North Sea gas production surges as UK ends Russian energy imports – live updates – The Telegraph

UK short-term borrowing costs have jumped to a post-financial crisis high as traders increase bets on faster Bank of England interest rate rises and a looming recession.
The yield on two year government debt – which is sensitive to interest rate expectations – rose by more than 20 basis points to 2.9pc on Wednesday. This is the highest since the end of 2008, when Lehman Brothers filed for bankruptcy.
Benchmark 10-year borrowing costs also jumped to almost 2.7pc, the highest level since 2014. Cheaper long-term borrowing costs suggest traders expect faster rate rises to trigger a recession.
Expectations of sharper rate increases have grown as forecasts for energy bills continue to climb and expectations grow that the next prime minister will have to do more to help struggling households.
Mark Capleton, a strategist at Bank of America, said: "People’s perceptions of the scale of fiscal support has gone up, which means the total cost of measures to safeguard the population has gone up. There’s a belief that rates will need to rise more to offset that and help keep a lid on inflation."
Investors now believe Threadneedle Street will increase interest rates to well above 4pc in 2023, from a current level of 1.75pc.
Bets on faster rate rises have also pushed up borrowing costs around the world. Yields on German, Italian and French debt also rose on Wednesday, though not as sharply as UK gilts.
Borrowing costs are rising as governments around the world rush to secure energy supplies this winter to avert a crisis.
New figures showed North Sea gas production surged by more than a quarter in six months as the UK stepped up efforts to wean itself off Russian energy imports.
Domestic gas production in the first half of the year was 26pc higher – or 3.5bn cubic metres – than last year, enough to heat almost 3.5m homes for a year, according to Offshore Energies UK.
Higher North Sea output comes as Britain looks to cut ties with the Kremlin’s energy sector and boost its energy security. 
Russian president Vladimir Putin wants to sell gas to Asia to replace lost European trade. The ambition has been dealt a blow after Russia was forced to scrap a cargo due to payment issues.
Sakhalin Energy, the new company set up by the Kremlin to tighten its control over a major liquefied natural gas facility in the country, scrapped a shipment to at least one North Asian customer due to payments issues and delays signing revised contracts.
Moscow seized ownership of the plant earlier this month and customers were asked to commit to new deals and send payments to Russian banks.
Few buyers have signed the revised contracts, which could threaten the flow of gas to markets including Japan and South Korea.
Gas prices fell back from 14-year highs on Wednesday despite reports of a delay in the restart of Freeport LNG’s Texas export terminal.
A fire at the Texas plant in June shut production, which is not expected to resume at full capacity until March 2023.
That’s all from us today, thank you for following! Before you go, have a look at the latest stories from our reporters:
Apple has sent media invitations to a Sept. 7 event, a week earlier than its traditional autumn event.
If Apple follows its pattern of shipping devices about a week and a half after it unveils them, it could add two weeks of iPhone sales to the company’s fiscal fourth quarter.
Analysts expect Apple to introduce a new generation iPhone 14 model on the upcoming event, as well as potentially new versions of the Apple Watch, iPad and Mac computers.
Apple just announced their “Far Out” iPhone 14 event for 9/7! pic.twitter.com/E1o84rN6WN
Commodity and financial stocks have dragged the FTSE 100 lower today on worries about a slowdown in global economic growth.
However, a jump in AVEVA Group on buyout news and a weaker pound helped limit losses on the exporter-heavy index.
The blue-chip index edged down 0.2pc for a third consecutive session of losses, while FTSE 250 reversed an earlier drop to a new five-week low to close flat.
Michael Hewson at CMC Markets said: "What is driving the FTSE 100 down is natural gas prices getting back close to record highs in the UK which is potentially feeding into the negativity in the index.
"People have suddenly realised that there are certain parts of the FTSE 100 that are likely to be fairly negatively affected by shrinking consumer incomes."
Atom Bank has rushed to defend the four-day week by crediting the radical working pattern with an almost four-fold increase in applications for job vacancies. Lucy Burton has more:
The challenger bank, which introduced the policy last November, spoke out after The Telegraph reported concerns about the policy from some of those involved in the world’s biggest four-day week pilot. 
The Durham-based bank said the shorter week has had a significant impact on job applications, with 603 people going for 28 roles in June this year compared to 309 applicants for 52 roles the same month last year.
Read the full story here
Venezuela has hired the global energy giant Siemens Energy to repair power plants as part of a government plan to rebuild a crumbling electricity grid plagued by constant blackouts and a lack of maintenance. 
Siemens signed contracts with the government to work on gas- and diesel-burning generation facilities that serve the capital, Caracas, as well as those that supply electricity to infrastructure used by the oil industry.
The German company was granted licenses by the US Treasury to work with the state-owned Petroleos de Venezuela, which owns the plants, via third parties and with the power utility Corpoelec, according to Siemens’s business manager in the country, Eric Soto.
It marks the rare deal in which an international company is working with President Nicolas Maduro’s government, which is under stiff US economic sanctions. 
EasyJet is shaking up its board amid a fresh wave of flight cancellations that have added to travel disruption this summer.
The airline said three new directors will join the board from the start of September. Former Google top manager Nick Leeder will step down as non-executive director following his move to Singapore, while Andreas Bierwirth and Julie Southern will both not seek re-election after serving a combined 14 years on the board.
The trio of new directors are former Lufthansa executive Harald Eisenacher, logistics veteran Dr Detlef Trefzger and former KLM chief executive Ryanne van der Eijk.
It comes a day after the announcement of last-minute cancellations of 26 easyJet flights to and from Gatwick, coinciding with the airport declaring a return to "business as usual" after summer travel disruption.
Switzerland has set a voluntary gas savings target of 15pc for the winter as Europe faces a potential gas shortage as a consequence of the Ukraine war.
While gas makes up a smaller share of Swiss energy consumption compared with other European countries, three-quarters of annual consumption occurs in the winter months.
Switzerland’s aim is to use 15pc less gas compared with the average consumption over the last five years from October 2022 through to March 2023, the government announced. That corresponds to around 3.6 terrawatt-hours.
The area with the greatest potential for saving energy is through heating, said the government, which plans to reduce building temperatures and turn off computers and devices when they are not immediately needed to set a good example.
That’s all from me today – thanks for following! Giulia Bottaro will take over from here.
Visa and MasterCard have denied price gouging on card fees after MPs challenged the companies to explain a fivefold increase in costs post-Brexit.
Patrick Mulholland reports:
The two companies claimed higher fees were necessary to combat the growing risk of fraud when shopping online and internationally.
The payment networks were responding to an open letter from Mel Stride, chairman of the Treasury Select Committee, calling on them to justify cost increases. 
Both Visa and MasterCard have raised fees on consumer debit and credit card payments from 0.2pc and 0.3pc to 1.15pc and 1.5pc, respectively. 
The sharp rise in so-called interchange fees has come since Britain has left the European Union, which has a cap on charges.
In two separate letters, Visa and MasterCard said interchange fees were needed due to the growing risk of fraud when people make card payments across borders.
Dutch state railway is planning to sell off its British subsidiary after 20 years of ownership as it doubles down on its home market.
Nederlandse Spoorwegen said it plans to transfer the operations of Abellio UK to its British leadership in the second half of this year through a management buyout.
Abellio UK has about 15,000 employees and runs the East Midlands, West Midlands, Greater Anglia and Merseyrail passenger services, as well as more than 50 London bus routes.
It posted an operating profit of €40m (£33.7m) in the first half, including an exceptional gain of €21m.
But the new division, dubbed Transport UK Group, will be forced to contend with strike action that’s gripping the country’s rail network.
The City watchdog is said to be sticking to its plans for flexible working, telling staff they’ll need to be in the office for 40pc of their working days.
While staff at the Financial Conduct Authority must be present for events such as team meetings and performance reviews, they can go into the office for a minimum of two in five days working days across a month.
The rules, which take affect from September 5 and last until until at least the end of next of year, followed a survey of staff on working habits, according to board minutes seen by Financial News.
Senior staff will be encouraged to come in for half of their times, while trials with some teams working completely remotely will continue for the rest of the year.
Rio Tinto has increased its offer to buy out Turquoise Hill Resources to $3.1bn (£2.6bn) as it moves to gain more control of a giant copper mine in Mongolia.
The Anglo-Australian miner said it was offering C$40a share to Turquoise Hill’s minority shareholders – 18pc higher than its previous bid of C$34 that was rejected earlier this month. 
Shares in Turquoise Hill surged 24pc – their biggest intraday increase since March.
Rio Tino is pushing to take control of the giant Oyu Tolgoi copper mine in Mongolia amid a shift towards commodities that are key for the green energy transition.
Rio owns 51pc of Turquoise Hill, which in turn holds a two-thirds share in Oyu Tolgoi.
France’s Schneider Electric is considering a £9bn takeover bid Cambridge-based software company Aveva, writes Matthew Field
The FTSE 100 constituent has been approached by the French conglomerate about delisting from the London Stock Exchange.
Schneider already owns 60pc of Aveva’s shares and said it was “considering a possible offer” for the whole company.  Schneider said the combination would allow Aveva to “executive its growth strategy faster”. 
Aveva develops software for the oil and gas, manufacturing and energy sectors. It has suffered from stagnant revenues in recent years and, prior to news of the potential takeover, its share price had fallen 30pc since the start of 2022.
Shares in Aveva jumped 33pc on news of the takeover talks, giving it an overall valuation of just under £9bn.
Aveva, which employs 6,500 people, began life as the Government-funded Computer Aided Design Centre in 1967 before it was floated in the 1990s.
It merged with Schneider’s software division in 2018, giving the Paris-listed multinational a 60pc stake in the business. The original deal prevented Schneider from increasing its stake beyond 75pc for two years. 
It’s a muted start to trading for Wall Street’s main indices as recent economic data fuelled fears of a slowdown ahead of the Federal Reserve’s annual conference this week.
Investor focus will be on the Jackson Hole symposium which begins tomorrow and remarks from Fed Chair Jerome Powell the day after for clues on whether the central bank can achieve a "soft landing".
The S&P 500 and Nasdaq were little changed at the opening bell, while the Dow Jones slipped 0.1pc.
The luxury group behind brands including Cartier has taken a $2.7bn (£2.3bn) hit after selling a stake in its online retail business YNAP to e-commerce rival Farfetch.
Following months of talks, Farfetch will snap up 47.5pc of YNAP, which includes the Yoox and Net-a-Porter brands. Richemont will retain 49.3pc.
The cut-price sale highlight’s Richemont’s failure to create an industry-wide online retail site for high-end brands.
Chairman Johann Rupert abandoned plans to build a solo luxury e-commerce platform in 2021, opting instead to concentrate on a tie-up between YNAP and Farfetch.
Mike Tholen, sustainability director at industry group Offshore Energies UK, calls for continued investment in the UK energy sector to help the country weather a winter crisis.
While we don’t know what winter will bring for the UK this year, we know that it is coming and, we must be prepared for the worst and hope for the best to support UK energy security.  
UK gas producers have already ramped up domestic supplies by 26pc in the first half of this year compared to the same period last year. The massive increase in our support for the UK’s gas needs can only be sustained by substantial ongoing investment from gas producer companies.  
If we are to continue our efforts to protect UK gas supplies, which remains the backbone of our energy mix for electricity, heating and industrial processes, we need politicians of all parties to support energy produced here in the UK with all the benefits that brings for taxes, energy security and jobs. 
It’s all the more important at a time when we can’t afford to tighten supplies even further, which is what will naturally happen if domestic production of gas isn’t maintained.
UK gas production is up 26% in the first half of 2022, boosting energy security.

New figures from @OEUK_ show an extra 3.5bn cubic metres of gas has been added to UK supplies thanks to new North Sea fields coming online, and fewer planned shutdowns.

👉🏾https://t.co/b4n47nld9S
Former Twitter staff have access to secret software codes months after leaving the business, a whistleblower has told The Telegraph, as the company faces questions over national security.
Gareth Corfield has the exclusive:
Ex-engineer Al Sutton revealed that despite quitting 18 months ago he still retained access to Twitter’s central file store on GitHub, a website used by software developers to store source code.
His account sheds fresh light on claims of poor practices at the social media platform made by another whistleblower.
Mr Sutton, who ran Twitter’s mobile developer experience team until February last year, said: "Not removing folks’ access to systems when you let them go seems, to me, like a basic part of good security."
His revelation comes after a former head of security at Twitter turned whistleblower wrote a 200-page dossier sent to regulators and politicians alleging Twitter’s lax security practices posed a threat to US national security.
​Read Gareth’s full story here
Thames Water is said to be looking to raise at least $150m (£127m) from private debt markets as it comes under pressure to fix leaky pipes and stop sewage pouring into rivers.
London’s water supplier is taking bids from institutional investors this week for a private debt package in a combination of pounds, euros and dollars, Bloomberg reports.
Thames Water is implementing a hosepipe ban from today after the heatwave led to an official drought and the driest July on record.
But it’s come under pressure following revelation it has the worst record on leaks of all nine water companies in the UK. It’s also facing criticism after sewage leaked into a river in Swindon this week.
German commuters are facing more rail delays as the country prioritises deliveries of coal and fuel for power stations in a bid to stave off an energy crisis this winter.
Germany’s efforts to ramp up power generation from coal and oil to replace lower gas supplies from Russia have been derailed by low water levels in the Rhine, which have exacerbated transport problems.
Companies such as Uniper have struggled to secure enough coal to keep power plants fully operational.
Olaf Scholz’s government has now approved a new measure prioritising energy shipments over passenger traffic and other goods on Germany’s rail network.
But the decree, which expires after six months, will add to the misery for passengers already facing delays.
Volker Wissing, Germany’s transport minister, said:
This is not an easy decision because it could mean that in some cases other trains have to wait.
It is all the more important to create clear rules today before the additional need for energy kicks in and transport demand increases in autumn and winter.
US futures struggled for direction this morning as investors analyses the latest comments from the Federal Reserve amid soaring inflation and signs of an economic slowdown.
The latest data showed a slowdown in economic activity in the US and across Europe. Investors will now pore over Fed chair Jerome Powell’s speech at Jackson Hole on Friday for a sense of how hawkish the US central bank will be.
Futures tracking the S&P 500, Dow Jones and Nasdaq were little changed in morning trading.
France has warned it can’t hold on to billion-euro energy price caps to help households cope with soaring inflation forever.
Gas prices in France are currently frozen and the Government had also put in place a cap for power price hikes, but both measures are set to expire this winter.
A spokesman for Macron’s government said: "There may be price increases."
UK supermarkets are phasing out expirations dates on a range of items, letting shoppers judge for themselves instead.
The country’s major chains said the move will save customers money and cut waste, but it’s also a grim sign of how much inflation is starting to hurt.
Asda, Co-op, Morrisons, Waitrose, Tesco and Marks & Spencer have all announced a total or partial scrapping of their "best before" and "use by" dates on certain perishable products.
In some cases, they’re moving to scannable codes that store staff can monitor to get rid of items that have gone off.
There is one bit of good energy news today – UK petrol and diesel prices have fallen for a seventh straight week, marking the longest decline since 2020.
After hitting record highs in July, prices have since eased after a drop in wholesale oil costs. 
For petrol, it’s the longest run of declines since November 2020, while for diesel it’s the most protracted drop since the first Covid lockdown in May of that year.
While declining pump prices offer a sliver of hope for struggling Brits, petrol is still 27pc more expensive than a year ago.
More than 1,600 London bus drivers will strike for a second time over the Bank Holiday weekend after union bosses rejected a pay offer.
The new strike, scheduled for August 28 and August 29, follows an initial walkout at the end of last week.
The Unite union said bus operator RATP had "failed to enter into meaningful negotiations".
“We’ve never seen a cost change like this before,” says Simon Bodsworth, boss of Yorkshire furniture manufacturer Daval, as he braces for a tripling in his energy bills from September.
Bodsworth and many other bosses warn that the energy crisis could be even more destructive than the pandemic for British business as the power vacuum in Number 10 frays nerves.
Tom Rees looks into the energy crisis facing the high street. Read his full story here.
Workers at Heinz will be full of beans today after union bosses secured a pay rise worth around 11pc.
Around 700 UK workers will receive a 5.5pc increase on their base pay, as well as two bonus payments totalling £1,200.
The agreement also includes three additional days off over the Christmas, the Unite union said.
Cineworld investors "will get zero" after the cinema operator said it was filing for bankruptcy in the US.
That’s according to Barry Norris, founder of short seller Argonaut Capital, who said the company’s management used too much debt for acquisitions to build an empire in a "sunset industry".
He told Bloomberg: "The capital structure is completely unsustainable, and that’s why it’s going bust."
Mr Norris added that Cineworld had the chance to raise equity but opted not to.
Argonaut has reportedly shorted Cineworld for four years. Shares in the cinema group dropped as much as 13pc.
Shares in Allied Minds almost halved this morning after the company said it wants to delist from the London Stock Exchange.
The company, which invests in the tech and life sciences sectors, said the costs of maintaining a premium listing on the LSE were now "prohibitively high" relative to its size.
It said the board intends to formally consult with shareholders over a possible delisting.
Shares crashed 45pc, leaving it with a market value of about £25m.
The possible move comes after Allied Minds began a review of its options in March, including a possible sale. It had said that moving onto the junior Aim market was unlikely to create significant savings.
The UK’s largest container ship port has accused unions bosses of acting against the interests of workers, saying many are unhappy at not being able to vote on the company’s latest pay offer.
Felixstowe said Unite was “promoting a national agenda at the expense of many of our employees,” in an escalation of the row between the company and the union.
The port has proposed a deal worth between 8.1pc and 9.6pc this year. But Unite is pushing for a raise of at least 10pc, with industrial action by about 2,000 dockers threatening to extend beyond the eight days currently planned.
A spokesman for the port said: “A lot of our employees feel let down by Unite. Many employees have told us they want to come to work but feel too uncomfortable to do so.”
The Felixstowe strike is upending supply chains across the UK as goods are left unprocessed and undelivered. Dock workers at the Port of Liverpool have also voted to strike.
The average price of a used car sold by Lookers has grown by more than a quarter as a shortage of semiconductors pushed up demand for vehicles.
The dealership group said used car prices rose 27pc in the first half of the year. That drove a £200m – or 17pc – increase in used car revenue even as the number of sales declined.
Meanwhile, there was a jump in the number of people waiting for a car. Lookers said it had 22,000 orders from retail customers at the end of June, compared to 9,000 in June 2021.
But the revenue the company got from new vehicles dropped 5.6pc to £970.2m. The drop was due to the fleet of vehicles that it rents out to companies.
Mark Raban, chief executive of Lookers, said:
Our first half financial performance was very strong, against an exceptional comparative period, despite ongoing inflationary pressure and vehicle supply disruption.
We have also made excellent progress with our strategic priorities. We remain focused on our customers and improving our proposition to ensure the process of buying or leasing a car is as easy and simple as possible, particularly in the current challenging economic environment.
The FTSE 100 has dropped sharply in early trading after a raft of global economic data fuelled fears of a recession.
The blue-chip index fell 0.8pc, losing ground for a third consecutive session.
HSBC was the biggest drag, shedding 1.4pc after Chinese shareholder Ping An defended its call to spin off HSBC’s Asia business.
Rio TintoAnglo American and Glencore were all in the red as miners lost ground. British American Tobacco bucked the trend, gaining 0.7pc in early trading.
The domestically-focused FTSE 250 was down 0.6pc at more than one-month lows.
The owner of Premier Inn has snapped up a property on he Strand in central London for just over £200m as it bets on the post-pandemic recovery.
Whitbread said 5 Strand, located just off Trafalgar Square, will become the latest hotel in its Premier Inn ‘hub’ portfolio. It’s expected to open sometime in 2027, subject to planning.
Alison Brittain, chief executive of Whitbread, said:
I’m delighted that we’ve been able to acquire this iconic location, which is set to become our latest hub by Premier Inn hotel.  It is in a prime position and is perfect for the hub brand which is continuing to perform well.
The purchase reinforces our confidence in the long term potential of the London market, the hub by Premier Inn brand and the growth prospects of our UK business.
Putin’s plans to sell gas to Asia to replace lost exports to Europe have been dealt a blow after it was forced to scrap a cargo due to payment issues.
Sakhalin Energy, the new company set up by the Kremlin to tighten its control over a major liquefied natural gas facility in the company, scrapped a shipment to at least one North Asian customer due to payments issues and delays signing revised contracts, Bloomberg reports.
Moscow seized ownership of the plant earlier this month and customers were asked to commit to new deals and send payments to Russian banks.
Few buyers have signed the revised contracts, which could threaten the flow of gas to markets including Japan and South Korea.
The FTSE 100 has opened lower as mounting energy and inflation troubles fuel fears of a recession.
The blue-chip index fell 0.2pc to 7,475 points.
An emergency plan to shield UK households from soaring energy bills will cost more than £100bn over two years.
That’s according to Keith Anderson, chief executive of energy giant Scottish Power, who has proposed capping household energy bills at around £2,000 a year.
Under his plans, bills would be frozen for two years at the current price cap of £1,971. Suppliers would cover the gap between the cap and wholesale prices by borrowing from a so-called deficit fund arranged by the Government.
This would be paid off by the public either through taxation, spread over bills for the next 10 to 15 years or a combination of the two, the Financial Times reports.
Mr Anderson raised the plans in a meeting with Business Secretary Kwasi Kwarteng last week.
Tory leadership frontrunner Liz Truss has acknowledged that more support with energy bills could be needed, but has railed against "handouts".
Here’s more on the CBI warning from my colleague Szu Ping Chan:
The CBI’s poll of almost 600 businesses also showed that while a third of businesses were trying to avoid passing on higher costs to customers, many had paused investment to cope with the price rises. 
“While helping struggling consumers remains the number one priority, we can’t afford to lose sight of the fact that many viable businesses are under pressure and could easily tip into distress without action," said Matthew Fell, the CBI’s chief policy director.
"Firms aren’t asking for a handout. But they do need autumn to be the moment that the government grips the energy cost crisis. Decisive action now will give firms headroom on cash flow and prevent a short-term crunch becoming a longer-term crisis."
Good morning. 
Britain’s biggest business group has sounded the alarm over the escalating energy crisis, saying thousands of companies could collapse without further support.
The Confederation of British Industry (CBI) urged the government to freeze business rates for another year and take quick and targeted action to prevent otherwise viable businesses from going bust.
The lobby group said two-thirds of businesses were facing a jump in their bills over the next quarter. Of those, a third face increases of more than 30pc.
It also urged the Government to give companies and the self-employed more time to pay their tax bills and provide easier access to pandemic-style loans to shore up their finances.
1) How the energy crisis is already laying waste to the high street  Businesses already on the brink after Covid are now being hammered by a massive surge in their power bills  
2) National Grid warns of three-year energy crisis as emergency effort launched to cut factory power use  Plans drawn up to pay industrial companies to shut down for next three winters
3) Brussels cuts crop production as half of Europe remains under drought warning conditions  Severe heat stress has caused widespread damage to yields across Europe
4) Eurostar says trains will not stop in Kent for ‘two to three years’ as it blames Brexit  Eurostar dashes hopes of a gradual return to services following ‘toughened’ border restrictions
5) Murdoch heir complains about ‘sensational’ language used to ‘humiliate him’  Lachlan Murdoch sues Australian news outlet over ‘abuse of media power’ accusation
Asian stock markets slipped for an eighth straight session this morning.
MSCI’s index of Asian shares outside Japan fell 0.2pc in morning trade, on track for the index’s eight successive daily drop, if sustained. Japan’s Nikkei fell 0.6pc.
S&P 500 futures fell 0.3pc in Asia.
We rely on advertising to help fund our award-winning journalism.
We urge you to turn off your ad blocker for The Telegraph website so that you can continue to access our quality content in the future.
Thank you for your support.
Need help?
Visit our adblocking instructions page.

source

Leave a Reply

Your email address will not be published. Required fields are marked *