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Trump Administration memo urges countries not to accept plastic production caps under UN Treaty
According to memos and communications obtained by the, the United States sent letters to a few countries to urge them to reject a goal of a global treaty that would include limits on plastic production as well as plastic chemical additives. In communications dated July 25, which were circulated at the beginning of the negotiations on Monday to all countries, the U.S. outlined its red lines in negotiations. This puts it directly against over 100 countries who have supported these measures. As delegates gathered for what was supposed to be the last round of negotiations, hopes for an ambitious global treaty tackling the entire life cycle of plastic pollution, from the production and disposal of waste to polymer production have dimmed. There are still significant differences between the oil-producing nations, who oppose limits on virgin plastic production, fueled by coal and petroleum, and parties like the European Union, small island states and others, who advocate for limits and stronger management of hazardous chemicals and plastic products. The U.S. delegation was led by career State Department employees who represented the Biden Administration. They sent memos to other countries outlining their position, and saying that they will not accept a treaty which addresses plastic pollution upstream. The memo was addressed to unnamed countries due to the sensitive nature of the negotiations. NAIROBI MEETING In a memo, the U.S. admitted that, after attending an initial heads of delegations meeting in Nairobi, from June 30 to 2 July, "we clearly do not see convergence in provisions related to supply of plastics, plastic production or plastic additives, as well as global bans and restriction on products and chemicals (also known by the global list). The spokesperson for the State Department told each party to take appropriate measures in accordance with their national context. The spokesperson stated that some countries may decide to ban certain products, while others might want to concentrate on improving collection and recycling. John Hocevar is the Oceans Campaign Director at Greenpeace USA. He said that the U.S. delegation under Trump was a return to "old school bullying" by the U.S. government, which used its financial power to persuade governments to change their positions in a manner that benefited what the U.S. wanted. In a resolution that was seen by the. Sources familiar with the talks told the newspaper that the U.S. was seeking to revert to the language agreed upon in 2022 for renegotiation of the mandate. The U.S. position is broadly in line with that of the global petrochemicals sector, which had stated similar positions before the talks and several powerful oil and chemical producing countries who have maintained this position during the entire negotiation. Over 100 countries support a global cap on plastic production. The Trump administration in the U.S. has taken numerous measures to Roll back climate and environmental policy It says that industry is burdened with too many obligations. According to the OECD, plastic production will triple without intervention by 2060, choking oceans and harming human health, as well as accelerating climate changes. (Reporting from Washington by Valerie Volcovici and Olivia Le Poidevin, with editing by Ed Osmond.)
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Gold drops on profit-taking, but Trump's Fed picks are in the spotlight
Gold prices dropped on Wednesday, as investors took profits after the prices reached a two-week high the previous session. Meanwhile, the market's attention shifted to the upcoming Federal Reserve nominees of U.S. president Donald Trump. Gold spot fell 0.3% to $3,371.31 an ounce at 0956 am. ET (1356 GMT). U.S. Gold futures dropped 0.2% to $3.427.10. David Meger said, Director of Metals Trading at High Ridge Futures, "We see this as a slight pullback... some profit-taking after the recent rise in prices, during a time of quieter economic conditions, and less need for safe-havens." Gold has gained for three sessions in a row after Friday's disappointing U.S. Employment Growth data. CME FedWatch reports that market participants see a higher probability of a rate cut in September, now at over 87%, up from the earlier 63%. Gold is a non-yielding investment that tends to do well in times of economic uncertainty. Trump announced on Tuesday that he would name a Fed Board candidate by the end the week. He has also narrowed down his options for replacing Chair Jerome Powell. Spot silver increased by 0.1% to $35.86 an ounce. Platinum rose 1% to $1334.05 while palladium fell 2.2% to $1147. This is the lowest level of palladium since July 11. The concern over sanctions against Russia was one of the reasons that palladium and platinum prices have been rising in the past few weeks. The prospect of reduced tensions between Russia and the U.S. has certainly allowed prices to drop in recent sessions," Meger stated. Russia is one of the major suppliers of palladium, platinum and other metals. A Kremlin official said that U.S. envoy Steve Witkoff had "useful and productive" talks with Russian president Vladimir Putin. This comes two days before the deadline Trump set for Russia to accept peace in Ukraine, or face new sanctions. (Reporting by Sarah Qureshi in Bengaluru; Editing by Vijay Kishore)
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Markets await the outcome of Putin-Witkoff's meeting to determine the value of the Russian rouble
Markets and the Russian rouble held their breath Wednesday, as they awaited President Vladimir Putin's Kremlin meeting with U.S. Special Envoy Steve Witkoff. Witkoff had "useful" and "constructive" talks with Putin, a Kremlin aide Yuri Ushakov stated, two days ahead of the deadline set by Donald Trump to have Russia agree to peace in Ukraine, or face new sanctions. LSEG compiled data based on OTC quotes that showed the rouble at 80 per dollar. The yuan was down 0.2% at the Moscow Stock Exchange. The main Russian stock market index fell by 0.15%. Analysts at T-Bank said that the market was awaiting the result of the meeting between Steve Witkoff and Vladimir Putin. Many analysts think that the rouble has been overvalued, and is waiting for a trigger which will cause it to weaken. The Russian currency rose by as much as 45% in value against the dollar in early this year. This was partly due to the expectation of a thaw between Russia and the U.S., as well as the hope for a peaceful resolution in Ukraine. Trump has several options to increase pressure on Russia, if Witkoff does not return with anything. These include possible new sanctions and trade tariffs against Russian oil buyers and the energy and banking sector of Russia. The Kremlin had earlier stated that Russia was immune to sanctions due to its long-term experience. The latest round of U.S. sanction against a Russian energy bank imposed by the United States last year led to a decline in the rouble. Evgeny Loktekhov, a PSB Bank analyst, said that the currency market would be watching for the news of the special representative of the U.S. president and any clarifications regarding the possible U.S. sanction situation. (Reporting and editing by Bernadettebaum; Gleb Bryanski)
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Pinnacle West's quarterly profits fall due to lower demand for power from Arizona's milder weather
Pinnacle West Capital announced a 5.5% drop in its second quarter profit on Wednesday as the mild weather conditions across Arizona reduced the utility's demand for power during the period April-June. The reduced temperatures during the quarter resulted in around 15% less cooling degree-days - a key measure for energy demand - compared to 2024's same period, which featured record-breaking heat. In a press release, CEO Ted Geisler stated that it was not surprising that Arizona's cooler weather led to lower earnings in the third quarter. The results were also affected by higher costs of fuel, maintenance, and borrowing, as well as lower tax credits, and income related to pensions. The total operating expenses of the company rose to $1.05billion during the third quarter from $995.2m during the same time period last year. The total cost of interest has risen to $101.9m, up from $97.9m a year earlier. The Phoenix-based utility reported that net income attributable common shareholders decreased to $192.6 millions, or 1.58 per share for the quarter ending June 30 from last year's 203.8 million, which was $1.76 per per share. Arizona Public Service's main subsidiary in Arizona, which provides service to 1.4 million homes, businesses and other entities in the state, experienced a 2.4% rise in its customers during the third quarter. (Reporting from Bengaluru by Sumit S. Saha; Editing by Vijay Kishore.)
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India's BHEL reports wider quarterly loss due to weaker power demand and higher expenses
Bharat Heavy Electricals Ltd. (BHEL), a state-owned company in India, reported a larger first-quarter loss Wednesday. The decline was attributed to a lower demand for the products it produces. The net loss of the manufacturer more than doubled from 2.13 billion to 4.55 billion (52 million dollars) for the quarter ending June 30. India's electricity demand dropped 1.8% on an annual basis to 481 billion units between April and June as the early monsoons hindered construction activities and reduced air-conditioning requirements. This led to a decrease in the number of project orders for electrical equipment. BHEL's revenues from this segment, which is its largest, dropped 5.6% to 38.99 Billion Rupees. The company's revenue from operations, which represents 55% of India’s total installed capacity for power generation, was almost flat at 54.87 trillion rupees during the third quarter. BHEL expenses rose by nearly 7%, to 62.80 trillion rupees. This was mainly due to a 10.8% increase in the price of raw materials and service. Tata Power, BHEL's competitor, missed its quarterly profit forecasts due to weak electricity demand. The shares of the company closed down 3.4%, ahead of results. ($1 = 87.6400 Indian rupees) (Reporting by Anuran Sadhu in Bengaluru; Editing by Savio D'Souza)
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What alternatives could India consider to Russian oil?
India, which imports more than one-third of its oil from Russia, will likely turn to other suppliers in the Middle East, Africa, and elsewhere if forced to reduce Russian imports by possible U.S. sanctions. Why is India importing Russian oil? India began buying Russian oil at a discounted price after the West imposed sanctions against Moscow for its invasion of Ukraine 2022. Russia is now India's top supplier, with 35% of India’s total supplies. This is up from a little over 2% just before the Ukraine war. The global crude price surged to $137 a barrel in response to fears of a shortage following the Western-led sanctions, before stabilizing. Discounted Russian crude has lowered the costs of Indian refiners. India imports over 85% of the oil it needs. How much Russian oil does India buy? Trade data revealed that the world's third largest oil importer and user received approximately 1.75 million barrels of Russian oil per day in the first six months of this year. This is up 1% compared to a year earlier. Private refiners Nayara Energy, Reliance Industries Ltd, and Reliance Industries Ltd, operators of the largest refinery complex in the world, have long-term contracts with Rosneft. Why does Trump want India to cut russian oil imports? Donald Trump, the U.S. president, has announced that he will raise the tariffs on goods imported to India from 25% to a substantial amount in light of New Delhi's continuing purchases of Russian crude oil. He warned that countries buying Russian exports may face sanctions if Russia does not reach a deal with Ukraine. New Delhi has refused to bow down, citing its close economic ties with Russia as well as its long-standing relations. The country's refiners, however, have stopped buying Russian oil. What are India's options if it can't buy Russian oil? India also buys oil in the United Arab Emirates and Iraq, besides Russia. Indian refiners buy most of their oil from Middle Eastern producers through annual agreements that allow them to request additional supplies every month. Since Trump's warning about sanctions, refiners bought crude oil from the United States as well as the Middle East, West Africa and Azerbaijan. Hardeep Singh Puri, the oil minister, says that India's supply sources have been diversified to around 40 countries. He also adds that Guyana, Brazil, and Canada are supplying more products on the market.
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NRG Energy exceeds its quarterly profit expectations, signs a 295 MW power deal for data centers
NRG Energy's second-quarter profits surpassed Wall Street expectations on Wednesday. The utility benefited from a surge in power demand, and increased retail margins at its Texas unit. The company has also signed a long-term contract to supply electricity to two data centers built on NRG's Texas sites. This deal could be expanded to approximately 1 gigawatt if additional sites are added. NRG will benefit from the surge in electricity demand in Texas. This is due in part to the boom of data centers that require large, reliable power supplies in order to support cloud computing and artificial intelligence. In April, the U.S. Energy Information Administration said that it expected power consumption to hit record levels in 2025 and 26. NRG announced that as part of the previously announced capital allocation plan for 2025, it will return approximately $345 million to common stock holders and $1.3 billion in dividends to shareholders. The Texas unit of the company posted a core adjusted profit of $512 millions, up from last year's $452million. NRG's operating costs increased to $6.74 Billion in the quarter ending June 30 from $5.25 Billion a year earlier. According to data compiled and analyzed by LSEG, on an adjusted basis the company reported a profit per share of $1.73, exceeding the average analyst forecast of $1.56. NRG has reaffirmed that its adjusted profit forecast for the current year is between $6.75 and $7.75 per share. (Reporting and editing by Maju Samuel in Bengaluru, Pranav Mathur from Bengaluru)
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Jindal Stainless announces that the government's antidumping investigation has been delayed due to uncertainty over US tariffs
India's Jindal Steel said that the launch by the government of an antidumping investigation into cheap stainless imports was delayed because of trade uncertainty resulting from new U.S. duties on Indian goods. Abhyuday Jindal, Managing Director of the company, said that the Indian Stainless Steel Development Association – a domestic trade organization of which it is a part – filed a complaint with the Federal Trade Ministry's Directorate General of Trade Remedies in late July. India will be subject to a 25% duty on all shipments it makes to the U.S. starting Friday. President Donald Trump warned that additional charges "very substantial" would be imposed because New Delhi imports Russian oil. Jindal stated that the DGTR would likely need two to three months more to begin the investigation. Indian mills are struggling with the increased imports of stainless steel cheaper from countries such as China and Vietnam. The demand for finished products - used by the automotive industry, home appliance manufacturers, and industrial sectors - was strong during the quarter of April-June, thanks to strong manufacturing and government spending. Jindal Stainless announced an 11% increase in its first-quarter profits to 7,15 billion rupees ($82 million) earlier that day. The country's total revenue increased 8.2%, to 102.07 trillion rupees.
The Indonesian nickel slump puts pressure on coal miners hit by declining exports
The Indonesian coal producers find themselves in a difficult situation, as their exports are falling and the demand for fuel from nickel smelters is at an all-time high. This creates a conundrum of growth.
Indonesia's largest export is coal, which will generate $30.49 billion by 2024. A decline in revenues would have an adverse effect on Southeast Asia's largest economy, which is heavily dependent on commodities.
Lower profit margins and falling share prices point to coal's future woes, which include a reduction in workforce, a slowdown in production, and less money going into government coffers, at a time that President Prabowo is launching ambitious spending plans.
The fastest-growing demand for Indonesian coal has been from electricity-hungry smelters that process nickel.
According to the Indonesian Coal Miners Association, (ICMA), the demand for nickel will reach a peak of 84.2 million tonnes by 2026, and then fall to 78.6 millions tons in 2027 due to overcapacity of the nickel industry and possible implementation of stricter emission regulations.
Kpler data showed that Indonesian coal exports were down 12.6% by volume compared to a year ago, while government data indicated a 19.1% drop in value.
Chinese data show that exports to China, which is the largest coal buyer in the world, dropped by 30% compared to a year ago. The country relies more on its domestic production and uses low prices to import coal of higher quality from other countries.
Manish Gupta is a senior analyst at Wood Mackenzie for Asia thermal coal. He said that Indonesian coal miners were diversifying their businesses to protect themselves against the steeply declining demand for low to mid-grade coal.
He said that he did not expect to see the increase in the number of captive plants, which are power plants linked to nickel smelting facilities.
According to Global Energy Monitor's coal plant tracker, Indonesia's nickel smelting sector has led to a threefold increase in Indonesian coal-fired power capacity from 5.5 gigawatts in 2019 to 16.6 GW by 2024.
As nickel prices fell due to increased overcapacity, and China's lower stainless steel imports, some Indonesian smelters idled their facilities.
Data from geospatial analysis firm Earth-i revealed that in June, Indonesian nickel pig-iron operations experienced a 9% increase in smelting activity compared to a year ago, which was the highest level in the past two years. This is primarily because the country's largest nickel producer, Tsingshan, likely stopped production at its joint-venture plants in Morowali Industrial Park.
H. Kristiono is the deputy chairman of ICMA which includes Adaro Bayan Bukit Asam and foreign traders Adani Global Trafigura. He still expects that the coal-fired capacity of the smelter sector will grow despite underutilisation.
The nickel industry will continue to use coal as its primary power source due to difficulties in switching to alternative sources, the slow progress of connecting sites to national grids and Indonesia's opposition to more stringent regulations.
Global Coal Monitor reports that the Global Coal Monitor estimates that Central Sulawesi, North Maluku and Central Sulawesi provinces are expected to have a combined capacity of 6 GW, or 46%, of all coal-fired plants currently under construction in Indonesia. These two provinces are where the nickel processing industry is concentrated.
Companies are squeezed
Indonesian coal producers are being squeezed by a combination of lower exports, slower growth in captive power demand and higher government payments.
LSEG data revealed that the profit margins of Bayan, a major miner in Indonesia, have been falling for three years. Bukit Asam has also seen its first-quarter margins fall below averages every year since 2010. This is due to higher royalty payments and increasing machinery costs.
The shares of Indonesia's five largest coal producers by production are down between 1% and 18% in this year. This is below the broader market growth rate of almost 7%. Adaro has fallen 18% while Golden Energy Mines, Bukit Asam and Bukit Asam lost over a tenth since the start of this year.
Requests for comment from the companies were not answered.
Indonesia announced in April new rates of royalty for nickel, coal and other minerals, to help Prabowo increase his spending. Some coal miners experienced a drop in their royalty rates, while others saw an increase of 1 percentage point.
According to the Energy Shift Institute, based in Australia, by 2024 royalties will account for 16% of average coal producers' cost structures, making them the most expensive among the major commodities produced in Indonesia.
Jakarta also considers export duties on coal for certain price levels in order to bolster state coffers. This is at a moment when miners are already facing higher fuel prices due to the removal biodiesel subsidy.
Analysts say that some coal miners are looking at diversification as a way to survive the current downturn, but they have made little progress. Bukit Asam said, for instance, in May that it was considering an investment of $3.1 billion in a facility to convert coal into synthetic natural gas.
Gupta, of Wood Mackenzie, said that producers are looking at a combination of downstream options, renewables, or investment in alternative commodities. (Reporting and editing by Christian Schmollinger, Ashitha Shivaprasad, Hongmei LI, Fransiska Nanangoy; Additional reporting by Sudarshan Varadhan).
(source: Reuters)