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Good evening from London
European governments continue to seek ways to insulate themselves from Russian power before household energy bills rise sharply in the coming months.
The latest push came with German Chancellor Olaf Scholtz’s support for a new gas pipeline linking Spain and Portugal to central Europe via France. The proposal backed by Madrid and Lisbon today could be ready within nine months, according to Spanish Energy and Environment Minister Teresa Ribera.
Meanwhile, according to Portuguese Prime Minister Antonio Costa, the port of Sins, on his country’s south-west coast, could be used as a hub to transport liquefied natural gas to Europe. LNG is becoming increasingly important as Russian gas dwindles, but Europe faces stiff competition from Asia to shut down supplies during the winter months.
The EU has identified the lack of alternative pipelines as a major obstacle to building the bloc’s energy infrastructure. Berlin is already under severe pressure after Russia cut flows through Nord Stream 1, a key connector with Europe, which is currently running at just 20 percent capacity. German households are bracing for an increase in heating bills this winter as shortages drive up prices and complicate the country’s efforts to fill gas storage facilities.
A range of government measures are in place across Europe to address rising energy prices, from price caps to tax cuts, windfall taxes and subsidies.
Low rainfall is also complicating matters. Norway said this week that it would freeze electricity exports to Europe if water levels for its hydroelectric plants remain low, dimming hopes that neighbors could come to the rescue. And in Germany, low levels on the Rhine are adding to business concerns: Inland waterways may account for only about 6 percent of German traffic volume but are used to transport 30 percent of coal, crude oil and natural gas.
In the UK, forecasts for household energy bills are rising, fueling a deepening cost of living crisis. The latest from consultancy Auxilione suggests the average could reach £5,000 next year, following a huge rise in wholesale gas prices.
Ministers are meeting with power company chiefs to discuss possible measures, as well as plans to combat the threat of power outages this winter. On the positive side, a common front against Russia’s energy squeeze has improved contentious relations between the UK and the EU.
The IMF suggested last week that European countries should pass on rising energy costs to consumers to encourage energy savings and a shift to greener power, albeit with targeted support for poorer households disproportionately affected by the increase.
Meanwhile, the International Energy Agency said Western sanctions had only a “limited impact” on Russian oil production. Although the exports to Europe, America, Japan and Korea have decreased, the routing of the flow towards countries like India, China and Turkey has reduced the deficit of the country.
The IEA also raised its forecast for oil demand due to its increasing use for power generation in Europe and the Middle East, as gas is more expensive.
Amidst the frustration, there is some consolation for consumers. US gasoline prices have dropped below $4 per gallon for the first time since Russia invaded Ukraine. This trend is also repeated in Europe, reports our Energy Resources newsletter: EU drivers are paying 9 percent less than in June and British drivers 8 percent.
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Need to know: Economy
New Britain GDP statistics This Morning showed the economy contracted 0.1 percent in the second quarter, after growing 0.7 percent in the first three months of the year, as households cut spending and a drop in Covid cases and disappointing health output tests. The country also reported its worst trade deficit since records began.
Latest for UK and Europe
drought In parts of England it was formally announced that, as the UK suffered its driest summer for 50 years, rainfall, river flows, soil moisture, groundwater and reservoir levels were far below normal.
industrial production The eurozone rose for a third consecutive month, raising hopes that supply chain problems may be easing. Growth of 2.4 percent in June last year was well ahead of the 0.8 percent forecast by economists.
The German economyIts industrial sector, in particular, has been hit hard by rising inflation, supply chain issues and a slowdown in global demand. Growth in what has traditionally been Europe’s powerhouse has stalled as the IMF slashed its 2023 forecast. On top of this, there is also a severe drought Rhine A great danger arises in business.
Fed official Mary Daly Despite Wednesday’s upbeat CPI report, it was too early to “declare victory” against inflation. However, she signaled support for the Fed to slow the pace of its interest rate hikes.
ColombiaThe first left-wing government in modern times is targeting the rich and the country’s commodity exports with massive tax reforms. The measures aim to raise an additional $5.8 billion, or 1.7 percent of GDP, next year.
Argentina Inflation increased by 7.4 percent in July compared to the previous month and increased by 71 percent year-on-year, raising the interest rate to 69.5 percent.
Need to know: Business
head of minimum wageChina’s top chipmaker said geopolitical tensions were creating panic in an industry beset by high inflation and a gradual decline in demand.
American West Coast Editor Richard Waters Data use is moving to the forefront of regulators’ antitrust concerns, he says. US Federal Trade Commission Chair Leena Khan has emphasized the need to act more aggressively against vertical integration – deals that combine companies in different parts of the value chain, such as Amazon’s purchase of iRobot.
In Epidemic Migration Florida has led Miami to become the new boom town for corporate lawyers.
Beijing’s zero-covid policy and weak consumer confidence have decimated China’s second-hand market. Luxury goods Such as high-end watches and handbags.
One high-end industry definitely not on the rocks — unless you like it served that way — is Scotch whisky. Spirit has proved surprisingly resilient, considering the headwinds of Brexit changes to trade rules, supply chain issues and rising inflation. The number of Scottish distilleries is the highest since the Second World War.
Continuous progress is being made Driverless carsBut a lack of public acceptance and legal certainty could prove the industry’s biggest hurdle, writes innovation editor John Thornhill.
Car manufacturers are also facing challenges in their drive towards an electric future. China has a monopoly on the supply of materials Electric batteries While the price of those remaining in the market is increasing. Chinese company CATL today announced a €7.3bn battery plant in Hungary, confirming its position as the world’s largest car battery manufacturer.
Science Round Up
North Korea “Victory” over Covid-19 was declared with a total of 74 deaths just three months after the virus was first acknowledged as an outbreak. Experts are skeptical of the lack of mass testing, while some have suggested there could be more of it. Wants to revive trade with China.
The Omicron The variant continues to wreak havoc in some parts of the world. Tibetan cities were locked down after experiencing the first Covid outbreak in two years. The lockdown has also affected popular Chinese tourist destinations such as Hainan.
But, there was optimism Hong Kongwhich shortened its hotel quarantine for international arrivals to three days this week.
The EU drugs regulator It will await trial data before approving vaccines designed to target the original coronavirus and omicron variants. The decision contrasts with the US, which plans to approve the jabs before releasing data on their effectiveness.
Biotech and Pfizer Omicron is starting clinical trials for vaccines targeting BA.4 and BA.5 variants. BioNTech reported lower-than-expected sales and earnings in the second quarter after the EU struck a blow to its Covid vaccine deal. Pfizer is also testing a Lyme disease vaccine.
Novavax It also pointed to lower demand for jabs when it lowered its 2022 revenue forecast. People in rich countries have become more reluctant to get frequent booster shots, while vaccine hesitancy is still a factor in poorer nations.
Health officials are focused on the growing threat Monkey pox. Vaccines are in short supply across Europe, and could run out in the UK this month.
There is another potential danger Polioviruswhich has been found in London’s sewers, prompting the rollout of a vaccine booster to children aged one to nine in the city.
Covid cases and vaccines
Total Global Cases: 581.2 million
Total dose given: 12.4 billion
Get the latest global picture with us Vaccination tracker
Some good news…
Columnist Sarah O’Connor Picks a cheerful nugget from some new official figures. Compared to pre-pandemic times, Britons are spending more time socialising, relaxing and keeping fit, and less time commuting. May continue for a long time.
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