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Ukraine Conflict Causing Huge Volatility in Energy Market -OPEC

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The Organisation of the Petroleum Exporting Countries (OPEC) has stated that the ongoing war by Russia in Ukraine was causing huge volatility for the global energy market. Mr Mohammad Barkindo, OPEC Secretary-General, made the assertion while speaking at the virtual 62nd Meeting of the Joint Technical Committee (JTC) on Wednesday.

Barkindo noted that there were implications and possible far-reaching consequences of the ongoing conflict in Ukraine.

He said: “As highlighted at our last meeting, the conflict has compounded the uncertainties related to the pandemic.

“It has heralded in further economic volatility, elevated risk premiums for oil, as well as many other essential commodities, given that both the Russian Federation and Ukraine are key global exporters, including of essential agricultural goods.

 “From the oil market perspective, however, what is clear is that Russia’s oil and other liquids exports of more than seven million barrels per day cannot be made up from elsewhere. The spare capacity just does not exist.”

According to him, its potential loss, through either sanctions or voluntary actions, is clearly rippling through energy markets. “The crises we face are causing huge volatility, with daily price swings of more than $5 per barrel occurring on 13 occasions across March and April,” Barkindo said.

He also recalled that April 2020 was the darkest and most sudden downturn in the history of the oil industry due to the COVID-19 pandemic. Barkindo said April 2020 saw global oil demand drop by more than 20mbpd with industries and businesses shuttered-in and populations locked down.

“None of us will ever forget April 20, 2020. On that day, the price of NYMEX WTI in the futures market plunged by 56 dollars/b to minus-37.6 dollars/b, the first ever drop into negative territory. “The markets were reacting to the situation with an unheralded bearish ferocity.

“It was a visceral moment for us all. I do not think any of us here ever envisaged a moment where sellers were literally paying buyers!

“However, the uncontrolled chaos over the month was also met by a landmark decision from OPEC and non-OPEC countries in the Declaration of Cooperation (DoC) on April 12,” Barkindo said.

He said the move was key to rescuing the industry from the precipice on which it stood, and in turn, assist with the resuscitation of the global economy. Barkindo said what recent events and developments imply was the continuing shift among policymakers to better understanding what was required in the energy transition.

He said: “It is not about moving from one energy to another; it is about utilising all available energies and understanding the energy security dimension of our future to enable the necessary investments.

“This was clearly highlighted last month by U.S. investment bank, JP Morgan in its first annual energy outlook. “It said the world needs to find 1.3 trillion dollars of incremental investment by 2030 to boost all types of energy output and infrastructure from renewables to oil and gas to avoid an energy crunch.

“What we are seeing is a wake-up call to all stakeholders. We need to ensure there is a clear pathway for all energy investments.” Sustained investment in oil is required if we are to expand production and ensure adequate spare capacity, a vital cog in the oil market landscape.” (NAN)

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Senate Demands Compulsory Screening of Foreign Arrivals

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By Eze Okechukwu, Abuja

The Senate yesterday ordered mandatory health screening for every international passenger arriving Nigeria airports, seaports, land borders as Ebola resurfaces in the Democratic Republic of Congo with a scare case reported in the FCT.

The resolution followed an urgent motion by Senator Francis Fadahunsi, who warned that with Lassa fever already ravaging states, Nigeria cannot afford another outbreak.

“Protecting our entry points is far cheaper than managing Ebola,” Fadahunsi told the chamber.

Lawmakers insisted screening must be total and indiscriminate — no exemptions based on nationality or departure country because infected travellers can transit through safe-listed nations.

Senator Diket Plang raised the stakes further, demanding immediate funding for NCDC and Port Health Services, including release of withheld funds and emergency budget.

Senate President Godswill Akpabio said the Federal Government has started releasing Ebola response funds but ordered relevant committees to track every kobo.

“Ascertain whether the funds were released and judiciously utilised. Any outstanding debt must be released by the Finance Ministry without delay,” Akpabio directed.

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Dozens of Gold Prospectors Kill in Strikes on Egypt-Sudan Border

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At least 72 civilians who had been prospecting for gold in a border region of Sudan have been killed in air strikes, a regional rights group said.

Emergency Lawyers, based in the Sudanese capital, Khartoum, said jets targeted the so-called artisanal miners at a popular gold mining site on Saturday.

Neither the Egyptian government nor the de facto Sudanese authorities have so far commented.

Cairo has previously faced accusations of deadly strikes on gold prospectors as part of a crackdown on illicit activity along its southern border.

Emergency Lawyers noted the previous alleged attacks and said they represented not only a violation of Sudan’s sovereign territory but demonstrated the government’s lack of control over the region.

“The deliberate targeting of unarmed civilians violates international humanitarian law and the right to life,” it said in a statement on Sunday. “These acts may constitute war crimes.”

It noted that its death toll was provisional and could rise.

The Paris-based Sudan Tribune reported that the death toll could far exceed the number reported by Emergency Lawyers, citing a survivor of Saturday’s attack who said many more people had been injured.

Eyewitnesses said the attack began around 06:00 local time (04:00 GMT), with the aircraft firing more than five missiles directly at the miners’ camps, destroying them and excavation pits with people still inside, the newspaper wrote.

The Sudan Tribune reported claims in June that Egyptian forces had used drones and artillery to target artisanal mining sites in the same region, killing several, after sporadic incidents of Egyptian border guards of burning equipment, torching temporary shelters, and firing live ammunition to disperse mine workers.

Days later, Egypt’s border agency announced that it and the military had begun a sweeping security campaign along the border to foil illegal migration, drug smuggling and illegal mining.

At the same time, Sudan’s de facto leader announced an investigation into the alleged strikes, which were said to have killed dozens.

Gold lies at the core of the border tensions.

Sudan’s ongoing civil war has led to a surge in artisanal mining – and often risky practice conducted by civilians with rudimentary tools and without official permission – particularly in remote areas near its borders.

Gold-rich areas lie along porous borders in terrain historically associated with cross-border smuggling routes, with artisanally mined gold potentially feeding into those channels.

Egypt’s border force said in June that it had seized 86 tonnes of gold ore along with amateur prospecting equipment.

Artisanal mining has also reportedly continued in Sudan’s conflict zones and smuggled gold may be a source of income for armed insurgent groups.

This has raised concerns of illicit Sudanese gold undermining the legitimate Egyptian gold market.

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German Jets Arrives Italy for Multinational NATO Exercise

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Several German fighter jets will take part in the Northern Atlantic Treaty Organisation (NATO) annual nuclear defence exercise this week as troops from 17 countries take part in the Steadfast Noon drill.

The German Air Force said three Tornado jets will take part in the exercise hosted by Italy, which starts Tuesday and runs for about a week and a half.

The jets are normally stationed in Büchel in the German state of Rhineland-Palatinate.

NATO has not revealed the exercise scenario but said its scale would be comparable to last year’s drill, which involved around 2,000 personnel and more than 70 aircraft.

Last week, NATO’s head of nuclear policy, Nassima Barrows, said the exercise was designed to demonstrate the alliance’s readiness and ability to defend its territory.

No real nuclear weapons will be used, she added.

NATO said the exercise was not linked to current events or directed at any specific country.

Military experts say the drills, held regularly in October, include practising the safe transport of weapons from underground storage facilities to aircraft and mounting them on fighter jets.

Only practice bombs without real nuclear warheads are used during the drills.

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