Connect with us

Spread & Containment

Conflict In North Africa Threatens Gas Supply To Europe

Conflict In North Africa Threatens Gas Supply To Europe

Authored by Cyril Widdershoven via OilPrice.com,

A diplomatic crisis between Morocco and Algeria threatens gas supply to Spain

Spain considers importing more (expensive) LNG

Published

on

Conflict In North Africa Threatens Gas Supply To Europe

Authored by Cyril Widdershoven via OilPrice.com,

  • A diplomatic crisis between Morocco and Algeria threatens gas supply to Spain

  • Spain considers importing more (expensive) LNG

  • Algeria faces a number of problems in expanding its gas market share in Europe

European natural gas supplies are not only waning because of lower Russian supply. Brussels, Berlin and even the Hague are keeping a keen eye on the statements made by Russian President Vladimir Putin and market reports about reduced flows through the Yamal pipeline and Ukraine. At the same time, it seems that Fort Europe is being besieged from all sides. The market is also being confronted by the negative implications of a political crisis between Morocco and Algeria, negatively impacting the latter’s gas supplies to the Iberian Peninsula. 

For a few weeks a full-out political, economic and possibly security crisis has been building up between Algeria and Morocco, mainly caused by the still continuing Western Sahara-Mauritania conflict. For decades, Morocco has exerted control over the Western Sahara, fighting a military conflict with rebel movement Polisario, which is backed by Algiers. Until now, Morocco has controlled most of the Western Sahara territory, considering it to be Moroccan. And since August 2021, when Algeria severed its diplomatic relations with Morocco, the conflict has spread to gas pipeline politics too. 

Algeria is facing a struggling economy, which has been hit hard by COVID-19, endemic corruption, mismanagement and internal political strive. Algeria’s leaders are also increasingly worried about Morocco’s growing political influence in the region, and even its improving relations with Israel. Internal instability, especially after the death of its former leader Bouteflika, has caused economic mayhem, and has led its oil and gas sector, the major source of income, to decline. 

The last decade, both countries also have been in an arms race, which Algeria due to higher oil and gas prices has been winning, but in which Morocco is returning to take the lead. The arms race, combined with a regional power strive between Morocco and Algeria, even into the Gulf region, has caused immense friction. Until now, the strife between the two North-Afican nations, has not had a major impact on Europe. While Brussels, Madrid and other European powers, have been keeping an eye on the conflict and internal developments, the rift was regarded as an insignificant power struggle. This has, however, changed dramatically since Algeria decided to close the Maghreb-Europe gas pipeline on November 1st.

Algiers decided to close down the conduit after Morocco refused to invest in its own part of the gas export pipeline, while still taking a part of the gas in the pipeline as payment for the transfer rights. Morocco used the gas to produce around 12% of the country’s electricity. Due to the closure, Spain is directly affected. In the heads of Algerian leaders, the Medgaz pipeline is seen as a replacement, which would allow Algeria to get rid of intermediaries and to cut Morocco out. 

The closure was expected, after that Algerian President Abdelmadjid Tebboune issued an order to Sonatrach, Algeria's state energy firm, to stop supplying export gas to Spain through the Maghreb pipeline on October 31. Even though Spain has been known as a major renewable energy proponent, mainly wind and solar, the country still relies on natural gas for almost 50% of its energy needs, most of it is being supplied via the Maghreb pipeline.

Knowing that Algeria refuses to renew the contract with Morocco, Spain has been left scrambling for whatever gas supply it can get hold of.  Increasing LNG imports is the first option that comes to mind, but buying spot cargoes on the market isn’t going to be easy. Madrid will have to compete with various other European and Asian buyers, which are already paying top-dollar for extra cargoes. As the Iberian Peninsula is not strongly connected to the European gas grid, importing gas from other European nations is also going to be challenging in the short term. Algerian natural gas supplies are still the main and at present the only real option. As the Magrheb-Europe gas pipeline delivered around 6 BCM per year, the gap is immense. 

The only other solution is to increase the Medgaz pipeline flows. Medgaz was inaugurated a decade ago and it is controlled jointly by the Algerian state (51%) and by the Spanish energy company Naturgy, formerly known as Gas Natural Fenosa (49%). Normally it provides around 25% of natural gas that reaches Spain. Algeria has pledged to raise its capacity from eight bcm to 10 bcm a year, but Spain would still need around four bcm more to cover its needs. Some Algerian LNG could also be heading to Spain, but the price for these spot cargoes will undoubtedly be high as other countries are also bidding for the same cargoes.

The overall impact on Spain could be significant. Natural gas is not only used for heating or industry use, but also for combined cycle power plants, which are generating around 30-33% of total electricity consumed. When looking at the available strategic gas reserves, the options are limited. Spanish minister of energy Teresa Ribera reported yesterday that the country has only natural gas reserves equivalent to 43 days of consumption. She however also reiterated that Algeria has offered to send higher volumes to Spain if needed. 

Algeria’s strategy is very diffuse at present. The lack of transparency in its oil and gas sector is extreme, while overall production capacity is under pressure. Some are even stating that the current crisis could be a way of hiding ongoing supply constraints or outright lack of export volumes. 

At the same time, Algeria stated bluntly today that it targets a 30% gas market share in Europe. On October 2nd, Algerian Energy Minister Mohamed Arkab stated that his country was seeking to increase its share of the European gas market to over the current 30%. Algerian press agency APS said that “the minister reiterated the country's ambition to further strengthen its presence on this market by suggesting additional quantities". Markets are however very doubtful this will happen in the next 2-5 years. Algeria is currently producing 1.2 million oil barrels per day and 130 billion cubic meters of natural gas annually, making it Africa’s largest gas exporter.

Tyler Durden Mon, 11/08/2021 - 03:30

Read More

Continue Reading

Spread & Containment

Easyjet share price down 3% as pandemic losses hit £2.2 billion

The EasyJet share price shed over 3% today to give up a chunk of…
The post Easyjet share price down 3% as pandemic losses hit £2.2 billion first appeared on Trading and Investment News.

Published

on

The EasyJet share price shed over 3% today to give up a chunk of the gains the budget airline had made earlier in the week. The new slide came after it announced a £213 loss for the last quarter of the year covering the Christmas period, taking losses for the Covid-19 pandemic period to £2.2 billion. The airline also told investors it is still burning through £150 million in cash every month as it struggles to build capacity back up.

The short-haul airline that makes most of its income shuttling holidaymakers and business travellers around Europe said it is still only operating at around half of its pre-pandemic capacity. However, it is hopeful that pent-up demand and an end to travel restrictions mean it will return to pre-pandemic levels by summer and enjoy much brisker trade than of late over the Easter and spring period.

easy jet plc

But before then the airline company will again have to absorb deep losses over the current quarter, which is traditionally its weakest of the year. Even a strong summer period, think most analysts, will be insufficient to see the company return to profit this year. EasyJet’s value is still less than half of what it was in February 2020 before the coronavirus-induced market sell-off that hit later that month and saw markets dive into March before starting to recover. The share prices of rival budget airlines Ryanair and WizzAir have recovered much more strongly in comparison to EasyJet’s and are now close to their pre-pandemic levels. There have been concerns around whether EasyJet could survive the pandemic but investors contributed £1.2 billion last autumn to bolster its balance sheet.

The EasyJet share price is closing the week at around £6.15 compared to over £15 before the pandemic. However, there is now hope the worst may be behind the airline and it can begin its, potentially long, journey back to health. Chief executive John Lundgren attempted to soften the announcement of another hefty loss with a bullish statement on where things go from here for his company:

“Booking volumes jumped in the UK following the welcome reduction of travel restrictions announced on January 5, which have been sustained and given a further boost from the UK government’s decision this week to remove all testing requirements.”

“We believe testing for travel across our network should soon become a thing of the past. We see a strong summer ahead, with pent-up demand that will see easyJet returning to near-2019 levels of capacity, with UK beach and leisure routes performing particularly well.”

For now, however, forward guidance for the immediate quarter remains cautious with the company admitting it has fallen short of its expectations to be at 80% capacity by this quarter, sitting at just 67%. However, with most analysts confident the company will eventually return to strength, and profit in the 2022-23 financial year, EasyJet shares could offer a good buying opportunity at current levels.

The post Easyjet share price down 3% as pandemic losses hit £2.2 billion first appeared on Trading and Investment News.

Read More

Continue Reading

Spread & Containment

Authoritarian Madness: The Slippery Slope From Lockdowns To Concentration Camps

Authoritarian Madness: The Slippery Slope From Lockdowns To Concentration Camps

Authored by John W. Whitehead & Nisha Whitehead via The Rutherford Institute,

“All the Dachaus must remain standing. The Dachaus, the Belsens, the Buchenwal

Published

on

Authoritarian Madness: The Slippery Slope From Lockdowns To Concentration Camps

Authored by John W. Whitehead & Nisha Whitehead via The Rutherford Institute,

“All the Dachaus must remain standing. The Dachaus, the Belsens, the Buchenwald, the Auschwitzes—all of them. They must remain standing because they are a monument to a moment in time when some men decided to turn the Earth into a graveyard. Into it they shoveled all of their reason, their logic, their knowledge, but worst of all, their conscience. And the moment we forget this, the moment we cease to be haunted by its remembrance, then we become the gravediggers.”

- Rod Serling, Deaths-Head Revisited

In the politically charged, polarizing tug-of-war that is the debate over COVID-19, we find ourselves buffeted by fear over a viral pandemic that continues to wreak havoc with lives and the economy, threats of vaccine mandates and financial penalties for noncompliance, and discord over how to legislate the public good without sacrificing individual liberty.

The discord is getting more discordant by the day.

Just recently, for instance, the Salt Lake Tribune Editorial Board suggested that government officials should mandate mass vaccinations and deploy the National Guard “to ensure that people without proof of vaccination would not be allowed, well, anywhere.”

In other words, lock up the unvaccinated and use the military to determine who gets to be “free.”

These tactics have been used before.

This is why significant numbers of people are worried: because this is the slippery slope that starts with well-meaning intentions for the greater good and ends with tyrannical abuses no one should tolerate.

For a glimpse at what the future might look like if such a policy were to be enforced, look beyond America’s borders.

In Italy, the unvaccinated are banned from restaurants, bars and public transportation, and could face suspensions from work and monthly fines. Similarly, France will ban the unvaccinated from most public venues.

In Austria, anyone who has not complied with the vaccine mandate could face fines up to $4100. Police will be authorized to carry out routine checks and demand proof of vaccination, with penalties of as much as $685 for failure to do so.

In China, which has adopted a zero tolerance, “zero COVID” strategy, whole cities—some with populations in the tens of millions—are being forced into home lockdowns for weeks on end, resulting in mass shortages of food and household supplies. Reports have surfaced of residents “trading cigarettes for cabbage, dishwashing liquid for apples and sanitary pads for a small pile of vegetables. One resident traded a Nintendo Switch console for a packet of instant noodles and two steamed buns.”

For those unfortunate enough to contract COVID-19, China has constructed “quarantine camps” throughout the country: massive complexes boasting thousands of small, metal boxes containing little more than a bed and a toilet. Detainees—including children, pregnant women and the elderly— were reportedly ordered to leave their homes in the middle of the night, transported to the quarantine camps in buses and held in isolation.

If this last scenario sounds chillingly familiar, it should.

Eighty years ago, another authoritarian regime established more than 44,000 quarantine camps for those perceived as “enemies of the state”: racially inferior, politically unacceptable or simply noncompliant.

While the majority of those imprisoned in the Nazi concentration camps, forced labor camps, incarceration sites and ghettos were Jews, there were also Polish nationals, gypsies, Russians, political dissidents, resistance fighters, Jehovah’s Witnesses, and homosexuals.

Culturally, we have become so fixated on the mass murders of Jewish prisoners by the Nazis that we overlook the fact that the purpose of these concentration camps were initially intended to “incarcerate and intimidate the leaders of political, social, and cultural movements that the Nazis perceived to be a threat to the survival of the regime.”

As the U.S. Holocaust Memorial Museum explains:

“Most prisoners in the early concentration camps were political prisoners—German Communists, Socialists, Social Democrats—as well as Roma (Gypsies), Jehovah's Witnesses, homosexuals, and persons accused of ‘asocial’ or socially deviant behavior. Many of these sites were called concentration camps. The term concentration camp refers to a camp in which people are detained or confined, usually under harsh conditions and without regard to legal norms of arrest and imprisonment that are acceptable in a constitutional democracy.”

How do you get from there to here, from Auschwitz concentration camps to COVID quarantine centers?

Connect the dots.

You don’t have to be unvaccinated or a conspiracy theorist or even anti-government to be worried about what lies ahead. You just have to recognize the truth in the warning: power corrupts, and absolute power corrupts absolutely.

This is not about COVID-19. Nor is it about politics, populist movements, or any particular country.

This is about what happens when good, generally decent people—distracted by manufactured crises, polarizing politics, and fighting that divides the populace into warring “us vs. them” camps—fail to take note of the looming danger that threatens to wipe freedom from the map and place us all in chains.

It’s about what happens when any government is empowered to adopt a comply-or-suffer-the-consequences mindset that is enforced through mandates, lockdowns, penalties, detention centers, martial law, and a disregard for the rights of the individual.

The slippery slope begins in just this way, with propaganda campaigns about the public good being more important than individual liberty, and it ends with lockdowns and concentration camps.

The danger signs are everywhere.

Claudio Ronco, a 66-year-old Orthodox Jew and a specialist in 18th-century music, recognizes the signs. Because of his decision to remain unvaccinated, Ronco is trapped inside his house, unable to move about in public without a digital vaccination card. He can no longer board a plane, check into a hotel, eat at a restaurant or get a coffee at a bar. He has been ostracized by friends, shut out of public life, and will soon face monthly fines for insisting on his right to bodily integrity and individual freedom.

For all intents and purposes, Ronco has become an undesirable in the eyes of the government, forced into isolation so he doesn’t risk contaminating the rest of the populace.

This is the slippery slope: a government empowered to restrict movements, limit individual liberty, and isolate “undesirables” to prevent the spread of a disease is a government that has the power to lockdown a country, label whole segments of the population a danger to national security, and force those undesirables—a.k.a. extremists, dissidents, troublemakers, etc.—into isolation so they don’t contaminate the rest of the populace.

The world has been down this road before, too.

Others have ignored the warning signs. We cannot afford to do so.

As historian Milton Mayer recounts in his seminal book on Hitler’s rise to power, They Thought They Were Free:

“Most of us did not want to think about fundamental things and never had. There was no need to. Nazism gave us some dreadful, fundamental things to think about—we were decent people‑—and kept us so busy with continuous changes and 'crises' and so fascinated, yes, fascinated, by the machinations of the 'national enemies', without and within, that we had no time to think about these dreadful things that were growing, little by little, all around us.”

The German people chose to ignore the truth and believe the lie.

They were not oblivious to the horrors taking place around them. As historian Robert Gellately points out, “[A]nyone in Nazi Germany who wanted to find out about the Gestapo, the concentration camps, and the campaigns of discrimination and persecutions need only read the newspapers.”

The warning signs were there, blinking incessantly like large neon signs.

“Still,” Gellately writes, “the vast majority voted in favor of Nazism, and in spite of what they could read in the press and hear by word of mouth about the secret police, the concentration camps, official anti-Semitism, and so on. . . . [T]here is no getting away from the fact that at that moment, ‘the vast majority of the German people backed him.’”

Half a century later, the wife of a prominent German historian, neither of whom were members of the Nazi party, opined: “[O]n the whole, everyone felt well. . . . And there were certainly eighty percent who lived productively and positively throughout the time. . . . We also had good years. We had wonderful years.”

In other words, as long as their creature comforts remained undiminished, as long as their bank accounts remained flush, as long as they weren’t being locked up, locked down, discriminated against, persecuted, starved, beaten, shot, stripped, jailed or killed, life was good.

Life is good in America, too, as long as you’re able to keep cocooning yourself in political fantasies that depict a world in which your party is always right and everyone else is wrong, while distracting yourself with bread-and-circus entertainment that bears no resemblance to reality.

Indeed, life in America may be good for the privileged few who aren’t being locked up, locked down, discriminated against, persecuted, starved, beaten, shot, stripped, jailed or killed, but it’s getting worse by the day for the rest of us.

Which brings me back to the present crisis: COVID-19 is not the Holocaust, and those who advocate vaccine mandates, lockdowns and quarantine camps are not Hitler, but this still has the makings of a slippery slope.

The means do not justify the ends: we must find other ways of fighting a pandemic without resorting to mandates and lockdowns and concentration camps. To do otherwise is to lay the groundwork for another authoritarian monster to rise up and wreak havoc.

If we do not want to repeat the past, then we must learn from past mistakes.

January 27 marks Remembrance Day, the anniversary of the liberation of Auschwitz-Birkenau, a day for remembering those who died at the hands of Hitler’s henchmen and those who survived the horrors of the Nazi concentration camps.

Yet remembering is not enough. We can do better. We must do better.

As I make clear in my book Battlefield America: The War on the American People and in its fictional counterpart The Erik Blair Diaries, the world is teetering on the edge of authoritarian madness.

All it will take is one solid push for tyranny to prevail.

Tyler Durden Fri, 01/28/2022 - 23:40

Read More

Continue Reading

Spread & Containment

Eli Lilly says FDA could deny expanded use of arthritis drug for eczema

Eli Lilly said on Jan. 28 the company expects the U.S. Food and Drug Administration to decline the approval of expanded use of the rheumatoid arthritis drug Olumiant as a treatment for adults with moderate-to-severe eczema.

Published

on

Eli Lilly says FDA could deny expanded use of arthritis drug for eczema

(Reuters) – Eli Lilly and Co (LLY.N) said on Friday it expects the U.S. Food and Drug Administration to decline the approval of expanded use of its rheumatoid arthritis drug as a treatment for adults with moderate-to-severe eczema.

“At this point, the company does not have alignment with the FDA on the indicated population,” the drugmaker said.

Olumiant, discovered by Incyte Corp (INCY.O) and licensed to Lilly, belongs to a class of drugs called JAK inhibitors, which came under regulatory scrutiny after Pfizer’s (PFE.N) arthritis drug Xeljanz showed an increased risk of serious heart-related problems and cancer in a February trial. read more

The path to approval for the drug has been arduous, with the FDA extending its review timeline repeatedly.

AbbVie’s (ABBV.N) rival eczema drug, Rinvoq, also faced similar regulatory hurdles before being finally approved by the FDA earlier this month, as well as Pfizer’s Cibinqo. read more

“While not specified by the company, we wonder if the FDA may be looking to limit the use of the product (Olumiant) to an even smaller subset of patients than what Rinvoq and Cibinqo were approved for,” Mizuho analyst Vamil Divan said in a client note.

An Eli Lilly and Company pharmaceutical manufacturing plant is pictured at 50 ImClone Drive in Branchburg, New Jersey, March 5, 2021. REUTERS/Mike Segar/File Photo

Lilly also said it has decided to discontinue its program for testing use of Olumiant in autoimmune disease lupus, based on early results from two late-stage trials.

The decision would adversely affect Lilly which continues to bet on upcoming regulatory decisions on the drug for treating COVID-19 for certain hospitalized patients and severe alopecia areata, a type of hair loss.

In the United States, the drug is already authorized for emergency use in hospitalized adults with COVID-19 and children aged two or older requiring supplemental oxygen or mechanical ventilation. Lilly awaits Olumiant’s full approval in certain hospitalized COVID-19 patients, with an anticipated regulatory action in the second quarter.

Reporting by Manojna Maddipatla in Bengaluru; Editing by Krishna Chandra Eluri and Shinjini Ganguli

Our Standards: The Thomson Reuters Trust Principles.

Read More

Continue Reading

Trending