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Companies count the costs of blackouts in Spain and Portugal
Business associations and companies started counting the costs as factories, hotels, and stores in Spain and Portugal slowly returned to normal after the massive blackout of the previous day. CEOE, the main Spanish business lobby, estimated that the outage could shave off 1.6 billion euro ($1.82 billion) or 0.1% of gross domestic product. They noted it would take a week or longer for oil refineries to fully resume their operations, and some industrial ovens were damaged. The meat industry estimates losses up to 190 millions of euros due to the loss of power in fridges, among other things. In some parts of Spain, the blackout lasted for more than 12 hour. The sector's association ANGED reported that most food stores operated normally on Tuesday. However, they were still assessing the amount of produce that had gone bad, or how much money had been lost due to card payment systems going offline and ATMs being out of service. Not everyone had the cash to purchase water, canned foods, flashlights and radios. Bank of Spain has confirmed that payments via card have resumed and ATMs are working. Volkswagen's Navarra plant, which employs 4,600 workers, only resumed production at 2.30 p.m. Tuesday, as the industry was facing some of its biggest challenges. A company spokesperson confirmed that the factory had lost about 1,400 vehicles since Monday. Volkswagen's Spanish SEAT brand also reported that production at its Barcelona factory, where 14,000 workers work, had not been fully restored after the power was restored at 1 am local time. Other sectors such as Spain’s vital tourism industry were mostly unaffected. The telecommunications failure has created a "very complex situation", said Jorge Marichal, the chairman of Spain's Hotel Association CEHAT. Many guests sought refuge in hotels. He said that we had a good occupancy rate and were able to assist some public agencies who requested help in accommodating people. Some companies, hoping for a quick fix to the blackout kept their staff on site for hours. Others, like industrial manufacturer Thune Eureka, in northern Spain sent workers home earlier during the blackout. The company's president, Adrian Garcia Aranyos said that his head of IT was a former power grid supervisor in Venezuela, and this had given them an unexpected advantage. "He knew that it would take at least eight... He said that we made a quick decision because of him after an hour without power. $1 = 0.8771 Euros (Reporting and Editing by Andrei Khalip, Barbara Lewis, Aislinn laing, Jesus Aguado)
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Grangemouth Oil Refinery in Scotland ends crude processing and redundancies begin
The operator of Scotland's sole oil refinery, Petroineos, said in a press release that the facility has ceased processing crude oil as of Tuesday. It is now converting to an import terminal. Petroineos (a joint venture between Ineos founded by British billionaire Jim Ratcliffe and Chinese state-owned PetroChina) confirmed in September the Grangemouth refinery will cease production in the second half of 2025. Iain Hardie is the region head for legal and external affairs of Petroineos. He said that the company had invested 67.06 millions pounds (50 million pounds) to convert to an import terminal. Petroineos announced that it would close the refinery due to losses of around $5000 per day. It also said the refinery was no longer competitive with other sites, such as those in Africa, the Middle East and Asia. Grangemouth is Britain's oldest refinery. Closures are being made in Europe due to a decline in refining capacity as companies look to convert or close oil refining assets. Shell will also close its German Wesseling Refinery in this year. Unite has announced that the first round of layoffs at Grangemouth is underway. Petroineos reported in September that as part of the closure of Grangemouth, the number employees was expected to drop from just 75 to 475. Sharon Graham, Unite's general secretary, said: "Highly-skilled and well-paid workers were thrown onto an industrial trash heap." Hardie, from Petroineos, said: "Our colleagues showed incredible commitment, dignity, and resilience throughout the months of uncertainty about the future of this plant, during the consultation period, the phased shutdown, and the beginning of refinery decommissioning." Unite, however, said that the UK government did not do enough in the short-term to protect jobs. The Grangemouth refinery was primarily responsible for processing crude oil from the North Sea. It is connected to the Forties Pipeline System. According to Kpler, a global provider of real-time analytics and data, it also imports crude oil by sea to the Finnart Terminal, where the last shipment from Algeria arrived on 7 March.
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John Paulson, a billionaire investor, believes that gold will be near $5,000 in 2028.
In an interview, John Paulson, a billionaire investor who has reaffirmed his commitment to U.S. mine projects, said that central bank gold purchases and global trade tensions will likely push bullion to prices near $5,000 per ounce by the year 2028. Gold reached a record-high just above $3.500 last week, and banks are now increasing their estimates. Deutsche Bank, for example, believes that bullion will reach $3,700 per ounce next year. Paulson, who is already the largest shareholder of Idaho gold and antimony developer Perpetua Resources in Alaska, bought last week a 40% stake from Barrick in NovaGold’s Donlin project. When asked where he expected bullion to go, Paulson quoted a recent estimate that he received for levels in the "high $4,000" range within three years. "It is a well-informed forecast." Paulson stated, "I think that number is reasonable." "Central banks and the public are looking to invest their money in more stable sources... "I think that gold will continue to increase in importance around the globe," he said. The New York-based investment cited the Western confiscation after Moscow invaded Ukraine of Russia's holdings of foreign reserves as a catalyst to get central banks around the world - and especially China - to buy gold. Paulson stated that "when the war began, (Russian) kept their gold reserves, which were safe, but their cash – the paper reserve – was confiscated." "So, that made other central banks wake up and ask... "What happens if there is a conflict with America? "Would the U.S. be able to keep our treasuries and our savings disappear?" Paulson stated. He said that the global trade uncertainty, which is fueled by Washington's new tariffs in part, further supports gold. The best option if you lose faith in the dollar (U.S.), is to use gold as a currency reserve, said Paulson. He was being considered for a position in Donald Trump's cabinet during his second term. Paulson refused to disclose details of his conversations with Trump. However, he said that the president was "very pro-America first, the golden age of America and bringing manufacturing, mining and other industries back to America." Paulson has been investing in gold for many years and has said that he is not interested in expanding his investments into other metals or copper. He said that other minerals were a different world and they are not where he wants to focus his efforts. Paulson, the largest shareholder of Perpetua in Idaho, has been receiving support from Trump's White House. Perpetua received its federal mining license in January and is now applying for funding through the U.S. Export-Import Bank. Perpetua’s gold production has been seen as a financial boost to the mine’s antimony production, and ensures a domestic supply for the Pentagon of the metal used in bullets and weaponry. China has banned antimony exports from the U.S. Perpetua works with Sunshine Silver & Refining, backed by Thomas Kaplan’s Electrum Group, to build an antimony refining facility. Sunshine has permits to build a refinery that would meet 40% of the country's antimony needs. Kaplan said that the process of refinement was well established. "We are just upgrading it, and putting it into production." Paulson stated that the Donlin Project in Alaska has been granted federal permits. Paulson also said operating costs should be around $1,000 per ounce, which is far below the current gold price. Paulson and Electrum have also invested in International Tower Hill which is developing a gold mine in Alaska, as well Trilogy Metals which aims at developing projects in Alaska's Ambler District.
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Ecolab confirms its annual profit forecast despite tariffs and a weak quarter
Ecolab, a water solutions company, kept its annual profit outlook unchanged on Tuesday in spite of tariff uncertainty and lower first-quarter revenues and profits. This sent its shares up 1.7%. The company that offers water services such as cleaning, sanitization and cooling to many industries still expects to see earnings grow between 12% and 15% this year. Ecolab uses its diverse supply chain and its 'local-for-local' production model, as well as a recently announced surcharge of 5% on all products and services sold in the U.S., to minimize tariff impact. The tariffs imposed by President Donald Trump on his trade partners and the retaliatory measures taken by other countries, such as China have raised concerns that raw materials and equipment prices for companies like Ecolab could increase. The company's sales for the first quarter fell by 1.5% compared to a year earlier, reaching $3.69 billion. This was due to the sale of its surgery unit announced in 2013 and the weak demand from customers. The company reported a profit of 402.5 million dollars, or 1.41 cents per share for the quarter ending March 31. This compares to $412.1 millions, or 1.43 cents per share a year earlier. Saint Paul, Minnesota based company also predicted current quarter adjusted profits between $1.84 and $1.94 each share. According to data compiled from LSEG, analysts were expecting $1.90 a share. (Reporting and editing by Sahal Muhammad in Bengaluru, Katha Kalia from Bengaluru)
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S&P Global believes that the US and China can breathe easier in their trade war with rivals S&P Global.
S&P Global’s top sovereign analyst said that a trade conflict is unlikely to have a significant impact on the credit ratings of China and the United States. Instead, damage will likely be concentrated in poorer countries or those who are already under downgrade warnings. S&P confirmed its "stable outlook" on its AA+ U.S. government credit rating, days before Donald Trump announced his massive round of trade tariffs for the global market in early April. The U.S. government's debt, which is close to 100% of GDP and the fiscal deficit that runs at 6-7% of GDP are its main credit weaknesses. It also highlighted the uncertainty surrounding Trump's policies and trade deals. Trump's tariffs have led to a reduction in global growth predictions. S&P managing Director Roberto Sifon Arevalo said that most major economies ratings should be able, for the time being, to handle the pressures. "At first, there was a flashback of the COVID period and the thought that this is another global crisis." When you look at the bigger picture, and the transmission channels that are available, it remains a question: Will this be enough to significantly change the creditworthiness of sovereigns worldwide? This does not mean, however, that the ratings for negative outlooks (the rating agency's term for warnings of a downgrade) will not go down. Or that the outlooks will not be lowered as they have already been in Slovakia and Egypt. More importantly, there shouldn't really be any major surprises. According to an S&P model based on credit default swap data, investors are currently pricing a five-notch downgrade for the U.S. and a three-notch cut to China's score of A+. S&P's U.S. credit rating hasn't been lowered since 2011, when it was downgraded from triple-A. China hasn’t seen a cut since 2017, but Fitch, its counterpart, cut Beijing a notch after Trump’s tariffs announcement. Sifon Arevalo stated that "for China and the U.S., there is room (for ratings)." He said that it is not the length of time the tariffs will remain in place that will determine how the two countries are rated, but there must be "some sort of resolution" (on tariffs) within the next few months. In China, it was about how much stimulus the country would inject to offset tariffs. Big Questions S&P is concerned more about possible knock-on effects such as a prolonged slump in commodity prices, such as metals and oil. Many countries depend on these commodities for a large part of their income. Sifon Arevalo stated that "if you have a large swing in commodity price, it has a much greater impact on ratings." Oil prices are 20% lower now than in mid-January. If Trump follows through with his plans to impose tariffs of 20% on EU countries, European ratings may also be put under further pressure. He welcomed Germany's plans to spend half a billion euros on defence and infrastructure, but warned that the current trade problems could further erode the already weak economy of the EU. Sifon Arevalo stated that "if these trade uncertainties are not resolved soon, there will be serious fiscal implications across the continent." You need growth to support fiscal consolidation. Tariffs are not helpful.
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S&P Global believes that the US and China can breathe easier in their trade war with rivals S&P Global.
S&P Global’s top sovereign analyst said that a trade conflict is unlikely to have a significant impact on the credit ratings of China and the United States. Instead, damage will likely be concentrated in poorer countries or those who are already under downgrade warnings. S&P confirmed its "stable outlook" on its AA+ U.S. government credit rating days prior to President Donald Trump's announcement of his global trade tariffs. The U.S. government's debt, which is close to 100% of GDP and the fiscal deficit that runs at 6-7% of GDP are its main credit weaknesses. It also highlighted the uncertainty surrounding Trump's policies and trade deals. Trump's tariffs have led to a reduction in global growth predictions. S&P managing Director Roberto Sifon Arevalo said that most major economies ratings should be able, for the time being, to weather these strains. "At first, there was a flashback of the COVID period and the thought that this is another global crisis." When you look at the bigger picture, and the transmission channels that are available, it remains a question: Will this be enough to significantly change the creditworthiness of sovereigns worldwide? This does not mean, however, that the ratings for negative outlooks (the rating agency's term for warnings of a downgrade) will not go down. Or that the outlooks will not be lowered as they have already been in Slovakia and Egypt. More importantly, there shouldn't really be any major surprises. According to an S&P model based on credit default swap data, investors are currently valuing a five-notch downgrade for the U.S. and a three-notch cut for China's A+ rating. S&P's U.S. credit rating hasn't been lowered since 2011, when it was downgraded from triple-A. China hasn’t seen a cut since 2017, but Fitch, its counterpart, cut Beijing a notch after Trump’s tariff announcement. Sifon Arevalo stated that "for China and the U.S., there is room (for ratings)." He said that it is not the length of time the tariffs will remain in place that will determine how the two countries are rated, but there must be "some sort of resolution" (on tariffs) within the next few months. In China, it was about how much stimulus the country would inject to offset tariffs. Big Questions S&P is concerned more about possible knock-on effects such as a prolonged slump in commodity prices, such as metals and oil. Many countries depend on these commodities for a large part of their income. Sifon Arevalo stated that "if you have a large swing in commodity price, it has a much greater impact on ratings." Oil prices are 20% lower now than in mid-January. If Trump follows through with his plans to impose tariffs of 20% on EU countries, European ratings may also be put under further pressure. He welcomed Germany's plans to spend half a billion euros on defence and infrastructure, but warned that the current trade problems could further erode the already weak economy of the EU. Sifon Arevalo stated that "if these trade uncertainties are not resolved soon, there will be serious fiscal implications across the continent." You need growth to support fiscal consolidation. Tariffs are not a good idea. (Reporting and editing by Hugh Lawson; Marc Jones)
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Battery industry: $100 billion US investment depends on Washington support
The manufacturers and developers of U.S. Energy Storage Projects said that their industry would invest $100 billion in this decade to create an entirely domestic battery supply chain. However, they warned that the goal is contingent upon Washington's support. The American Clean Power Association is a trade association that represents energy storage firms. Its members aim to reduce the sector's dependence on China, who currently supplies most of the U.S. battery supply. The storage projects are therefore likely to be severely affected by the decision of President Donald Trump to impose 145% tariffs on Chinese imports. The industry wants a nuanced approach in order to encourage domestic production. Jason Grumet, CEO of ACP, said in a press conference with reporters before the announcement that "China stole our entire supply chain for over a decade. We're not going get it back within 10 weeks." If the administration begins to see batteries as an important national security technology, then we will move away from broad-based reciprocal duties, which is a blunt way of grabbing attention, and into a strategic conversation. Grid storage projects - mainly large lithium-ion battery systems – can help wind and solar resources by storing energy when the sun shines and the wind blows so it can be later used. According to the U.S. Energy Information Administration, the U.S. utility scale battery capacity increased by 66% in the past year. It was only second to solar for the addition of capacity to the grids. The clean-energy industry has been on alert ever since Trump assumed office in January. He promised to increase fossil fuels, undo climate and renewable energy policies set by his predecessor, Joe Biden, and boost the use of fossil fuels. ACP stated that the $100 billion investment would create 350,000 new jobs, and include between $10 to $15 billion of active projects. These include a Tesla cell factory in Sparks Nevada, a Fluence plant in Tennessee, LG’s Holland, Michigan plant, and an Weirton West Virginia facility by the startup Form Energy. (Reporting and editing by Marguerita Choy)
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Police report: Five Kenyan quarry workers were killed by suspected al Shabaab militants, according to a police report
According to a Kenyan Police report, five quarry workers died and two were injured in an attack on their vehicle by suspected al Shabaab terrorists in northeastern Kenya Tuesday morning. Reports say that 10 gunmen, allegedly from an al Qaeda group based in Somalia, ambushed a minibus with workers near Bur Abor Village, Mandera County at 6 a.m. (0300 GMT), and forced them to get out. They were asked to hand over their ID cards and phones. The police report stated that (they were) fatally shot as they lay down. The report stated that another 13 people fled into the bush before being rescued. Kenya's Police spokesperson did not respond immediately to a comment request. Al Shabaab is waging a war against the Somali Government since 2007. Its goal is to seize control and establish a rule based upon its strict interpretation of Islamic Law. The Islamist group frequently conducts cross border raids in Kenya, which is a major contributor of troops to the African Union's peacekeeping mission. (Reporting and writing by Humphrey Malalo, Editing by Aidan Lewis).
Why is a Peruvian farm taking RWE in Germany to court for climate change?
A Peruvian farm gets his day in court as part of a landmark climate lawsuit against German energy giant RWE. The case could change the way that companies' emissions effects are litigated.
On Monday, the Higher Regional Court of Hamm is scheduled to begin hearings between RWE and farmer Saul Luciano Lliuya.
Lliuya has filed a lawsuit against RWE, seeking 21,000 euros. He claims that the company's emissions contributed to the melting andean glaciers which caused a lake to rise dangerously above his home.
What is the nature of the case? What is the legal basis? What does this mean for future climate litigation?
What is the case about?
Lliuya filed a lawsuit in 2015 with the support of the activist group Germanwatch. He claimed that RWE's greenhouse gases had contributed to the melting an Andean Glacier, which raised the water levels at Laguna Pacacocha. This created a flood risk for his home, located near the town of Huaraz.
Lliuya wants RWE to contribute 21,000 euros towards the estimated cost of $3.5 million for a flood-defence project. He claims that the company is responsible for nearly 0.5% global greenhouse gas emissions caused by man since the Industrial Revolution, and therefore should be paying the equivalent of the flood protection costs.
Why did it take 10 years to have a hearing?
The first court to hear the case was in Essen, Germany, where RWE has its headquarters. The court rejected the claims saying that there are countless carbon dioxide emitters worldwide and any potential flood risks as a result from the melting glacial ice cannot be attributed solely to RWE.
Lliuya filed an appeal against the Hamm higher regional court's decision in 2017. The court admitted the case and stated that it would be seeking evidence.
The COVID-19 pandemic delayed a visit by experts appointed by the court to study flood risk around the glacier until 2022. A 200-page expert report was made available over a year after the COVID-19 pandemic. The two parties had to review it.
What is the legal basis of the case?
The case is based upon section 1004 (Civil Law Code) which states that the owner can require the disturber remove the interference if it is done to their property.
If the court finds that the flood threat claimed by the plaintiff was real, it will then determine in the second phase the extent to which RWE's emissions of CO2 have contributed to a risk of a flood from a glacial outburst lake.
The next hearing will be a preliminary step that will include the evaluation of the experts appointed by the court.
Why has the case attracted so much interest?
If the court holds RWE legally responsible for climate change and finds that glacier melt poses a flood threat, this would be a precedent to hold companies accountable for climate changes.
The amount in dispute is less than 20,000 Euros, but it's clear that the potential to set precedents in this case is huge," says the website of Freshfields Bruckhaus Deringer, the law firm which represents RWE.
Roda Verheyen said that even if the court did not find there to be a flood threat, its decision would serve as a basis for future cases.
What does science say about this?
Scientists at the University of Washington and Oxford University proved in 2021 that global warming caused the melting of the glacier of the Peruvian Andes, increasing flooding risks to nearby residents.
Friederike Otto is a climate scientist with the Grantham Institute for Climate Change and the Environment. She said: "There are plenty of proofs that the science applies in the Andes. We have no evidence to the contra."
What does RWE say about the case?
RWE claims that Lliuya’s complaint is unfounded. It argues that a single emitter can't be held accountable for global warming.
It has made a transition from coal to gas, but it still runs 7 lignite power plants or brown coal plants. These plants account for 26,7% of the company's total electricity generation. In 2020, there were 20 plants. It also operates 21 gas-fired power plants in Germany, the Netherlands and the UK.
RWE said that its CO2 emissions will be reduced by almost half to 60,6 million tons from 118 millions tons in 2018. Further reductions are expected. The company aims to phase out lignite completely by 2030. (Reporting and editing by Adam Jourdan, Christina Fincher and Riham Alkousaa)
(source: Reuters)