Russia: Gazprom boosts oil trade

Russian gas giant Gazprom fresh from an annual loss of US$7 billion, has increased its activity in the oil business to offset weaker natural gas trade over the past year, reports Reuters.

Kremlin-owned Gazprom has suffered from the loss of the European gas market, once the source of around two-thirds of its gas revenue, due to a deep rift between Russia and the West over the conflict in Ukraine.

It also cut natural gas production by 13% to an all-time annual low of 359 billion cubic meters (bcm) in 2023 from 412.94 bcm in 2022.

Gazprom's oil arm, Gazprom Neft has fared better than the parent company thanks to the flourishing oil business.

Now Gazprom Group, via its Gazprom Export division, is trying to raise its exposure to the oil business and increased handling of Asia-bound ESPO oil grade as well as Siberian Light oil exports.

Russian oil exports have been a stable profit maker for Moscow during the past two years despite Western sanctions, as Russia was able to diver to India and China.

Gazprom Export, which was a minor oil exporter prior to 2022, has boosted oil exports in the second half of 2023 and plans to increase shipments even more in 2024.

Gazprom's oil pipeline exports have doubled in 2023 and are expected to double again in 2024.

Russia's Pacific port of Kozmino is a key outlet for Gazprom's crude exports. ESPO Blend oil exports provide one of the best revenues for Russian oil producers compared to other routes thanks to premium quality of the grade and proximity to main customers in Asia.

Gazprom's oil loadings from Kozmino have jumped from between 30,000 metric tons and 50,000 tons per month last year to around two to three 100,000-ton vessels per month this year. These volumes are supplied in addition to the exports of Gazprom Neft, which is also an ESPO Blend oil exporter.

In May 2024, Gazprom also loaded 80,000 tons of Siberian Light grade from Novorossiisk and the company plans to continue diversifying its oil supply.

In May, the company started production at the Urengoysky oilfield that is expected to produce 1.5 million tons of condensate per year.

 

 

US aircraft carrier arrives in South Korea

A nuclear-powered US aircraft carrier, the Theodore Roosevelt, arrived in South Korea's port city of Busan on Saturday for joint military exercises this month with the host nation and Japan, reports Reuters.

The visit comes seven months after a South Korea trip by another US aircraft carrier, the Carl Vinson, in a show of extended deterrence against the North's nuclear and missile programs.

The leaders of the three nations agreed at a Camp David summit in August 2023 to hold annual military training drills as they condemned China's "dangerous and aggressive behaviour" in the disputed waterway of the South China Sea.

Russian President Vladimir Putin visited North Korea this week for the first time in 24 years and signed a deal with leader Kim Jong Un that included a mutual defence pledge.

It was one of Russia's most significant moves in Asia for years, which Kim described as amounting to an alliance.

 

Hezbollah fighters ready to join war, Nasrallah

Hezbollah Secretary General Seyyed Hassan Nasrallah has played down Israel’s threats of waging a full-scale war against the Lebanese resistance group.

Speaking at a ceremony to commemorate senior Hezbollah commander Taleb Abdullah as well as three other resistance fighters who were martyred in an Israeli airstrike in Lebanon over a week ago, Hezbollah leader said Israel can only talk about waging such a war but is incapable of conducting it.

Nasrallah added that Hezbollah does not want a total war with Israel but issued a warning in the face of such a scenario. 

He said Israel must prepare for attacks from the ground, air and sea, and that the situation in the Mediterranean will change completely if it decides to get engaged in a full-blown conflict with Lebanon. 

The Hezbollah chief warned that no place in Israel would be spared from the resistance group’s weapons in case of a direct war. He said Hezbollah would fight with “no rules” and “no ceilings”.

 He noted that the resistance group carries out attacks against the regime to support Palestinians in the Gaza Strip. 

“We will continue to support Gaza and we are ready for anything. We are not afraid. Our demand is clear “A complete and permanent ceasefire in Gaza.”

Hezbollah and Israel have been trading fire since October 08, 2023 the day after Israel declared war on Gaza following a surprise military operation conducted by Hamas in southern Israel. 

Hezbollah reiterated that it won’t stop its attacks against Israel unless the regime ends the war of genocide on Gaza which has so far claimed the lives of some 37,400 Palestinians. 

Israel has repeatedly warned that it will go to direct war with Hezbollah if it continues attacks against the regime. 

The latest of such threats were made by Israeli Foreign Minister Israel Katz.

“We are getting very close to the moment of deciding to change the rules of the game against Hezbollah and Lebanon. In an all-out war, Hezbollah will be destroyed, and Lebanon severely beaten,” Katz claimed on X on Tuesday. 

His threat came after Hezbollah released footage showing its reconnaissance drones flying over sensitive Israeli sites in areas such as Haifa port. 

Hezbollah said the drones bypassed Israeli air defenses and returned to Lebanese airspace without being detected.

The footage captured by the Hezbollah drones stole the limelight at major news outlets. 

Analysts have said the move has exposed Israel’s vulnerability and humiliated the regime. 

Further in his remarks, Nasrallah said the footage is just a short and selected excerpt from long hours of recorded videos captured above Haifa. 

The Hezbollah leader added that Israeli leaders are not willing to admit the magnitude of the military and economic damage they have received at the hands of Hezbollah resistance fighters.

Nasrallah also said the number of Hezbollah operatives who are ready to join the war has exceeded 100,000.

The Hezbollah chief also threw a spotlight on Israel’s failure to achieve its military goals in Gaza. 

Israel claims to be the strongest army in West Asia but has failed to defeat Hamas, he said. 

Since declaring war on Gaza on October 07, 2023 Prime Minister Benjamin Netanyahu has vowed to achieve “total victory” over Hamas and “destroy” the resistance group.

Netanyahu’s dreams have so far remained elusive as Hamas has put up resistance against Israeli forces and dealt severe blows to the regime in the Gaza battlefield.    

 

LNG vessel begins journey through Red Sea

According to Reuters, a liquefied natural gas (LNG) vessel has commenced journey through the Red Sea after crossing the Bab al-Mandab Strait this week, a rare occurrence for LNG shipments following attacks by Yemeni Houthis on ships in the area.

The Asya Energy vessel passed by Yemen through the Bab al-Mandab Strait on June 18, shiptracking data from LSEG and Kpler showed, the same week as a second ship believed to have been hit by Yemen's Houthi militants sunk.

"Asya Energy is the first LNG tanker to sail through the Bab el Mandeb strait since January this year when LNG voyages through the Red Sea were suspended amid repeated rocket attacks," said LSEG analyst Olumide Ajayi, adding that data showed that the ship is carrying cargo.

Most LNG tankers have avoided taking this route after Houthis launched repeated drone and missile strikes in the Red Sea region. They describe their attacks, which have since expanded to other busy waterways, as acts of solidarity with Palestinians in Israel's war in Gaza.

The Red Sea is linked to the Mediterranean by the Suez Canal, creating the shortest shipping route between Europe and Asia, and is connected to the Gulf of Aden by the Bab-el-Mandeb strait between Yemen and Djibouti.

Palau-flagged Asya Energy is heading for Gibraltar, according to Kpler data. It previously called at the Sohar port in Oman, LSEG data showed. It was not immediately clear who is chartering the ship.

Nur Global Shipping manages the ship which is owned by Lule One Services, data on Equasis showed.

Nur Global Shipping did not immediately respond to a request for comment when contacted on LinkedIn.

Reuters could not find contact information for Lule One Services.

The Asya Energy vessel may soon become the first vessel to sail through the Red Sea passage since January 12, 2024 after waiting around the coast of Oman since mid-January, said Ana Subasic, natural gas and LNG analyst at data and analytics firm Kpler.

"At present, AIS (automatic identification system) signal feed to our platform shows the ballast vessel has set a course towards the Gibraltar checkpoint - although I would take this with a grain of salt, it is too early to be making an accurate prediction," she said.

"We are keeping a very close eye on it and waiting for more ad-hoc raw signals or market sources to feed in."

Leading industry groups have called for urgent action to be taken in the Red Sea to stop attacks on merchant shipping by Houthis.

The UK-owned Rubymar was the first ship sunk by the Houthis. It went down on March 02, about two weeks after being struck by missiles.

 

New NATO Chief

Iohannis formally exited the race on Thursday when he told his security council that they should back Rutte for the top job in NATO.

Romania is the only country in the 32-member Western security alliance that has yet to approve of Rutte for the job, and with Iohannis gone, the Dutch leader appears set to assume the role.

“It took a very long time," Rutte told reporters on Thursday, according to The Associated Press. "It’s a complicated process, but it’s an honor that it appears to have happened."

Hungary had been a holdout, but Hungarian Prime Minister Viktor Orban indicated earlier this week that he would support Rutte. That came after Rutte signaled he would not pressure Budapest to back new support for Ukraine amid its war with Russia.

NATO Secretary-General Jens Stoltenberg has been the familiar chief of the alliance for the past decade. His term has been extended four times, but his current term ends in October. 

Rutte will be taking over the alliance as NATO supports Ukraine in the fight against Russia, the largest land war on Europe since World War II, and as allies seek to increase defense spending.

And former President Trump, the presumptive 2024 GOP Republican nominee, has threatened to not defend allies who don't pay enough, spurring fears across Europe. 

NATO spokesperson Oana Lungescu said in a statement on social media platform X that Rutte "is one of the few European politicians to have developed a good working relationship not just with Biden, but also with Trump."

"That could prove a key asset for NATO," Lungescu wrote.

The Russian threat has increased NATO defense spending. Stoltenberg announced earlier this week that in 2024, a record 23 allies, including the Netherlands for the first time, will meet the minimum requirement of 2% of economic output spending on defense.

Rutte, who has spent more than a dozen years as the prime minister of the Netherlands, will bring a wealth of experience to the job.

He has dealt with multiple coalitions as the Dutch prime minister, possesses extensive foreign policy experience and was known as "Teflon Mark" because political scandals did not stick to him.

Since Russia invaded Ukraine in 2022, the Netherlands has also full-fledged support for Kyiv, including some $3 billion pledged for this year.

It's not clear when Rutte will be formally accepted into the job, but NATO can hold a meeting or approve him at a July summit in Washington.

 

Canada declares IRGC a terrorist group

Canada has listed Iranian Islamic Revolutionary Guard Corps (IRGC) as a terrorist organization, after years of pressure from opposition legislators and some members of the Iranian diaspora.

Announcing the decision on Wednesday, Public Safety Minister Dominic LeBlanc called it a “significant tool in fighting global terrorism”.

The move will mean that thousands of senior Iranian government officials, including top IRGC officials, will be barred from entering Canada.

The IRGC is a major military, political and economic force in Iran, with close ties to the Supreme Leader, Ayatollah Ali Khamenei.

It is estimated to have more than 190,000 active personnel with its own ground forces, navy and air force that oversee Iran’s strategic weapons.

The IRGC exerts influence elsewhere in the Middle East by providing money, weapons, technology, training and advice to allied governments and armed groups through its shadowy overseas operations arm, the Quds (Jerusalem) Force, according to the government.

The Quds Force was already listed as a terrorist group by Canada, but Wednesday’s announcement extends the designation to the entire IRGC.

Speaking to reporters, LeBlanc said the action “sends a strong message that Canada will use all of the tools at its disposal to combat the terrorist entity of the IRGC".

“The Iranian regime has consistently displayed disregard for human rights, both inside and outside of Iran as well as a willingness to destabilize the international rules-based order,” he said.

After this designation, current and former senior Iranian government officials already in Canada may also now be investigated and removed.
Canada's foreign affairs minister, Melanie Joly, warned that Canadians in Iran could be at risk of arbitrary detention following the announcement. “My message is clear for those who are in Iran right now, it’s time to come back home,” she said. “And for those who are planning to go to Iran, don’t go.”

The Canadian government under the leadership of Prime Minister Justin Trudeau had previously declined to extend the terrorism designation to the IRGC, despite pressure from some diaspora members — including the families of those who died after Flight PS752 was shot down by the IRGC in January 2020 in Tehran.

All 175 passengers onboard the plane were killed, including 55 Canadian citizens and 30 permanent residents of Canada.

Tehran had claimed that the missile strike on the plane was done by mistake.

Trudeau had previously said in 2022 that he feared a terrorism designation would unfairly target Iranians in Canada who opposed the regime and fled, but had to serve in the IRGC in the past.
Asked why now by reporters, LeBlanc said the decision to designate a group as a terrorist entity is a “deliberative process” made on advice of security services and with foreign policy considerations.

“It is a threshold that must be met under the criminal code of Canada,” he said.

The move makes Canada the second country in North America after the US to label the IRGC as a terrorist organization, which did so in 2019. The UK had previously indicated its intent to make a similar move as recently as 2023, but has yet to do so. 

South Africa: Ramaphosa sworn in second time

South Africa's Cyril Ramaphosa has been sworn in for a second full term in office as president, despite failing to secure a majority in parliament in last month's election for his African National Congress (ANC).

Lawmakers re-elected him as president last week following a deal between the ANC, its long-time rival Democratic Alliance (DA) and other parties to form a coalition government.

The ANC, which has governed since the end of apartheid in 1994, lost its majority for the first time after the May 29 election produced no outright winner.

Many dignitaries, including several African heads of states, are attending the ceremony.

The oath of office was administered by Chief Justice Raymond Zondo.

After Ramaphosa took the oath, a band played the national anthem followed by a 21-gun salute and a fly-past by army helicopters, before he made his inaugural address.

The uMkhonto weSizwe (MK) party formed six months ago by former President Jacob Zuma says its officials will not participate in the “farcical” inauguration.

The party, which won 15% of votes and obtained 58 parliamentary seats, also boycotted parliament’s first sitting last Friday.

Ramaphosa has kept the presidency even though the ANC vote fell by 17 percentage points and it lost 70 seats in parliament.

He did this through a power-sharing arrangement with the pro-business DA, a historic rival, and other parties.

The ANC got 40% of the vote, while the DA came second with 22%.

The coalition is a move to the political centre because the ANC’s left-wing and populist breakaway parties rejected the invitation to join a national unity government.

Ramaphosa is expected to appoint a cabinet in the coming days, which is to include his new coalition partners – the DA and three other smaller parties. Together, the coalition accounts for 68% of seats in parliament.

The president is also expected to set out an agenda to rescue the flailing economy.

Under his rule, the economic performance has continued to suffer amid power cuts, rising crime and unemployment.

Ramaphosa first became president in 2018 when his predecessor, Zuma, was forced to resign because of corruption allegations - which he denied.