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Ukraine wants G7 to lower price cap on Russian oil to $30 per barrel
Andriy Sibiha, the Ukrainian Foreign Minister, said that Ukraine wanted the Group of Seven Advanced Economies to lower its price limit on Russian oil shipped by sea to $30 per barrel. The G7's current price cap is $60 per barrel. This was imposed because of Russia's conflict in Ukraine. Sybiha, a journalist from Brussels, told reporters that the reasonable price cap for oil is 30 dollars. The European Union (EU) and Britain (UK) announced new sanctions against Russia on Tuesday. They said that the sanctions would target the "shadow fleet" in Moscow of oil tankers, financial firms and other companies which have allowed it to avoid being affected by the other sanctions imposed due to the conflict. Britain and the EU also said that they would work together to lower the cap on oil prices, which now imposes a much smaller discount on Russian crude oil due to the fall in global oil prices this year. EU officials who were briefed about the discussions have stated that the EU will suggest a price limit of $50 per barrel. Separately, Ukrainian President Volodymyr Zelenskiy stated that he spoke with European Commission President Ursula von der Leyen Tuesday and expressed his gratitude for the recent sanctions. "Russian oil and energy trade infrastructure are the most painful to Russia and, therefore, most useful for peace," wrote he on Telegram. The more pressure on Russia the more motivation Moscow will have to make real peace, he said. This was a day after U.S. president Donald Trump met with Russian President Vladimir Putin, but without a promise for a ceasefire to be made in Ukraine.
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17 injured in fire at Chevron platform off Angola
In a joint statement, the Angolan government and Chevron said that 17 people, including four serious injuries, were injured when a fire broke in the early morning hours of Tuesday on the deep-water Benguela, Belize, Lobito, Tomboco oil platform. Investigations are currently underway to determine the cause of a fire that occurred on the basement level of the multi-storey production platform of Block 14 in the Block 14 concession, some 60 miles (97 kilometers) off the coast of Cabinda. Angola's National Agency for Petroleum, Gas and Biofuels issued a statement referring to the injured. Chevron stated that the incident took place at a time BBLT was undergoing an annual maintenance, as part of a planned shutdown. All production had stopped at the site on May 1, this year. According to Chevron, the platform can accommodate 157 people. Chevron reported that the fire started around 3 am (0200 GMT). All personnel has been accounted for.
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Shell CEO, re-elected, responds to BP question by saying bar for deal is high
Shell shareholders re-elected Andrew Mackenzie as Shell's Chair and Wael Sawan as its CEO on Tuesday. When asked about a possible deal with rival BP, Wael Sawan said that the bar was high for mergers and purchases. Media reports Early this month Shell had reportedly been working with advisors to assess a possible acquisition of BP. Shell's annual meeting saw Sawan receive 98.7% support from shareholders, while Mackenzie received 91.4%. Helge Lind, BP's Chair, received only 76% of the vote at its annual general meeting after years with poor share performance. He is expected to step down in the next few months. Sawan echoed previous comments made when asked about reports in the media that Shell was considering a bid for BP. He said Shell's share price at present makes buybacks a particularly attractive way to spend money. Around 20.6% of shareholders voted in favor of a shareholder resolution that asked Shell to provide more information about its strategy for boosting LNG sales and how it is compatible with the goals to reduce carbon emissions. Shell's largest contribution to the energy transformation will be LNG, Sawan told Shell shareholders. He was referring to the possibility of replacing coal with gas to replace more polluting fuels. "LNG will be a low-carbon fuel with a wide range of applications that is essential to the energy transition." Methane is the main component of natural gas. It is a significant greenhouse gas that contributes to climate change along with carbon dioxide. All the other board members were also reelected, including Finance Director Sinead Gordon. (Reporting and editing by Shadia Nasralla)
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Copper falls as tariff uncertainties counteract weaker dollar and China stimulus
The copper price fell on Tuesday, as concerns about the growth of demand and its impact due to U.S. Tariffs overshadowed support from a lower dollar and China's stimulus measures. In official open-outcry trade, the benchmark three-month copper price on London Metal Exchange (LME), was down by 0.1% to $9,519 per metric tonne. The 90-day trade truce that was announced between Beijing and Washington last week provided temporary relief for the market. However, there is uncertainty about what comes next after the pause. The focus is also on a ongoing investigation of possible new tariffs for U.S. imports of copper, which aims to rebuild domestic production. Copper is critical in electric vehicles, military equipment and semiconductors. John Meyer, analyst at SP Angel, said that investors are worried about the volatility of the copper investigation. This investigation has led to a premium in price for COMEX futures contracts compared to LME contracts. Traders have taken advantage of this by diverting copper supplies from other market places into the United States. COMEX registered warehouses are now stocking 77% more than they did a year ago Since the end of March. The U.S. Dollar remained weak, which supported prices. The dollar's weakness makes metals more accessible to holders of other currencies. Meyer said that the weaker dollar in the United States may have encouraged some small-scale stockings of commodities. China has cut its benchmark lending rate for the first since October and many state banks have lowered their deposit rates in order to help the economy, as the trade war continues. The rate cuts were modest, reflecting the gradual nature of monetary easing. Other metals include aluminium, which rose by 0.4% to $2459.5 per ton. Zinc was up 0.8% to $2697; lead climbed 1.1% to $1983; tin grew 0.2% at $32,950, while nickel fell 0.2% to 15 525. (Reporting and editing by Varun H. K. in Bengaluru)
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Enel: Italian electricity bills will include extra costs for licenses
Enel, Italy's biggest power provider, announced on Tuesday that the electricity bill will include extra costs for utilities in order to obtain licence extensions. Last year, the government extended electricity distribution licenses that were due to expire by 2030 for up to 20 more years. In return, it asked utilities to pay a one-off sum to the state, and to present additional investment plans to upgrade grids. There has also been no action taken by the government to date. Enel said in a letter sent to its investors before the annual shareholder meeting on May 22 that the one-off payment as well as the additional grid investment would be reflected in domestic energy bills. The government hasn't yet specified exactly when the one-off payment will be imposed. It was estimated that the average price of electricity in Italy last year was 109 euros ($122.61), nearly twice as much as it is in France. This prompted both industrial and retail consumers to call for action on reducing power bills. The government officials are currently in talks with the utilities, finalising their investment plans and negotiating the one-off payment. The Italian energy authority ARERA stated in March that the payment and investment plans required by utilities would increase their regulated assets base (RAB), giving them an annual return 6.5%. Enel, Italy's largest power distributor, is managed by regional utilities such as ACEA or A2A. ($1 = 0.8890 euro) (Reporting and editing by Alvise Armillini and Susan Fenton).
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India's April infrastructure output growth hits eight-month low
India's infrastructure production grew by 0.5% in April, the slowest rate in eight months. The decline in crude oil prices and refinery products was to blame, according to government data released on Tuesday. The index which tracks eight sectors, and accounts for 40% of industrial production in the country, increased at a revised rate of 4.6% in march, compared with the initial estimate of just 3.8%. In April, crude oil production fell 2.8% compared to a drop of 1.9% in March. Natural gas production also declined by 0.4% compared to a drop of 12.7% in March. Cement production increased 6.7% in April compared with a revised 12.2% rise in March. Steel production rose 3% versus a revised 9.3% increase a month ago. Fertilizer output fell by 4.2% in April, compared with an 8.8% increase in March. Coal production increased by 3.5% compared to just 1.6%. Refinery products fell 4.5% in April compared to 0.2% in March. The core sector's output increased by 6.9% between April 2024 and the fiscal year of 2024-25. (Reporting and editing by Nivedita Bhattacharjee, Savio D’Souza, & Shubham Bhattatra)
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Sandvik, a Swedish company, aims to save $103 million annually
Sandvik, a Swedish manufacturer of metal-cutting equipment and mining equipment, said it aimed to save 1 billion Swedish crowns (about $103.3 million) annually by 2030. The company made the announcement in advance of its Investor Days on Tuesday. Sandvik said it will split its Manufacturing and Machining Solutions into two separate business areas and plan to implement restructuring measures within the Machining Business throughout 2025-2030 in order to improve its geographical footprint and increase its regionalisation. In 2024, Manufacturing and Machining Solutions will account for about 40% of Sandvik’s revenue. In recent quarters, it has been hit by a weak demand for its products in Europe and the automotive industry. Sandvik stated that the restructuring will cost 3 billion crowns in five years, due to consolidation of sites and other measures. Sandvik announced its long-term financial goals ahead of a two day capital markets event held in Sweden. These included a 7% growth in revenue and an adjusted operating profit margin (EBITA), which ranged from 20% to 22 %. After the announcement was made, its shares increased by about 0.9%.
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Sources say that US-led peace negotiations could increase Rwandan processing Congo minerals
Three sources said that Congolese minerals, such as tungsten tantalum, and tin which Kinshasa accuses Rwanda of exploiting illegally, could be legitimately exported to Rwanda under the terms of the peace deal being negotiated between the U.S. Kinshasa sees the pillage of its mineral wealth in eastern Congo as the key driver for the conflict between their forces and the Rwanda-backed M23 rebellions that has intensified ever since January. Kinshasa accuses Kigali smuggling over the border tens or millions of dollars of minerals each month, to be sold by Rwanda. Massad Boulos told the media earlier this month that Washington wants a peace deal between the two parties to be signed by the end of the summer. This agreement will also include mineral deals aimed at bringing Western investment worth billions of dollars to the region. He told X last weekend that the U.S. provided a first draft of a contract to both sides. However, its content has not been revealed. According to two diplomatic sources, and one U.N. official briefed on the matter by U.S. officials, the negotiations may lead to the refinement and marketing of minerals from what is now artisanal mine zones in eastern Congo from Rwanda. One of the diplomats stated that "their (Washington) point of views is simple: if Rwanda can legitimately profit from Congo's mineral through processing, then it will be less inclined to occupy and plunder their neighbour's minerals." "Industrialization for Congo would increase revenues, improve the traceability and combat the armed group that lives off the miner's wages." The foreign ministry did not answer questions posed by a government spokesperson from Congo. It has been long-established that the country wants to shift away from raw exports to local processing. Unnamed Congolese official said that no cooperation in minerals would be possible without the withdrawal by Rwandan troops, and "their proxy", which is a reference to M23. M23 controls more territory now than ever before in eastern Congo. The official added that Rwanda must also respect "our sovereignty, which includes our minerals." The negotiations may bring Rwanda a large inflow of money that will help clean up a sector of the economy that has been largely illegal. For its part, the U.S. would be able secure deeper access for itself and allies to Congolese minerals assets, which are dominated by China. In a statement released by the U.S. State Department, a spokesperson stated that Congo and Rwanda, in a joint declaration signed last month in Washington, had committed to creating transparent, formalized and licit end to end mineral value chains that linked both countries. investors." Boulos said last week that U.S. representatives had spoken with "probably 30" U.S. companies about "doing businesses in Rwanda in mining," including downstream processing. Separately, he said that the U.S. International Development Finance Corporation (an agency tasked with mobilising capital for U.S. national security and foreign policy goals by offering debt financing) would "provide full assistance on these transactions and investment". Companies that take the plunge in this region are at risk of losing money due to the long history and violence of the area. HEART CAUSES Sources said that the minerals projects will not stop a conflict which dates back to the Rwandan genocide of 1994. A mining agreement will not bring peace. Another diplomat stated that these projects would take three, five, or ten years. There are immediate issues and root causes which need to be addressed. Congo, the U.N., and the U.S. accuse Rwanda repeatedly of profiting illegally from the exploitation of Congolese minerals resources. Kigali strongly denies these allegations. Four years ago, an attempt to promote deeper official mining collaboration between Rwanda and Congo failed. In June 2021 the two sides signed a memorandum relating to the joint exploitation of Congolese Gold by state-owned Sakima, and private Rwandan company Dither. Kinshasa, however, suspended the agreement in June 2022 citing Rwanda’s alleged support for M23 as well as the rebel group’s capture of Bunagana, the strategic border city. Rwanda has denied supporting M23, but acknowledged deploying "defensive actions" in eastern Congo to combat Rwandan Hutu militas. Analysts claim that the Democratic Forces for the Liberation of Rwanda (DFLR), the group most often cited, is no longer a serious threat. According to a diplomatic source, Kinshasa was not seen as a trustworthy negotiating partner by Kigali. They said that the collapse of Sakima's deal was a concern for Rwandan officials. William Millman is an independent consultant in the tantalum and niobium industries who has visited both mines. "So, unless you have somebody with a large club, like the United States of America, they won't honour agreements." Reporting by Sonia Rolley and Daphne Psaledakis, both in Paris; Additional reporting from Andrew Mills and Jan Harvey in Doha.
Ithaca Energy to purchase a $155 million stake in the Cygnus Gas Field from Centrica JV
Centrica, a British company, announced on Tuesday that Spirit Energy - its joint venture with German utility Stadtwerke Munchen GmbH - will sell to Ithaca Energy a 46.25 percent stake in the Cygnus field for approximately 116 million pounds (155.05 millions dollars).
Cygnus is located in the Southern North Sea and is the UK's largest continental shelf gas field. It also contributes to the UK energy security.
Ithaca Energy will increase its operating interest in Cygnus from 65% to 85%. This will position the company as a majority owner, and reinforces the strategic goal of becoming one the largest independent energy companies on the North Sea.
Ithaca shares rose marginally, but Centrica shares gained 1.4%.
Spirit Energy is expected to receive around 215 million pound from the deal. This includes 116 million pound in headline consideration, and 99 million pound in decommissioning obligations. Centrica's share of 69% amounts to 80 million lbs.
Chris O'Shea said, "Through this sale we are taking another important step to reduce our exposure to the gas production industry while accelerating the delivery to enhanced shareholder value."
The British utility is shifting its focus away from traditional oil and gas production to decarbonisation and renewable energy.
(source: Reuters)