Wind turbines in the Netherlands. A report from the International Energy Agency “expects renewables to become the primary energy source for electricity generation globally in the next three years, overtaking coal.”
Mischa Keijser | Image Source | Getty Images
Renewables are on course to overtake coal and become the planet’s biggest source of electricity generation by the middle of this decade, according to the International Energy Agency.
The IEA’s Renewables 2022 report, published Tuesday, predictsa major shift within the world’s electricity mix at a time of significant volatility and geopolitical tension.
“The first truly global energy crisis, triggered by Russia’s invasion of Ukraine, has sparked unprecedented momentum for renewables,” it said.
“Renewables [will] become the largest source of global electricity generation by early 2025, surpassing coal,” it added.
According to its “main-case forecast,” the IEA expects renewables to account for nearly 40% of worldwide electricity output in 2027, coinciding with a fall in the share of coal, natural gas and nuclear generation.
The analysis comes at a time of huge disruption within global energy markets following Russia’s invasion of Ukraine in February.
The Kremlin was the biggest supplier of both natural gas and petroleum oils to the EU in 2021, according to Eurostat. However, gas exports from Russia to the European Union have slid this year, as member states sought to drain the Kremlin’s war chest.
Read more about energy from CNBC Pro
As such, major European economies have been attempting to shore up supplies from alternative sources for the colder months ahead — and beyond.
In a statement issued alongside its report, the IEA highlighted the consequences of the current geopolitical situation.
“The global energy crisis is driving a sharp acceleration in installations of renewable power, with total capacity growth worldwide set to almost double in the next five years,” it said.
“Energy security concerns caused by Russia’s invasion of Ukraine have motivated countries to increasingly turn to renewables such as solar and wind to reduce reliance on imported fossil fuels, whose prices have spiked dramatically,” it added.
In its largest-ever upward revision to its renewable power forecast, the IEA now expects the world’s renewable capacity to surge by nearly 2,400 gigawatts between 2022 and 2027 — the same amount as the “entire installed power capacity of China today.”
The IEA expects electricity stemming from wind and solar photovoltaic (which converts sunlight directly into electricity)to supply nearly 20% of the planet’s power generation in 2027.
“These variable technologies account for 80% of global renewable generation increase over the forecast period, which will require additional sources of power system flexibility,” it added.
However, the IEA expects growth in geothermal, bioenergy, hydropower and concentrated solar power to stay “limited despite their critical role in integrating wind and solar PV into global electricity systems.”
Read more about electric vehicles from CNBC Pro
Fatih Birol, the IEA’s executive director, said the global energy crisis had kicked renewables “into an extraordinary new phase of even faster growth as countries seek to capitalise on their energy security benefits.”
“The world is set to add as much renewable power in the next 5 years as it did in the previous 20 years,” Birol said.
The IEA chief added that the continued acceleration of renewables was “critical” to keeping “the door open to limiting global warming to 1.5 °C.”
The 1.5 degree target is a reference to 2015′s Paris Agreement, a landmark accord that aims to “limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels.”
Cutting human-made carbon dioxide emissions to net-zero by 2050 is seen as crucial when it comes to meeting the 1.5 degrees Celsius target.
Earlier this year, a report from the International Energy Agency said clean energy investment could be on course to exceed $2 trillion per year by 2030, an increase of over 50% compared to today.
Opinion by Jomo Kwame Sundaram, Hezri A Adnan (kuala lumpur, malaysia)
Inter Press Service
KUALA LUMPUR, Malaysia, Dec 06 (IPS) – Natural flows do not respect national boundaries. The atmosphere and oceans cross international borders with little difficulty, as greenhouse gases (GHGs) and other fluids, including pollutants, easily traverse frontiers.
Yet, in multilateral fora, strategies to address climate change and its effects remain largely national. GHG emissions – typically measured as carbon dioxide equivalents – are the main bases for assessing national climate action commitments.
Hezri A AdnanAssessing national responsibility
Jayati Ghosh, Shouvik Chakraborty and Debamanyu Das have critically considered how national climate responsibilities are assessed. The standard method – used by the UN Framework Convention on Climate Change (UNFCCC) – measures GHG emissions by activities within national boundaries.
This approach attributes GHG emissions to the country where goods are produced. Such carbon accounting focuses blame for global warming on newly industrializing economies. But it ignores who consumes the goods and where, besides diverting attention from those most responsible for historical emissions.
Thus, attention has focused on big national emitters. China, India, Brazil, Russia, South Africa and other large developing economies – especially the ‘late industrializers’ – have become the new climate villains.
China, the United States and India are now the world’s three largest GHG emitters in absolute terms, accounting for over half the total. With more rapid growth in recent decades, China and India have greatly increased emissions.
Undoubtedly, some developing countries have seen rapid GHG emission increases, especially during high growth episodes. In the first two decades of this century, such emissions rose over 3-fold in China, 2.7 times in India, and 4.7-fold in Indonesia.
Meanwhile, most rich economies have seen smaller increases, even declines in emissions, as they ‘outsource’ labour- and energy-intensive activities to the global South. Thus, over the same period, production emissions fell by 12% in the US and Japan, and by nearly 22% in Germany.
Jomo Kwame SundaramObscuring inequalities
Only comparing total national emissions is not just one-sided, but also misleading, as countries have very different populations, economic outputs and structures.
But determining responsibility for global warming fairly is necessary to ensure equitable burden sharing for adequate climate action. Most climate change negotiations and discussions typically refer to aggregate national emissions and income measures, rather than per capita levels.
But such framing obscures the underlying inequalities involved. A per capita view comparing average GHG emissions offers a more nuanced, albeit understated perspective on the global disparities involved.
Thus, in spite of recent reductions, rich economies are still the greatest GHG emitters per capita. The US and Australia spew eight times more per head than developing countries like India, Indonesia and Brazil.
Despite its recent emission increases, even China emits less than half US per capita levels. Meanwhile, its annual emissions growth fell from 9.3% in 2002 to 0.6% in 2012. Even The Economist acknowledged China’s per capita emissions in 2019 were comparable to industrializing Western nations in 1885!
Several developments have contributed to recent reductions in rich nations’ emissions. Richer countries can better afford ‘climate-friendly’ improvements, by switching energy sources away from the most harmful fossil fuels to less GHG-emitting options such as natural gas, nuclear and renewables.
Changes in international trade and investment with ‘globalization’ have seen many rich countries shift GHG-intensive production to developing countries.
Thus, rich economies have ‘exported’ production of – and responsibility for – GHG emissions for what they consume. Instead, developed countries make more from ‘high value’ services, many related to finance, requiring far less energy.
Export emissions, shift blame
Thus, rich countries have effectively adopted then World Bank chief economist Larry Summers’ proposal to export toxic waste to the poorest countries where the ‘opportunity cost’ of human life was presumed to be lowest!
His original proposal has since become a development strategy for the age of globalization! Thus, polluting industries – including GHG-emitting production processes – have been relocated – together with labour-intensive industries – to the global South.
Although kept out of the final published version of the Intergovernmental Panel on Climate Change (IPCC) report, over 40% of developing country GHG emissions were due to export production for developed countries.
Such ‘emission exports’ by rich OECD (Organization for Economic Co-operation and Development) countries increased rapidly from 2002, after China joined the World Trade Organization (WTO). These peaked at 2,278 million metric tonnes in 2006, i.e., 17% of emissions from production, before falling to 1,577 million metric tonnes.
For the OECD, the ‘carbon balance’ is determined by deducting the carbon dioxide equivalent of GHG emissions for imports from those for production, including exports. Annual growth of GHG discharges from making exports was 4.3% faster than for all production emissions.
Thus, the US had eight times more per capita GHG production emissions than India’s in 2019. US per capita emissions were more than thrice China’s, although the world’s most populous country still emits more than any other nation.
With high GHG-emitting products increasingly made in developing countries, rich countries have effectively ‘exported’ their emissions. Consuming such imports, rich economies are still responsible for related GHG emissions.
Change is in the air
Industries emitting carbon have been ‘exported’ – relocated abroad – for their products to be imported for consumption. But the UNFCCC approach to assigning GHG emissions responsibility focuses only on production, ignoring consumption of such imports.
Thus, if responsibility for GHG emissions is also due to consumption, per capita differences between the global North and South are even greater.
In contrast, the OECD wants to distribute international corporate income tax revenue according to consumption, not production. Thus, contradictory criteria are used, as convenient, to favour rich economies, shaping both tax and climate discourses and rules.
While domestic investments in China have become much ‘greener’, foreign direct investment by companies from there are developing coal mines and coal-fired powerplants abroad, e.g., in Indonesia and Vietnam.
If not checked, such FDI will put other developing countries on the worst fossil fuel energy pathway, historically emulating the rich economies of the global North. A Global Green New Deal would instead enable a ‘big push’ to ‘front-load’ investments in renewable energy.
This should enable adequate financing of much more equitable development while ensuring sustainability. Such an approach would not only address national-level inequalities, but also international disparities.
China now produces over 70% of photovoltaic solar panels annually, but is effectively blocked from exporting them abroad. In a more cooperative world, developing countries’ lower-cost – more affordable – production of the means to generate renewable energy would be encouraged.
Instead, higher energy costs now – due to supply disruptions following the Ukraine war and Western sanctions – are being used by rich countries to retreat further from their inadequate, modest commitments to decelerate global warming.
This retreat is putting the world at greater risk. Already, the international community is being urged to abandon the maximum allowable temperature increase above pre-industrial levels, thus further extending and deepening already unjust North-South relations.
But change is in the air. Investing in and subsidizing renewable energy technologies in developing countries wanting to electrify, can enable them to develop while mitigating global warming.
Hezri A Adnan is adjunct professor at the Faculty of Sciences, University of Malaya, Kuala Lumpur.
G7, the EU and Australia implemented on December 5 a cap on Russian oil prices. Market players have doubts the measure will be effective.
Bloomberg | Bloomberg | Getty Images
BRUSSELS — A price cap on Russian seaborne oil will work, EU ministers told CNBC, despite attempts from the Kremlin to escape sanctions and a broad market skepticism over the measure.
The EU, alongside the G-7 and Australia, agreed on Friday to limit the purchases of Russian oil to $60 a barrel as part of a concerted effort to curtail Moscow’s ability to fund its war in Ukraine.
The price cap came into force on Monday. In essence, the measure stipulates oil produced in Russia can only be sold with the necessary insurance approval at or below $60 a barrel. Insurance companies are mostly based in G-7 nations.
However, Russia has already said it will not sell oil to nations complying with the cap and that it is ready to cut production to maintain its revenues from the commodity.
In addition, reports suggested that it has been putting together a fleet of about 100 vessels to avoid oil sanctions. Having its own so-called “shadow fleet” would allow the Kremlin to sell its oil without needing insurance from the G-7 or other nations.
When asked if the oil cap can work in reducing Russia’s oil revenues, Irish Finance Minister Paschal Donohoe said, “Yes, it can.”
It is “the right message at the right time,” he said in an interview with CNBC on Monday.
One of the big open questions is the role of India and China in the implementation of this price cap.
Both nations have stepped up their purchases of Russian oil in the wake of the invasion of Ukraine, and they are reluctant to agree to the cap. India’s petroleum minister reportedly said Monday that he “does not fear” the cap and he expects the policy to have limited impact.
However, France’s Finance Minister Bruno Le Maire told CNBC on Monday: “I think it’s worth trying.”
“Then we will assess the consequences of the implementation of this oil cap,” he added.
The level of the cap will be reviewed in early 2023. This revision will be done periodically and the aim is to set it “at least 5% below the average market price for Russian oil,” according to the agreement reached by EU nations last week.
European Commission President Ursula von der Leyen said over the weekend that the limit on oil prices will help the bloc stabilize energy prices. The EU has been forced to abruptly reduce its dependence on Russian hydrocarbons due to the Kremlin’s war in Ukraine.
Market players, however, remain wary about the integrity of the policy.
Analysts at Japan’s Mitsubishi UFJ Financial Group said in a note Monday that the scale of the price cap’s impact “remains ambiguous.” They added, “we have been sceptical on the practicalities of its success.”
There is a risk that nations buy Russian oil at the agreed cap but then resell it at a higher price to Europe, for example. This would mean that Russia would still make money from the commodity sales while Europe would be paying more at a time when its economy is already slowing down.
“The introduction of the cap on the price will probably not remove all the volume, some will find its way to the markets,” Angelina Valavina, head of EMEA Natural Resources and Commodities at the Fitch Group, told CNBC’s “Street Signs Europe” Monday.
Oil prices traded higher Tuesday morning in London.
Both international benchmark Brent crude futures and West Texas Intermediate futures traded 0.4% higher at around $83 a barrel and $77 a barrel respectively.
Crude futures traded higher Monday morning, following a decision by OPEC+ nations to keep output targets unchanged, but moved lower in afternoon trading.
The Temperance card represents moderation, balance, self-evolution, and avoiding extremes. As author and tarot expert Claire Goodchild previously explained to mbg, this card appears in our lives when we’re feeling out of balance—and sometimes even when we don’t feel out of balance but actually are.
It can also indicate that we’ve been too indulgent and need to take a step back, she says. The word temperance, after all, literally means “moderation in action, thought, or feeling,” as well as abstinence from drinking alcohol. “The Temperance card’s main theme is about restoring balance, and another big part of it is mind over matter,” Goodchild notes, adding, “Anything you want to do, you can do. It just takes a little bit of work and finessing what’s happening.”
For many officials, it’s a topic they won’t touch. When pressed, politicians give memorized, terse and robotic answers.
The verboten subject? Ukraine’s potential NATO membership.
It’s an issue so potentially combustible that many NATO allies try to avoid even talking about it. When Ukraine in September requested an accelerated process to join the military alliance, NATO publicly reiterated its open-door policybut didn’t give a concrete response. And last week, when NATO foreign ministers met, their final statement simply pointed toa vague2008 pledge that Ukraine would someday join the club.
Not mentioned: Ukraine’s recent request, any concrete steps toward membership or any timeline.
The reasons are manifold. NATO is fractured over how, when (and in a few cases even if) Ukraine should join. Big capitals also don’t want to provoke the Kremlin further, aware of Vladimir Putin’s hyper-sensitivity to NATO’s eastward expansion. And most notably, NATO membership would legally require allies to come to Ukraine’s aid in case of attack — a prospect many won’t broach.
The result is that while Europe and the U.S. have plowed through one taboo after another since Russia invaded Ukraine in February — funneling mountains of lethal military equipment to Kyiv, slapping once unthinkable sanctions on Moscow, defecting from Russian energy — the prospect of Ukraine joining NATO remains the third rail of international politics.
Touching the issue can leave you burned.
French President Emmanuel Macron sparked an outcry over the weekend when he said the West must consider security guarantees for Russia if it returns to the negotiating table — a gesture that enraged Kyiv and appeared to go against NATO’s open-door policy. And behind the scenes, Ukrainian officials themselves faced annoyed colleagues after making their public plea for swift membership.
“Some very good friends of Ukraine are more afraid of a positive reply to Ukraine’s bid for membership in NATO than of providing Ukraine with the most sophisticated weapons,” said Dmytro Kuleba, Ukraine’s foreign minister.
“There are still many psychological barriers that we have to overcome,” he told POLITICO in a recent interview. “The idea of membership is one of them.”
‘De facto’ ally
Ukraine’s leadership has argued that for all intents and purposes, it is already a member of the Western military alliance — and thus deserves a quick path to formal NATO membership.
“We are de facto allies,” Ukrainian President Volodymyr Zelenskyy declared when announcing his country’s bid to join NATO | Alexey Furman/Getty Images
“We are de facto allies,” Ukrainian President Volodymyr Zelenskyy declared in September when announcing his country’s bid to join NATO “under an accelerated procedure.”
“De facto, we have already completed our path to NATO. De facto, we have already proven interoperability with the alliance’s standards,” he added. “Ukraine is applying to make it de jure.”
The Ukrainian leader’s statement caught many of Kyiv’s closest partners by surprise — and left several grumbling.
The overture threatened to derail a plan the alliance’s most influential capitals had essentially settled on: Weapons now, membership talk later. It was an approach, they felt, that would deprive Moscow of a pretext to pull NATO directly into the conflict.
In their statement last week, ministers pledged to step up political and practical help for Ukraine while avoiding concrete plans for Kyiv’s future status.
Ultimately, however, few allies question Ukraine’s long-term membership prospects — at least in theory. The divisions are more over how and when the question of Kyiv’s membership should be addressed.
A number of Eastern allies are arguing for a closer political relationship between Ukraine and NATO, and they want a more concrete plan that sets the stage for membership.
“My thinking is that it is basically unavoidable,” said Lithuanian Foreign Minister Gabrielius Landsbergis, “that NATO will have to have a way to accept Ukraine.”
On the other end of the spectrum, France’s Macron wants to take Moscow’s perspective into account.
“One of the essential points we must address — as President [Vladimir] Putin has always said — is the fear that NATO comes right up to its doors, and the deployment of weapons that could threaten Russia,” Macron told French television channel TF1 in an interview released Saturday.
Most other allies essentially evade the subject — not rejecting Ukraine’s NATO dreams but repeating a carefully crafted line about focusing on the current war.
Here’s NATO Secretary-General Jens Stoltenberg’s version, offered last week: “The most immediate and urgent task is to ensure that Ukraine prevails as a sovereign, independent democratic nation in Europe.”
“The most immediate and urgent task is to ensure that Ukraine prevails as a sovereign, independent democratic nation in Europe,” said NATO Secretary-General Jens Stoltenberg | Armend Nimani/AFP via Getty
And here’s Dutch Foreign Minister Wopke Hoekstra’s take from the same week: “The task here is to make sure that the main thing continues to be the main thing — and that is helping out Ukraine on the battlefield.”
U.S. NATO Ambassador Julianne Smith echoed the point in an interview: “The focus right now is practical support to Ukraine.”
Analysts say the fault line lies between primarily Western European capitals such as Berlin and Paris — which see membership as an ultra-sensitive issue to be avoided at the moment — and some Eastern capitals that see Ukrainian accession as a goal the alliance can begin working toward.
Since the war began, that divide has only become more “exacerbated,” said Ben Schreer, executive director for Europe at the International Institute for Strategic Studies. “Some countries simply don’t want to even have a conversation about this because they feel it might further harden Russian responses.”
Another path
Ukrainian officials do recognize that NATO membership is not imminent, but they still want a gesture from the alliance.
“The ideal scenario would, of course, be a very simple sentence from NATO: ‘OK, we receive your application, we begin the process of considering it.’ That would already be a major milestone achievement,” said Kuleba, Ukraine’s foreign minister, ahead of last week’s meeting.
Smith, the U.S. ambassador, said the Ukrainians are aware they need to do more before they could become members.
Ukraine formally adopted a constitutional amendment in 2019 committing to pursue NATO membership. But even though the country has pursued some reforms over the past few years, experts and partner governments say there’s more Ukraine must do to integrate Kyiv into Western institutions.
“There’s more work to be done, I don’t think that’s a mystery,” said Smith, adding: “I think they’d be the first to tell you that.”
As an interim solution, Kyiv has presented what it calls a pragmatic proposal for Western countries to help protect Ukraine.
“Russia was able to start this war precisely because Ukraine remained in the gray zone — between the Euro-Atlantic world and the Russian imperialism,” Zelenskyy said when presenting a 10-point peace plan in November.
The West’s “psychological barriers” need to be “overcome by changing the optics” Ukrainian Foreign Minister Dmytro Kuleba said | Mads Claus Rasmussen/Ritzau Scanpix/AFP via Getty Images
“So, how can we prevent repetition of Russia’s such aggression against us? We need effective security assurances,” he said, calling for an international conference to sign off on the so-called Kyiv Security Compact, a new set of security guarantees for Ukraine.
But it remains unclear whether Ukraine’s Western partners would be willing to make any legally binding guarantees — or if anything short of NATO’s Article 5 collective defense clause would prove a sufficient deterrent down the line.
“Some of those countries,” said IISS’ Schreer, “would be very reluctant.” Any written security guarantee, he noted, “from their perspective would probably invite strong Russian response, but it also would make them at this point of time part of this conflict.”
A Ukrainian victory, of course, could shift the calculus.
“If Ukraine is stuck in a stalemate, then NATO membership isn’t gonna happen,” said Max Bergmann, director of the Europe program at the Center for Strategic and International Studies. “But if it retakes its territory and accepts its borders — whatever those borders may be, whether it includes Crimea or does not, because that’s the fundamental question for Ukraine — then I think things can move very quickly.”
Asked if he is frustrated with Western partners, Kuleba was blunt.
“I know them too well to be frustrated with them — they are good friends,” he said. “It would be close to impossible for us to sustain the Russian pressure and to prevail on the battleground without them.”
But, the foreign minister added, the West’s “psychological barriers” need to be “overcome by changing the optics.”
Kyiv’s partners, he said, “have to begin to see Ukraine’s membership as an opportunity — and not as a threat.”
U.S. gas companies will be urged to up their exports to Europe via the U.K. under a new transatlantic energy partnership agreed by Rishi Sunak and Joe Biden.
The new “U.K.-U.S. Energy Security and Affordability Partnership” announced Wednesday includes a commitment from the White House to “strive to export at least 9-10 billion cubic metres of liquefied natural gas (LNG) over the next year via U.K. terminals,” No. 10 Downing Street said. The aspiration includes both gas for U.K. consumption and gas that might be re-exported to mainland Europe via pipeline.
The U.K. has three LNG terminals — two in Milford Haven, Wales and one in Medway, Kent — and has become a major hub for LNG supplies to Europe from the U.S.; a vital lifeline as the Continent has sought to replace Russian pipeline gas since Moscow’s invasion of Ukraine.
The new partnership between the U.S. and the U.K. mirrors in many ways an existing U.S.-EU task force that also focuses on energy security. It will be led by a “joint action group” consisting of senior White House and U.K. government officials, Downing Street said, with the first virtual meeting to be held on Thursday.
Alongside helping to guarantee U.K. and EU gas supply, it will work on global investment in clean energy and efficiency, plus the promotion of nuclear energy, including small modular reactors, in third countries. British Prime Minister Sunak and U.S. President Biden discussed the partnership at the G20 summit in Indonesia last month.
“This partnership will bring down prices for British consumers and help end Europe’s dependence on Russian energy once and for all,” Sunak said. “Together the U.K. and U.S. will ensure the global price of energy and the security of our national supply can never again be manipulated by the whims of a failing regime. We have the natural resources, industry and innovative thinking we need to create a better, freer system and accelerate the clean energy transition.”
The LNG commitment will be dependent on U.S. gas exporting companies. As is the case with its task force with the EU, the U.S. government will likely play the role of encouraging companies to direct their cargoes to the U.K.
The two sides will “proactively identify and resolve any issues faced by exporters and importers,” Downing Street said, adding: “We will look to identify opportunities to support commercial contracts that increase security of supply.”
Adam Bell, a former U.K. government energy official and now head of policy at the Stonehaven consultancy, said there was a “diplomatic upside” to the U.K. facilitating gas flows to the EU: “Especially this winter when we’ll want pipes to flow the other way; Europe has the stores that we don’t.” The U.K. would also benefit from shipping charges as the gas passes through its network, Bell added.
Air alerts sound across Ukraine, south and north hit, 4 dead
Russia striking Ukraine’s infrastructure since October
Moscow: Ukrainian drones attack air bases in Russia, 3 dead
Price cap of $60 for Russian oil comes into force
KYIV, Dec 5 (Reuters) – Ukraine said Russia destroyed homes in the southeast and knocked out power in many areas with a new volley of missiles on Monday, while Moscow said Ukrainian drones had attacked two air bases deep inside Russia hundreds of miles from front lines.
A new missile barrage had been anticipated in Ukraine for days and it took place just as emergency blackouts were due to end, with previous damage repaired. The strikes plunged parts of Ukraine back into freezing darkness with temperatures now firmly below zero Celsius (32 Fahrenheit).
At least four people were killed in the Russian missile attacks, Ukrainian President Volodymyr Zelenskiy said, adding that most of some 70 missiles were shot down. Energy workers had already begun work on restoring power supplies, he said.
Russia’s defence ministry said Ukrainian drones attacked two air bases at Ryazan and Saratov in south-central Russia, killing three servicemen and wounding four, with two aircraft damaged by pieces of the drones when they were shot down.
Ukraine did not directly claim responsibility for the attacks. If it was behind them, they would be the deepest strikes inside the Russian heartland since Moscow invaded Ukraine on Feb. 24.
One of the targets, the Engels air base near the city of Saratov, around 730 km (450 miles) southeast of Moscow, houses bomber planes belonging to Russia’s strategic nuclear forces.
“The Kyiv regime, in order to disable Russian long-range aircraft, made attempts to strike with Soviet-made unmanned jet aerial vehicles at the military airfields Dyagilevo, in the Ryazan region, and Engels, in the Saratov region,” the Russian defence ministry said.
It said the drones, flying at low altitude, were intercepted by air defences and shot down. The deaths were reported on the Ryazan base, 185 km (115 miles) southeast of Moscow.
The Russian defence ministry called the drone strikes a terrorist act aimed at disrupting its long-range aviation.
Despite that, it said, Russia responded with a “massive strike on the military control system and related objects of the defences complex, communication centres, energy and military units of Ukraine with high-precision air- and sea-based weapons” in which it said all 17 designated targets were hit.
Ukraine’s air force said it downed over 60 of more than 70 missiles fired by Russia on Monday – the latest in weeks of attacks targeting its critical infrastructure that have cut off power, heat and water to many parts of the country.
“Our guys are awesome,” Andriy Yermak, head of the Ukrainian presidential staff, wrote on Telegram.
Kyiv’s forces have also demonstrated an increasing ability to hit strategic Russian targets far beyond the 1,100 km-long frontline in south and eastern Ukraine.
Saratov is at least 600 km from the nearest Ukrainian territory. Russian commentators said on social media that if Ukraine could strike that far inside Russia, it might also be capable of hitting Moscow.
Previous mysterious blasts damaged arms stores and fuel depots in regions near Ukraine and knocked out at least seven warplanes in Crimea, the Black Sea peninsula annexed by Russia from Ukraine in 2014.
[1/15] People take shelter inside the metro station amid Russian missile attacks in Kyiv, Ukraine, December 5, 2022. REUTERS/Shannon Stapleton
President Vladimir Putin drove a Mercedes across the bridge linking southern Russia to Crimea on Monday, less than two months since that, too, was hit by an explosion.
Kyiv has not claimed responsibility for any of the blasts, saying only that they were “karma” for Russia’s invasion.
“If something is launched into other countries’ air space, sooner or later unknown flying objects will return to (their) departure point,” Ukrainian presidential adviser Mykhailo Podolyak tweeted, tongue in cheek, on Monday.
MISSILE FRAGMENTS HIT MOLDOVA
Moscow has been hitting Ukraine’s energy infrastructure roughly weekly since early October as it has been forced to retreat on some battlefronts.
This time, police in Moldova were reported to have found missile fragments on its soil near the border with Ukraine.
In the Zaporizhzhia region, at least two people were killed and several houses destroyed, the deputy head of the presidential office, Kyrylo Tymoshenko, said.
Missiles also hit energy facilities in the regions of Kyiv and Vinnytsia in central Ukraine, Odesa in the south and Sumy in the north, officials said.
Forty percent of the Kyiv region had no electricity, regional governor Oleksiy Kuleba said, praising the work of Ukrainian air defences.
Ukraine had only just returned to scheduled power outages from Monday rather than the emergency blackouts it has suffered since widespread Russian strikes on Nov. 23, the worst of the attacks on energy infrastructure that began in early October.
Russia has said the barrages are designed to degrade Ukraine’s military. Ukraine says they are clearly aimed at civilians and thus constitute a war crime.
WESTERN PRICE CAP ON RUSSIAN OIL
A $60 per barrel price cap on Russian seaborne crude oil took effect on Monday, the latest Western measure to punish Moscow over its invasion. Russia is the world’s second-largest oil exporter.
The agreement allows Russian oil to be shipped to third-party countries using tankers from G7 and European Union member states, insurance companies and credit institutions, only if the cargo is bought at or below the $60 per barrel cap.
Moscow has said it will not abide by the measure even if it has to cut production. Ukraine wants the cap set lower: Zelenskiy said $60 was too high to deter Russia’s assault.
A Russian oil blend was selling for around $79 a barrel in Asian markets on Monday – almost a third higher than the price cap, according to Refinitiv data and estimates from industry sources.
Reporting by Nick Starkov and Reuters bureaus; Writing by Philippa Fletcher and Mark Heinrich; Editing by Peter Graff and Angus MacSwan
Led by Saudi Arabia and Russia, OPEC+ agreed in early October to reduce production by 2 million barrels per day from November.
Vladimir Simicek | Afp | Getty Images
An influential alliance of oil producers on Sunday agreed to stay the course on output policy ahead of a pending ban from the European Union on Russian crude.
OPEC and non-OPEC producers, a group of 23 oil-producing nations known as OPEC+, decided to stick to its existing policy of reducing oil production by 2 million barrels per day, or about 2% of world demand, from November until the end of 2023.
Energy analysts had expected OPEC+ to consider fresh price-supporting production cuts ahead of a possible double blow to Russia’s oil revenues.
The Kremlin has previously warned that any attempt to impose a price cap on Russian oil will cause more harm than good.
Oil prices have fallen to below $90 a barrel from more than $120 in early June ahead of potentially disruptive sanctions on Russian oil, weakening crude demand in China and mounting fears of a recession.
Led by Saudi Arabia and Russia, OPEC+ agreed in early October to reduce production by 2 million barrels per day from November. It came despite calls from the U.S. for the group to pump more to lower fuel prices and help the global economy.
It’s not just cars that will be going through energy transition in the years ahead. The parking lots where EVs recharge are a growing focus of construction efforts linked to climate change and carbon reduction.
A law approved in France last month requires that parking lots with 80 or more spaces be covered by solar panels within the next five years. For the biggest parking lots, those with more than 400 spaces, three years has been granted to have at least half of the parking lot’s surface area covered by solar.
Similar renewable energy design ideas are expected to gain more market share in the U.S. if not necessarily through a federal mandate.
“You’ll see a lot of the same stuff that you’re seeing in France and other countries, but it probably won’t necessarily play out the same way, in terms of federal action versus state action,” said Bill Abolt, vice president and lead of energy business for infrastructure consulting firm AECOM.
As local and state governments create mandates for renewable energy deployment, and the federal government takes an incentive-based approach to encourage climate technology through measures like the Inflation Reduction Act, major corporations are making their own commitments to solar power.
Target, Home Depot, Walmart and renewable energy
Target revamped one of its California stores with solar panel carports this spring. Home Depot is making efforts to have all of its stores use only renewable energy by 2030, while Walmart hopes to achieve this by 2040. These efforts won’t only come through producing renewable power on-site — procurement of renewable energy from utility-scale projects is among strategic options to meet these goals — but investing in solar power for store locations will become more prevalent.
“You have a lot of significant companies that have stepped up and made commitments to renewable energy and similar things with local governments and institutions. So, there’s no doubt that that level of investment has accelerated the development of technology, the deployment of more cost effective solar,” Abolt said.
The cost to install solar has dropped by more than 60% over the past decade, according to the Solar Energy Industries Association.
“There’s no doubt that the cost curve of solar gets better and better all the time and will continue to do so. Private business has done a lot, and we’re seeing even more private investment likely to happen as a result,” Abolt said.
Global commercial real estate company CBRE is partnering with renewable energy company Altus Power to work with clients including many Fortune 500 companies on solar projects.
“The topics that are top of mind for these corporations right now are decarbonization and energy efficiency and energy resiliency,” said Lars Norell, co-founder and co-CEO of Altus Power. “The No. 1 answer is building-sited clean energy,” he said.
Norell said it has now become possible for businesses of all sizes to consider renewable energy projects.
“Something that Walmart or IKEA or Amazon does, smaller family-owned businesses come to us and say ‘Should we do the same thing? Could our roof hold solar?’ The answer in almost all those cases is absolutely yes,” he said.
Public expectations and pressure from boards are key factors in why major corporations tend to act quicker than smaller companies when it comes to renewable energy. “In many cases, smaller companies don’t have quite such an audience that is expecting them to act, but many of them are acting sort of out of self-interest or because they would like to save money,” Norell said.
Solar carports and rooftop solar are the primary solar designs being adopted in the world of commercial real estate.
“We find that there is almost no debate around the wisdom of putting solar in a parking lot,” Norell said. “We believe that rooftop solar and carport solar are going to be easier for most communities to not only accept but embrace as a way to make clean energy.”
In recent years, an increasing number of solar projects have been built over commercial parking lots, and state governments have created incentives specifically for solar carports, including the 2018 Solar Massachusetts Renewable Target, and the Maryland Energy Administration Solar Canopy Grant Program, which provides funding to incentivize the use of solar carports and parking garages, with EV chargers included on site. It has provided up to $250,000 per solar carport project, creating an incentive for commercial businesses to invest in the projects.
“Increasing power prices and more government support, like in France where they mandated it, we think will mean that more parking lots are going to have carports,” Norell said.
Commercial retail centers and logistics buildings are prime targets for solar. Commercial retail centers, like grocery stores, consume higher levels of energy and often feature big parking lots. Logistics buildings like warehouses feature large rooftops that are optimal places to implement rooftop solar energy.
Altus Power forecasts that most buildings will have a solar power system over the next decade.
With the growing production and consumption of EVs — the International Energy Agency reported that U.S. electric car sales doubled in market share to 4.5% in 2021, reaching 630,000 EVs sold — solar-powered commercial businesses become more beneficial to consumers requiring EV chargers in parking lots.
The same will be the case for warehouses and distribution centers.
“Once we start getting good at having electrical-powered van fleets and trucks, all those trucks come to those logistical buildings, and that’s an excellent spot to put up fleet chargers, so that when the truck is busy … we take the opportunity to charge its electrical battery as well,” Norell said. “We can charge it with clean electricity because we’re making solar power on the roof, and that’s then going into the truck.”
It’s important to mention here that simply adding a crystal to your collection isn’t going to magically make your wishes come true. And as Leavy tells mbg, she actually finds the modern interest in crystals and manifesting slightly problematic.
“A lot of nuance is lost when it comes to talking about manifestation, and it’s become this very surface level conversation about getting stuff or having your life like look or be or feel a certain way,” she tells mbg, adding that true manifestation involves realizing that wanting something or asking for something alone can’t necessarily create it—and neither can just working with a crystal.
“The way that we’re best able to manifest things in our lives is working in communities lifting each other up,” she notes.
But in terms of using crystals to help aid in your manifestations, she says, think of it as a supportive, complementary practice to help keep you in alignment with your vision. “It’s about supporting us to be more in alignment with our vision for ourselves and our vision for our lives,” she explains.
And some of the best ways to do that, according to her, include making a crystal grid in a communal space, whether in your home, office, or elsewhere.
Wearing your crystal as jewelry, especially somewhere you’ll see it frequently such as with rings or bracelets, can also serve as a helpful reminder to keep you on track. “If you can’t find that crystal and jewelry, even just carrying a piece in your pocket as like a touchstone can be a really good reminder as well,” she adds.
OPEC+, a group of 23 oil-producing nations led by Saudi Arabia and Russia, will convene on Sunday to decide on the next phase of production policy.
Bloomberg | Bloomberg | Getty Images
OPEC and non-OPEC oil producers could impose deeper oil output cuts on Sunday, energy analysts said, as the influential energy alliance weighs the impact of a pending ban on Russia’s crude exports and a possible price cap on Russian oil.
OPEC+, a group of 23 oil-producing nations led by Saudi Arabia and Russia, will convene on Sunday to decide on the next phase of production policy.
The highly anticipated meeting comes ahead of potentially disruptive sanctions on Russian oil, weakening crude demand in China and mounting fears of a recession.
Claudio Galimberti, senior vice president of analysis at energy consultancy Rystad, told CNBC from OPEC’s headquarters in Vienna, Austria, that he believes the group “would be better off to stay the course” and roll over existing production policy.
“OPEC+ has been rumored to consider a cut on the basis of demand weakness, specifically in China, over the past few days. Yet, China’s traffic nationwide is not down dramatically,” Galimberti said.
Energy market participants remain wary about the European Union’s sanctions on the purchases of the Kremlin’s seaborne crude exports on Dec. 5, while the prospect of a G-7 price cap on Russian oil is another source of uncertainty.
The 27-nation EU bloc agreed in June to ban the purchase of Russian seaborne crude from Dec. 5 as part of a concerted effort to curtail the Kremlin’s war chest following Moscow’s invasion of Ukraine.
Concern that an outright ban on Russian crude imports could send oil prices soaring, however, prompted the G-7 to consider a price cap on the amount it will pay for Russian oil.
No formal agreement has yet been reached, although Reuters reported Thursday that EU governments had tentatively agreed to a $60 barrel price cap on Russian seaborne oil.
“The other factor OPEC will need to consider is indeed the price cap,” Galimberti said. “It’s still up in the air, and this adds to the uncertainty.”
The Kremlin has previously warned that any attempt to impose a price cap on Russian oil will cause more harm than good.
OPEC+ agreed in early October to reduce production by 2 million barrels per day from November. It came despite calls from the U.S. for OPEC+ to pump more to lower fuel prices and help the global economy.
The energy alliance recently hinted it could impose deeper output cuts to spur a recovery in crude prices. This signal came despite a report from The Wall Street Journal suggesting an output increase of 500,000 barrels per day was under discussion for Sunday.
OPEC+ agreed in early October to reduce production by 2 million barrels per day from November. It came despite calls from the U.S. for OPEC+ to pump more to lower fuel prices and help the global economy.
Bloomberg | Bloomberg | Getty Images
Speaking earlier this week, RBC Capital Markets’ Helima Croft said there was no expectation of a production increase from the upcoming OPEC+ meeting and a “significant chance” of a deeper output cut.
“There is so much uncertainty,” Croft told CNBC’s “Squawk Box” on Tuesday. OPEC delegates “have to factor in what happens with China but also what happens with Russian production.”
“My expectation right now is, if prices are flirting with Brent breaking into the 70s, certainly OPEC will do a deeper cut, but the question is, how do they factor in what is going to come the next day?” Croft said. “So, I still think it is up for grabs.”
Oil prices, which have fallen sharply in recent months, were trading slightly lower ahead of the meeting.
International Brent crude futures traded 0.2% lower at $87.78 a barrel on Friday morning in London, down from over $123 in early June. U.S. West Texas Intermediate futures, meanwhile, dipped 0.3% to trade at $80.95, compared to a level of $122 six months ago.
“Barring any negative surprise during Sunday’s virtual OPEC+ talks and assuming a healthy compromise on Russian oil price cap before the EU sanctions kick in on Monday it is tempting to audaciously conclude that the bottom has been found,” Tamas Varga, analyst at broker PVM Oil Associates, said in a note Thursday.
Varga said oil prices trading below $90 a barrel was “not acceptable” for OPEC and Russia was widely expected to introduce retaliatory measures against those signing up for the G-7 deal.
“Choppy and nervous market conditions will prevail, but the new month should bring more joy than November,” he added.
Jeff Currie, global head of commodities at Goldman Sachs, said OPEC ministers would need to discuss whether to accommodate further weakness in demand in China.
“They got to deal with the fact that, hey, demand is down in China, prices are reflecting it, and do they accommodate that weakness in demand?” Currie told CNBC’s Steve Sedgwick on Tuesday.
“I think there is a high probability that we do see a cut,” he added.
Analysts at political risk consultancy Eurasia Group said that lower oil prices “heighten the risk” of a new OPEC+ output cut.
“Ultimately, the decision will depend on the trajectory of the oil price when OPEC+ meets and how much disruption is evident in markets because of the EU sanctions,” Eurasia Group analysts led by Raad Alkadiri said Monday in a research note.
If Brent crude futures dip below $80 a barrel for a sustained period ahead of the meeting, Eurasia Group said OPEC+ leaders could push for another production cut to shore up prices and bring Brent futures back up to around $90 — a level “that they appear to favor.”
As Yulia Van Doren, author of Crystals: The Modern Guide to Crystal Healing and founder of Goldirocks previously told mbg, turquoise is a stone of folklore wisdom and natural magic. “It reminds us that we can draw support and healing from the natural world whenever needed—all you have to do is ask,” she says.
And according to Leavy, turquoise is associated with the elements of air and water, as well as the signs of Sagittarius, and less slightly, Capricorn.
“It really is a great stone for communication, intuition, emotional healing, and emotional balance,” Leavy tells mbg, adding, “It’s also good for present moment awareness and mindfulness, and self-expression—especially if you have a difficult time communicating your needs or talking about your feelings or emotions.”
It’s also good for self-confidence and promoting relaxation, any type of spiritual work, and even enhancing meditation. Long story short—this is a versatile stone in its application!
So to work with it, Leavy recommends carrying it in your pocket, particularly if you wanted to work on self-expression and self-competence. “Incorporating this crystal into your altar or sacred space, because of its connection with the water elements and with intuition, could be beneficial as well,” she adds.
And good news if you’re planning on gifting turquoise to a December baby in your life: Crystal expert Heather Askinosie previously wrote for mbg that when turquoise is given as a gift, its healing properties are thought to be magnified.
LONDON — Three years after leaving the EU to chart its own course, Britain finds itself caught between two economic behemoths in a brewing transatlantic trade war.
In one corner sits the United States, whose Congress in August passed the Biden administration’s much-vaunted $369 billion program of green subsidies, part of the Inflation Reduction Act (IRA).
In the opposing corner is the European Union, which fears Washington’s subsidy splurge will pull investment — particularly in electric vehicles — away from Europe, hitting carmakers hard.
The EU is preparing its own retaliatory package of subsidies; Washington shows little sign of changing course. Fears of a trade war are growing fast.
Now sitting squarely outside the ring, the U.K. can only look on with horror, and quietly ask Washington to soften the blow. But there are few signs the softly-softly approach is bearing fruit. Britain now risks being clobbered by both sides.
“It’s not in the U.K.’s interest for the U.S. and EU to go down this route,” said Sam Lowe, a partner at Flint Global and expert in U.K. and EU trade policy. “Given the U.K.’s current economic position, it can’t really afford to engage in a subsidy war with both.” The British government has just unleashed a round of fiscal belt-tightening after a market rout, following months of political turmoil.
For iconic British motor brands, the row over the Biden administration’s IRA comes with real costs.
The U.S. is the second-largest destination for British-made vehicles after the EU, and the automotive sector is one of Britain’s top goods exporters.
Manufacturers like Jaguar Land Rover have warned publicly about the “very serious challenges” posed by the new U.S. law and its plan for electric vehicle tax credits aimed at boosting American industry.
Kemi on the case
U.K. Trade Secretary Kemi Badenoch has for months been privately urging top U.S. officials to soften the impact of the electric vehicle subsidies on Britain by carving out exemptions, U.K. officials said.
When Commerce Secretary Gina Raimondo visited London in early October, Badenoch pushed her to rethink the strategy. The U.K. trade chief brought that same message to Washington in a series of private meetings earlier this month, including at a sit-down with Deputy Treasury Secretary Wally Adeyemo.
Badenoch has “raised this issue on many levels,” an official from the U.K.’s Department for International Trade said, citing conversations with U.S. Ambassador to Britain Jane Hartley, with Secretary Raimondo, “and with members of the Biden administration and senior representatives of both parties.”
The Cabinet minister has also spoken out in public, telling the pro-free market Cato Institute in Washington earlier this month that “the substantial new tax credits for electric cars not only bar vehicles made in the U.K. from the U.S. market, but also affect vehicles made in the U.S. by U.K. manufacturers.”
U.S. Secretary of Commerce Gina Raimondo | Mandel Ngan/AFP via Getty Images
Badenoch’s comments echo concerns raised by both British automotive lobby group the Society of Motor Manufacturers and Traders (SMMT), and by Jaguar Land Rover, in comments filed with the U.S. Treasury Department.
The SMMT warned that Biden’s green vehicle package has several “elements of concern that risk creating an uneven competitive environment, with U.K.-based manufacturers and suppliers potentially penalised.” The lobby group is taking aim at the credit scheme’s requirement for green vehicles to be built in North America, with significant subsidies available only if critical minerals are sourced from the U.S. or a U.S. ally.
In response to Washington’s plans, the EU is preparing what could amount to billions in subsidies for its own industries hit by the U.S. law, which also offers tax breaks to boost American green businesses such as solar panel manufacturers. Britain faces being squeezed in both markets, while lacking any say in whatever response Brussels decides.
Protectionism that impacts like-minded allies “isn’t the answer to the geopolitical challenges we face,” the British trade department official warned, adding “there is a serious risk” the law disrupts “vital” global supply chains of batteries and electric vehicles.
The conversations Badenoch had this month in Washington were “reassuring,” the official added. “But it’s for them to address and find solutions.”
‘Ton of work to do’
Yet others believe Badenoch will have a hard time getting her colleagues in the U.S. — now cooling on a much-touted bilateral trade deal — to take action. “The U.S. is minimally focused on how any of their policies are going to impact the U.K.,” admitted a U.S.-based representative of a major business group.
While Britain and the U.S. are “very close allies”, they added, those in Washington “just don’t really view the U.K. as an interesting trade partner and market right now.” The U.S. is more focused, they noted, on pushing back against China, meaning Badenoch has “a ton of work to do” getting the administration to soften the IRA.
Nevertheless the U.S. is still working out how its law will actually be implemented, the business figure said, and is assembling a working group on how the IRA impacts trade allies. This has the potential, they added, to “alleviate a lot of the concerns coming out of the U.K.”
Late Tuesday evening, the SMMT called on the British government to provide greater domestic support for the sector as it prepares to ramp up its own electric vehicle production. The group wants an extension past April on domestic support for firms’ energy costs; a boost to government investment in green energy sources; and a speedier national rollout of charging infrastructure and staff training.
In the meantime, Britain’s options appear limited.
Newly manufactured Land Rover and Range Rover vehicles parked and waiting to be loaded for export | Paul Ellis/AFP via Getty Images
The U.K. “could consider legal action” and haul the U.S. before the World Trade Organization or challenge the EU through provisions in the post-Brexit Trade and Cooperation Agreement, said Lowe of consultancy Flint. “But — to be blunt — neither of them care what we have to say.”
Anna Jerzewska, a trade advisor and associate fellow at the UK Trade Policy Observatory, suggested pressing ahead “with your own domestic policy and efforts to support strategic industries is perhaps more important” than complaining about foreign subsidy schemes. But she noted that after a “chaotic” political period, Britain is “likely to take longer to respond to external changes and challenges.”
And in truth, Britain “can’t afford to out-subsidize the U.S. and EU,” said David Henig, a trade expert with the European Centre For International Political Economy think tank.
Outside the EU, Britain could work to rally allies such as Japan and South Korea who are also unhappy with the Biden administration’s protectionist measures, he noted. “But I don’t think we’re in that position,” Henig said, as it would take a concerted diplomatic effort, and the U.K.’s automotive sector would “have to be well positioned” in the first place, not struggling as it is. He predicted London’s lobbying in Washington and Brussels is “not going to get anywhere.”
The EU wants to slash the amount of packaging waste produced across the bloc, banning everything from mini hotel toiletries to throwaway plastic wrapping around some fresh fruit and vegetables.
The proposal is part of the European Commission’s circular economy package, legislation aimed at slashing waste and reducing emissions to help the bloc reach climate neutrality by 2050.
The new rules include mandatory targets for the amount of recycled materials used in plastic packaging and pushes cafés, shops and hotels to switch to reusable, rather than single-use packaging. It calls for all packaging on the EU market to be recyclable by 2030.
Countries will also be told to set up schemes to increase recycling of bottles and cans: Customers would pay a small additional sum on top of their purchase, which is refunded on the bottle’s return.
Packaging is a “key environmental concern,” the Commission said in its preamble to the new rules. The sector is one of the “main users of virgin materials,” hoovering up 40 percent of plastics and 50 percent of paper, and accounting for 36 percent of municipal solid waste.
In 2020, every EU resident generated nearly 180 kilograms of waste, according to new EU data. Paper and cardboard are the main culprit, accounting for 32.7 million tons in 2020, followed by plastic and glass at about 15 million tons each.
“Without action, the EU would see a further 19 percent increase in packaging waste by 2030, and for plastic packaging waste even a 46 percent increase,” according to the Commission.
But its proposal isn’t going down particularly well. Industry groups have pushed back hard against higher reuse targets in recent weeks, while NGOs are accusing the Commission of bowing to those demands and watering down its proposal.
Here are four key points of contention.
End of single-use
One key element of the Commission’s proposal is a ban on some types of single-use packaging in the hospitality sector — such as disposable plates and cups, sugar packets and other condiments, or mini soaps and shampoos.
Businesses won’t let that happen without a fight.
Ever since a first draft of the new rules leaked last month, they’ve been hammering home the argument that the energy and water needed to clean the reusable packaging would outweigh the environmental benefits of moving away from single-use items.
A ban would “require a full cost analysis of businesses in particular energy, water and operational costs,” hospitality lobby HOTREC argued in an emailed statement, adding that the cost of those assessments shouldn’t fall to the businesses.
The rules also set targets for companies to ensure a certain quantity of products are provided in reusable or refillable packaging. For example, 20 percent of takeaway beverage sales made by a café must be served in reusable packaging or using customers’ own containers by 2030, with the target ramping up to 80 percent in 2040. Beer retailers will have to sell 10 percent of their products in refillable bottles by 2030 and 20 percent by 2040.
That’s another sore point for industry.
The Commission should “look at the full life cycle impact of all packaging products,” according to the European Paper Packaging Alliance lobby. It argues that “scientific evidence shows that recyclable, single-use, paper-based packaging has a lower environmental impact than reusable systems, in takeaway settings as well as in quick service restaurants.”
Recycling concerns
Industry groups also complain that the proposal unfairly favors reusable packaging over recyclable single-use packaging, meaning wasted money on investments in recycling facilities — even though the text seeks to boost recycling in the bloc. There’s a minimum amount of recycled content that must be used in the manufacturing of certain plastic packaging, for example.
“There’s a real concern for the industry — we don’t know which horse to back now, because the policy itself has conflicting goals,” said Ian Ellington, senior vice president at Pepsico and president of EU soft drinks lobby UNESDA. “I think the likely outcome of that is we would pause some of those investments while we figure out what the regulatory framework is really going to be.”
Brussels seems to have listened: The rules proposed on Wednesday lay down lower targets on what percentage of packaging must be reusable.
But now environmental groups are sounding the alarm, saying the EU needs to focus on boosting reusable packaging rather than relying on recycling as the solution.
Campaigners have argued that positive messaging around recycling could be promoting additional consumption — and additional waste. They also point out that the average recycling rate is only 64.4 percent.
In rowing back the reuse targets in its current proposal, the EU executive “seems to have fallen into industry’s false promises on investments on recycling,” Larissa Copello, a policy officer for Zero Waste Europe said in an emailed statement.
Death of marketing
The Commission’s proposal would also ban “superfluous” packaging, like double walls or false bottoms aimed at making products appear to contain more than they do.
That essentially means all packaging should be designed for functionality and to minimize the amount of packaging used.
The idea isn’t going down well with businesses that use distinctive packaging to stand out, such as spirits and perfume manufacturers.
In a letter to the Commission, several lobbies argued the new rules will lead to “standardisation of packaging and have negative competitive repercussions for EU consumers, brands and industry.”
“An awful lot of work goes into presenting your products to the market,” said Adeline Farrelly, secretary-general of the association of European manufacturers of glass containers. “The image of your product, the way it looks and feels is a huge part of the value added product.”
Biodegradable packaging in the crosshairs
Compostable and bio-based packaging manufacturers will also have to abide by new rules, as such products can jam up recycling processes and take a long time to fully biodegrade in certain environments.
The Commission has designated a “very small list of products” that should be designed for composting — tea bags, filter coffee pods, sticky labels attached to fruit and vegetables, and lightweight plastic carrier bags — while the rest should go into recycling.
The compostable packaging industry isn’t happy about that, saying it will seriously hamper their business.
The new rules are still “effectively … a ban, or sort of very tight control of what can be composted and what can’t,” said Jack McKeivor, the director of public affairs for compostable packaging company TIPA.
“Why would investors want to invest in it? Why would customers want to buy this stuff if they can’t use it for its originally designated purpose?” he added.
The move would jeopardize the EU’s “current leadership role in the sector” and “freeze” further research and investments into such products, a coalition of bioplastic companies wrote in a letter.
The Commission’s proposal will now be examined by the European Parliament and EU countries, but faces a rocky road ahead — a number of MEPs have already sent a letter to the Commission echoing industry concerns.
Income-seeking investors are looking at an opportunity to scoop up shares of real estate investment trusts. Stocks in that asset class have become more attractive as prices have fallen and cash flow is improving.
Below is a broad screen of REITs that have high dividend yields and are also expected to generate enough excess cash in 2023 to enable increases in dividend payouts.
REIT prices may turn a corner in 2023
REITs distribute most of their income to shareholders to maintain their tax-advantaged status. But the group is cyclical, with pressure on share prices when interest rates rise, as they have this year at an unprecedented scale. A slowing growth rate for the group may have also placed a drag on the stocks.
And now, with talk that the Federal Reserve may begin to temper its cycle of interest-rate increases, we may be nearing the time when REIT prices rise in anticipation of an eventual decline in interest rates. The market always looks ahead, which means long-term investors who have been waiting on the sidelines to buy higher-yielding income-oriented investments may have to make a move soon.
During an interview on Nov 28, James Bullard, president of the Federal Reserve Bank of St. Louis and a member of the Federal Open Market Committee, discussed the central bank’s cycle of interest-rate increases meant to reduce inflation.
When asked about the potential timing of the Fed’s “terminal rate” (the peak federal funds rate for this cycle), Bullard said: “Generally speaking, I have advocated that sooner is better, that you do want to get to the right level of the policy rate for the current data and the current situation.”
Fed’s Bullard says in MarketWatch interview that markets are underpricing the chance of still-higher rates
In August we published this guide to investing in REITs for income. Since the data for that article was pulled on Aug. 24, the S&P 500 SPX, -0.29%
has declined 4% (despite a 10% rally from its 2022 closing low on Oct. 12), but the benchmark index’s real estate sector has declined 13%.
REITs can be placed broadly into two categories. Mortgage REITs lend money to commercial or residential borrowers and/or invest in mortgage-backed securities, while equity REITs own property and lease it out.
The pressure on share prices can be greater for mortgage REITs, because the mortgage-lending business slows as interest rates rise. In this article we are focusing on equity REITs.
Industry numbers
The National Association of Real Estate Investment Trusts (Nareit) reported that third-quarter funds from operations (FFO) for U.S.-listed equity REITs were up 14% from a year earlier. To put that number in context, the year-over-year growth rate of quarterly FFO has been slowing — it was 35% a year ago. And the third-quarter FFO increase compares to a 23% increase in earnings per share for the S&P 500 from a year earlier, according to FactSet.
The NAREIT report breaks out numbers for 12 categories of equity REITs, and there is great variance in the growth numbers, as you can see here.
FFO is a non-GAAP measure that is commonly used to gauge REITs’ capacity for paying dividends. It adds amortization and depreciation (noncash items) back to earnings, while excluding gains on the sale of property. Adjusted funds from operations (AFFO) goes further, netting out expected capital expenditures to maintain the quality of property investments.
The slowing FFO growth numbers point to the importance of looking at REITs individually, to see if expected cash flow is sufficient to cover dividend payments.
Screen of high-yielding equity REITs
For 2022 through Nov. 28, the S&P 500 has declined 17%, while the real estate sector has fallen 27%, excluding dividends.
Over the very long term, through interest-rate cycles and the liquidity-driven bull market that ended this year, equity REITs have fared well, with an average annual return of 9.3% for 20 years, compared to an average return of 9.6% for the S&P 500, both with dividends reinvested, according to FactSet.
This performance might surprise some investors, when considering the REITs’ income focus and the S&P 500’s heavy weighting for rapidly growing technology companies.
For a broad screen of equity REITs, we began with the Russell 3000 Index RUA, -0.04%,
which represents 98% of U.S. companies by market capitalization.
We then narrowed the list to 119 equity REITs that are followed by at least five analysts covered by FactSet for which AFFO estimates are available.
If we divide the expected 2023 AFFO by the current share price, we have an estimated AFFO yield, which can be compared with the current dividend yield to see if there is expected “headroom” for dividend increases.
For example, if we look at Vornado Realty Trust VNO, +1.03%,
the current dividend yield is 8.56%. Based on the consensus 2023 AFFO estimate among analysts polled by FactSet, the expected AFFO yield is only 7.25%. This doesn’t mean that Vornado will cut its dividend and it doesn’t even mean the company won’t raise its payout next year. But it might make it less likely to do so.
Among the 119 equity REITs, 104 have expected 2023 AFFO headroom of at least 1.00%.
Here are the 20 equity REITs from our screen with the highest current dividend yields that have at least 1% expected AFFO headroom:
Click on the tickers for more about each company. You should read Tomi Kilgore’s detailed guide to the wealth of information for free on the MarketWatch quote page.
The list includes each REIT’s main property investment type. However, many REITs are highly diversified. The simplified categories on the table may not cover all of their investment properties.
Knowing what a REIT invests in is part of the research you should do on your own before buying any individual stock. For arbitrary examples, some investors may wish to steer clear of exposure to certain areas of retail or hotels, or they may favor health-care properties.
Largest REITs
Several of the REITs that passed the screen have relatively small market capitalizations. You might be curious to see how the most widely held REITs fared in the screen. So here’s another list of the 20 largest U.S. REITs among the 119 that passed the first cut, sorted by market cap as of Nov. 28:
Opinion by Armida Salsiah Alisjahbana (bangkok, thailand)
Inter Press Service
BANGKOK, Thailand, Nov 29 (IPS) – The recent climate talks in Egypt have left us with a sobering reality: The window for maintaining global warming to 1.5 degrees is closing fast and what is on the table currently is insufficient to avert some of the worst potential effects of climate change. The Nationally Determined Contribution targets of Asian and Pacific countries will result in a 16 per centincrease in greenhouse gas emissions by 2030 from the 2010 levels.
Armida Salsiah Alisjahbana
The Sharm-el Sheikh Implementation Plan and the package of decisions taken at COP27 are a reaffirmation of actions that could deliver the net-zero resilient world our countries aspire to. The historic decision to establish a Loss and Damage Fund is an important step towards climate justice and building trust among countries.
But they are not enough to help us arrive at a better future without, what the UN Secretary General calls, a “giant leap on climate ambition”. Carbon neutrality needs to at the heart of national development strategies and reflected in public and private investment decisions. And it needs to cascade down to the sustainable pathways in each sector of the economy.
Accelerate energy transition
At the Economic and Social Commission for Asia and the Pacific (ESCAP), we are working with regional and national stakeholders on these transformational pathways. Moving away from the brown economy is imperative, not only because emissions are rising but also because dependence on fossil fuels has left economies struggling with price volatility and energy insecurity.
A clear road map is the needed springboard for an inclusive and just energy transition. We have been working with countries to develop scenarios for such a shift through National Roadmaps, demonstrating that a different energy future is possible and viable with the political will and sincere commitment to action of the public and private sectors.
The changeover to renewables also requires concurrent improvements in grid infrastructure, especially cross-border grids. The Regional Road Map on Power System Connectivity provides us the platform to work with member States toward an interconnected grid, including through the development of the necessary regulatory frameworks for to integrate power systems and mobilize investments in grid infrastructure. The future of energy security will be determined by the ability to develop green grids and trade renewable-generated electricity across our borders.
Green the rides
The move to net-zero carbon will not be complete without greening the transport sector. In Asia and the Pacific transport is primarily powered by fossil fuels and as a result accounted for 24 per cent of total carbon emissions by 2018.
Energy efficiency improvements and using more electric vehicles are the most effective measures to reduce carbon emissions by as much as 60 per cent in 2050 compared to 2005 levels. The Regional Action Programme for Sustainable Transport Development allows us to work with countries to implement and cooperate on priorities for low-carbon transport, including electric mobility. Our work with the Framework Agreement on Facilitation of Cross-border Paperless Trade also is helping to make commerce more efficient and climate-smart, a critical element for the transition in the energy and transport sectors.
Adapting to a riskier future
Even with mitigation measures in place, our economy and people will not be safe without a holistic risk management system. And it needs to be one that prevents communities from being blindsided by cascading climate disasters.
We are working with partners to deepen the understanding of such cascading risks and to help develop preparedness strategies for this new reality, such as the implementation of the ASEAN Regional Plan of Action for Adaptation to Drought.
Make finance available where it matters the most
Finance and investment are uniquely placed to propel the transitions needed. The past five years have seen thematic bonds in our region grow tenfold. Private finance is slowly aligning with climate needs. The new Loss and Damage Fund and its operation present new hopes for financing the most vulnerable. However, climate finance is not happening at the speed and scale needed. It needs to be accessible to developing economies in times of need.
Innovative financing instruments need to be developed and scaled up, from debt-for-climate swaps to SDG bonds, some of which ESCAP is helping to develop in the Pacific and in Cambodia. Growing momentum in the business sector will need to be sustained. The Asia-Pacific Green Deal for Business by the ESCAP Sustainable Business Network (ESBN) is important progress. We are also working with the High-level Climate Champions to bring climate-aligned investment opportunities closer to private financiers.
Lock in higher ambition and accelerate implementation
Climate actions in Asia and the Pacific matter for global success and well-being. The past two years has been a grim reminder that conflicts in one continent create hunger in another, and that emissions somewhere push sea levels higher everywhere. Never has our prosperity been more dependent on collective actions and cooperation.
Our countries are taking note. Member States meeting at the seventh session of the Committee on Environment and Development, which opens today (29 November) are seeking consensus on the regional cooperation needed and priorities for climate action such as oceans, ecosystem and air pollution. We hope that the momentum begun at COP27 and the Committee will be continued at the seventy-ninth session of the Commission as it will hone in on the accelerators for climate action.
In this era of heightened risks and shared prosperity, only regional, multilateral solidarity and genuine ambition that match with the new climate reality unfolding around us — along with bold climate action — are the only way to secure a future where the countries of Asia and the Pacific can prosper.
Armida Salsiah Alisjahbana is an Under-Secretary-General of the United Nations and Executive Secretary of the Economic and Social Commission for Asia and the Pacific (ESCAP)
Opinions expressed by Entrepreneur contributors are their own.
I was watching Good Morning America recently and saw a segment in which they recommended people take short breaks in between work tasks. The program cited an analysis in the journal PLOS ONE showing that “microbreaks” during the workday increase energy and decrease fatigue.
This is the essence of the recovery methodology I’ve learned from research and personal experience, dating back to my days as a teenage lifeguard at Jones Beach in New York. We focus on practicing what I call resilience rituals and how they help us combat depletion, exhaustion and burnout while rebuilding resilience.
The forces driving us toward burnout are chronic stress (driven in part by being constantly engaged online), multitasking and forgetting to tend to the needs of our bodies and minds. The results can be catastrophic for our health and wellbeing, but there’s good news: Resilience rituals, if practiced regularly, can help us recharge, rejuvenate and perform at our best.
When I was a lifeguard, we made dozens of ocean rescues each day, but there was one rescue that failed when we were unable to find a swimmer who went down in the rough surf. From that tragedy, we vowed to make sure that would never again happen on our watch. To make good on that vow, our lifeguard crew had to learn to become more capable and pivot in the face of a serious tragedy. To ensure everyone was performing at their best, we started taking more breaks and spelling each other.
Today, I call that concept the toggle method — a way to recharge energy and boost resilience.
How the toggle method helps recharge resilience
For a long time, people have defined resilience as our ability to take a hit and bounce back. The person who was able to produce the most, endure the most stress and be the first in and last out of the office was considered resilient. Trying to live up to that old paradigm is one reason so many people are exhausted, near or past burnout.
You can’t endlessly absorb stress and take the hits of uncertainty and anxiety and keep coming back stronger. It’s like fighting a rip current. Instead, I believe resilience is about recovery. It’s the process of recovery that ultimately enables you to bounce forward, rather than just bounce back.
Practicing resilience rituals allows you to toggle between periods of focused energy (the “E-Zone”) and periods of focused rest and recovery (the “R-Zone”), like a light switch toggles between on and off. Taking breaks throughout the day allows you to toggle between your E-Zone and your R-Zone — using intermittent rest, recovery and regeneration as a tool to increase productivity and performance.
When you toggle back and forth between those two states often enough throughout the day, you find that it increases your capacity to focus. This allows you to get more accomplished throughout the day with less exhaustion, less depletion and less risk of burnout. Over time, this also helps you build higher levels of resilience.
So, how can we regenerate in ways that increase our longevity, capacity and sustainability, whether as individuals or as teams? We’ve developed a “toggle menu” of things people can do during the day to reset, recharge and rejuvenate. Some activities can be done in less than one minute, while others can be done in 30 minutes or less. Here are a few to try:
Legs Up the Wall: This is my ultimate go-to for energy in the afternoon. Rather than drink coffee or eat a candy bar, try lying flat on your back with your legs vertically up the wall, with your body in the shape of an L. You can do this for as short as 20 minutes with your eyes closed, with or without meditation. Set an alarm because you could literally drop off to sleep! After 20 minutes in that position, you’ll either wake up or get up restored. It feels like taking a multi-hour nap without the grogginess. You’ve taken pressure off your back and legs. You have better circulation and blood flow. You’ll feel mentally, physically, emotionally, and maybe even spiritually restored. When I do this for 20 minutes in the afternoon, I find my capacity matches my best productivity hours in the morning.
Zone 2 Cardio Walk: The impact of walking cannot be ever overstated, especially if you walk after meals. Walking helps regulate your biochemistry to lower your heart rate, lower your blood pressure, and increase levels of dopamine and serotonin in your body. Take one or more 20- to 30-minute walks during the day, and you will likely feel better. A Zone 2 Cardio Walk is a little different because you breathe through your nose and keep your mouth shut while you walk, so you are not talking to other people or talking on your phone. By breathing in and out through your nose, you create more of an aerobic experience with more benefits to your cardiovascular system. It’s a combination walking/breathing exercise you will find restorative and beneficial to your sense of wellbeing. If you walk after eating, you gain the benefit of increasing metabolism and assisting your digestion and assimilation of what you ate.
Hand/Ear Massage: Your ears don’t typically get a lot of touch, and massaging them can be a bit of a state change. This is an area that has been shown through research to produce a change in the way neurons fire in your brain. So, when you are sitting at your desk feeling tired, close your eyes and massage your ears up and down for about 60 seconds. You can also try massaging your hands between your thumb and index finger. Little toggle rituals such as this can have a big effect!
There are many ways you can give yourself breaks throughout the day to recharge your energy and reboot your resilience. Try taking quiet time for meditation, gratitude and prayer to start and end your day. Set reminders on your phone to help you remember to unplug for a bit each day. Experiment with different activities of various durations and see what works best for you.
Investors are waking up to big trouble in big China. Stock futures and oil prices are falling after angry anti-COVID zero protests swept the country.
“This is a sudden powerful new distraction for markets when this week was supposed to be about incoming U.S. data,” sum up strategists at Saxo Bank. They say watch companies exposed to China, “given forward earnings are likely to be downgraded following further China lockdowns and protests.”
Before China grabbed the spotlight, holiday weekend sales, jobs and inflation data that due this week, as well as remarks by Fed Chairman Jerome Powell were the big focus.
Other questions are now swirling. Will China-related falls in oil prices lend to the peak inflation theory? And what about China’s post-COVID economic rebirth?
Onto our call of the day, which says it’s time to short long bonds because of sticky food inflation — thanks to China. It comes from Russell Clark, a former hedge-fund manager who has spent the last 20 years focusing on that market, macro and short selling.
He notes investors have been scooping up the the iShares 20 years+ Treasury Bond ETF TLT, -0.34%,
a liquid exchange-traded fund that buys long-dated bonds, even as with U.S. inflation hovering at 1970 highs.
“The reason that people are getting bullish bonds I believe is that the yield curve has inverted. And every time that has happened, you have a recession and you want to get out of equities and into bonds,” says Clark. A yield curve inversion occurs when long-term interest rates drop below short term rates. The inversion of 2 and 10-year Treasury yields is at its steepest since the 1980s.
Clues may lie in Japan’s poorly performing bond market. “Not only has it been prescient in leading the U.S. bond yields lower from 1999 onward, in 2020 the JGB market was also prescient in signaling the future U.S. treasury sell off,” he says.
Russell Clark
And what Japan is likely seeing that U.S. investors aren’t right now is China-driven food inflation. That’s something the Fed will find it tough to ignore, he said.
Since the since the 1980s, food commodity prices have followed raw commodity prices higher, If the Fed wants to work that down, it will raise interest rates. For example, falling natural-gas prices NG00, -3.37%
would help ease fertilizer costs for farmers.
Russell Clark
Clark points out that China is the world’s biggest food importer, with much higher prices than the U.S.
“Pork, which is the most consumed meat in China, is now 3 times more expensive than the U.S. market, and has recently doubled in price. As Japan is also a large importer of pork, perhaps this was the reason the JGB market sold off before the U.S.,” he said.
Beef is also a major import for China, and yes, prices are much higher than that of the U.S.
“In essence, I am saying that China is exporting food inflation to the rest of the world, and I don’t see that ending at the moment. JGBs seem to agree – and when I look at the index value of US Food CPI on a log basis, I keep thinking that is says interest rates are going higher not lower,” said Clark.
He sees food inflation looking secular, rather than cyclical, due to the demands of an increasingly urbanized China. “Secular food inflation implies POLITICAL pressure to have higher interest rates. US treasuries look a short to me, just as everyone has gotten long,” he said.
St. Louis Fed President James Bullard will sit down for an interview with MarketWatch on Monday, at 12 noon Eastern. New York Fed President John Williams address the Economic Club of New York at the same time. Fed’s Powell will speak on Wednesday, along with several other Fed officials this week.
A busy data week starts Tuesday with home-price indexes and consumer confidence data. GDP, the PCE price index for October — a favored gauge of the Federal Reserve and November employment data are also on tap this week.
‘Gaslighting’ is Merriam Webster’s word of the year. No, really.
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This is an opinion editorial by Kent Halliburton, President and COO of Sazmining.
Though the intention of the Bitcoin white paper was to usher in a financial revolution by introducing the first effective peer-to-peer electronic cash system, we’re now seeing the inception of Bitcoin’s second revolution: Energy.
Bitcoin miners serve as energy buyers of last resort, can work from anywhere and can turn on and off with nearly infinite flexibility. As such, bitcoin mining can render viable renewable and remote energy sources that would have otherwise been unprofitable. Additionally, miners can convert waste energy into digital gold, drastically curbing humanity’s emissions problem. Interestingly, these improvements to our relationship with energy are already underway, even before bitcoin has evolved into the next global reserve asset. Could it be that Satoshi Nakamoto’s unstated energy revolution actually takes hold before the first revolution of a peer-to-peer cash system? Although we can’t know with certainty, the data suggests that could be the case.
The Energy Revolution Gains Steam
Though imperfect, the best metric for comparing Bitcoin’s monetary and energy revolutions is growth. Let’s look at growth ratesbetween the total number of bitcoin holders and the total hash rate of all bitcoin miners. Hash rate, the total computational power used by miners to process bitcoin transactions and earn new bitcoin, serves as a good proxy for miners’ energy consumption. However, this still does not give us direct data about bitcoin mining’s increasingly positive effects on the energy sector. After all, if greater energy consumption by bitcoin miners simply corresponds to greater demand for energy, then Bitcoin will not have caused a paradigm shift in our relationship with energy at all. But, as we will see, the energetic benefits of bitcoin mining haverisen along with Bitcoin’s energy consumption.
As you can see in the first chart, the number of bitcoin users increased at a rapid rate until mid-2021, when the rate of growth slowed. The drop in adoption roughly corresponds with bitcoin’s price drop from over $61,000 to under $32,000. While the hash rate also crashed around this time, it steadily climbed back and continues to reach new heights. Although bitcoin adoption has slowed, the network’s energy consumption and mining activity continues to grow significantly.
As mentioned earlier, bitcoin mining’s increase in energy consumption alone does not tell us that Nakamoto’s second revolution is underway. To argue that, we need to know how much of that energy comes from renewable, waste and stranded energy. The Bitcoin Mining Council’s Q3 2022 report explains that bitcoin mining’s sustainable electricity mix is nearly 60% as of October 2022, up by about 3% from a year ago. Bitcoin miners purchase renewable energy as buyers of last resort; they are not consuming energy that would have been bought by other consumers. Rather, they purchase the energy precisely when there is little demand from others, increasing the profitability — and therefore the viability — of renewable energy sources across the world. As bitcoin mining’s renewable energy consumption increases, so does the global market for clean energy.
Future Indicators Of Nakamoto’s Revolutions
In addition to measuring the number of bitcoin holders (or wallets) in existence, another metric by which to gauge the success of Nakamoto’s monetary revolution is the number of transactions per unit of time that involve bitcoin.
The Lightning Network, a Layer 2 technology designed to make bitcoin transactions cheap, quick and user-friendly, is growing in prominence as bitcoin evolves from a store of value into a medium of exchange. The number of transactions executed on the Lightning Network per unit of time will be a straightforward indicator of bitcoin’s growth as a monetary instrument.
As more and more energy projects take advantage of bitcoin mining, Nakamoto’s energy revolution will be measured by tracking all of the following:
Tonnes of carbon dioxide equivalent reduced per unit of energy consumed by bitcoin miners per unit of time.
Wattage output by stranded energy sources that would have been unviable in the absence of bitcoin mining.
Wattage output by intermittent (and renewable) energy sources that would have been unviable in the absence of bitcoin mining.
As we receive more data about both the Lightning Network and the intersection between bitcoin mining and the energy sector, we will be able to compare how much each of Nakamoto’s revolutions is progressing over time. As stated earlier, although there will never be a single moment at which either revolution will have officially come to pass, we will at least be able to measure the speedat which each is progressing.
What We Now Know About The Dual Revolutions
Current data indicates that the growth of bitcoin owners has slowed relative to the growth of mining. If these trends continue andif bitcoin miners’ renewable energy mix continues to be among the greenest on the planet, then Nakamoto’s second revolution could indeed overtake his first. Bitcoin could acquire a reputation as a significant asset in the battle against global warming, rivaling its emerging reputation as the next global reserve asset.
Nakamoto’s unintended energy revolution will continue to grow in force. Fortunately for humanity, it does not matter which of Nakamoto’s revolutions is happening faster. We all win with drastically improved money and energy.
This is a guest post by Kent Halliburton. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
A sign is posted in front of a Chevron gas station on July 31, 2020 in Novato, California.
Justin Sullivan | Getty Images
Chevron on Saturday received an expanded U.S. license allowing the second-largest U.S. oil company to resume production in Venezuela and to import the South American country’s crude into the United States.
The decision allows Chevron to revive existing oil projects in the U.S.-sanctioned country and bring new oil supplies to refiners in the United States. However, it restricts cash payments to Venezuela, which could reduce the amount of oil available to Chevron.
License terms are designed to prevent Venezuelan state-run oil firm PDVSA from receiving proceeds from Chevron’s Venezuelan petroleum sales, U.S. officials said. The license lasts for six months and will be automatically renewed monthly thereafter, according to the U.S. Treasury.
A Chevron spokesperson said the company was reviewing the license terms and declined immediate comment.
The U.S. issued the license on the same day that Venezuela and opposition leaders began a political dialogue in Mexico City by agreeing to ask the United Nations to oversee a fund to help provide food, health care and infrastructure to Venezuelans.
Terms bar Chevron from helping the OPEC member develop new oilfields but provides a way for the company to recoup some of the billions of dollars owed by PDVSA through the oil sales. The United States said it reserved the right to rescind or revoke the license at any time.
“This action reflects longstanding U.S. policy to provide targeted sanctions relief based on concrete steps that alleviate the suffering of the Venezuelan people and support the restoration of democracy,” the U.S. Treasury Department statement said in a statement.
The authorization could provide limited new supplies of crude to a market now struggling to replace Russian barrels shunned by Western buyers over its invasion of Ukraine. Chevron and other U.S. oil refiners could benefit from supplies of Venezuela’s heavy crude flowing to their U.S. Gulf Coast processing plants.
Analysts cautioned that Venezuelan President Nicolas Maduro is likely to bristle at the restrictions included in the license, including the lack of cash payments that his administration sought. Proceeds due Venezuela from Chevron’s oil sales would go into a humanitarian fund rather than to PDVSA.
Terms will “require significant,” a U.S. official said, adding other sanctions on Venezuela and its officials remain in place.
“There is not a big incentive in the short term” for Venezuela, said Francisco Monaldi, an expert on Latin American energy policy at Rice University’s Baker Institute for Public Policy. Terms could be relaxed over time depending on how the talks in Mexico City proceed.
“We’ll see how Maduro’s government reacts to it and how many cargoes will be assigned to Chevron after,” Monaldi said.
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