Latest News
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Engie buys DNO's Norwegian gas production for four years
The Norwegian company DNO announced on Wednesday that it had sold all of its gas production from the Norwegian continental shelf over a period of four years to French utility Engie at an undisclosed price. The deal was facilitated by an American bank loan, as U.S. banks are increasing funding for the fossil fuel sector. It also said it is in talks over a similar agreement and financing facility related to its North Sea oil production. The agreement will take effect on October 1, and it covers DNO’s increased gas production following its March acquisition of assets from Sval Energi. Sval's purchase quadrupled DNO’s North Sea production, which now stands at about 80,000 barrels equivalent of oil per day. About half of this is natural gas. Engie didn't immediately respond to our request for comment. DNO has not disclosed the exact volume of its four-year contract to Engie. However, DNO and Sval Energi produced 1,82 bcm from the Norwegian continental Shelf last year. DNO has entered a financing agreement with an unnamed U.S. Bank for up to 500 million dollars. This money will be used for Sval Energi’s debts as well as for general corporate purposes. In a press release, DNO Executive Chairman Bijan Mossavar Rahmani stated that "we have received strong interest from buyers to prepurchase the enlarged North Sea Production". (Reporting from Nerijus Adomiaitis and America Hernandez, Paris; editing by Barbara Lewis.)
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The yuan strengthens as tariff uncertainty is offset
The price of copper rose on Wednesday, as the weaker dollar and stronger yuan in China, a major metals consumer, offset concerns about trade tensions around the world. By 1025 GMT, the price of three-month copper at the London Metal Exchange had risen by 0.2% to $9,951 per metric tonne. On Tuesday, the metal used in construction and power, which is valued at $10,000, tested the psychological threshold for the first three months, as positive manufacturing data from China, the top consumer, improved sentiment. Analyst Carsten Menke of Julius Baer said that this spike was due to a persistent premium in U.S. Copper Futures amid expectations that Section 232 tariffs would be imposed on imports to the United States in the future, assuming the investigation will conclude imports threaten U.S. National Security. This has led to a spike in U.S. imports of copper this year. The metal is now scarcer outside the U.S. The LME copper contract with a shorter maturity is trading at a higher premium than those with a longer maturity. Goldman Sachs stated in a report that they expect China's demand for refined Copper to increase by 6% between 2025 and 2050. They also see upside risks for their August LME copper prediction of $10,050 due to the competition for copper from China and America. Julius Baer is worried about the future demand for copper due to the pre-buying by U.S. importers. The U.S. Dollar was near its lowest level since February 2022 as traders weighed the impact of President Donald Trump’s spending bill and the looming deadlines for trade tariffs. The yuan is nearing an eight-month-high against the dollar, amid hopes of a easing in U.S. China trade tensions. LME aluminium dropped 0.2% to $2.593.50 per ton. Zinc rose 0.4% at $2.725.50. Lead increased 0.4% at $2.046.50. Tin fell by 0.6%, to $33,430, and nickel rose by 0.1%, to $15,220. (Reporting and editing by David Evans; Polina Devitt)
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Allianz: Heatwaves could reduce GDP in Europe by 0.5 percentage points
A report by Allianz Research found that recent heatwaves in Europe could slow the economic growth of Europe by half a point by 2025. The report compared a day where temperatures exceeded 32 degrees Celsius with half a days worth of strikes. In Europe, the GDP loss ranges from 0.1 percent points in Germany to 1.4 percent points in Spain, where summer temperatures are approximately ten degrees warmer. Climate change increases the frequency and intensity for heatwaves, wildfires and droughts. This has far-reaching effects on the economy. Allianz Research reported that the global heatwaves have reduced GDP by 0.6 percentage points in this year. The Allianz Research report stated that China, Spain and Italy could all see GDP declines of almost one percentage point each due to current heatwaves. Meanwhile, the U.S. might face a drop of around 0.6 percentile points and France by up to a quarter of a percentage point. Heat stress is also a factor that reduces productivity. According to the International Labour Organization, heat stress worldwide will decrease total working hours by 2,2% by 2030. Allianz Research says that heat-related productivity losses can be reduced by taking structural measures in cities to adapt to the climate and adapting workplaces.
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German wind power increases as spot prices fall.
German and French baseload electricity prices for the day ahead fell by around 20% on Wednesday, as a cooling heatwave in Europe is expected to reduce demand. Meanwhile, increased wind power production in Germany will increase supply. LSEG data show that the German baseload day-ahead contract fell 19.3% to 86.75 Euro per Megawatt Hour (MWh) at 1011 GMT. The equivalent French contract, at 82.50 Euros/MWh, was 19.7% less expensive. The benchmark European power price has exceeded 100 euros per Megawatt Hour (MWh) for the first since April, as a heatwave early in summer spreads across Europe and increases electricity demand. Prices began to fall on Tuesday as the wind was predicted to increase and temperatures to drop. They then continued their decline on Wednesday. According to LSEG, the average daily temperature for Germany is expected to fall by 6.3 degrees Celsius (43.34degF), compared to Wednesday. In France, it's forecast to drop 2.6 degrees. In a recent note, LSEG analyst Guro Wyller stated that wind power generation is expected to increase day-to-day in Germany by 10 gigawatts. This is "well above normal for the time of year", she said. On the demand front, German consumption is expected to fall by 450 MW on Thursday to 56.4 GW, while French demand will drop by 3.7 GW, to 47.5 GW. Data compiled by revealed that 78% of France's nuclear power was operational, up from only 72% two days ago. EDF has shut down the reactor No. 1, which is 1,300 MW, at Golfech Nuclear Power Plant in Southwest France. The EDF shut down the 1,300 MW reactor no. 1 on Sunday night due to the anticipated increase in temperature of the Garonne River during the heatwave. The other reactor of the plant was already off-line for maintenance. The German baseload price for the year ahead was up 1.0% to 87.40 Euro/MWh. This increase was supported by the strength of other energy markets. The benchmark contract on the European carbon markets increased by 2.3%, to 72.22 Euros per metric ton. The European Commission proposed a climate target for 2040 on Wednesday that will for the first allow countries to use credits from developing nations as part of their emission goal.
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Dutch climate tech company Dexter Energy raises 23,5 million Euros
Dexter Energy is an Amsterdam-based climate technology firm that has raised $27.1 million via a round of funding to expand its AI driven services for renewable energy sources and batteries. The company announced this on Wednesday. Why it's Important: This investment is a reflection of the increasing reliance on AI technology to navigate Europe’s volatile renewable energy market and accelerate the clean-energy transition. KEY QUOTES "We are excited to welcome Klima as well as Mirova on board. "They share our belief that AI has become essential infrastructure for a grid powered increasingly by renewables and energy storage," said Luukveeken, CEO of Dexter Energy. By the Numbers: Dexter Energy claims that its AI-driven trading solutions for renewable energy producers can increase wholesale market revenue by as much as 30%. Alantra, a financial services company, led the latest round of funding. Mirova, ETF Partners, and Newion are also among the investment firms that participated in this funding round. WHAT'S NEXT: Dexter intends to expand its service in the Netherlands and on other European markets. The company, founded in 2017, uses AI technology to trade on the power markets. The company claims that its price forecasting models are based on more than 12 sources including weather models and data from the market.
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Venezuelan oil exports are on the increase as more cargoes go to China
According to shipping documents and data, Venezuela exported 844,000 barrels of crude oil and fuel per day in June. This is an 8% rise from the previous months, as more cargoes were sent to China to offset the loss of U.S. markets and European ones. Washington terminated in late May a grouping of licenses which had authorized partners, such as Chevron and Repsol of the oil company PDVSA to transport Venezuelan crude for U.S. or European refineries. Since then, the state-owned firm has increased its exports to Asia. It sells its crude oil and fuels through little-known middlemen who make deals with independent Chinese refiners. According to PDVSA internal documents, the cargoes included shipments of Boscan crude oil, which had previously been exported to the U.S. by Chevron. The data revealed that 27 tankers left Venezuelan waters during June. They carried an average of 844,000 barrels per day (bpd) of crude oil and refined products, and 233,000 tons of petrochemicals and byproducts. In May, oil exports averaged 779 000 bpd. In May, the country exported 329,000 metric tonnes of petrochemicals and byproducts. According to data and documents, exports to China were 90% of June's total. In May, it was 75%. PDVSA shipped 8,000 bpd of petroleum coke and methanol to Europe and India, as well as a few cargoes to Cuba. Three cargoes of heavy grade Boscan crude used in asphalt production were shipped to Asia, boosting June's exports. These exports are crucial for PDVSA in order to avoid a production cutback at the Boscan oilfield. It is one of the largest oilfields in Venezuela. PDVSA did not import diluents during June, despite having filled its tanks with imported refined product ahead of the cancellation of licenses.
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EU adds international CO2 credits as part of next climate goal
The European Commission proposed a climate target for the EU for 2040 on Wednesday. For the first time, countries will be able to use credits for carbon from developing nations in order to reach a small portion of their emission goal. The European Union executive has proposed a legally binding target of cutting net greenhouse gas emission by 90% by 2040 from 1990 levels. This is to keep the EU on track to achieve its core climate goal to reach zero net emissions by 2050. The Commission, however, after facing opposition from France, Germany and other governments, including Italy, Poland, the Czech Republic and France, proposed flexibility to the 90 percent emissions target for European industry. The EU has some of the most ambitious climate goals among major economies. EU emission targets are based on only domestic emissions reductions. Carbon credits purchased from other countries via a U.N. supported market can cover up to three percentage points of Germany's 2040 target, reducing the amount of effort needed by the domestic industry. Carbon credits will be phased-in from 2036. The EU will propose legislation in the next year that will establish the quality standards for the credits and who can buy them. Wopke Höstra, EU Climate Commissioner, said that the new climate targets would provide investment certainty to industries and governments. He also stated that purchasing foreign carbon credits can help EU diplomacy. "We will continue to pursue a clean transition." Hoestra stated in a press release that we know the reasons for our clean transition - economic, geopolitical and security. A draft of the proposal was previously published. The countries would also have more flexibility in choosing the sectors of their economy that contribute most to the 2040 target. Climate change has made Europe one of the fastest-warming continents in the world. A severe heatwave last week caused wildfires, disruption and chaos across the continent. But Europe's aggressive policies to combat the temperature rise has stoked tensions among the 27 member bloc. The European Commission's climate agenda is marketed as a means to increase Europe's security and competitiveness. However, certain governments and legislators say that industries already struggling with high energy prices and U.S. tariffs cannot afford stricter emission rules. Climate science advisors from the EU warned against counting foreign carbon credits towards the 2040 goal, saying that spending money on them would divert investment away from local industries. Carbon credits can be generated through projects that reduce CO2 emission abroad, such as forest restoration projects in Brazil. These carbon credits then raise money for these projects. Investigations have revealed that some credits did not deliver the claimed environmental benefits. EU legislators and countries must agree on the 2040 target. This lawmaking process may take many years, but by mid-September the EU must submit to the U.N. its new 2035 climate goal - which should be derived directly from the current 2040 target - as the Commission had stated. (Reporting and editing by Barbara Lewis; Kate Abnett)
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Malaysia reduces green electricity tariff premium rates up to 80% starting July 1
Malaysia has reduced its green energy tariff premium rates up to 80% starting July 1, in an attempt to diversify the green electricity supply options available to companies so they can meet their ESG obligations. In a Wednesday statement, the Energy Transition and Water Transformation Ministry announced that premium rates previously set according to user categories would now be combined in one single pricing tier. Users will pay 5 cents a kilowatt-hour for contracts lasting one year, 4 cents a kWh for agreements lasting two years, and 3 cents a kWh for commitments lasting three years. Green electricity tariff (GET), a programme to offer renewable energy to Tenaga Nasional Berhad customers who wish to reduce their carbon footprint, was launched in 2021. The government set a quota for the 2025 GET Programme of at least 6,600 gigawatt-hours, with premium rates as low as 10 cents/kWh for domestic users and non-domestic users of low voltage and medium voltage and 20 cents/kWh for non-domestic users of high voltage and medium voltage. The Ministry stated that as these new provisions include structural changes and costs implications, users will be able to cancel existing subscriptions until August 31, without penalty. In response to the demand of data center operators, industrial and commercial users as well as the Ministry itself, the GET GreenPath Programme was launched to provide "tenant accounts" with formal recognition for their green electricity consumption through Renewable Energy Certificates. TNB will implement this enhanced version of its existing GET program and open subscriptions on August 1.
Investors weigh Fed rate stance as they assess US data and gold prices.
The gold price fell on Wednesday, as investors waited for U.S. employment data and assessed Federal Reserve Chairman Jerome Powell's cautious approach to rate cuts. However, a weaker greenback helped limit losses on bullion priced in dollars.
As of 0217 GMT spot gold fell 0.2% to $3,330.68 an ounce while U.S. Gold Futures dropped 0.3%, falling to $3,340.60.
Holders of other currencies can now afford to buy bullion because the U.S. Dollar index has fallen to its lowest level in over three years.
Gold prices have been consolidating since posting their strongest gains in the past two weeks. "The overall trend bias continues in favour of the upside at this time," said Ilya SPivak, Tastylive's head of global macro.
Powell said that the U.S. Central Bank will "wait and see" how tariffs impact inflation before it lowers interest rates. This is a further rejection of President Donald Trump's demand for immediate rate cuts.
The number of U.S. jobs opened in May was unexpectedly higher, but the decline in hiring is a sign that the labour markets has shifted down gear due to the uncertainty surrounding the Trump administration’s tariffs against imports.
Investors will now be awaiting the U.S. ADP Employment data due later today, as well as nonfarm payroll numbers on Thursday, for more insight into the labour market.
Spivak stated that the biggest risk to gold is an unexpectedly high (NFP) result, but this seems unlikely.
The U.S. Senate Republicans passed Trump's tax and spending bill Tuesday by a narrow margin. It is a package that cuts taxes, reduces social safety net programs, increases military expenditures, while adding $3.3 billion to the national debt.
Trump was optimistic on Tuesday regarding a possible trade agreement with India, but sceptical about a similar deal with Japan. He also said that he would not consider extending the deadline of July 9 for countries to reach trade agreements.
Spot silver fell 0.1% per ounce to $36.01, platinum dropped 0.4% at $1,344.91, and palladium rose 0.4% to $ 1,104.92.
(source: Reuters)