Soaring prices for fuel and low gas storage levels force Brussels to ‘improve risk-preparedness’
The European Union is in talks with its trading partners in search of viable options to increase supplies of natural gas to its member states, according to the bloc’s Energy Commissioner Kadri Simson.
“The gas storage levels in the EU are significantly lower than usual at this time of the year,” Simson said, after a meeting with European energy ministers in France on Saturday.
The energy chief added that EU authorities need to remain “extremely vigilant” to make sure the bloc is ready for emergency situations at a time of unusually low gas storage levels, along with increased tensions beyond its eastern borders.
“The Commission is also discussing with our partners the potential to increase supplies to Europe,” she added.
Last year, Europe was hit by an unprecedented energy crunch that sent gas and power prices skyrocketing, and forced several industrial giants in the region to curb production, while households had to struggle with persistently rising bills for electricity and heating.
The severe energy crisis has recently been exacerbated when storage tanks in the EU dropped to their lowest seasonal levels in more than ten years. The decline reportedly occurred due to longer-than-usual maintenance at Norwegian fields and to Russia restocking its own inventories.
Moreover, the latest speculation over probable military conflict between Russia and Ukraine is also fueling concerns about Russian gas supply. The US and Western allies have pledged to impose a new series of sanctions against Moscow in the event of an invasion. The sanctions may reportedly target Russian energy sales.
“My message is that Europe has a robust, well diversified and resilient gas infrastructure and clear procedures of solidarity in case of emergencies,” Simson stressed, calling for even stronger solidarity between member states.
According to the European Commission, among the bloc’s 27 member states, 22 have implemented the necessary steps to cushion the impact of the energy crisis, such as lower taxation and duties, direct income support and vouchers.
Such measures have reportedly helped some 70 million individual customers and several million small- and medium-sized companies.The bloc’s authorities are also discussing draft rules to improve their coordination on gas storage, as well as to enable voluntary purchases of strategic gas reserves. EU member states have also been seeking to reform its power market.
UK government believes Russia is allegedly planning to invade Ukraine
British authorities are reportedly considering “an opportunity to support the suspension of Russia from the SWIFT international payment system, citing a hypothetical military conflict that could erupt between Russia and Ukraine.
Prime Minister Boris Johnson “fears some world leaders may not appreciate the deteriorating picture on the Ukrainian border, or fully comprehend the risks posed by a bullying Russia,” The Telegraph reports, citing sources close to the leader.
Over the past few months, a wide range of Western media outlets, along with multiple US officials, have been spreading speculation about an imminent Russian invasion of Ukraine. Washington and its allies threatened Kremlin with a new round of ‘crippling’ sanctions if this happens, citing the movement of Russian troops within the country’s vast Western territory as evidence of the plan. Moscow has consistently rejected the allegations, saying that Russia has a right to carry out military maneuvers as it pleases within its borders.
According to the British premier, the potential sanctions against Russia “cannot exclude” Nord Stream 2, the widely debated pipeline that is designed to increase gas supplies to crisis-hit European nations and is currently stuck in a protracted EU certification process.
Johnson is reportedly due to hold calls with G7 leaders to finalise a “sanction coalition” to introduce targeted measures against Russia.
Earlier this week, Bloomberg reported that officials at the UK Foreign Office were told to be ready to move into “crisis mode” at very short notice, as “concerns that Russia’s aggression toward Ukraine could escalate into conflict” increased. That reportedly means that officials and diplomats would focus their work on the UK response to any further spike in tensions, including deterrence and sanctions.
On Saturday, London’s Foreign Office issued grotesque claims that Moscow was plotting to “install a pro-Russian leader in [Kiev] as it considers whether to invade and occupy Ukraine.” Russia’s Ministry of Foreign Affairs has dismissed the claim, urging the UK to stop spreading “nonsense” and “disinformation.”
The idea of cutting Russia off the SWIFT banking network was reportedly considered as one of the options to punish Russia for the military assault they have been warning about, but was rejected by EU and US politicians, Das Handelsblatt reported earlier this week, citing sources close to the matter. The measure might reportedly result in a destabilization of financial markets in the short term and, in the medium term, in the development of an alternative payment infrastructure.
US financial regulator intensified its crackdown on crypto in recent years
A report by Cornerstone Research shows that the US Securities and Exchange Commission (SEC) has brought a total of 97 enforcement actions worth $2.35 billion against participants in the digital asset marketplace since 2013.
According to the research, 58 of those actions were litigations and the remaining 39 were administrative proceedings. Of the total $2.35 billion in penalties, $1.71 billion was charged in litigation and $640 million in administrative proceedings.
The majority of those charged were “firm respondents only,” racking up $1.86 billion of the total. Individual respondents were charged the remaining $490 million.
“Of the 20 enforcement actions brought in 2021, 65% alleged fraud, 80% alleged an unregistered securities offering violation, and 55% alleged both,”the report noted.
According to the document, the recent crackdown on crypto may be linked to the appointment of SEC chair Gary Gensler in April 2021, as enforcement had been “notably high” between the end of May and mid-September.
Those tough measures are expected to continue into the new year, Cornerstone Research Vice President Abe Chernin said. “Given the SEC’s continued focus on this space, in 2022, we may see further scrutiny of certain market participants such as DeFi platforms.”
International tourism won’t return to pre-pandemic levels until 2024 at the earliest
Global tourism saw a 4% increase last year, compared with 2020, which was the worst year on record as international arrivals plunged by 73%, the World Tourism Organization (UNWTO) said. The highly contagious Covid-19 Omicron variant, though mild, will “disrupt the recovery” in early 2022, it added.
According to the UN body, tourism arrivals around the globe are not expected to return to their pre-pandemic levels until 2024 at the earliest.
“The pace of recovery remains slow and uneven across world regions due to varying degrees of mobility restrictions, vaccination rates and traveler confidence,” the UNWTO said.
In Europe and the Americas, foreign visitor arrivals rose by 19% and 17%, respectively, last year over 2020.
Meanwhile, in the Middle East, arrivals declined by 24% last year, while in the Asia-Pacific region they were 65% below 2020 levels, and 94% down from pre-Covid levels.
The agency forecast a rise of 30% to 78% in international arrivals this year over 2021, while remaining far below 2019 levels.
It said that tourism revenue in 2020 was down 72% on the previous year.
“The economic contribution of tourism in 2021 [measured in tourism direct gross domestic product] is estimated at $1.9 trillion, above the $1.6 trillion in 2020, but still well below the pre-pandemic value of $3.5 trillion,” the UNWTO said.
Tensions between nations have helped send European energy bills to a historic high
The price of energy across the world has skyrocketed to unprecedented levels in a trend that is being exacerbated by geopolitical pressures, says the European Commission.
The soaring cost of gas has clearly impacted energy prices on the continent, according to European Commissioner for Energy Kadri Simson.
However, strife between and within nations has inevitably had a knock-on effect too.
February futures prices at the Netherlands’ Title Transfer Facility, a virtual trading point for natural gas, reportedly surged to $915 per 1,000 cubic meters on Friday, or €78 ($88.5) per megawatt hour in household terms.
In December, they hit a record high in Europe of nearly $2,200 per 1,000 cubic meters, which constituted an almost 400% rise since the start of the year.
“This is a particularly important time for the energy sector, both for its current state and for its future,” Simson said after a meeting with European energy ministers in France on Saturday.
“In the short term, we are faced with unusually high energy commodity prices – a trend intensified by geopolitical tensions.”
She affirmed that the current astronomically high prices for electricity and gas were placing an intolerable burden on homeowners and businesses alike across the European Union, but said national leaders were taking all possible steps to cushion them from future market shocks.
“These actions taken by member states to protect the consumers amount to more than €21 billion – a remarkable and swift effort by the EU governments,” Simson said.
