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Kuwait Petroleum Corp. reports damage to units following Iran drone attacks
On?Sunday?, Iranian drone attacks hit multiple targets in Kuwait. State?energy company Kuwait Petroleum Corporation reported fires and "severe damage" to some units. KPC stated in a press release that teams are working to contain fires at National Petroleum Company and Petrochemical Industries Company affiliates. KPC said earlier that a drone had attacked the complex housing the KPC headquarters and oil ministry in Shuwaikh. Kuwaiti state media, citing Kuwait's finance ministry, reported that an Iranian drone had allegedly 'hit an office complex of government ministries, inflicting significant material damage, but no injuries. Kuwait's Ministry of Electricity and Water said that two power-generating units were taken out after Iranian drones attacked two desalination and power plants. The damage was significant. In all incidents, no injuries have been reported. The U.S. and Israeli 'war on Iran' is now in its sixth weeks, with Tehran attacking Israel and Gulf Arab states that host U.S. military bases. Iran's Revolutionary Guards have claimed responsibility for the attacks on Kuwaiti petrochemical facilities, as well as those in Bahrain and the United Arab Emirates.
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PMI data shows that Saudi Arabia's non oil business activity shrank in March amid conflict.
A 'business survey' revealed that Saudi Arabian non-oil sector activity fell in March for the first time since August 20. The war in the Middle East had slowed down supply chains. S&P Global's?seasonally-adjusted Riyad Bank Saudi Arabia Purchasing managers' Index (PMI) fell to 48.8 from 56.1 in Feb. The readings below 50 indicate contraction. Naif Al Ghaith is the chief economist at Riyad Bank. He said that the drop into contraction was largely due to short-term uncertainties linked with the geopolitical tensions of the region. "The soft reading was mainly?driven by a pause in the new orders, as clients adopted more caution." Export orders experienced a notable drop, and some firms reported a temporary slowdown of cross-border activities. This led to a moderated output, Al-Ghaith explained. For the first time, both output and new orders have declined since August 2020, when the COVID-19 epidemic brought economies to a grinding halt. New orders dropped to 45.2 in March, down from 61.8 in February. Export demand was weakening sharply. New export orders posted their steepest drop?in nearly six years. Exports were 'completely stopped' by some firms, while others experienced greater logistical problems. The conflict has slowed the flow of water through the Strait of Hormuz, but the supply strains have increased. This situation may continue as long as the Strait of Hormuz remains effectively blocked. Business expectations for the coming 12 months remain 'positive' despite a 'weakening of their lowest level since June 2020. Some firms are still confident about government spending, the development of infrastructure and the improvement in demand on the long term. (Reporting and Editing by Hugh Lawson).
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South Korea asks Gulf Nations for a steady supply of energy and safety of Korean vessels
The South Korean Ministry of Finance announced that Koo 'Yun-cheol, Minister of Finance, met with envoys of Gulf countries on Sunday to discuss energy security and the safety of 'Korean vessels near the Strait of Hormuz. This is due to the escalating Iran conflict disrupting shipping. The ministry said that during the Friday meeting, Koo requested the ambassadors of the Gulf Cooperation Council to ensure a constant supply of oil, liquefied gas, naphtha and urea as well as other critical resources. He also asked them to ensure the safety and security for Korean vessels and crews near this vital strait. The statement stated that the envoys referred to South Korea as a nation of "top priority". They also pledged to work closely with Seoul in order to maintain a stable supply. Like many Asian economies, South Korea relies heavily upon energy imports. This includes through the Strait of Hormuz. The Strait of Hormuz was the conduit for 20% of 'world oil' before Israel and the U.S. launched their war on the 28th of February. Since then, Iran has effectively closed the waterway. This has pushed up energy prices and raised fears of a global recession. Saudi Arabia, United Arab Emirates (UAE), Qatar, Kuwait and Oman are the six GCC member states. Reporting by Cynthia Kim, Editing by William Mallard
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Egypt increases electricity prices for households and businesses that use more energy amid energy crisis
The electricity ministry announced on Saturday that Egypt will raise electricity prices for residential and commercial consumers who use more electricity. This increase is due to a global energy crisis caused by the Gulf War. The government has taken a number of measures to reduce energy consumption and curb fiscal pressures as rising import costs put pressure on the finances of the most populous Arab country. The ministry stated that the increase would only affect households with higher consumption and commercial users. This was done to ensure the supply of electricity across residential, industrial and commercial sectors. The report said that electricity rates for residential bands up to 2,000 kilowatt hours per month would remain the same, but tariffs for higher residential brackets will increase by an average 16%. It added that commercial electricity prices in all brackets will increase on average by about 20%. In March, Prime Minister Mostafa. Madbouly stated that Egypt's energy import bills had more than doubled in the last few years since the start of the conflict involving the United States and Israel. This forced the government to increase fuel prices, raise fares for public transportation, and slow down some state projects, to relieve pressure on the public finances. Egypt implemented measures to rationalise its energy consumption in March, including a move towards earlier closing times for commercial venues. This was due to the rise of global oil prices during the conflict. Inflation has been in double digits since September 2023, when it peaked at 38%. The country is already struggling with heavy debts. Reporting by Momen Atallah and Enas Alashray
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Slovak PM: EU should lift sanctions on Russian oil, gas and other energy sources to improve energy security
Robert Fico, the Slovakian Prime Minister, said that the European Union must end sanctions on Russian oil and gas imports and take steps to restore Druzhba pipeline flows, as well as end the conflict in Ukraine, in order to tackle the energy crisis stemming from the war with Iran. Fico stated in a press release after a phone call with Hungarian Premier Viktor Orban, that the EU should re-establish dialogue with Russia to ensure member states get gas and oil from all sources including Russia. Hungary and Slovakia are the only two EU countries that maintain relations with Moscow. Oil prices have risen?since U.S.-Israeli strikes against Iran began on February 28, causing a disruption to oil supplies in the Gulf and causing what the International Energy Agency calls the largest oil supply interruption in history. Central European nations have taken steps to reduce the impact of high fuel prices on consumers and businesses. By the end of 2025, only a fraction of EU oil imports came from Russia. This was after a steep decline in imports following Moscow's invasion of Ukraine. By January 27, Kyiv reported that a Russian drone attack had hit Ukrainian pipeline equipment, disrupting Russian oil?shipments. Budapest and Bratislava accuse Ukraine of intentionally delaying repairs in order to resume oil flow through the Druzhba pipe. This has triggered a political dispute which?has seen Hungary blocking an EU loan for Kyiv. Ukraine claims it is repairing it as fast as possible. Fico stated that it is not enough to address the energy crisis at the national or only local level. Five other European Union countries are also calling for a windfall profit tax on energy companies in response to rising fuel prices. This was revealed by a letter sent to the EU Commission on Saturday. The energy chief of the bloc said on Tuesday that it was considering reinstating energy crisis measures from 2022. This included proposals to reduce grid tariffs and electricity taxes.
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Taiwan has received assurances from a'major country' about LNG supplies
Taiwan's economy minister announced on Saturday that the energy minister of a "major country" producing liquefied gas had given Taiwan assurances about supply. He was speaking in relation to the?impact of the Iran War on Middle East energy imports. Taiwan, which is a major producer of semiconductors, relied on Qatar to supply around a third its LNG prior to the conflict. It has now said that it has secured alternative supplies from countries such as Australia and the United States for the months ahead. Kung Ming Hsin, Taiwan's Economy Minister, told reporters in Taipei that Taiwan enjoys good relations with its?crude gas and natural oil suppliers. Therefore, adjusting the origin of shipments or purchasing additional spot -cargoes will not be a problem. Kung stated that the energy minister from a "major energy producing country" had contacted him about two weeks prior. The person "explained that they would fully support our natural gas needs. He added that if we had any requests, we could let them know. Kung added: "Another nation even stated that certain countries had released strategic petroleum reserves and could help coordinate the matter if Taiwan needed assistance." He said, "This shows Taiwan has earned considerable international goodwill through the long-term confidence it has built." He refused to identify the countries involved. Angela Lin, spokesperson of state-owned refiner CPC said that at the same?newsconference, crude oil inventories are being maintained at levels prior to conflict and that overall petrochemical supply has remained stable. CPC Chairman Fang Jeng Zen said that a new agreement with the U.S. would see 1.2 millions metric tons of LNG delivered?annually. He added that Taiwan does not intend to import crude oil or LNG from Russia. (Reporting and editing by Ben Blanchard, Roger Tung and Joe Bavier).
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Five EU Finance Ministers Call for Tax on Windfall Profits of Energy Companies
In response to fuel prices rising due to the Iran War, five?European Union Finance Ministers have called for a tax to be placed on the 'windfall profits' of energy companies. This was revealed in a letter sent to the EU Commission on Saturday. In a joint letter dated on Friday, the finance ministers from Germany, Italy Spain Portugal and Austria called for such a move, stating that it would "signal" to others that they are united and capable of taking action. They wrote: "It will also send a message that those who benefit from the war's consequences must do their part in easing the burden of?the public." Since the U.S. and Israeli strikes against Iran began on 28 February, oil and gas prices have risen dramatically. This is similar to the energy crises Europe experienced after Russia invaded Ukraine - in '2022 - despite the fact that EU countries are now getting more of their energy from renewable sources. LETTER HIGHLIGHTS 'MARKET DISTORTIONS' In a letter addressed to EU Climate commissioner Wopke Hekstra, the Ministers referred to the possibility of a similar tax to be implemented in 2022 as a way to combat high energy prices. They wrote: "Given current market distortions, and fiscal constraints the European Commission must develop quickly a similar EU wide contribution instrument based on a sound legal basis." The letter did not specify the level of windfall taxes that ministers would propose, nor which companies should be affected. The energy chief of the bloc said on Tuesday that it is considering reviving measures taken in response to the energy crisis in 2022. This includes proposals to "curb grid rates" and taxes on electricity. After Russia cut off gas deliveries, the EU implemented a series of emergency policies. These included a?EU-wide gas price cap, a tax imposed on windfall profits of energy companies, and targets to?reduce gas demand. The Middle East conflict has a significant impact on the global energy prices. Since the U.S. and Israel war against?Iran started on February 28, European gas prices have risen'more than 70%. Dan Jorgensen, EU Energy Commissioner, said that Brussels is particularly worried about the supply of refined petroleum in Europe such as diesel and jet fuel. Reporting by Andreas Rinke, Writing by Tom Sims, Editing by Alison Williams
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Senegal bans travel by government officials as Iran oil shock affects public finances
Senegal has banned all travel abroad by top officials and ministers that is not essential. The government warned of "extremely challenging" times as a result of the U.S./Israeli conflict with Iran, which will increase global oil prices, straining Senegal's budget. The price of Brent crude has soared and governments have been urged to act to reduce the negative effects. Senegal Prime Minister Ousmane sonko, speaking at a youth event on Friday night in Mbour, pointed out that oil is trading for about $115 per barrel, almost twice what was assumed to be the price in Senegal’s budget projections. He announced that he has already cancelled his own trips to Niger and France. The?crisis has prompted governments across West Africa and the world to take a number of?measures, including increases in fuel prices, subsidies and remote work. Sonko said that such actions were a "justification" for Senegal, a debt-ridden country. He said that?additional?measures would be announced next?week, and the Energy and Mines?Minister is expected to address?the?nation in the?coming?days?to detail efforts to mitigate?the impact of the?price shock. (Reporting and editing by Joe Bavier, Diadie Ba and Bate Felix)
As military buildups eclipse talks, the US and Iran are heading towards a conflict.
Officials on both sides, as well as diplomats in the Gulf and Europe, say that Iran and the United States have moved rapidly toward a military conflict. They are losing hope for a diplomatic resolution to the standoff they've had over Tehran’s nuclear program.
Sources say that Iran's Gulf neighbours, including Israel, now see a conflict as more likely than a peaceful settlement. Washington is building one of the largest military deployments it has made in the region since the 2003 invasion of Iraq.
Source familiar with the plans said that Israel believes Washington and Tehran are in a deadlock and has begun preparing for a possible joint military operation with the United States. However, no decision has yet been made on whether or not to conduct such an action.
This would be the U.S.'s second attack on Iran in less than one year. The first was an airstrike by the U.S., Israel and other countries against Iranian military and nuclear installations last June.
Officials in the region say that oil-producing Gulf nations are preparing themselves for a possible conflict, which they fear will spiral out of control and cause destabilisation of the Middle East.
Two Israeli officials said they believed the gaps between Washington, D.C. and Tehran were unbridgeable. They also stated that there was a high likelihood of a military escalation in the near future.
Regional officials claim that Tehran is making a grave mistake by refusing to make concessions. They also say that President Donald Trump is trapped by his military build-up and cannot reduce it without losing face.
Alan Eyre is a former U.S. Diplomat and Iran Specialist. He said that "both sides are sticking with their guns" and that "nothing meaningful will emerge unless the U.S.
"What Trump cannot do is assemble this much military and then return with a "so-so" deal and withdraw the military. He said: "I think he believes he will lose face." "If he attacks it will get ugly very quickly."
TALKS HAVE STALLED
Iran-U.S. talks stalled after two rounds on key issues from uranium to missiles and sanctions relief.
Sources familiar with the talks say that when Omani mediators handed an envelope containing proposals from the U.S. on missiles, Iranian Foreign Ministry Abbas Araqchi did not even open it. He returned it.
Araqchi, who spoke at the Geneva talks on Tuesday, said that the two sides had agreed upon "guiding principles" but the White House stated there was still distance.
A U.S. official stated that Iran would submit a written proposal within the next few days. Araqchi, on Friday, said he expected a draft of a counterproposal to be ready in a matter of days.
Trump, who sent aircraft carriers and warships to the Middle East on Thursday, warned Iran that it must reach a deal over its nuclear program, or else "really bad" things will happen.
He seemed to have set a 10- to 15-day deadline, which prompted a response from Tehran that it would retaliate if the U.S. bases were attacked. Oil prices have increased due to the rising tensions.
Officials in the United States say that Trump is still undecided about whether he will use military force, although he admitted on Friday that he might order a limited attack to try and force Iran to a deal.
He told reporters, "I suppose I can say that I am considering it."
It is not clear when an attack could occur. The U.S. secretary of state Marco Rubio will meet with Israeli Prime Minister Benjamin Netanyahu to discuss Iran on February 28, 2019. Senior U.S. officials said that it would take until mid-March for all U.S. troops to be in place.
What's the endgame?
European and regional officials are of the opinion that the size of the U.S. military deployment in the region will allow Washington to strike Iran while simultaneously defending its allies, Israel and military bases.
The U.S. core demand is unchanged: No uranium enrichment in Iran. Iran says that it will not discuss ballistic missiles and insists on maintaining its nuclear capability. It denies that it is planning to build nuclear weapons.
Defence analyst David Des Roches says that if talks fail, U.S. activities in the Gulf already signal how any strike would start: Blind Iran's Air Defence?and then attack the Revolutionary Guards Navy. This is the force behind decades of tanker attacks, and threats to shut down the Strait of Hormuz - the route used by a fifth of the world's oil.
Some Arab and European officials say they don't know what Trump's ultimate goal is. And?European governments ask the U.S. for specifics on what it wants to achieve with its strikes - whether to reduce Iran's missile and nuclear capabilities, to prevent escalation, or to pursue a more ambitious goal such as "regime changes".
Some European and regional officials are unsure whether military action will be able to change the course of Iran's ruling regime, which is led by Ayatollah Ayatollah Khamenei. The powerful Islamic Revolutionary Guards Corps protects the Supreme Leader.
Some claim that because there is no apparent alternative political force in Iran, and the leadership's resilience is largely intact it would be dangerous to assume that strikes could lead to "regime changes".
They say that military action is easier to start than control and harder to turn into a strategy.
ARE CONCESSIONS LIKELY TO OCCUR?
Few signs of compromise have been seen. Ali Larijani - a close advisor to Khamenei - told Al Jazeera TV Iran is willing to allow the International Atomic Energy Agency extensive monitoring to prove that it does not seek 'nuclear weapons. Tehran informed IAEA Chief Rafael Grossi about its decision.
Sources familiar with the talks say that Iran's support for regional militias was not raised in formal talks. However, Tehran has no objections to U.S. concerns regarding proxies.
Three regional officials reported that Iranian negotiators made it clear that Khamenei is the sovereign right to enrichment and missile production. David Makovsky, of The Washington Institute, said that each side is betting on the limits of the other.
He said that Washington believed overwhelming force would force Tehran to yield. Tehran, on the other hand, believes Trump is not interested in a sustained campaign, and Israel, the gap between the two countries, was too large to close. This, he added, made confrontation inevitable. Steve Holland reported from Washington and Rami Ayyub in Jerusalem, Samia Nakhoul wrote the article, and Timothy Heritage edited it.
(source: Reuters)