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Malaysia restricts data center growth to China, blocking AI chips
M alaysia is a hotspot of data centres. It has slowed down its expansion, which industry analysts and insiders believe will hamper China's attempts to access powerful chips, crucial for improving artificial intelligence capabilities. In recent years, the Southeast Asian nation has attracted data center investments from U.S. tech giants such as Microsoft, Amazon, Alphabet’s Google, and their Chinese counterparts Tencent Huawei and Alibaba, due to cheap land and electric costs, and robust local AI market prospects. According to DC Byte, more than two thirds of the data center capacity currently under construction in Southeast Asia’s five major growth markets have been committed to Malaysia. Companies have committed to building more data centres in Johor, Malaysia's neighbouring state. This is due to spillover from Singapore which is more expensive. The data centre boom is slowing down as Malaysia struggles with its power grid and water resources. Washington has also put pressure on Malaysia to stop Chinese firms from using the region as an export control backdoor for U.S. AI chips. Malaysia, China's biggest trading partner in Southeast Asia announced in July that it would require permits for all exports and transshipments of high-performance U.S. chips such as those manufactured by Nvidia. Chinese replacements for U.S.-made chips are still inferior alternatives to the development and maintenance of cutting-edge Chinese AI applications and models that can compete with U.S. competitors. The new restrictions allow Chinese data centres to import U.S. chip for use in the country. Experts say that as Malaysia attempts to finalise its trade agreement with the United States, they will be scrutinised more closely. The U.S. Commerce Department is concerned that data centres located outside of China may purchase AI chips in order to train AI models, and even to support military purposes, in China. Collmann Griffin, a former U.S. Government sanctions policy advisor, said this. The U.S. Commerce Department has not responded to a comment request. 'AI BELTS AND ROAD' China's overseas push began shortly after the release of a three-year plan in 2021 for Chinese data centres operators, which called on these firms to expand overseas, particularly in countries that have signed up to Xi Jinping’s Belt and Road Initiative (Xi Jinping’s flagship initiative for overseas development), Malaysia being a signatory. The countries issued a joint declaration at the end of Xi’s visit to Malaysia, in April. They pledged to increase their cooperation in "data links", 5G infrastructure, and AI. This statement referred to the increasing political momentum behind China's expansion of data centres in Malaysia. GDS Holdings is one of China’s largest data centres operators. Two years ago, they began operating an hyperscale campus data centre in Johor. This massive project, which continues to be expanded, was launched. But as the U.S. continues to target China's AI capabilities, GDS has gradually reduced its stake in the Singapore-headquartered subsidiary that managed its overseas data centres and spun it off into an independent entity called DayOne in January. Lee Ting Han said that the "rebranding", by Chinese companies, is likely to diversify their clientele "because they are very aware of what is happening, trade tensions are moving". Jamie Khoo, DayOne's CEO, said at the opening of DayOne Singapore's first data center in July that the company has always planned to separate its business from the Chinese parent because both companies operate under different regulations. Singapore announced last year it would release only 300 megawatts of data center capacity "in a short time" due to its power and water shortages. Knight Frank reported that by December 2024 Johor would have 12 data centres in operation with an estimated combined capacity of 369.9MW. An additional 28 data centers were planned to be developed, which represents an estimated capacity 898.7MW. The state's chief Minister said that Johor is Malaysia's largest data centre investment hub, with 42 projects totaling 164.45 billion Ringgit ($39.08billion) being approved by the second quarter 2025. These projects will contribute 78.6% to the country's operational information technology capacity. Johor's proximity to Singapore allows it to benefit from a lower latency connection to other data centres in the city-state. Lee explained that Johor had begun to slow down. Last year, the state introduced a committee to review data center projects. The committee rejected 30 percent of applications by 2024 because they did not demonstrate sustainable practices in terms of water and energy use. He added that the approval rate is higher as more applicants are familiarized with the process. Vivian Wong is a senior analyst with DC Byte. She said that Southeast Asian countries such as Malaysia are attractive markets for Chinese expansions of data centres due to their geographic proximity, relative lower political friction, and the growing demand for digital infrastructure. She said that, "However as Southeast Asia faces increased tariffs and scrutiny, this could potentially reap less success than in previous years, particularly in markets known to be home to Chinese-backed operations, which are also being targeted by the Trump Administration." $ 1 = 4.2080 ringgit (Reporting from Eduardo Baptista, in Beijing; Ashley Tang, Danial Azhar, and Jun Yuan Yong, in Singapore; Editing done by Miyoung and Jamie Freed).
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Oil prices continue to fall due to oversupply and US demand concerns
After a big drop in the previous session, oil prices dipped on Friday due to concerns over a possible softening in U.S. consumer demand. This was offset by worries about disruptions in supply from the conflict in the Middle East. Brent crude futures dropped 30 cents or 0.45% to $66.07 per barrel at 0114 GMT. U.S. West Texas Intermediate Crude fell 31 cents or 0.5% to $62.06. In the last trading day, benchmarks fell by 1,7% and 2% respectively. The International Energy Agency, in its latest monthly report, said that the world's oil supply will rise faster than expected due to the planned production increases by the Organization of Petroleum Exporting Countries (OPEC+), a grouping of countries including Russia. OPEC's own report did not change its high growth predictions for global oil demand in 2025 and 2026. It said that the world economy is still on a steady growth path. OPEC+ announced on Sunday that it would increase its oil production quotas starting in October, as Saudi Arabia, the group's leading member, tries to regain market shares. Saudi Arabian crude oil exports are expected to increase, according to several sources on Thursday. The state-owned energy company Aramco shipped about 1.65 millions barrels of crude oil per day to China in October. This is a sharp rise from the 1.43 million barrels of crude oil per day allocated to China in September. Analyst Giovanni Staunovo at UBS said that the market was questioning for how long China could continue to absorb barrels and maintain low Organization for Economic Co-operation and Development inventories (OECD). Investors were also keeping an eye on any further sanctions affecting Russian crude oil. The IEA reported that in Russia, which is expected to be the second largest producer of crude oil behind the U.S. by 2024, revenues from the sale of crude and petroleum products declined in August, reaching one of their lowest levels since the beginning of the conflict in Ukraine. Two sources familiar with the plans said that Russia intends to reduce ESPO Blend oil loads from its Far East Kozmino Port in September from 4.2 millions tons to 4 million metric tonnes (about one-million barrels per day), from 4.2million tons in August. The U.S. consumer price index in August rose by the highest rate in seven months. A surge in the number of first-time unemployment aid applications last week raised expectations that the Federal Reserve would cut interest rates in the coming week. This could increase economic growth and the demand for oil. A report released by the Energy Information Administration on Wednesday showed that U.S. crude oil stocks increased last week, rising by 3.9 millions barrels to 424.6million barrels. Reporting by Sam Li in Beijing and Lewis Jackson in New York, with editing by Tom Hogue.
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Sources say Valero is overhauling the FCCU at Tennessee refinery.
Valero Energy Corporation is overhauling its gasoline-producing Fluidic Catalytic Cracking Unit (FCCU) in Memphis, Tennessee, according to people familiar with the plant's operations. Valero's spokesperson was unavailable to comment on the refinery operation Thursday. Sources said that the 65,000 bpd FCCU and the 12,000 bpd unit of alkylation were shut down over the weekend for an overhaul. Sources said that the overhaul should be completed by November 1. Sources claim that the refinery's flaring gas recovery unit and hydrotreater were also taken off production to change a catalyst. The FCCU converts gas oil to unfinished gasoline using a fine powder silica catalyst. Alkylation units are used to convert refinery byproducts into liquids that boost the octane of unfinished gasoline. The flare gas collection unit collects the gases that would have been burned in the refinery’s safety flare system and uses them as fuel for boilers. In order to comply with U.S. Environmental Rules, hydrotreaters remove sulfur from motor gasoline using catalysts and hydrogen. (Reporting and editing by Himani Sarkar, Chris Reese, and Erwin Seba)
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Embraer CEO: 100 commercial aircraft deliveries expected per year by 2028
Embraer's CEO said that the Brazilian planemaker expects to achieve 100 commercial aircraft deliveries annually in 2028. He added that supply chain problems will likely prevent Embraer from reaching that milestone sooner. As part of its recovery after the industry crisis caused by the pandemic, the world's third largest planemaker increased annual deliveries. It expects between 77-85 commercial jet deliveries in 2019, up from 73 last year. Embraer's CEO Francisco Gomes Neto warned that supply-chain snags could limit Embraer's production plans. The company last delivered 100 commercial jets annually in 2017. In an interview with a newspaper on Wednesday, he stated that "2026 is still going to be a challenging year in terms of commercial jet production." "In 2027 we will resume our strong growth plans, and in 2028 I expect we will be hitting 100 commercial planes per year." Embraer faced delays in the supply of engines for its E2 jets last year. Gomes Neto stated that while the situation has improved since then, Embraer is still facing problems with GE Aerospace engines and fuselage parts for its E1 jets. He said that the "delivery" outlook range we have provided the market with has allowed us, despite the challenges of the supply chain, to deliver on what we promised. "Embraer's growth will continue. Our production slots for 2026, 2027 and partially 2028 are almost completely filled. We have orders that need to be delivered, a backlog and we are nearly out of production slots for 2026, 2027 and 2028. "The challenge is now delivering the aircraft." He made his remarks after Embraer announced on Wednesday a firm order of 50 E195E2 aircraft for low-cost airline Avelo Airlines. This was the first U.S. contract for E2 jets. The deal increased Embraer's backlog, and highlighted a solid demand. The company had already received orders from customers such as Japan's ANA, Scandinavian Airlines SAS and U.S. airline SkyWest for E1 jets. Gomes Neto stated that more E2 orders could be placed this year as a number of sales campaigns are currently underway. Gomes Neto said that E1 jets which are almost exclusively used in the U.S. marketplace will not be expected to generate new sales by 2025. Gomes Neto, Embraer's CEO, said that despite the Avelo contract and the 10% U.S. tax on Brazilian-built aircraft Embraer does not plan to establish a U.S. assembly line for the E2 commercial jet. He said that any possible plant would depend on a rush of new orders. The firm had preferred to focus on its campaign to remove the tariff by focusing on the benefits it provides to U.S. customers and suppliers. Gomes Neto stated, "We prefer to present Embraer’s overall business case. Over the next five-year period, our plan is for us to import $21 billion dollars from the U.S. while exporting $13 billion." Embraer produces both generations of commercial aircraft at its Sao Jose dos Campos factory in Brazil on a hybrid production line. Gomes Neto stated that "creating a new product line would require an enormous investment which would result in a significant depreciation, making the product less competive." "If we sold thousands of aircraft and received orders for hundreds, yes, it would not be possible to do all of it (in Brazil). A second line could then be located nearer to the major customers. "But that's just not the case at this time," he said. The company has assembly lines in Florida for executive jets and pitched a $500-million line for the C-390, if the U.S. decides to buy the military cargo plane. Reporting by Gabriel Araujo, Mexico City Editing Brad Haynes and Rod Nickel
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Oracle's record-breaking surge shows AI's growing influence in the market
Wall Street's AI trade has driven the market to new highs in 2018. Oracle's share price gains have given investors yet another reason to support the trade. Oracle shares rose 36% Wednesday, after the company cited a surge in demand from AI firms to use its cloud services. This surge boosted its market value from $822 billion to $922.25 billion, surpassing Walmart WMT.N, JPMorgan Chase JPM.N, and Eli Lilly LLY.N. Oracle, Broadcom and Palantir have all seen gains this year, despite some pullbacks due to fears that the rally was becoming too hot. The "Magnificent 7" megacap trade, which led stocks higher during this bull market for most of the time, has faltered this year due to the decline in Apple and Tesla shares. Peter Tuz of Chase Investment Counsel, Charlottesville, Virginia, said: "When people began to worry about AI and infrastructure growth slowing, Oracle came out with a number which surprised everyone and fuelled the fire of this whole subgroup." This is a sign that the AI industry as a whole has taken the lead in terms of equity markets. Oracle has become one of Wall Street’s 10 most valuable corporations. Nvidia is a leader in AI as are Microsoft, Alphabet, and Amazon. Nvidia, the AI chip giant, became the most valuable company ever in 2018. It surpassed Microsoft and Apple, who many investors believe are lagging behind in the race for dominating emerging AI technology. Nvidia stock has dropped about 2% in price since the company's uninspiring forecast of August 27. However, its market value is still $4.3 trillion at Wednesday's closing. Investors have begun to show caution about the AI market, which has led to a stabilization of tech shares. The technology sector has risen by more than 16% in 2025. Oracle's stock market value of $922 billion following Wednesday's surge is just behind Berkshire Hathaway, at $1.06 trillion. Tesla, on the other hand, has a $1.12 trillion valuation. Oracle announced four multi-billion dollar contracts on Tuesday. It took advantage of a shift in industry spending led by OpenAI and xAI to spend aggressively to secure the massive computational capacity required for the AI race. Oracle, Broadcom and other AI-related companies now account for almost 30% of S&P 500. AI-related companies have also contributed the most to the recent gains of the benchmark index. According to LSEG data, gains in shares of Nvidia and Microsoft, Broadcom, Meta Platforms Alphabet, Amazon Palantir Technologies, Oracle, Broadcom and Meta Platforms have accounted together for about half of S&P 500’s 11% rise so far in 2025. Apple is the only exception. In the last five trading days, nine out of the 10 Wall Street companies that were most actively traded on Wall Street had AI as a common theme. Nvidia tops the list with $29 billion in average daily trades, according to LSEG. The AI stock craze has expanded beyond the tech sector, with shares in utilities and power equipment companies soaring. These companies will be required to meet the exploding energy demand that is needed to fuel this technology. AI-driven excitement has helped non-tech stocks such as GE Vernova, Constellation Energy, Vistra and the industrial firm GE Vernova to make massive gains over the last year. AI's enthusiasm has helped to drive the U.S. Stock market's valuation above historic levels. According to LSEG Datastream, the S&P 500 trades at more than 22 times expected earnings for its constituents. This is its highest valuation since four years. This compares with an average P/E ratio of 18.6 over the past decade. According to LSEG Datastream, the forward P/E of Tech has risen to 28 times its 10-year average. Oracle stock is up by nearly twofold year-to date after Wednesday's price surge. Other large tech stocks are also experiencing huge increases. Palantir's shares had surged 120% by 2025, while Broadcom was up nearly 60%. Chuck Carlson is the chief executive officer of Horizon Investment Services, based in Hammond, Indiana. He said, "I was surprised by the size of the Oracle jump. It shows that the AI industry still has a great deal of life and money to invest."
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Trump's nominee for India says that the US and India are not far apart on tariffs.
The nominee of Donald Trump to be ambassador to India, who is a Republican, said that Washington and New Delhi "are not that far apart" when it comes to tariffs. Sergio Gor, an aide to Trump who is director of the White House Presidential Personnel Office and was confirmed by the Senate, stated that "we're not too far apart" on a tariff deal. Gor: "I think that it will be resolved within the next few days." U.S.-India relations have been affected by Trump's Trade War. Talks on lower tariffs collapsed after India, which is the fifth largest economy in the world, refused to open its vast dairy and agricultural sectors. The bilateral trade between India and the United States is valued at more than $190 million each year. Trump imposed tariffs on India's imports at first of 25%, but then increased them to 50% as punishment when New Delhi bought more Russian oil. Trump said Tuesday that his administration continues negotiations to address India's trade barriers and he will talk to Modi. This is a sign of a new beginning after weeks of diplomatic tension. Gor responded to the question of whether he would push to have the Quad summit, which includes India, Australia, Japan, and the United States take place on the scheduled date later this year. "Without giving exact dates, the president is committed to continuing to meet with Quad and strengthening it." India was expected to host the Quad Summit in November, with an explicit focus on China's security. However, a source familiar with the situation said this month that Trump had not yet scheduled a visit to India.
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GE Vernova sells Proficy to TPG at $600 million and shifts its focus to grid software
GE Vernova announced on Thursday that it would sell its Proficy Industrial Software unit to TPG, a private equity firm for $600,000,000 and reinvest those proceeds into grid software. Proficy, which represents about 20% of GE Vernova’s electrification-software revenue, allows manufacturers to monitor and optimize their production. Revenue from electrification software in 2024 will be $7.55 billion. The company spun off last year from GE has been working on reducing rising costs due to inflation and tariffs. In April, the company forecasted a $300-400 million cost increase by 2025. It said that it would raise prices and streamline its operations to protect margins. GE Vernova also invests in its supply chain. In January, it announced a $600,000,000 upgrade of its U.S. facilities over two years in order to meet the rising global demand for electricity. After the announcement of the deal, CEO Scott Strazik stated that "Indirectly we will reinvest in the grid software business". The Proficy transaction is expected to be completed in the first half 2026. TPG will own and control the company, while GE Vernova will retain a seat on the board as an observer. GE Vernova anticipates receiving additional proceeds from the sale in future, depending on different outcomes and conditions. Christopher Dendrinos, analyst at RBC Capital Markets, stated that the company is monetizing software assets with a high value but are likely undervalued. The shares of the energy equipment provider dropped 3.2% to $622.77. Reinvesting in other areas is a strategic move. Dendrinos said that manufacturing is in high-demand and there are many opportunities to reinvest into these core business lines. The deal will establish Proficy's software division as a separate business. TPG Capital would invest in Proficy, TPG's U.S.-based and European private equity platform. (Reporting and editing by Tasimzahid and Pooja Deai in Bengaluru, and Sumit Saha based in Bengaluru)
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After the Doha attack, an adviser said that the UAE president's Gulf trip seeks coordination.
His diplomatic advisor said that the tour by Sheikh Mohammed bin Zayed Al Nahyan of the United Arab Emirates to Gulf countries was meant to coordinate positions following Tuesday's Israeli assault on Hamas leaders at Doha. Anwar Gargash wrote in a blog post that "the President's Gulf Tour reflects a profound conviction in strengthening cooperation and coordination, and reinforcing a concept of a shared destiny." Israel tried to kill Hamas leaders on Tuesday in an airstrike in Qatar's capital. This escalating military campaign in the Middle East prompted a wave of international condemnation. Sheikh Mohammed is the first head-of-state to visit Doha since the attack. He has also visited Bahrain and Oman. Qatar's official news agency announced earlier Thursday that Doha would host an urgent Arab-Islamic Summit next Sunday and on Monday to discuss Israel's attack. The UAE's Foreign Ministry condemned Benjamin Netanyahu's remarks about Qatar in a separate press release. It stressed that any attack against a Gulf State was an attack against "the collective Gulf Security Framework." On Wednesday, Netanyahu warned Qatar to "either expel Hamas representatives or bring them to justice because if we don't do it, then you will". He also accused Qatari of providing safe-haven and funding to Hamas. Doha responded with a harsh rebuke. The UAE is a major oil exporter and regional hub for trade and commerce with diplomatic influence across the Middle East. In 2020, the Abraham Accords, negotiated by the United States, led to a normalisation agreement between Israel and the UAE. This opened the door to close economic and security ties, including defence cooperation.
Australia's nuclear power proponents have concerns to respond to: Russell
(The. viewpoints expressed here are those of the author, a columnist for. .)
Australia's main opposition celebration wants a sensible dispute. about nuclear power as it devotes to develop seven plants to. replace coal generation if it wins the next federal election.
The conservative Liberal Celebration and its junior regional. partner National Celebration announced intend on Wednesday for five. large-scale nuclear plants in the eastern Australian states of. Queensland, New South Wales and Victoria, in addition to small. modular reactors for South Australia and Western Australia.
If there is to be a real argument on what type of. generation is best to change Australia's aging and. significantly undependable fleet of coal generators, there are 2. main questions that need to be responded to.
The first is the expense of the replacement generation and the. second is whether it can be delivered quickly enough to not just. replace coal plants, but also to satisfy Australia's dedication to. net-zero emissions by 2050.
The Liberal and National parties, together known as the. Coalition, decreased to offer any costings for the their plans,. but Liberal leader Petter Dutton did acknowledge it would be. expensive, while still declaring it would deliver less expensive power. for Australians.
No credible expert supports Dutton's assertion, with. price quotes differing as to the expense of building nuclear generation,. however all of them coming in well above the cost of solar and wind. firmed by battery storage and pumped hydropower.
The federal government's science company, the CSIRO, estimated that. new nuclear power would be two times as pricey as renewables. backed by storage, and this was a best case scenario predicated. on attaining economies of scale from a long-term and continuous. constructing programme.
The Union stated it would be able to have nuclear plants. up and running between 2035 and 2037, assuming it started. executing its policy if it beats the ruling Labor Celebration in. a federal election due in the first half of 2025.
In theory it would be possible to develop the seven gigawatts. ( GW) of nuclear plants on that time scale, however doing so would be. an amazing achievement at odds with the recent experiences of. other Western countries.
Nuclear plants are well-known for burning out both on spending plan. and time, with Britain's under-construction Hinkley Point C one. such example, where the expense has more than doubled and the start. date pressed back at least seven years.
BARRIERS ABOUND
The Union likewise did not elaborate on how it would. get rid of several political and social barriers to nuclear. power.
Currently nuclear generation is prohibited by federal law,. suggesting the Coalition would need to pass enabling legislation. through both the lower chamber and the upper home Senate.
While it may win the election and manage the lower house,. it would take an enormous triumph for it to take control of the. Senate.
This suggests Dutton as prime minister would have to negotiate. with cross-bench senators, and provided the majority of those are. either from the Australian Greens or are progressive. independents, it's likely his nuclear strategy would stop working at the. initially obstacle.
There are also restrictions on nuclear power in a number of. states, therefore far the leaders of New South Wales, Victoria and. Queensland have turned down any nuclear plants.
Developing a nuclear industry from scratch would likewise need. importing a competent workforce of nuclear engineers and other. professionals, something that appears at chances with the Union's plans. to lower migration and its increasing anti-immigrant rhetoric.
Winning a social licence from the communities where the. nuclear plants are prepared to be situated might also provide. obstacles, even if the centers bring tasks to change those. lost when the coal-fired generators close.
There is likewise the concern of scale, with the Union. intending on 7 GW of nuclear plants, which is only a 3rd of. Australia's current coal-fired capacity of about 22 GW.
This indicates that nuclear will not come close to changing coal,. which in turn means that renewables and storage will be needed. too, or there will be more reliance on costly natural gas.
The concern of funding nuclear is likewise unsettled,. especially given that no Australian energy has actually revealed any interest in. going nuclear.
The Coalition has actually indicated that a government-owned. corporation will be established and probably funded by taxpayers, a. position that seems to contradict the underlying philosophy of. a minimum of the Liberal part of the Union that governments. should play a minimal function in the economy.
Initial reaction to the Coalition's nuclear plans has been. overwhelmingly negative, with one of the couple of encouraging voices. originating from the Minerals Council of Australia, a lobby group. that includes coal miners.
While the council doesn't say it in their media release,. part of their support for nuclear is since they identify that. going down that path most likely means coal stays in the. generation mix for a lot longer duration than currently anticipated.
In general, it's tempting to dismiss the Coalition's nuclear. plans as a pricey fantasy, specifically in a country so. preferably fit to establish solar and wind.
However, the real damage from the nuclear proposal is most likely. that the energy argument in Australia will come down into a partisan. political slanging match, with nuclear and fossil fuels being. promoted by the conservative and renewables and storage by their. left opponents.
The opinions revealed here are those of the author, a columnist. .
(source: Reuters)