they prepare to hike interest rates next month, with speculation over how fast and hard it will move.

Commentators said bets are on six increases this year, down from previous forecasts for up to seven, adding the stakes are rising further.

“Policy mistakes at this point in time are almost guaranteed,” Shana Sissel of Banrion Capital Management told Bloomberg Television.

“The question isn’t, ‘Is there going to be a policy mistake?’, but, ‘How bad will it be? Will the Fed hike too much too fast, will they front-load everything?'”

And with uncertainty reigning supreme, warnings abound of worse to come, with BNY Mellon Investment Management’s Lale Akoner saying: “Expect volatility to really persist in the next few months.”

Geopolitical risks were flaring at a “very inopportune time”, she added, as traders try to navigate central bank tightening.

Key figures around 0710 GMT

Brent North Sea Crude: UP 6.8 percent at $103.38 per barrel

West Texas Intermediate: UP 6.4 percent at $97.97 per barrel

Tokyo – Nikkei 225: DOWN 1.8 percent at 25,970.82 (close)

Hong Kong – Hang Seng Index: DOWN 3.2 percent at 22,901.56 (close)

London – FTSE 100: DOWN 2.7 percent at 7,298.98

Shanghai – Composite: DOWN 1.7 percent at 3,429.96 (close)

Dollar/yen: DOWN at 114.61 yen from 114.96 yen late Wednesday

Euro/dollar: DOWN at $1.1251 from $1.1308

Pound/dollar: DOWN at $1.3478 from $1.3545

Euro/pound: UP at 83.46 pence from 83.41 pence

New York – Dow: DOWN 1.4 percent at 33,131.76 (close)

AFP

Somali Leaders Reject ‘Illegal’ Oil Deal With US Company

Somalia Election: Mohamed Abdullahi Emerges As President
A photo of the Somalian flag.

 

Somalia’s President and premier have declared null and void a deal signed by their energy minister with a US company to explore for oil and gas off the coast of the troubled Horn of Africa nation.

Minister of Petroleum and Mineral Resources Abdirashid Mohamed Ahmed and Coastline Exploration Ltd had announced on Saturday seven production sharing agreements (PSAs) covering deepwater offshore blocks.

Ahmed hailed it as a “huge moment” for Somalia, one of the poorest countries in the world, which is in the grip of a political crisis over long-delayed elections and also battling a jihadist insurgency.

Read Also: China Helps Virus-Ravaged Hong Kong Build Isolation Units

“Recently completed seismic programmes indicate that Somalia has the potential to become a significant oil and gas producing country,” he said in a statement.

The PSAs “will have an immediate positive effect on the country”, he said, and are expected to generate tens of millions of dollars for federal and state coffers.

But both Somalia’s president and prime minister — who are often at loggerheads — swiftly denounced the deal late Saturday.

The office of President Mohamed Abdullahi Mohamed, better known by his nickname Farmajo, said it flouted a decree that bans the signing of any agreements with foreign governments or entities during the election period.

“Therefore the agreement which the minister signed is null and void,” it said in a statement.

Prime Minister Mohamed Hussein Roble also dismissed the agreement as “illegal, unacceptable” in a post on Twitter, saying he would “take all appropriate measures to protect our national resources”.

Somalia is plodding through an election process that is more than a year overdue and has been marred by violence, including an attack Saturday in the central town of Beledweyne that killed 14 people on the eve of a round of voting for parliamentary seats there.

Coastline, which is based in Houston, Texas, had hailed the deal as a “defining moment” for Somalia, which has so far not produced oil or gas although exploration started in the 1950s before being derailed by the civil war.

“Somalia contains the largest remaining unexplored set of basins situated in warm waters in the world,” Coastline chief executive W. Richard Anderson said in a statement.

There was no immediate response from Coastline to requests for comment about the Somali leaders’ reaction to the deal.

Oil Bunkering: Why We Can’t Tolerate Acts Of Economy Sabotage – Wike

A file photo of Rivers State Governor, Nyesom Wike.

 

Rivers State Governor, Nyesom Wike, says as a responsible government, even if his political party; Peoples Democratic Party (PDP) is in opposition, his administration will not allow any act of economic sabotage such as crude oil theft in the state.

Governor Wike said the war against illegal refining of crude oil is not about the political party but Nigeria and its survival. He stated that it is also about ensuring that the health of Rivers people is not endangered.

According to a statement by his special media aide, Kelvin Ebiri, the Rivers State Governor made the assertion during a security meeting he had with heads of security agencies in the State and five local government chairmen at the Government House in Port Harcourt on Friday.

READ ALSO: APC Has Failed To Protect Plateau State, PDP Ready To Takeover – Wike

“The mere fact that I am in opposition does not mean that I have to sabotage the economy of the nation. This country belongs to all of us and you know that oil is the major source of revenue for the federation that the three tiers of government share from,” the statement added.

“So, you cannot, because you’re of the opposition, close your eyes and allow that to happen. No responsible government does that. This is not about the party. It is about Nigeria. It is about making sure this country survives and then also the health factor.

“We must continue to take this war very seriously. Not only because it is sabotage to the national economy but also for the health of our people, which, for me, is the key why we must fight against this sabotage.”

Governor Wike commended the security agencies and some chairmen of councils who have shown seriousness in the fight against operators of illegal crude oil refineries in the state. He, however, urged them not to rest on their oars because the fight is far from over, especially with such commitment to save Rivers people and all residents of the likely ailment soot causes.

“So, let’s take this as a war that we must save our people. And we must save our nation. I commend you so far for your efforts. But we must redouble our efforts and not give any chances to these armed robbers that they called bunkers,” the governor said.

“As far as I am concerned, they’re even worse than armed robbers. One who sabotages the national economy is worse than an armed robber.”

Governor Wike explained that the list bearing the names of those selected to be part of the task force against illegal refining activities has been sent to the Department of State Services (DSS) for profiling.

According to him, the prospective members are drawn from council areas where their chairmen have shown commitment to the fight. Governor Wike urged the DSS to be dutiful and attend to it quickly so that those who scaled can be assigned their responsibilities.

“It is important that when you profile them, you do it quickly too so that they can start work. Those in whom we have no trust, we remove them,” Wike added.

Speaking further, Governor Wike said he has approved the money that was pledged to councils that have identified and destroyed sites used for illegal crude oil refining. He clarified that only five local government areas have satisfied the conditions to get the fund.

“I will not give a local government money that I have not seen any commitment. No, I won’t do that. I want to see commitment,” he said. “So, it is only those that have shown commitment that I have approved the money for.”

SEPCOL’s Oil Field Fire Extinguished, Evacuation Operation Launched – Ikeazor

The scene of the explosion.

 

Minister of State for the Environment, Chief Sharon Ikeazor has announced that the recent fire incident at Ukpokiti Oil Field, involving the Floating Production Storage and Offtake of Shebah Exploration and Production Company Limited (SEPCOL), has been ‘totally’ extinguished.

Ikeazor in a statement on Sunday assured that the National Oil Spill Detection Response Agency (NOSDRA), the scheduled agency under her ministry, will go for overflight today (Sunday) and Monday to monitor the situation of crude spill in the sea.

She noted that the overflight operation will be sustained in the weeks ahead until whatever remnants of oil in the FPSO are evacuated and measures evolved to forestall a recurrence of such kind of incident.

Ikeazor had in a communique on Friday, assured that necessary efforts are being made to ensure the fire incident at Ukpokiti oil field is contained after a fire engulfed a floating production, storage, and offloading (FPSO) vessel named ‘Trinity Spirit’ in the early hours of Wednesday.

READ ALSO: No ‘Reported Fatalities’ Yet In Trinity Spirit FPSO Fire Incident, Says SEPCOL

But in a recent update, Ikeazor said the fire incident at Ukpokiti Oil Field was eventually contained on Thursday evening.

She made this known after receiving an update from the Director-General of NOSDRA, saying a ‘joint investigation’ operation was conducted at the incident area on Saturday.

She equally said NOSDRA had an overflight on the incident area last Friday, to ascertain from the air what the surrounding conditions were, after extinguishing the fire.

According to the Environment Minister, a joint investigation visit to the incident area, as well as the FPSO, was undertaken on Saturday by NOSDRA, the Nigerian Maritime Administration and Safety Agency (NIMASA), the Ondo State Ministry of Environment, Representatives of Communities proximate to the Area and staff of Shebah Exploration and Production Company Limited.

“While the cause of the fire incident is yet to be fully determined, the environment around the FPSO is only slightly covered by sheen and emulsified oil,”  the ministry said.

It was earlier reported that the approximate quantity of oil in the FPSO in the recent past was said to be a little less than 200 000 barrels.

One of the operators utilizing the services provided by the FPSO was said to have made an Offtake of approximately 120,000 barrels before the incident; leaving an estimated 50-60 000 barrels in the FPSO as at the time of the fire incident.

“NOSDRA will continue to give updates on this incident after each aerial surveillance scheduled for today and Monday,” Ikeazor assured.