Europe's current imports of liquefied natural gas are sufficient to compensate for any shortfalls, should there be a stoppage in Russian supplies passing through Ukraine amid the geopolitical turmoil in eastern Europe, according to IHS Markit.
Volumes of Russian gas sent to Europe through Ukraine have already fallen significantly, reaching historic lows of 50 million cubic metres per day (cmpd) in January, less than half the levels from a year ago, IHS Markit said in a report.
While gas flows through Ukraine increased in February, they still remain 50 per cent less than the levels seen between 2015 and 2020. The EU depends on Russia for about a third of its gas supplies. Germany is the biggest buyer of Russian gas while Italy, Austria and Slovakia are most dependent on Ukraine transit gas, consultancy Wood Mackenzie has said.
“Europe is already experiencing a ‘quasi-curtailment’ of Russia gas flows,” said Michael Stoppard, chief strategist, global gas, at IHS Markit. “The result is a European gas import picture that is starkly different from a year ago. One where LNG imports have ramped up to fill the gap.”
European LNG regasification hit record levels last month, averaging 363 million cmpd between January 1 and January 19, growing 142 per cent year-on-year, research by S&P Global Platts found. The figure was also higher than the 351 million cmpd seen in November 2019, which was a record month for LNG regasification in Europe.
LNG imports to Europe increased to 34 per cent of total supply for the whole of January to reach 490 million cmpd, while Russian pipeline supply dropped to 17 per cent, the report said. LNG imports from the US rose to a record high of 245 million cmpd.
The trend is continuing this month, with LNG imports for the first three days of February averaging 605 million cmpd.
"Warmer temperatures in Asia prompted LNG traders to reroute cargoes to take advantage of higher prices in Europe, temporarily reducing European buyers’ requirements of Russian imports. That though has now reversed with the arrival of cold weather lifting Asian spot LNG prices," Wood Mackenzie said.
Europe is already experiencing a ‘quasi-curtailment’ of Russia gas flows. The result is a European gas import picture that is starkly different from a year ago.
Michael Stoppard,
chief strategist, global gas, IHS Markit
Geopolitical tensions in eastern Europe are escalating rapidly, with fears of an imminent Russian invasion of Ukraine. Russia has amassed about 100,000 troops on the Ukrainian border, but insists it has no intention of invading the country. On Sunday, the US dispatched additional troops to Poland in a sign of support for its Nato allies.
While the stoppage of Russian pipeline flows through Ukraine will not present a threat to physical supplies, it would likely put further pressure on prices as LNG volumes are pulled away from other markets, the IHS report stated.
“So far, this is more of a price crisis than a physical supply crisis," said Shankari Srinivasan, vice president of IHS Markit. “While gas supply is sufficient to meet most market needs through the end of the winter heating season, high prices are already leading to closures of some industry and furloughing of workers in Europe.”
The report also cautioned that if Russian pipeline flows completely stopped through all routes going into Europe, it would create an "immediate supply deficit that LNG alone could not compensate for".
“Under an extreme, if highly unlikely, scenario where all Russian pipe flows were cut off, the tightness of global LNG supply and limited spare European LNG regasification capacity means that other supply levers would be needed to close the gap,” said Mr Stoppard.
“Extra coal and nuclear power generation capacity — either in the form of mothballed capacity being brought back online, resorting to strategic reserves or delayed plant closures — along with additional drawdowns of gas from storage would all be required.”
If there was a complete halt to all gas imports from Russia due to heightened tensions, it might "prove impossible to find alternative volumes to meet 28 per cent of annual demand" in Europe, Wood Mackenzie said.
"Were all gas flows to stop today, existing gas storage would run out in six weeks. Demand destruction would be massive and if disruption was prolonged, gas inventory couldn’t be rebuilt through the summer," the consultancy added.
"We’d be facing a catastrophic situation of close to zero gas in storage for next winter. This scenario highlights how dependent Europe has become on Russian gas and the critical role diplomacy and commercial sensibilities have to play to ensure supplies keep flowing."
BORDERLANDS
Starring: Cate Blanchett, Kevin Hart, Jamie Lee Curtis
Director: Eli Roth
Rating: 0/5
PROFILE OF HALAN
Started: November 2017
Founders: Mounir Nakhla, Ahmed Mohsen and Mohamed Aboulnaga
Based: Cairo, Egypt
Sector: transport and logistics
Size: 150 employees
Investment: approximately $8 million
Investors include: Singapore’s Battery Road Digital Holdings, Egypt’s Algebra Ventures, Uber co-founder and former CTO Oscar Salazar
How to become a Boglehead
Bogleheads follow simple investing philosophies to build their wealth and live better lives. Just follow these steps.
• Spend less than you earn and save the rest. You can do this by earning more, or being frugal. Better still, do both.
• Invest early, invest often. It takes time to grow your wealth on the stock market. The sooner you begin, the better.
• Choose the right level of risk. Don't gamble by investing in get-rich-quick schemes or high-risk plays. Don't play it too safe, either, by leaving long-term savings in cash.
• Diversify. Do not keep all your eggs in one basket. Spread your money between different companies, sectors, markets and asset classes such as bonds and property.
• Keep charges low. The biggest drag on investment performance is all the charges you pay to advisers and active fund managers.
• Keep it simple. Complexity is your enemy. You can build a balanced, diversified portfolio with just a handful of ETFs.
• Forget timing the market. Nobody knows where share prices will go next, so don't try to second-guess them.
• Stick with it. Do not sell up in a market crash. Use the opportunity to invest more at the lower price.
How to get there
Emirates (www.emirates.com) flies directly to Hanoi, Vietnam, with fares starting from around Dh2,725 return, while Etihad (www.etihad.com) fares cost about Dh2,213 return with a stop. Chuong is 25 kilometres south of Hanoi.
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Aston martin DBX specs
Engine: 4.0-litre twin-turbo V8
Transmission: nine-speed automatic
Power: 542bhp
Torque: 700Nm
Top speed: 291kph
Price: Dh848,000
On sale: Q2, 2020
The specs
Price, base: Dh228,000 / Dh232,000 (est)
Engine: 5.7-litre Hemi V8
Transmission: Eight-speed automatic
Power: 395hp @ 5,600rpm
Torque: 552Nm
Fuel economy, combined: 12.5L / 100km
The National Archives, Abu Dhabi
Founded over 50 years ago, the National Archives collects valuable historical material relating to the UAE, and is the oldest and richest archive relating to the Arabian Gulf.
Much of the material can be viewed on line at the Arabian Gulf Digital Archive - https://www.agda.ae/en
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Dhadak 2
Director: Shazia Iqbal
Starring: Siddhant Chaturvedi, Triptii Dimri
Rating: 1/5
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How to wear a kandura
Dos
- Wear the right fabric for the right season and occasion
- Always ask for the dress code if you don’t know
- Wear a white kandura, white ghutra / shemagh (headwear) and black shoes for work
- Wear 100 per cent cotton under the kandura as most fabrics are polyester
Don’ts
- Wear hamdania for work, always wear a ghutra and agal
- Buy a kandura only based on how it feels; ask questions about the fabric and understand what you are buying
Fund-raising tips for start-ups
Develop an innovative business concept
Have the ability to differentiate yourself from competitors
Put in place a business continuity plan after Covid-19
Prepare for the worst-case scenario (further lockdowns, long wait for a vaccine, etc.)
Have enough cash to stay afloat for the next 12 to 18 months
Be creative and innovative to reduce expenses
Be prepared to use Covid-19 as an opportunity for your business
* Tips from Jassim Al Marzooqi and Walid Hanna
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Spain drain
CONVICTED
Lionel Messi Found guilty in 2016 of of using companies in Belize, Britain, Switzerland and Uruguay to avoid paying €4.1m in taxes on income earned from image rights. Sentenced to 21 months in jail and fined more than €2m. But prison sentence has since been replaced by another fine of €252,000.
Javier Mascherano Accepted one-year suspended sentence in January 2016 for tax fraud after found guilty of failing to pay €1.5m in taxes for 2011 and 2012. Unlike Messi he avoided trial by admitting to tax evasion.
Angel di Maria Argentina and Paris Saint-Germain star Angel di Maria was fined and given a 16-month prison sentence for tax fraud during his time at Real Madrid. But he is unlikely to go to prison as is normal in Spain for first offences for non-violent crimes carrying sentence of less than two years.
SUSPECTED
Cristiano Ronaldo Real Madrid's star striker, accused of evading €14.7m in taxes, appears in court on Monday. Portuguese star faces four charges of fraud through offshore companies.
Jose Mourinho Manchester United manager accused of evading €3.3m in tax in 2011 and 2012, during time in charge at Real Madrid. But Gestifute, which represents him, says he has already settled matter with Spanish tax authorities.
Samuel Eto'o In November 2016, Spanish prosecutors sought jail sentence of 10 years and fines totalling €18m for Cameroonian, accused of failing to pay €3.9m in taxes during time at Barcelona from 2004 to 2009.
Radamel Falcao Colombian striker Falcao suspected of failing to correctly declare €7.4m of income earned from image rights between 2012 and 2013 while at Atletico Madrid. He has since paid €8.2m to Spanish tax authorities, a sum that includes interest on the original amount.
Jorge Mendes Portuguese super-agent put under official investigation last month by Spanish court investigating alleged tax evasion by Falcao, a client of his. He defended himself, telling closed-door hearing he "never" advised players in tax matters.
The five pillars of Islam
Bharat
Director: Ali Abbas Zafar
Starring: Salman Khan, Katrina Kaif, Sunil Grover
Rating: 2.5 out of 5 stars
Lexus LX700h specs
Engine: 3.4-litre twin-turbo V6 plus supplementary electric motor
Power: 464hp at 5,200rpm
Torque: 790Nm from 2,000-3,600rpm
Transmission: 10-speed auto
Fuel consumption: 11.7L/100km
On sale: Now
Price: From Dh590,000
Zayed Sustainability Prize
if you go
The flights
Air Astana flies direct from Dubai to Almaty from Dh2,440 per person return, and to Astana (via Almaty) from Dh2,930 return, both including taxes.
The hotels
Rooms at the Ritz-Carlton Almaty cost from Dh1,944 per night including taxes; and in Astana the new Ritz-Carlton Astana (www.marriott) costs from Dh1,325; alternatively, the new St Regis Astana costs from Dh1,458 per night including taxes.
When to visit
March-May and September-November
Visas
Citizens of many countries, including the UAE do not need a visa to enter Kazakhstan for up to 30 days. Contact the nearest Kazakhstan embassy or consulate.
The more serious side of specialty coffee
While the taste of beans and freshness of roast is paramount to the specialty coffee scene, so is sustainability and workers’ rights.
The bulk of genuine specialty coffee companies aim to improve on these elements in every stage of production via direct relationships with farmers. For instance, Mokha 1450 on Al Wasl Road strives to work predominantly with women-owned and -operated coffee organisations, including female farmers in the Sabree mountains of Yemen.
Because, as the boutique’s owner, Garfield Kerr, points out: “women represent over 90 per cent of the coffee value chain, but are woefully underrepresented in less than 10 per cent of ownership and management throughout the global coffee industry.”
One of the UAE’s largest suppliers of green (meaning not-yet-roasted) beans, Raw Coffee, is a founding member of the Partnership of Gender Equity, which aims to empower female coffee farmers and harvesters.
Also, globally, many companies have found the perfect way to recycle old coffee grounds: they create the perfect fertile soil in which to grow mushrooms.
Farage on Muslim Brotherhood
Nigel Farage told Reform's annual conference that the party will proscribe the Muslim Brotherhood if he becomes Prime Minister.
"We will stop dangerous organisations with links to terrorism operating in our country," he said. "Quite why we've been so gutless about this – both Labour and Conservative – I don't know.
“All across the Middle East, countries have banned and proscribed the Muslim Brotherhood as a dangerous organisation. We will do the very same.”
It is 10 years since a ground-breaking report into the Muslim Brotherhood by Sir John Jenkins.
Among the former diplomat's findings was an assessment that “the use of extreme violence in the pursuit of the perfect Islamic society” has “never been institutionally disowned” by the movement.
The prime minister at the time, David Cameron, who commissioned the report, said membership or association with the Muslim Brotherhood was a "possible indicator of extremism" but it would not be banned.
