Sunday, 2 March 2025

Iraq-Turkey pipeline capacity utilization

Turkey wants an Iraq-Turkey oil pipeline to operate at maximum capacity once it resumes flows through Turkey's Ceyhan, Turkish Energy Minister Alparslan Bayraktar was quoted as saying by the state-owned Anadolu news agency on Sunday.

The pipeline was halted by Turkey in March 2023 after the International Chamber of Commerce (ICC) ordered Ankara to pay Baghdad US$1.5 billion in damages for unauthorized exports between 2014 and 2018.

Turkey has said since late 2023 that it is ready to resume operations at the pipeline, carrying oil exports from the semi-autonomous Kurdistan region. Bayraktar told Reuters last month that Ankara had not received confirmation on resuming flows.

On Friday, eight international oil firms operating in Iraq's Kurdistan region said they would not resume oil exports through Turkey's Ceyhan despite an announcement from Baghdad that the restart was imminent.

"This pipeline has been ready for 1.5 years already. We want the Turkey-Iraq pipeline, especially the two pipelines of 650 km from our Silopi to Ceyhan to be used," Bayraktar said.

"We want some of the oil passing through this line to go to the refinery in Kirikkale, and also via ships through Ceyhan, to refineries in Turkey or to different refineries in the world, so that the capacity of the line can be used at the maximum level," he added.

Bayraktar also said a planned trade route project involving Turkey and Iraq, dubbed the Development Road Project, included the construction of a pipeline reaching the Persian Gulf for the Iraqi oil flows to go to global markets via Turkey.

 

Iran: Foreign outfits attempting to destabilize Sistan and Baluchistan province

Iranian Intelligence Minister Esmaeil Khatib said the foreign adversaries are attempting to destabilize the southeastern province of Sistan and Baluchistan by using external elements to fuel insecurity. His remarks came in the wake of a major counterterrorism operation that resulted in the dismantling of a Takfiri terrorist network and the seizure of a significant cache of weapons and explosives.  

Speaking during a visit to the province on Friday, Khatib stressed that Iran’s enemies have historically sought to create unrest within the country.

"From the very beginning of the Islamic Revolution, adversaries have continuously plotted against the Islamic Republic. Today, we see that efforts to incite insecurity are being carried out by foreign-backed agents who have no connection to the people of this region," he said.  

Khatib urged vigilance and national unity in the face of these threats, warning that hostile forces seek to exploit every opportunity to sow discord.

"The enemies will use any means at their disposal to create chaos, but the Iranian people have consistently resisted such conspiracies through awareness and solidarity. Now, more than ever, we must remain alert and prevent external actors from destabilizing our country," he emphasized.  

The intelligence minister reaffirmed the government's commitment to safeguarding security in the southeastern province, calling for enhanced cooperation between the public and local authorities. "Ensuring peace and stability in Sistan and Baluchistan is a top priority. We must not allow our enemies to use this region as a launching pad for their destructive agendas," he stated.  

Khatib reassured that Iran’s intelligence forces are closely monitoring and countering any threats to national security.

"The Ministry of Intelligence will not hesitate to take action against any attempts to undermine stability. We will continue to work relentlessly to protect the nation and uphold peace," he declared.

He also expressed gratitude to the people and officials of Sistan and Baluchistan for their crucial role in maintaining security.  

The counterterrorism operation, conducted on Wednesday, uncovered four warehouses filled with arms and explosives belonging to the terrorist group.

According to local media reports, security personnel confiscated 226 light and heavy weapons, including pistols, Kalashnikov rifles, and Goryunov machine guns.  

 

Saturday, 1 March 2025

Trump still supplying arms to Israel

According to media reports, the US State Department has approved the sale of nearly US$3 billion worth of bombs, demolition kits and other weaponry to Israel. The weapons sales were notified to Congress on Friday afternoon on an emergency basis. 

That process sidestepped a long-standing practice of giving the chairs and ranking members of the House Foreign Affairs and Senate Foreign Relations Committees the opportunity to review the sale and ask for more information before making a formal notification to Congress.

The sales included 35,529 general-purpose bomb bodies for 2,000-pound bombs and 4,000 bunker-busting 2,000-pound bombs made by General Dynamics. While the Pentagon said that deliveries would begin in 2026, it also said “there is a possibility that a portion of this procurement will come from US stock which means immediate delivery for some of the weapons.

A second package, valued at US$675 million, consisted of five thousand 1,000-pound bombs and corresponding kits to help guide the “dumb” bombs. Delivery for this package was estimated to be in 2028. A third notification consisted of US$295 million worth of Caterpillar D9 bulldozers.

Friday’s announcements marked the second time this month the Trump administration has declared an emergency to quickly approve weapons sales to Israel. The Biden administration also utilized emergency authorities to approve the sale of arms to Israel without congressional review.

On Monday, the Trump administration rescinded a Biden-era order that required it to report potential violations of international law involving US-supplied weapons by allies, including Israel. It has eliminated most US humanitarian foreign aid.

Since Israel’s inception, it has received hundreds of billions of dollars in US foreign aid, a level of support that reflects many factors, including a US commitment to Israel’s security and the countries’ shared foreign policy interests in the Middle East.

Israel is a leading buyer of US weapons systems via traditional arms sales. The Council on Foreign Relations (CFR) report found Israel as one of the largest cumulative recipient of US foreign aid since its founding, receiving about US$310 billion in total economic and military assistance.

Nearly all US aid today goes to support Israel’s military, the most advanced in the region. The United States has provisionally agreed via a memorandum of understanding (MoU) to provide Israel with $3.8 billion per year through 2028, as per the CFR report.

The report also highlighted that since the start of Israel’s conflict with Hamas on October 07, 2023, the US has enacted legislation providing at least US$12.5 billion in direct military aid to Israel, which includes US$3.8 billion from a bill in March 2024 and US$8.7 billion from a supplemental appropriations act in April 2024.

 

Pakistan: Suicide attack kills top cleric

The bombing of Darul Uloom Haqqania in KP’s Nowshera district on Friday marks a departure from the recent trend of militants targeting mostly security personnel and government officials. A number of victims lost their lives in the tragedy, including Maulana Hamidul Haq Haqqani, head of the institution, who appeared to be the religious heir of his murdered father, Maulana Samiul Haq.

The latter, along with his involvement in Pakistani politics, was known as the ‘Father of the Taliban’; he had earned the moniker because numerous high-ranking Afghan Taliban leaders had attended his madressah. Media reports have quoted police officials as saying that it was a suicide blast, and that Hamid Haqqani was the apparent target.

While no group has claimed responsibility for the terrorist attack, the Afghan Taliban have insinuated that the self-styled Islamic State may be involved. An Afghan interior ministry official, while condemning the attack, pinned the blame on “enemies of religion”, an apparent reference to IS.

Those familiar with the militancy dynamics of the region also concur that there is a strong possibility that this is IS-K’s handiwork, as the latter had been openly critical of the Haqqania seminary.

There is, of course, no love lost between the Afghan Taliban and IS, but from Pakistan’s point of view, if the attack were indeed traced to IS, it would signal a fresh security challenge in KP.

Already the province, as well as parts of Baluchistan, are witnessing frequent terrorist activity believed to be carried out by the banned TTP and affiliated groups. IS is an equally — if not more — ferocious entity, with global pretensions and a mediaeval, sectarian outlook.

What adds further credence to the belief that IS may be involved is that the group, and those adhering to its ideological narrative, view clerics who endorse democracy in any form with disdain. The late Haqqania head, as well as his father, were active in politics, along with their religious activities.

It is also a possibility that the Haqqanis’ strong links with the Afghan Taliban could have made them prime targets for rival militants. Only a thorough probe can establish the facts, while fresh IS activity in the country should be cause for considerable concern.

Nevertheless, the attack also offers an opportunity for Islamabad and Kabul to work together against a common, and highly dangerous foe.

Courtesy: Dawn

 

 

Why no oil pipeline after Trans Mountain?

The Canadian energy sector has proposed several major oil pipeline projects in the last decade, but only the Trans Mountain expansion project was completed.

There are three other pipelines that never came to be:

Energy East

A proposed C$15.7 billion project (US$11.0 billion), Energy East would have carried oil cross-country from Alberta to the Atlantic province of New Brunswick. It was cancelled in 2017 by TC Energy in the face of regulatory hurdles and opposition from environmental groups, particularly in Quebec.

Northern Gateway

This pipeline was proposed by Enbridge in 2006 to carry oil from Alberta to British Columbia's northwest coast. The C$7.9 billion project (US$5.5 billion) faced opposition from local and Indigenous communities who feared the risk of a marine spill. The project died in 2016 after Prime Minister Justin Trudeau's government cancelled its permits.

Keystone XL

This proposed TC Energy project would have carried oil from the oilsands of northern Alberta to the major US crude storage hub at Cushing, Oklahoma and then on to US Gulf Coast refineries. The project was rejected on environmental grounds by former US President Barack Obama's administration, then revived during President Donald Trump's first administration. Former President Joe Biden revoked the pipeline's permit on his first day in office in 2021.

TC Energy spun off its oil pipeline business in October last year into a new company named South Bow Energy. Trump said on Monday he wanted the pipeline built, but South Bow said it had moved on.

TC Energy has sought to recover more than US$15 billion from the US government for cancellation of the project

 

Friday, 28 February 2025

Five Takeaways from Trump-Vance-Zelensky meeting

An astonishing scene played out in the Oval Office on Friday as President Trump and Vice President Vance got into a shouting match with Ukrainian President Volodymyr Zelensky, reports The Hill.

Amid angry crosstalk, Trump told Zelensky “without us, you don’t have any cards” and “you’re gambling with World War III.” Vance, for his part, accused Zelensky of being “disrespectful.”

Zelensky had taken issue with Trump’s depiction of him as having so much “hatred” for Russian President Vladimir Putin that it made it hard to end the conflict.

The Ukrainian president also pushed back on Vance’s suggestion that diplomacy could end the war — insisting that his nation had previously adopted that approach after Russia annexed Crimea in 2014, only for Putin to launch a full-scale invasion in 2022.

The clash derailed the proposed signing of a deal granting the United States some rights over Ukraine’s mineral deposits. A news conference between Trump and Zelensky that had been scheduled was abruptly canceled, and Zelensky left the White House without further comment.

Here are five big takeaways:

A row heard around the world

It’s hard to exaggerate the seismic shock created by the squabble in the Oval Office.

The political world, in the US and internationally, was instantly aflame over what had taken place. On cable news, usually loquacious anchors were left struggling for words.

It’s been years, if ever, since such a spectacle was seen on public display at the White House.

Inevitably, the shock spurred fevered speculation. One big question was whether Trump and Vance had intentionally provoked Zelensky, whom Trump recently dubbed a “dictator,” into a confrontation.

The other was whether the Ukrainian leader had reacted too intemperately in the moment, to the detriment of his national interests.

Certainly, Trump’s initial comments about Zelensky’s “hatred” for Putin carried a disparaging tone that it is hard to imagine being expressed toward any other US ally who was trying to repel an invasion. 

Likewise, Vance’s role will be closely dissected, especially his reference to Zelensky being “disrespectful” and his demands that the Ukrainian president say “thank you” for US aid.

But Zelensky’s volleys back made it clear he was not going to adopt the mollifying tone used by the week’s other high-profile visitors to the White House, French President Emmanuel Macron and British Prime Minister Keir Starmer.

The White House has seemed to celebrate the encounter.

Meanwhile, a photo posted by CNN’s Kaitlan Collins of the Ukrainian ambassador to the US with her head in her hands during the encounter told its own story.

Now what?

The big question is where things go from here.

The minerals deal was presented, at least in some quarters, as a way to reimburse the US for future assistance to Ukraine, but Trump had been conspicuously vague on the key point of whether Washington would offer firm security guarantees in return.

Now, with that deal presumably shelved for the foreseeable future, nobody honestly knows what happens.

Zelensky could lean more heavily on Europe for both military and diplomatic support. Macron and Starmer have far more pro-Ukrainian viewpoints than does Trump. 

Italian Prime Minister Giorgia Meloni, who has more of a Trump-like worldview, called on Friday for an immediate summit between the US and European nations to discuss Ukraine.

If the spigot of US aid is to be choked off and a piqued Trump is now fully embittered against Zelensky, the future looks bleak from a Ukrainian perspective.

It’s also worth noting that neither the US nor its European allies are willing to put boots on the ground during the war itself, for fear of being drawn into their own war with Russia

The suggestion so far is that the Europeans might help shore up a peace agreement — if one is reached.

Democrats, Trump critics blast Trump for helping Putin

Prominent Democrats blasted Trump and Vance for how they conducted the meeting with Zelensky, and some other Trump foes joined in.

Senate Minority Leader Chuck Schumer on social media accused Trump and Vance of “doing Putin’s dirty work” and pledged that “Senate Democrats will never stop fighting for freedom and democracy.”

Sen. Elizabeth Warren contended that it was “shameful and dangerous” for Trump to engage, as she saw it, in “treating the destruction of a democracy as a political show — throwing Ukraine to the wolves and doing a favor for Putin.” 

Meanwhile, former Republican congresswoman and leading Trump critic Liz Cheney said on social media that Trump and Vance had “attacked Zelenskyy and pressured him to surrender the freedom of his people to the KGB war criminal who invaded Ukraine.”

Cheney added, “History will remember this day— when an American President and Vice President abandoned all we stand for.”

Trump loyalists wear such disapproval as a badge of honor, of course. But there is no mistaking how deep the dismay runs on the other side.

Republicans counter that Trump stood up for American interests

GOP voices rushed to acclaim Trump — and often bash Zelensky — for the way the Oval Office drama went down.

Broadly, the chorus of Republican approval viewed Trump as standing up for American interests and cast Zelensky as an ingrate.

Treasury Secretary Scott Bessent told Bloomberg that the Ukrainian president “chose to let things go into a downward spiral on worldwide television.”

Sen. Lindsey Graham said he had “never been more proud” of Trump and blamed Zelensky for a “disrespectful” display.

“I don’t know if we can ever do business with Zelensky again,” Graham said.

Sen. Bill Hagerty, alluding to the contrast with the Biden presidency, wrote on social media, “The United States of America will no longer be taken for granted. The contrast between the last four years and now could not be clearer. Thank you, Mr. President.” 

The White House Office of Communications collated many such responses and sent them out in an email with the subject line, “Support Pours in for President Trump, VP Vance’s America First Strength.”

Happiest of all: Russia

For all the delight expressed by some of Trump’s domestic allies, the real gloating seemed to come from Moscow.

Putin ally Dmitry Medvedev, who served as Russia’s president more than a decade ago, celebrated on social media that “the insolent pig finally got a proper slap down in the Oval Office.”

Medvedev also endorsed Trump’s view that Zelensky was gambling with World War Three. 

The Associated Press (AP) quoted a Russian lawmaker, Andrei Klishas, as describing the outcome of the meeting as “a brilliant result.”

Klishas, per the AP, wrote on Telegram that Zelensky had “played his role of a ‘president’ poorly in the White House and was thrown out for bad behavior and disrespect towards the US.”

Whatever Trump’s intentions, the current picture could hardly look rosier from the Kremlin’s perspective. 

Russia has been advancing on the battlefield, Ukraine is now starkly at odds with its chief benefactor and it’s not at all clear Trump will press Putin for major concessions in any peace deal.

 

PSX remains volatile throughout the week

Pakistan Stock Exchange (PSX) remained volatile throughout the week, with the KSE-100 index closing at 113,252 points, up 0.4%WoW on Friday February 28, 2025.

The week started on a positive note, buoyed by initiation of talks for up to US$1.5 billion climate financing from IMF, government proposals for energy tariff cuts and resolving circular debt, and strong corporate results, particularly from banking and cement sector.

However, the momentum faded during the latter half of the week due to absence of fresh triggers.

On the climate financing front, authorities are discussing the implementation of carbon levy, meanwhile, IMF has objected the exemption of sales tax on local EV component sales.

On the macro front, Pakistan signed several accords and committed to boosting bilateral trade with Azerbaijan and Uzbekistan during the Prime Minister's visits to respective countries and signed agreements with UAE during the visit of Abu Dhabi’s Crown Prince.

Inflation is expected to ease further to a nine-year low of 1.9%YoY in February 2025, driven primarily by falling food and energy tariffs.

On the external front, foreign exchange reserves held by State Bank of Pakistan (SBP) rose by US$21 million to US$11.2 billion.

Domestic currency depreciated by 0.04%WoW to close at PKR279.67/US$.

Market participation also remained subdued during the week, with average daily traded volume falling by 17%WoW to 492 million shares, from 593 million shares a week ago.

Other major news flow during the week included: 1) GoP collected PKR23 billion from 16 banks against windfall tax, 2) Pakistan, Vietnam set US$3 billion annual trade target, 3) SBP invites bids for PKR200 billion PFL buyback auction, 4) Pakistan, Iran agree to boost bilateral trade to US$10 billion, and 5) Petroleum Division proposes PKR392.5 billion PSDP for in-house projects.

Glass & Ceramics, Real Estate Investment Trust, and Commercial Banks were amongst the top performing sectors, while Jute, Property, & Leasing Companies were the laggards.

Major selling was recorded by Individuals and Foreigners with an aggregate net sell of US$24.5 million. Mutual Funds absorbed most of the selling with a net buy of US$31.6 million.

Top selling scrips of the week were: TGL, PKGP, MLCF, NATF, and AGP, while laggards included: MEHT, NCPL, BIPL, SEARL, and AKBL.

According to AKD Securities, market outlook remains positive, with upcoming meeting of Monetary Policy Committee (MPC) meeting scheduled for March 10, 2025, and any developments on IMF review remaining in the investor’s focus.

Over the medium term, the KSE-100 is anticipated to remain on upward trajectory, primarily driven by strong earnings in Fertilizers, sustained ROEs in Banks, and improving cash flows of E&Ps and OMCs, benefiting from falling interest rates and economic stability.

Top picks includes, OGDC, PPL, MEBL, MCB, HBL, FFC, ENGROH, PSO, LUCK, FCCL, ILP, INDU, and SYS.