October 20, 2017

Kurdistan accuses Baghdad of planning oil field seizure

The AFP separately quoted an Iraqi general who confirmed the information, saying “Iraqi armed force are advancing to retake their military positions that were taken over during the events of June 2014.” In 2014, the Kurdish Peshmerga forces took over Kirkuk, driving IS out. Since the, the multiethnic city has been the subject of an ongoing dispute between the Kurdistan Regional Government and Baghdad.

Kurdish forces loyal to the Patriotic Union of Kurdistan (PUK) party are seen after storming a facility in protest at the Iraqi government's oil policy in Kirkuk, Iraq March 2, 2017. © Ako RasheedKurdish vote won’t spark a sustained oil price rally

The latest news reports from Iraq say that Iraqi PM Haider al-Abadi first denied there was a government plan in progress to retake the oil fields around Kirkuk, and then ordered a halt to the advance of Iraqi troops towards the northern Iraqi city.

According to the Kurdistan Regional Security Council, there are Iraqi army forces as well as Popular Mobilization Forces units near Kirkuk deploying tanks and heavy artillery in an area populated predominantly by Shia Turkmens. The PMF is a paramilitary organization, trained by Iran.

This is the latest spike in internal tensions in OPEC’s number-two oil exporter that follows the Kurds’ vote for independence from Baghdad. The central Iraqi government has made no secret of its opposition to Kurdish independence and it has had the support of Turkey and Iran.

Immediately after the independence referendum, Baghdad closed all international air traffic to and from the autonomous region, and later began talks with Turkey to revive an old oil pipeline between the two countries that bypasses Kurdistan.

Read more on Oilprice.com: Busting The Lithium Bubble Myth

Now it seems Baghdad has escalated the pressure as the Kurds refuse to cancel the results of their referendum and seem intent on getting their independence whether the rest of the region likes it or not.

Kirkuk and the oil fields around it, however, are vital for the autonomous region. They also represent a substantial portion of Iraq’s oil wealth, which it is naturally unwilling to surrender to the Kurds. Baghdad has repeatedly called on Erbil to relinquish control of Kirkuk to the federal government.

This article was originally published on Oilprice.com

Article source: https://www.rt.com/business/406702-kurdistan-accuses-baghdad-of-planning/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Russia will re-route Nord Stream 2 natural gas pipeline if Denmark tries to block it

EU has no legal way to block Russia’s Nord Stream 2 pipeline – Vestager

According to Danish daily Berlingske, the Nord Stream 2 company has applied to the Danish Energy Agency for a permit to construct within territorial waters. The company, however, has alternative routes for the €10 billion project.

“We are now following the debate in the [Danish – Ed.] parliament. Although we do not know how it ends, any project’s manager would consider alternatives in such situation. We are evaluating continuously,” Nord Stream 2 spokesman Jens Mueller told Berlingske.

The company’s technical director Sergey Serdjukov said this week they are ready to re-route the pipeline, avoiding Danish territorial waters if Copenhagen blocks construction plans.

According to Serdjukov, “everything has been already prepared, and it won’t be very difficult.”

“The distance does not matter. Who cares about a couple of extra kilometers on a 1,200-kilometer long pipeline,” Serdyukov told Russian business daily Vedomosti.

Russian gas giant Gazprom plans to lay the 1,200-kilometer Nord Stream 2 pipeline under the Baltic Sea to the German coast near Greifswald, where it would connect to the European gas transport networks.

​Gazprom to open Nord Stream-2 by 2020 – CEO

The new pipeline will be operational by the end of 2019, according to Gazprom CEO Aleksey Miller.

It is expected to double the capacity of the existing Nord Stream pipeline, which opened in 2010 and goes under the Baltic Sea to Germany.

In 2015, Gazprom signed a memorandum of intent to cooperate on the new gas pipeline with Germany’s E.ON, Royal Dutch Shell and OMV of Austria.

Critics claim the Gazprom-led project will make Europe more dependent on Russian gas as it bypasses Ukraine as a transit country. Proponents argue it will bring gas prices in Europe down.

European Commissioner for Competition Margrethe Vestager said on Wednesday, the EU has no legal means to stop the pipeline that will deliver natural gas from Russia to Germany.

Article source: https://www.rt.com/business/406600-denmark-nord-stream-pipeline/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Richard Branson gets onboard Hyperloop One

‘We made history’: Hyperloop One completes first successful test (PHOTOS, VIDEO)

“After visiting Hyperloop One’s test site in Nevada and meeting its leadership team this past summer, I am convinced this groundbreaking technology will change transportation as we know it and dramatically cut journey times,” Branson said in a statement.

The maverick British billionaire will join the company board and take charge of developing pods that will transport passengers and cargo at speeds of over 400 kilometers per hour (kph), with a theoretical possibility of reaching 700 kph.

“Virgin has been known for investing in and creating innovative companies over the years, and I look forward to making history together as we bring Hyperloop to the world as Virgin Hyperloop One,” the businessman added.

The Hyperloop high-speed transport technology was proposed by US billionaire and investor Elon Musk in 2013. Traveling via Hyperloop is expected to be twice as fast as an airplane and four times faster than a high-speed train. The system pledges to be safe and will be run by solar energy.

“Virgin Hyperloop One will be all-electric, and the team is working on ensuring it is a responsible and sustainable form of transport,” Virgin Group said.

The system uses magnets to lift pods above a track inside an airless tube, creating conditions in which the floating pods could move people or cargo.

Last month, Hyperloop One raised $85 million in new funding, bringing the total financing raised to $245 million since it was founded three years ago.

The start-up is reportedly working on projects in the Middle East, Europe, India, and Canada.

Virgin group is not a newcomer to the transportation industry. Apart from airlines, cruise ships and rail franchises the company is working on the world’s first commercial space travel.

Article source: https://www.rt.com/business/406572-richard-branson-hyperloop-one-rebrand/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Bitcoin now bigger than Bayer, Goldman Sachs & Nike

Bitcoin smashes $5,000 ceiling to hit another all-time high

Its market capitalization is approaching $97 billion. If bitcoin were a company, its market cap puts it in the same league as some of the world’s biggest corporations.

The cryptocurrency would be in 77th in PwC’s list of the top 100 corporations, bigger than Bayer, Goldman Sachs, UPS, Nike, and Mitsubishi.

Bitcoin is up over 480 percent year-to-date.

The reason behind the rally is talk China may reverse the ban it imposed on cryptocurrency exchanges last month. The Chinese central bank also declared initial coin offerings (ICOs) illegal and banned fundraising through ICOs.

After the Chinese ban, the Japanese yen consolidated the global trade volume, with 57 percent of bitcoin’s fiat exchange volume. The US dollar and South Korean won follow.

Some investors say bitcoin bulls could test a new ceiling of $6,500. They are also buoyant that banking giant Goldman Sachs is likely to start trading bitcoin.

READ MORE: $100 in bitcoin in 2010 now worth almost $73 million

Mike Novogratz, Galaxy Investment Partners, recently told CNBC that bitcoin can hit the $10,000 mark soon, but with a warning.

“Remember, bubbles happen around things that fundamentally change the way we live,” he said.

“The railroad bubble. Railroads really fundamentally changed the way we lived. The internet bubble changed the way we live. When I look forward five, 10 years, the possibilities really get your animal spirits going.”

Bitcoin is likely to become “the biggest bubble of our time,” he added.

Article source: https://www.rt.com/business/406565-bitcoin-record-high-bayer-goldman/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Spain hopes mass business exodus ends Catalonia’s independence dream

Spanish PM seeks clarity on Catalan independence declaration, threatens to suspend region’s autonomy

Before Catalonian leaders announced their independence decision, the Spanish government changed the law making it easier for corporations to move their headquarters to other parts of the country.

Major Spanish banks Banco Sabadell and CaixaBank were among the first, moving headquarters to Alicante and Valencia “to protect the interests” of customers, shareholders, and employers. CaixaBank said it wanted to avoid the risk of finding itself illegally headquartered outside the eurozone should Catalonia become independent.

Spanish utility Gas Natural Fenosa and satellite broadband Eurona have announced moving legal bases to Madrid. Infrastructure firm Abertis Infraestructuras, Cellnex Telecom, real-estate company Inmobiliaria Colonial, textile firm Dogi International Fabrics have joined the flow of companies fleeing the region. They said they would relocate headquarters to Madrid, at least temporarily.

Prosecco and wine-makers Freixenet and Cordoniu are both looking at relocating their offices, but a decision hasn’t been taken yet. Some of Spain’s largest firms are also debating whether to move their headquarters.

Catalonia is Spain’s most economically productive region, hosting 7,100 multinationals, including Volkswagen, Nissan, and Cisco. It generates about 20 percent of the country’s GDP and contributes 21 percent of its total taxes.

Losing Catalonia would deprive Spain of about 16 percent of its people, a fifth of its economic output and more than a quarter of its exports. But at the same time, analysts predict, the mass exodus of companies would cause devastating economic consequences for the region.

Spanish economy minister says ‘it’s very clear’ Catalan independence not going to happen

“It’s the death knell for the separatists’ science fiction view of their economic position, and the evidence of the disaster of the separatist economy,” Chief Economist at Tressis, Daniel Lacalle told RT.

Catalans, who support independence, believe the region could turn its budget into surplus after stopping transfers to the federal government. Lacalle claims their calculations are simply a fantasy.

“Even in their transition document they concede they will have to finance themselves through patriotic bonds and bonds payable by higher future taxes,” he said, adding that the reality is that “their alleged transfers to the rest of the state are not enough to cover their financing needs plus the cost of secession.”

According to the economist, “this would lead to an annual deficit of around €16 billion being conservative, and that is before the loss of revenues from the companies that have left.”

Spain’s Minister of Economy Luis De Guindos blamed the Catalan government for the businesses’ moving, saying it is the consequence of the policies put in place by the regional government.

Jose Luis Feito, president of the Institute of Economic Studies, echoed the minister, saying the main consequences of the “illegal action” on behalf of independence will be mainly felt in the economy of Catalonia.

“An independent Catalonia will be outside of the European Union and outside of the common currency,” said Feito, adding “what companies are doing in Catalonia, particularly banks, are obviously protecting themselves and their customers and their shareholders from this possibility.”

The European Union (EU) has already said it won’t recognize an independent Catalonia and will not grant EU membership.

Spain passes law making it easier to move business out of Catalonia

According to Lacalle, it is “impossible for Catalonia to survive without any EU recognition and it will not receive it. This destroys the secession argument.”

“It means the collapse in the economy as Catalonia sells more than 80 percent of its goods to the rest of the EU,” the expert said.

Spanish Prime Minister Mariano Rajoy on Wednesday accused the Catalan government of being “disloyal” and carrying out a “very dangerous attack on institutions as well as the coexistence of citizens which is worse.”

He said the referendum, in which two million Catalans voted to break away from Spain, resulted in disorder and prompted companies to flee the region.

While Catalonia’s government has delayed the decision on making a unilateral declaration of independence this week, they remained defiant.

Catalan leader Carles Puigdemont said on Wednesday that the regional government is ready for dialogue “without preconditions” and that the relationship between Catalonia and Spain “does not work.”

Article source: https://www.rt.com/business/406517-catalonia-businesses-exodus-turmoil/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Putin wants to boost share of small & medium-sized businesses in Russia

Putin: Russian economy has moved to period of growth

The Russian president was speaking at a meeting with German business leaders in Sochi on Thursday.

“I think you will agree that the cooperation of our countries should not be limited only to major projects, an important driver for the development of the modern economy is small and medium businesses. In Germany, small business accounts for more than half of the country’s GDP,” said Putin.

“The share is much less in Russia, unfortunately, but we set a goal to make small and medium businesses account for 30 to 40 percent of the Russian economy by 2030,” Putin stressed.

The president said he would be interested to hear proposals from German businessmen on how to connect small and medium-sized businesses to Russian-German economic links.

“Of course, we are interested in the opinion of our foreign partners, what in general makes it difficult to do business in Russia, what additional support from the state is needed to our partners from abroad,” he said.

Russian economists have said small and medium-sized businesses often face limited domestic demand, the dominance of large economic and financial structures in the economy, expensive loans, and red tape.

Putin has repeatedly stressed the importance of small and medium-sized business for the Russian economy.

Data from 2016 says that only 5.8 percent of Russians of working age start their own business, the lowest among the BRICS countries, while almost one in five Brazilian starts his own business. To boost entrepreneurship in Russia, the government has offered better tax terms, a three-year moratorium on scheduled inspections and a quota in procurements by Russia’s big corporations.

Article source: https://www.rt.com/business/406484-putin-russia-small-business-share/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Russia rebuilds Iraq’s energy sector in areas freed from ISIS militants

The Badra oil field is located near the Iranian border and was recently on the frontline of the battle against Islamic militants. It holds reserves of around three billion barrels of crude.

© Azad LashkariRosneft to reach gas pipeline deal with Iraqi Kurdistan

The Gulf Wars and the Iran-Iraq conflicts make this one of the most dangerous places in the world to operate with landmines and explosives littering the desert.

Before the work began, 30 million square meters had to be de-mined with over 20,000 explosive devices from previous conflicts found and removed.

Apart from the remnants of wars specialists from Russia and Korea had to overcome some natural obstacles.

The region is a hard place to drill. Tough multi-layered rock formations mean drilling as deep as five kilometers.

“I joined the project in 2014. The main problem we faced was tough geological locations. We came across problems with the construction of wells, what chemicals to use. Three years on we have halved construction time, all those problems have been minimized,” one Gazprom engineer told RT.

The Russian operator company Gazprom Neft Badra is developing the oil field in the Wasit Province of eastern Iraq. The operator represents the interests of the international consortium that includes Russia’s Gazprom Neft, South Korean KOGAS, Malaysia’s Petronas, Turkish TPAO and the Iraqi government. The project is scheduled to take 20 years.

Under the government contract, at least 20 percent of the rig’s workforce has to come from the local area.

Along with jobs Iraqis from Badra are given training, earning critical roles on the drilling rig. Some of their children also study at a local school built by Gazprom just minutes from the base.

The oil sector isn’t the only area of Iraqi-Russian cooperation. Gazprom Neft delivers gas to the Az-Zubaydiyah gas and power station. The plant is expected to become a principal electricity source for surrounding regions as well as providing gas for export.

Gazprom Neft is in talks with the Iraqi government to develop more oil fields in the region.

Article source: https://www.rt.com/business/406458-gaspromneft-iraq-daniel-hawkins/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

Sanctions against Russia may last at least a decade – Lukoil boss

“Our current strategic plan for the next ten years is that sanctions will remain in place. I don’t perceive that sanctions will be removed in the coming years, and even [when they are] it will be a lengthy and very complicated process,” said Alekperov in an interview with the Financial Times.

US sanctions won’t stop Russia’s pipeline project to Europe – analysts

Lukoil produces 1.8 million barrels per day and is the largest private oil company in Russia, second only to state-run Rosneft.

The US and its Western allies imposed sanctions against Russia over the conflict in Ukraine leading to the country’s reunification with Crimea. Moscow was accused of annexing the former Ukrainian region which has an ethnic Russian majority and voted to rejoin Russia in a 2014 referendum. Further sanctions were imposed over the civil war in eastern Ukraine after the West accused Moscow of helping the rebels in the breakaway regions of Donetsk and Lugansk.

While sanctions have not affected Russia’s oil exports, they do have an impact on joint projects with major international energy firms, particularly American companies.

ExxonMobil has been forced to shelve plans in Sakhalin and the Russian Arctic. Sanctions also limit the ability of Russian energy companies from buying equipment for oil and gas extraction.

Regarding the oil price, Alekperov says he’s satisfied with the agreement between OPEC, Russia and other oil producers to cut output.

“If the price is less than $50, then we must go for an extension. If it is $55, then there is no need. Just a gradual withdrawal,” he said.

“The most important thing, for now, is to not to allow another time of $100 a barrel, that would be major trouble for the industry. We want to have a predictable level of $55-$60 at least for the 10 years to come . . . and keep both consumers and producers happy,” Alekperov added.

In December 2016, OPEC, Russia and other major producers agreed to curb production by 1.8 million barrels per day (bpd) for six months from January 1 to support the market and push prices to $60 per barrel. In May, the agreement was extended by another nine months.

Alekperov is Lukoil’s largest shareholder and owns about a quarter of the firm. He founded the company from state oil assets after the break-up of the Soviet Union.

Article source: https://www.rt.com/business/406457-russia-lukoil-sanctions-oil/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

China could shatter petrodollar by compelling Saudi Arabia to trade oil in yuan

In an interview with CNBC Weinberg said China has become a key player in the oil market since overtaking the US to become the world’s largest importer.

© Jason LeePetrodollar end looming as China allies dump it in oil trading – Jim Rogers

Saudi Arabia has “to pay attention to this because even as much as one or two years from now, Chinese demand will dwarf US demand,” Weinberg told the media.

“I believe that yuan pricing of oil is coming and as soon as the Saudis move to accept it — as the Chinese will compel them to do — then the rest of the oil market will move along with them,” he added.

A 1974 agreement between US President Richard Nixon and Saudi King Faisal meant Riyadh has been accepting dollars for all its oil exports.

However, recently, countries like China and Russia have been looking to exclude the greenback from bilateral oil trade. Russia and Saudi Arabia are the most significant exporters of oil to China, alternating in top spot.

China has already said it wants to start a crude oil futures contract priced in yuan and convertible into gold.

Veteran investor Jim Rogers told RT last month that countries are getting more concerned about trading in dollars, because “if the US gets angry at you, they just set enormous pressure on you that can even get you out of business.”

“China, Russia, and other countries understand this, and they are trying to move world trade and world finance away from that,” said Rogers.

In July, Russia and China signed a 68 billion yuan ($10 billion) investment fund to ease ruble-yuan settlements.

Article source: https://www.rt.com/business/406373-china-saudi-arabia-yuan-oil/?utm_source=rss&utm_medium=rss&utm_campaign=RSS

European Central Bank made almost €8bn from Greece’s financial crisis

Germany made over €1bn out of Greek debt crisis

A written response to a request from a Greek MEP showed the bank collected €7.8 billion in interest payments between 2012-2016 on Greek sovereign bonds acquired under its Securities and Markets bond-buying program (SMP).

Profits are usually redistributed among the 19 eurozone central banks.

In 2016, the ECB collected more than €1.1 billion in interest payments on the nearly €20 billion worth of Greek bonds it holds, according to German daily Suddeutsche Zeitung.

An analysis from the Jubilee Debt Campaign estimated Greece’s other creditor, the International Monetary Fund, had made €2.5 billion from its loans to the country.

According to Leo Hoffmann-Axthelm from Transparency International, the ECB’s participation in Greece’s bailout had led to a “conflict of interest.”

“The ECB expects repayments on its Greek bonds with one hand while approving Greece’s reform progress with the other. The Bank is literally sitting on all sides of the table,” said Hoffmann-Axthelm.

The SMP program was started at a time of the eurozone’s debt crisis in 2009 was aimed at easing market pressure on the borrowing costs of member states. Later in 2015, the ECB started its quantitative easing (QE) program, but Athens was barred from it because it’s still under the terms of a third EU bailout.

Greece approved to get more bailout funds after completing reforms

Greece’s inclusion into QE could happen only when the central bank decides the country’s 180 percent debt to GDP is sustainable. Most of the country’s near €300 billion government debt is in the hands of international rather than private sector creditors.

“This is a matter of national competence and falls outside the remit of the ECB,” said the central bank in a letter to FT signed by ECB President Mario Draghi.

Decisions about what to do with the earnings will be taken by national member states, the letter explained.

“Any future decisions on the transfer to the Greek State of amounts equivalent to the National Central Bank’s (NCB) income do not fall within the remit of the ECB or the NCBs, but rather that of the national governments of the euro area member states,” it said.

Eurozone members initially agreed to hand any interest back to the Greek central bank as a point of EU solidarity. However, when the second bailout program started in 2015, the pay-back operation was halted, and the full interest was never paid back to Athens.

Article source: https://www.rt.com/business/406359-ecb-profits-greek-debt/?utm_source=rss&utm_medium=rss&utm_campaign=RSS