Hungary proposes removing Russian oil embargo from EU agenda
Hungary proposes removing Russian oil embargo from EU agenda/node/2089446/business-economy
Hungary proposes removing Russian oil embargo from EU agenda
Foreign Minister Peter Szijjarto blamed the EU’s executive branch for pushing the plan without ensuring the energy security of Hungary, which gets 85 percent of its natural gas and more than 60 percent of its oil from Russia
BUDAPEST: European Union efforts to impose an embargo on Russian oil faced more roadblocks Wednesday as Hungarian officials said they would not back the plan in its current form and recommended removing the topic from the agenda of an EU leaders’ summit next week.
The EU has worked to forge a consensus among its 27 member nations for cutting off Russian oil by the end of 2022 to block a key source of revenue financing Russia’s war in Ukraine.
While some countries in central and Eastern Europe initially expressed reservations over the embargo, Hungary remains the most vocal member nation blocking the measure, which is part of a sixth proposed round of EU sanctions against Russia.
During a news conference in the Hungarian capital, Budapest, Foreign Minister Peter Szijjarto said Wednesday that Hungary would not vote in favor of the oil embargo proposal “as long as it makes Hungary’s energy supply impossible.”
He blamed the EU’s executive branch for pushing the plan without ensuring the energy security of Hungary, which gets 85 percent of its natural gas and more than 60 percent of its oil from Russia.
“This problem was created by the European Commission, so the solution must be offered by the European Commission. The solution must come first, and only then can we talk about sanctions,” Szijjarto said.
While the EU earlier offered exceptions to landlocked countries like Hungary, Slovakia and the Czech Republic that are particularly dependent on Russian oil, granting them extended timelines for the phase-out, the government in Budapest has remained steadfast in its opposition to sanctions on Russian energy.
Hungarian Prime Minister Viktor Orban, who is considered Russian President Vladimir Putin’s closest EU ally, has argued that an EU oil boycott would be an “atomic bomb” for Hungary’s economy and destroy its “stable energy supply.”
Orban wrote a letter to the president of the European Council on Monday, asking that the proposed oil embargo be taken off the agenda of the summit set to begin May 30.
In the letter to Charles Michel, Orban said Hungary was “not in a position to agree to the 6th sanctions package until the negotiations succeed in resolving all outstanding issues,” and that a solution was “very unlikely” to be reached before next week’s summit.
“I am convinced that discussing the sanctions package at the level of leaders in the absence of a consensus would be counterproductive,” Orban wrote. “It must remain our priority to maintain the unity of the European Union.”
India In-Focus — Shares hit 4-month high; HDFC to issue nearly 1-year CP; India to produce ethanol from farm waste
Updated 13 sec ago
RIYADH: Indian shares scaled four-month highs on Thursday, with technology and banking stocks leading the pack after softer-than-expected US inflation data eased fears of aggressive rate hikes from the Federal Reserve.
The NSE Nifty 50 index, with most of its major sub-indexes in the positive territory, climbed 0.83 percent to 17,681.05, as of 0449 GMT, and the S&P BSE Sensex was up 0.94 percent at 59,371.43.
India’s HDFC to issue nearly 1-year CP: traders
India’s Housing Development Finance Corp. Ltd. plans to raise funds through commercial papers maturing in nearly one year, three merchant bankers said on Thursday.
The housing finance company will offer a yield of 6.90 percent on this issue, and has received commitments worth around five billion rupees ($63.06 million), the bankers said.
The notes are rated A1+ by CRISIL and will mature in July 2023. The terms of the deal were set on Wednesday.
SIDBI to issue 3-year-plus bonds
Small Industries Development Bank of India plans to raise at least 15 billion rupees through issuance of bonds maturing in three years, six months and 10 days, three merchant bankers said on Thursday.
The state-run company has invited coupon and commitment bids from bankers and investors for the same on Friday, they said.
The notes are rated AAA by CARE Ratings and the issue will close for subscription on Aug. 17.
The issue has a greenshoe option to retain an additional 25 billion rupees and will mature on Feb. 27, 2026.
Oil costs spur India to produce ethanol from farm waste
India opened its first factory to produce ethanol from rice straw or stubble on Wednesday as part of measures to reduce its reliance on oil imports and meet its net zero carbon goal.
Prime Minister Narendra Modi said the project will help cut pollution in India’s capital New Delhi, which has been blanketed by smog from stubble burning in recent winters, as well as in the northern states of Haryana and Punjab.
India, one of the world’s biggest emitters of greenhouse gasses, has set a 2070 goal for net zero carbon emissions and has expedited steps to switch to cleaner energy to cut projected emissions by a billion tons by 2030.
Modi said India, the world’s third-biggest oil importer, could not remain insulated from disruption in global markets, adding that the Panipat project would boost farmers’ incomes.
A combination of oil prices rising well above $100 per barrel and a strong US dollar have piled pressure on countries which are dependent on crude imports to drive their economies.
Indian state-run oil firms have announced plans for 12 plants in several states to produce ethanol using farm waste.
Apart from financial savings, the new plant will also help in disposing of rice crop-waste, which is a major source of air pollution when farmers burn stubble.
The new plant will use 200,000 tons of rice straw.
Dubai utility DEWA earns $3.3bn in first-half revenue after record IPO
Updated 33 min 15 sec ago
RIYADH: Dubai Electricity and Water Authority has reported 12.08 billion dirhams ($3.3 billion) in first-half revenue, which is 12 percent up from the prior-year period, driven by increased energy demand after a record $6.1 billion initial public offering earlier this year.
With a market cap of nearly 127 billion dirhams, the state utility’s profit grew 33 percent on the year to 3.3 billion dirhams in the first half of 2022, according to a statement.
“Continued focus on project delivery, innovation, and accelerating our digital transformation has bolstered our results through the first six months of 2022,” said CEO Saeed Al Tayer, commenting on the results.
The demand for energy during the six-month period hit 23.3 terawatt-hours, compared to 21.9 in the same period in 2021, of which solar contributed 10 percent.
Similarly, DEWA’s water demand in the same period rose by 6.4 percent, whereas its peak demand was up 7 percent to 9.4 gigawatts.
French utility giant EDF gets to the forefront of the Saudi energy market
Updated 47 min 53 sec ago
The year 2022 marks a decade of growth for the EDF Group in Saudi Arabia. Active in the Kingdom since 2012, the group’s initial focus was on a single line of business for the Saudi National Atomic Energy Project, as announced by the King Abdullah City for Atomic and Renewable Energy.
In line with the Saudi Vision 2030 and EDF’s 2030 sustainability strategy, the group began to diversify its lines of business, a total of five, and expand in the Kingdom to support its sustainability and energy transition objectives beyond the civil nuclear program.
In 2017, the EDF Group, through EDF Renewables, participated in all public renewable energy tenders organized by the Saudi Ministry of Energy to develop utility-scale projects in the Kingdom.
In 2019, EDF was awarded the development of the largest and most powerful wind farm in the Middle East: the 400 megawatts Dumat Al Jandal Wind Farm. The fully operational project provides clean energy to more than 70,000 Saudi households. In 2021, the 300 MW South Jeddah Noor Solar Project had also been awarded to the French giant, positioning EDF as the first non-regional foreign investor within the Saudi renewable energy market.
EDF’s growth and development in the Kingdom were further strengthened in 2021 by establishing the regional headquarters of the group’s energy services arm, Dalkia Middle East, in Riyadh. The group is also expanding its operations within the Saudi low-carbon energy services sector to incorporate energy efficiency, district cooling networks, operations and maintenance, and exploring the geothermal energy potential in the Kingdom.
Dalkia Middle East is currently in the execution phase of the District Cooling Project, based on a design, build and operate model with the Prince Mohammed Bin Salman Nonprofit City. In addition, the EDF subsidiary is actively involved in Tarshid’s Energy Efficiency Program and leading the operation and maintenance of the Kingdom Tower in Riyadh.
As one of the leading operators of hydropower plants in the world, through EDF Hydro, the group firmly believes in the NEOM landscape and considers it to be the perfect location to utilize pumped storage hydropower. “We have completed pre-feasibility site selection studies in NEOM and are eager to provide further support and expand our cooperation with this ambitious city.
The EDF Group has, beyond the technical services provided by EDF Hydro for PSH, the ambition to invest in such assets in the Kingdom,” said Omar Aldaweesh, EDF general manager for Saudi Arabia and Bahrain.
From low-carbon energy generation to energy services for industrial clients, the EDF International Network, which represents the EDF-owned French Distribution Service Operator on the international scale, is currently executing a project management office contract with the Saudi Electricity Co. to support the digitalization of their distribution network in the Kingdom.
The EDF Group has empowered its subsidiaries and various divisions’ expansion in the Saudi market while maintaining its mandate concerning civil nuclear energy and other complex projects in the Kingdom.
The EDF Group, alongside its partner MASDAR, is launching Emerge KSA, a 50 percent-owned joint venture between the two leading companies, with its ongoing pipeline, which will be officially established in the Kingdom by the end of 2022.
The JV, providing turnkey energy solutions, is currently active in the UAE to develop combined renewable power solutions alongside energy efficiency services within the commercial and industrial market, with major projects already in operation in Abu Dhabi.
“Emerge KSA has massive potential in Saudi Arabia, not only in the C&I market but in off-grid overall. We have seen many projects exceed dozens of MW capacity. The objective is to target more integrated solutions within Emerge KSA by enabling the hybridization of existing carbonized power systems,” said Aldaweesh.
The C&I market in the Kingdom is known to be the largest in the region, with various prospects presently under assessment by Emerge KSA.
EDF’s engagement across the Saudi energy value chain
The EDF’s “raison d’etre” aims to build a carbon-free future by generating clean electricity and offering innovative solutions to the global energy market. “The group’s targets are certainly in line with the Saudi Vision 2030 and the Saudi Green Initiative’s objectives,” said Aldaweesh.
“We are proud of our engagement throughout the entire Saudi energy value chain, from generation to end user, and our ever-expanding cooperation with the Saudi government in that regard,” he added.
Moreover, and with respect to low-carbon resources, the EDF Group is currently in discussion with the Saudi government on the development of geothermal energy and hydroelectricity in the Kingdom.
EDF is also exploring electrical network investments in the Kingdom, such as transmission and distribution.
The group is targeting opportunities for two of its main subsidiaries involved in smart city solutions: Urbanomy, for urban planning services to support the decarbonization of the Saudi real estate sector, and Citegestion, which has the expertise to provide city monitoring services that could be highly beneficial for projects under the Saudi Public Investment Fund.
Active in the global hydrogen value chain, EDF announced in April of 2022 a plan to develop 3 gigawatts of low-carbon hydrogen projects worldwide by the end of the decade, derived from renewable or nuclear power. “We believe that Saudi Arabia offers the perfect ground to be a worldwide hydrogen player, and the group is eager to be part of the Kingdom’s vision on that front,” confirmed Aldaweesh.
Challenges and opportunities
The current rise in oil prices does not seem to constitute a challenge. Aldaweesh believes there will be no impact on EDF’s activities in the Kingdom, as the Saudi government has already revealed its clear sustainability plans and will provide the necessary support to reach the set targets.
The first Saudi appointed general manager within EDF, added, “The group continues its commitment to support the decisive energy transition in Saudi Arabia, and we truly believe that we have merely begun scratching the surface in terms of our potential in the Kingdom, as well as our diverse wide-ranging capabilities which can position the EDF Group as an essential player in the Saudi energy sector.”
Crypto Moves – Bitcoin and Ethereum rise; Binance wins crypto clients due to inflation
Updated 11 August 2022
RIYADH: Bitcoin, the leading cryptocurrency internationally, traded higher on Thursday, rising by 6.13 percent to $24,406 as of 7:46 a.m. Riyadh time.
Ethereum, the second most traded cryptocurrency, was priced at $1,886 rising by 12.09 percent, according to data from Coindesk.
Binance wins crypto clients due to inflation
A high dollar and rising inflation, coupled with a depressed emerging market currency, are causing Binance, the world’s largest cryptocurrency exchange, to experience an uptick in clients, according to Reuters.
Maximiliano Hinz, who heads Binance in Latin America told Reuters: “Now that we are seeing inflation ramping up worldwide, we are seeing that more and more people are seeking cryptocurrency, like Bitcoin, as a way to protect themselves from inflation.”
As an example, Hinz cited Argentina, where annual inflation is 90 percent. Together with Brazil and Mexico, the country has become one of the company’s top markets.
A fall in cryptocurrency prices did not stop Argentina’s citizens from investing their savings in Bitcoin this year.
Hinz said that while El Salvador adopted Bitcoin as legal tender, other Latin American nations have not passed meaningful cryptocurrency laws, although that may not necessarily be bad for his company.
“Regulation is a framework, but it’s not always negative that something isn’t regulated,” he said. “If something isn’t banned, then it’s legal.”
As a result of President Nayib Bukele’s massive bet on Bitcoin, El Salvador has made the cryptocurrency legal tender and purchased more than $100 million worth of it.
However, Bitcoin has lost about 50 percent of its value amid a broader cryptocurrency selloff.
Cryptocurrencies have important roles in the metaverse, Bank of England Analysts say
Bank of England’s analysts said crypto assets could have important roles within the metaverse, according to Bitcoin.com.
They added that, “widespread adoption of crypto in the metaverse … would require compliance with robust consumer protection and financial stability regulatory frameworks.”
In a blog post published Tuesday, economist Owen Lock and policy analyst Teresa Cascino discussed crypto assets, the metaverse, and systemic risk.
“Cryptoassets could have important roles within the metaverse,” the blog said.
The risks associated with crypto assets may scale up to have a systemic financial stability impact if an open and decentralized metaverse grows.
“Widespread adoption of crypto in the metaverse, or any other setting would require compliance with robust consumer protection and financial stability regulatory frameworks,” they said.
In order for the open metaverse to exist, there needs to be a way to own and transact interoperable digital objects between virtual worlds, Lock and Cascino explained, noting that “cryptoassets are well suited to play an important role here.”
“If a sizable open-metaverse materialized, households may hold a greater share of their wealth in crypto assets to make metaverse-based payments or for investment purposes,” they said.
A growing open-metaverse may improve the investment prospects of crypto assets and their supporting infrastructure, according to the authors.
Oil Updates — Crude slips; DNO raises its Tawke output forecast; Brazil’s Bolsonaro mum on Petrobras privatization
Updated 11 August 2022
RIYADH: Oil prices slipped in Asia on Thursday after gaining more than $1 in the previous session, as concerns over supply disruptions eased and markets looked for evidence of improving fuel demand.
Brent crude futures dipped 18 cents, or 0.2 percent, to $97.22 a barrel by 0419 GMT.
US West Texas Intermediate crude futures fell 22 cents, or 0.2 percent, to $91.71.
Norway’s DNO raises its Tawke output forecast
Norwegian oil firm DNO raised its guidance on Monday for output from Iraq’s Tawke license and said the company now has more cash on its hands than debt for the first time since 2018.
Gross output from Tawke, located in the Iraqi Kurdish region, is now projected at between 107,000 and 109,000 barrels of oil equivalent per day in 2022, up from a previous forecast of 105,000 boed, the company said in a statement.
“DNO is committed to put its capital to work in its core competency and capture new opportunities created as peers and even some of the largest European companies scale back spending,” Executive Chairman Bijan Mossavar-Rahmani said.
“We believe in the oil and gas business and in our responsibility to all stakeholders, including host governments who want to capitalize on current prices and consumers who now call for more production, not less,” he said.
Brazil’s Bolsonaro pledges privatizations if re-elected
Brazil’s President Jair Bolsonaro did not mention privatizing state-controlled oil company Petrobras in his re-election plan released on Wednesday that promises to continue pursuing policies that reduce the size of the state.
“The government ... will proceed with reordering the state’s role in the economy, through privatization and divestment of state-owned companies, to focus on state participation in essential activities and in promoting Brazil’s economic, social and sustainable development,” the plan said.
The document contrasts with his 2018 election plan that dedicated specific pages to Petrobras. The company was not even mentioned this time, despite Mines and Energy Ministry Adolfo Sachsida requesting its privatization be studied.