Latest News
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Italy's Ludoil purchases Sicilian oil refinery as war threatens Europe fuel supply
G.O.I., a Cypriot private equity fund, has agreed to purchase the Sicilian oil refiner ISAB. The Italian group Energy said Wednesday that the Iran War has revealed Europe's dependence on the Gulf to supply jet fuel and refined products. Ludoil is the jet fuel supplier to Rome's Fiumicino airport. The Morattis family of Italy and the Brachetti Perettis family in Azerbaijan sold their oil refineries recently to Vitol, a commodity trader. Ludoil had already begun discussions with G.O.I. When the United States and Israel struck Iran on February 28, they used ISAB to generate energy. Ludoil was founded in 1954 by Donato Ammaturo's grandfather. The new entity, which is Italy's largest privately-held multi-energy firm, will have consolidated revenues of more than 10 billion euros (11,7 billion dollars). The acquisition will enable ISAB to evolve from a refinery to an energy company. This will enhance competitiveness, supply security and the development new value chains in energy. Ludoil stated that it would integrate ISAB into its portfolio, which included coastal storage terminals and a fuel retailer network. It also hoped to develop a biofuels business for the refiner. The deal is divided into two phases. In the first, Ludoil will acquire a 51 percent stake in ISAB. This acquisition is subject to a number of conditions, including the approval from the Italian government, under the so-called golden powers regime. Ludoil has not revealed how much money it will pay for the stake. It also did not respond immediately to requests for more information. ISAB, which accounts for over 20% of Italy's refinery capacity, is considered by the government to be a strategic asset. G.O.I. Energy? Bought from Russia's Lukoil by 2023. Ludoil has not said whether the existing agreement between Trafigura and Ludoil for 'the supply of raw material and 'the purchase of finished goods will remain in place. According to a person with knowledge of the deal, Trafigura will keep its contract for supply and offtake with ISAB's Priolo refining facility.
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TSX falls as gold, technology stocks drag
Canada's main stock index dropped on Wednesday, as gold and technology stocks?came under pressure?while investors viewed developments?around the Middle East conflict and U.S. president Donald Trump's China visit. At 11:03 a.m., the S&P/TSX composite index of the Toronto Stock Exchange fell 0.5% to 34 128.67. ET. It closed Tuesday at its highest level in three weeks. This index is the worst performing on TSX in this?year. It has fallen by nearly 20%. Brian Madden said that the Canadian technology sector was more of a victim than a benefit of artificial intelligence due to a high concentration of software firms. It was down a lot during the first quarter, and it hasn't recovered as well as the U.S. technology sector." A positive earnings season, largely driven energy companies and miner, has helped to keep the Canadian equity markets just below their record high of March 2. Oil?prices remained largely unchanged, but above $100 a barrel as investors watched a fragile Middle East truce and awaited a summit between Trump and China’s Xi Jinping. The energy stocks are steady. Gold?miners fell 1.4%, as the price of precious metals dropped. This was after U.S. producer price data that were hotter than expected reinforced expectations of a tighter monetary policies. Equinox Gold's shares dropped 3.6% following the announcement that it would be acquiring Orla Mining as part of an all-stock transaction to create a North American producer of gold worth $18.5 billion. Orla shares ?dipped 0.7%. Boyd Group shares, which operate autobody and autoglass repair facilities in North America, fell 12% as the company failed to meet analysts' expectations regarding first-quarter sales. (Reporting and editing by Joyjeet Das in Bengaluru, Sruthi Shakar in Bengaluru)
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Europe falling short on replacing Middle East jet fuel imports, IEA says
The 'International Energy Agency' said on Wednesday that Europe's jet fuel supply from the Middle East has plummeted since April and the region is not able to replace those shipments. The IEA reported in a report that Middle East jet fuel supplies to Europe fell from 330,000 bpd per day in March to only 60,000 bpd per day in April. This was due to the Iran War and the effective closure of Strait?of Hormuz. According to the IEA, importing'regions such as Europe' should replace a minimum of 80% and preferably 90% of lost Middle -East import volumes in order to avoid summer shortages. The IEA reported that European jet fuel imports in April were only 70% of the March levels. The European Union increased its imports of jet-fuel from the United States and Nigeria but not enough to compensate for the Middle East's losses. These flows were 221,000?bpd according to?Kpler's data in April. The report stated that "With European inventories reducing at a rapid pace, and Middle East flow still largely 'offline, supply chains are now stretching to cover a much greater gap...In the absence of a near-term solution to the 'Hormuz issue, rebalancing is going to take time." Reporting by Seher DAREEN in London and editing by Alex Lawler & Kirsten Donovan
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The Latvian government has lost its majority in the parliament due to its handling of Ukraine drone incidents
Evika Silina, the Latvian Prime Minister, was left without a majority in the 'parliament' on Wednesday after the 'left-wing Progressives Party' announced that it would withdraw its support. This decision comes after the Progressives' defence minister Andris Spruds was fired at the weekend for his handling of incidents with stray Ukrainian drones that flew into Latvia from Russia. Andris Suvajevs, the parliamentary leader of the Progressive Party, told the media that the current Prime Minister "doesn't have nine votes" from the Progressives after meeting Silina. He added: "Therefore, we?call President Edgars Rinkevics?to?begin the political consultations about the?formation a new government as soon as possible." Suvajevs said that Silina could either resign, or she can wait until the parliament votes her out. The Prime Minister wrote on X she was speaking with her centre-right New Unity Party and the other coalition parties, the Greens & Farmers Union regarding their next steps. The national broadcaster LSM reported that Rinkevics will meet with all the parliamentary factions this Friday. BNS reported that the opposition party United List announced on Wednesday it would vote no confidence against Silina in parliament, and was'ready to lead the next government. (Reporting from Andrius Sytas, Vilnius; Janis Laizans, Riga; editing by Hugh Lawson).
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Rate cut bets are impacted by inflation worries as gold prices continue to fall
The gold price fell a second time on Wednesday, as inflation fears fueled by war weighed down on the expectations of interest rate reductions. Markets were also looking forward to Trump-Xi's upcoming meeting. At 09:05 am EDT (1305 GMT), spot gold fell 0.6%, to $4686.99 an ounce. U.S. Gold Futures rose 0.2% to $4694.70. U.S. Producer Prices increased more than expected during April. They posted their largest gain since early 2022. This is the latest sign that inflation has accelerated amid the Iran War. Peter Grant, senior metals analyst at Zaner Metals and vice president, said that inflation remains "sticky" and therefore, expectations of higher rates for longer were reinforced. This has led to gold's price being pushed up in the last two days. Gold is often seen as a hedge against inflation. However, higher interest rates can put pressure on the metal. Data released on Wednesday revealed that U.S. consumer inflation rose further in April. The annual rate posted its biggest gain in three year. Last month, the U.S. Central Bank left its benchmark interest rate at 3.50%-3.75%. CME Group's FedWatch reports that traders have priced in a rate cut by the U.S. this year. Donald Trump is on his first trip to China as a U.S. President in almost a decade, eager to make deals, maintain the fragile trade truce between?the second-largest economic power and boost public approval ratings that have been hurt by his war with Iran. India raised its import tariffs for gold and silver from 6% to 15% as part of an effort to reduce overseas purchases of metals. This will also help to ease the pressure on India's foreign exchange reserves. India is the second largest consumer of precious metals in the world. Grant stated that the news of higher import duties has caused some?demand worries and could be a long-term headwind. After hitting a session high of two months earlier, spot silver dropped 0.2% to $86.70 an ounce. Platinum fell 0.3%, to $2,120.20 after reaching its highest price since March 17. Palladium fell 0.4% to $1,484.10. Ashitha Shivprasad, reporting from Bengaluru and Alexander Smith, editing)
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India's increased tariffs on gold and silver are unlikely to affect demand
India, which is the second largest gold consumer in the world, raised its tariffs for gold and silver from 6% to 15%, as the Iran war strains New Delhi’s balance of payment. India imports nearly all its gold and has repeatedly tried to reduce consumption. India's weddings and festivals are a major part of its culture, so gold is a necessity rather than merely luxuries. Why is India targeting imports of gold and silver? India's current-account deficit is being impacted by imports of precious metals that New Delhi considers non-essential. The rupee has been impacted by the rising prices of gold and silver, which have increased the bill and led to a widening of external outflows. India spent $84 billion in gold and silver imports during the fiscal year ending March. This is up from $35.5 billion 10 years ago. India is the largest consumer of silver in the world. It's used for jewellery, coins, bars, and industrial applications from solar energy to electronic devices. In the last year, silver ETFs have seen record-high inflows, indicating that investment is driving demand more than jewellery or silverware. Do higher tariffs curb demand? Indian consumers are very price sensitive, and sudden price increases often cause them to delay their purchases. The annual demand for gold has been relatively stable at 666-803 tons on average, even though local prices have risen by 443% in the last decade. The demand remained resilient even when India increased gold import tariffs from 2% to 10% between 2012 and 2013 Buyers are unlikely to stop buying gold because of a tariff increase. Indian households purchase gold to protect themselves against inflation, currency weakness and long-term value. In rural areas, farmers use it for financial protection during times of crisis. Banks and finance companies offer credit in minutes to millions of Indians. Which Gold Demand Segment Will Be Hit Hardest? India's gold consumption is dominated by jewellery demand, which accounts for 75%. The rest comes from investment, in the form of coins, bars, and gold ETFs. The demand for jewellery has already weakened due to high prices. Further increases are likely in the near future and will push buyers toward lower-carat pieces. Investors buy gold to anticipate price increases, while Indians view it as a safe haven and an inflation hedge. The higher tariffs increase?local prices and make gold a more attractive asset. In addition, rising prices can attract new investors who are worried about missing out on future gains. In the March quarter, investment demand for gold exceeded jewellery consumption for first time. Investors turned to the metal due to weak equity returns. Inflows to local gold ETFs are expected to continue rising. Will the TARIFF RISE Spur Gold Smuggling? The latest duty increase has increased the margins of so-called grey markets to 18% from around 9%. New Delhi reduced tariffs in 2024, and the unofficial gold imports dropped sharply. The gold imports dropped from 156.1 tons to 69.2 tonnes in 2024, then further to 20.4 tons in 2020. The margin for smuggling one kilogram of gold is now at a record high 3 million rupees. This creates a greater incentive for gray market operators.
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India has cleared a $3.9 billion plan to convert coal to gas in order to reduce the reliance on imported fuel.
Ashwini Vaishnaw, India's Information Minister, said that the cabinet had approved a scheme worth 375 billion rupees ($3.92billion) to promote coal gasification, which will reduce reliance on imported fuels, and use domestic coal for cleaner industrial purposes. The Cabinet decision seeks encouragement for the conversion of coal to synthetic gas, which can be used in power production, fertiliser production, petrochemical applications, and other industrial applications. Vaishnaw, who spoke on Wednesday, said that this would, in turn, help India reduce its imports of liquefied gas (LNG), ammonia, urea and methanol. India's gas exports have been affected by the Middle East conflict. As part of their efforts to reduce emissions, several countries, such as the United States and China are also exploring coal gasification technology. India has a coal reserve of 401 billion tons, and a lignite reserve of 47 billion tons. The country aims to gasify 75 million metric tonnes of coal per year. The government will provide financial support of up to 20% of the costs of plant and machinery. Power producers are becoming more interested in this sector. NTPC, a state-run power company, is 'looking to enter coal gasification, with plans to produce between five million and ten million tonnes of synthetic 'gas per year over the next three or four years, according to a report last year. In 2024, India approved a 85 billion rupee incentive scheme for coal gasification.
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Aluminium nears 4-year high and copper continues to push towards record January high
Due to 'bullish technical indicators and the outperforming of prices in the U.S. The benchmark three-month 'copper' on the London Metal Exchange rose 0.8% to $14138 per metric ton, in open-outcry official trading, following a record-breaking close on Tuesday. The LME index of six base-metals contracts closed on a record on Tuesday, with copper moving closer to the intraday record of $14,527.50 that was set on January 29. Prices for the entire complex were also strong. Bets on the future growth of demand for copper are a good way to support the price. Recent strong factory data is also a great way to ease concerns about the Middle East conflict and the availability of sulphuric acids. The Yangshan premium copper The price of copper in China has risen by 3%, to $72 per tonne, the highest level since mid-April. This indicates that demand is still strong, despite higher prices. The most active COMEX copper futures for July gained 1.8%, reaching a record-high of $6.6485 per lb. The U.S. copper market is currently trading at about $500 per ton more than the LME, with Washington expected by the end of June to decide whether or not to impose tariffs on imported refined copper. The anticipation of policy actions is drawing metal to the United States, and tightening the availability elsewhere. This adds another layer of support for the global market, Neil Welsh, the head of metals of broker Britannia Global Markets said in a note. LME?aluminium prices rose 2.4% in official trading to $3 649 per ton after hitting $3 657, the highest level since April 16. Metal is nearing its highest level in four years, as the Iran War disrupted Middle East producers' supply. Daily LME data shows that after Malaysia's 30,000 new cancellations, the on-warrant aluminum stocks in LME registered warehouses dropped to 301.722.5 tons. Zinc increased by 0.1%, to $3,535. Lead, on the other hand, rose by 0.4%, to $2,004.5. Both metals reached their highest levels since late January. Nickel increased 1.5% and tin gained 1.7%. Chinese companies in Indonesia, a giant nickel producer, warned that local tax increases and tighter ore quotas would threaten their investment. (Reporting and editing by Shreya Biwas; Polina Devitt)
Falling power rates threaten debt-laden EDF's revival
Falling electrical energy prices are slowing EDF's negotiations with industrial consumers for longterm contracts, four professionals and sources say, threatening the debtladen energy group's longterm financial resources and ability to keep its aging nuclear plants running.
Monetary results for 2023 on Friday will likely reveal development in cutting a few of EDF's 65 billion euros ($ 69.5. billion) of financial obligation and an increase in revenues reinforced by skyrocketing. power rates following Russia's intrusion of Ukraine in 2022.
The lack of forward offers will renew concerns about the. state-owned power business's long-lasting business outlook after. its nationalisation last June. EDF requires those deals to support. its finances and decrease dangers of price swings so it can invest. to extend the life of its 56 nuclear reactors and build at least. six more.
A power rate offer EDF agreed with the federal government in. November intends to stabilise electrical power rates for retail and. commercial clients at 70 euros per megawatt-hour (MWh) on. average from 2026 when present contracts expire. The current. breakeven level for production expenses is 60 euros/MWh.
But sinking rates are undermining that technique.
The drop in costs is seriously interfering with both the market. and EDF, said one EDF source who declined to be identified. because the talks are private. He explained the market as being. in a genuine paralysis due to the fact that both sides remain in a wait-and-see. mode.
A lack of deals might make it harder for EDF to secure. financing or injure its credit ratings. Top agencies Fitch, S&P and. Moody's have lower-medium grade scores for its long-term debt.
We'll closely monitor how the quantity of long-term contracts. choices up in time, Antonio Totaro, Fitch's head of EMEA. energies and transportation, stated.
Aluminium producer ArcelorMittal signed a letter of intent. for an electrical energy production allotment contract with EDF in. mid-January. EDF declined to comment on the progress of any. talks.
HOLDING OUT
EDF and consumers have blamed each other for the slow rate. of talks.
The EDF source stated it makes no sense for consumers to. book far forward agreements while costs are trending downwards.
Yet EDF could likewise be stalling, hoping that costs stabilise. above current levels.
Industrial customers are all set to sign offers, Nicolas de. Warren, president of Union of Energy Using Industries (Uniden). stated.
Things are stagnating quickly enough, he stated. Uniden. represents about 70% of France's industrial energy users, such. as Renault and train operator SNCF.
Uncertainty over future costs is slowing investment. decisions for energy-intensive markets even as the federal government. aims to reindustrialize France while reducing carbon emissions,. he stated.
These markets can not live with increasing market value. irregularity, so we definitely require these agreements, de Warren. said.
While the scheme is off to a bad start, there is no. alternative currently on the table, the EDF source said. EDF and. the government stated in 2015 they plan to evaluate its success. around May.
An alternative to the November strategy might be to set a. floor cost for nuclear electrical power sold by EDF, through a. agreement for difference plan for instance, which would. require approval from Brussels.
BREAKEVEN
The French baseload agreement for 2026 has more. than cut in half over the previous year, piercing the 70 euro/MWh level. on Feb. 5 that was set as the market reform recommendation price. On. Wednesday, it struck a fresh contract low of 63.75 euros/MWh.
Front-year contracts traded around 50 to 60. euros from 2018 before spiking in 2022 after Russia's intrusion. of Ukraine when they peaked at 1,200 euros/MWh. They have fallen. quickly over the last year and are now at around 70 euros/MWh.
EDF's other brand-new prices method, focused on setting rates to. offer to rivals such as Engie and TotalEnergies. , consists of auctions for 2028 and 2029 agreements.
Need has actually been lacklustre for those too.
Out of 54 total auctions given that the start of the year, just a. dozen have actually achieved success and at prices below 70 euros, EDF. data showed.
The reasonably low level of participation shows a limited. interest on the part of the French market for this kind of. item, probably due to EDF's reserve prices, which may be. considered too high, stated ICIS analyst Lucca Urbanucci.
The French economy ministry stated it has no plans to help the. group if power costs fall listed below the 60 euros per megawatt-hour. ( MWh) breakeven level. It restated this month that market. reform agreed in November will assist EDF manage rate volatility. and invest in possessions. ($ 1 = 0.9344 euros)
(source: Reuters)