Business

LONDON — European gas prices soared to a new record high at the close of trading on Friday after Russia's Gazprom announced that the Nord Stream pipeline would be closed for maintenance at the end of the month.

The Dutch TTF Gas Futures contract jumped to a closing high of 257.40 euros ($258.30) amid fears of winter energy shortages after Gazprom said deliveries via the Nord Stream pipeline would be halted for three days.

Russian gas deliveries to Europe through the Nord Stream pipeline will cease from August 31 to September 2 for "maintenance", Russian energy giant Gazprom said on Friday, raising the prospect of energy shortages in Europe.

"It is necessary to carry out maintenance every 1,000 hours" of operation, Gazprom said in a statement.

"On August 31, 2022, the only Trent 60 gas compression unit will be stopped for three days for maintenance" involving technicians from Germany's Siemens, Gazprom said. 

As a result, "gas transportation through the Nord Stream pipeline will be suspended for three days".

At the end of this period, deliveries will be restored to a flow of 33 million cubic metres of gas per day, Gazprom said. 

News of the decision could revive fears of shortages in Europe.

Since Western countries imposed sanctions on Moscow after it launched its offensive against Ukraine, Moscow has repeatedly cut gas deliveries to Europe, which is heavily dependent on Russian supplies.

NEW YORK — Allen Weisselberg, the long-time chief financial officer of the Trump Organisation, pleaded guilty on Thursday to tax fraud and agreed to testify at an upcoming criminal trial of the former US president's real estate company.

The 75-year-old Weisselberg, who served as CFO of the Trump Organisation from 2005 to 2021, pleaded guilty to 15 counts of tax fraud, Manhattan District Attorney Alvin Bragg said in a statement.

Weisselberg admitted involvement in a 15-year scheme with co-defendant the Trump Organisation to defraud federal, New York State and New York City tax authorities, Bragg said.

Weisselberg is to serve five months in prison contingent on his testifying truthfully at the October criminal trial of the Trump Organisation on tax fraud charges, Bragg said.

Weisselberg has steadfastly refused to deliver testimony against Donald Trump personally. The 76-year-old Trump served as president and owner of the Trump Organisation until 2017, when he entered the White House.

But the former Trump Organisation executive could face additional prison time in the case of failing to testify at the criminal trial of the real estate company.

Jury selection in the Trump Organisation trial on tax fraud charges is scheduled to begin October 24, Bragg said. 

In the plea agreement, Weisselberg admitted evading payment of taxes due on $1.76 million in unreported income and will be required to repay nearly $2 million in taxes, penalties and interest.

"Today Allen Weisselberg admitted in court that he used his position at the Trump Organisation to bilk taxpayers and enrich himself," Bragg said.

"Weisselberg had the Trump Organisation provide him with a rent-free apartment, expensive cars, private school tuition for his grandchildren and new furniture — all without paying required taxes," he said.

"This plea agreement directly implicates the Trump Organisation in a wide range of criminal activity and requires Weisselberg to provide invaluable testimony in the upcoming trial against the corporation," he said. "We look forward to proving our case in court against the Trump Organisation."

Legal battles 

Trump's business practices are the subject of a separate probe by New York Attorney General Letitia James and the former president was questioned for more than four hours last week in connection with that investigation.

According to US press reports, Trump, who is weighing another White House run in 2024, invoked his legal right not to answer questions more than 400 times during his deposition with James.

James suspects the Trump Organisation fraudulently overstated the value of real estate properties when applying for bank loans, while understating them with tax authorities to pay less in taxes.

The New York cases are among myriad legal battles facing the former president.

FBI agents searched his palatial Mar-a-Lago residence in Florida on August 8 and seized documents marked "Top Secret", "Secret" and "Confidential".

The search warrant for the raid, which was personally approved by Attorney General Merrick Garland, directed the FBI to seize documents and records "illegally possessed" in violation of three criminal statutes, including one falling under the Espionage Act, which makes it a crime to illegally obtain or retain national security information.

Trump vehemently denounced the FBI raid on his home as a "witch hunt" and claimed that all of the material confiscated during the search had been previously "de-classified".

Trump is also facing legal scrutiny for his efforts to overturn the results of the November 2020 election and the January 6, 2021 attack on the US Capitol by his supporters.

YANGON — Dozens of people queue under monsoon drizzle for subsidised cooking oil in Myanmar's commercial hub Yangon, waiting for one of the many commodities that have become scarce as economic misery strikes the city.

The country's economy tanked following a military coup last year and has been further rattled by the junta's attempts to seize foreign exchange as well as erratic rules governing businesses and imports.

Living standards are being hammered by global commodity price spikes sparked by Russia's invasion of Ukraine, leaving many struggling to get by and relying on subsidies or charity to put food on the table.

"People can't spend much of their income on food because of higher commodity prices," said 55-year-old housewife Khin Khin Than as she waited to fill her plastic bottle with oil sold by a local association.

The market price for roughly 1.6 kilogrammes of oil has rocketed to 9,000 kyat ($4.25) from 5,000 kyat, she said. 

"If only one person is working, a family won't have much money left for food."

In July, the World Bank said about 40 per cent of the population was living under the national poverty line.

Consumer Price Index inflation hit 17.3 per cent year-on-year in March, it added.

The price of rice has also shot up thanks to increased transport costs and as the military and anti-junta fighters turn swathes of the country into battlegrounds.

Even the state-backed Global New Light of Myanmar newspaper carries almost daily reports on the rising cost of rice, eggs, vegetables, bus travel and rent.

Last week, the price of a litre of diesel jumped by around 6 US cents overnight, state media reported, to a high of 2,440 kyat ($1.15) per litre.

On the day before last year's coup, customers in Yangon were paying 695 kyat at the pump in Yangon according to industry figures.

This week the junta announced it had formed a steering committee to purchase fuel from ally Russia, but gave no details on when or how this would begin.

Many people are relying on charity to make ends meet.

"If we cook at home, there is no electricity, rice is expensive to buy," said Lay Lay, 68, one of hundreds queuing at a monastery for a free meal of curry and rice.

"Cooking costs are too high for someone who is retired."

Ashin Ottamasiri, who supervises the distribution, said his monastery is giving out coupons to 500 people every day for food the monks cook using ingredients donated to them.

"But some days there are more than 600 people," he said. "If we run out of rice and curry, we give cakes, snacks and fruits."

"I can't give shelter for many people but I can share food so people will have meals like I do."

NEW YORK — European and US stocks mostly fell on Friday, with investors focused firmly on central bank interest rate hikes as the US dollar rallied.

After slumping through the first half of 2022 amid concerns over central bank tightening, stocks have done better since the end of June as investors bet on a pivot by the Federal Reserve (Fed) some time in the near future.

But there is considerable uncertainty about when such a shift will happen, as Fed officials have consistently repeated the message that they are not done with rate hikes as they battle to douse red-hot inflation.

"Stocks will most likely struggle for direction for the rest of the summer as Wall Street is still uncertain with how aggressive the Fed will be in September," said OANDA trading platform analyst Edward Moya.

In Europe, London's blue-chip FTSE-100 index just barely managed to stay in the green, but Paris and Frankfurt tumbled around 1 per cent.

Wall Street's three main indices closed lower, with the tech-heavy Nasdaq Composite slumping 2 per cent.

The losses in New York resulted in the S&P 500's first weekly decline after four straight weeks of gains.

Patrick O'Hare, analyst at Briefing.com, said the recent rally has been driven by the market "embracing a belief that the Fed won't have to get overly restrictive with its monetary policy before ultimately shifting to an easing stance".

The gains have come in the face of several problems that have caused unease on trading floors, including China-US tensions, the Ukraine war, supply chain snarls and extreme weather across much of the northern hemisphere.

Data this week showing British inflation had jumped into the double digits, as well as German producer price inflation surging to 37 per cent on higher energy costs, also dampened hopes for a shift in monetary policy away from aggressive tightening.

"It just reminds people that central banks' policies have to be hawkish still," said Karl Haeling of LBBW. "It was really the inflation data both out of the UK and Germany that really gave everything the bearish push."

The dollar meanwhile rose sharply against its main rivals, while oil prices steadied as traders assessed the risk of a possible global recession.

European gas prices reached a fresh record-high closing price as the Ukraine war impacts supplies.

Elsewhere, Bitcoin slumped some 9 per cent as investors shunned risky assets.

Jackson Hole next 

The minutes of the Fed's latest policy meeting made clear that more rate hikes are in the cards.

All eyes are now on next week's central banking symposium in Jackson Hole, Wyoming, Federal Reserve Chair Jerome Powell the star attraction. He is due to speak August 26.

At Jackson Hole "one of the key things that people look at is to what extent does Powell sort of repeat the message presented in the minutes," Haeling said.

"Do they emphasise the hawkishness over the need to slow down?"

LONDON — Railway staff in Britain on Thursday staged the latest in a series of strikes, once again disrupting commuters and leisure travelers.

Decades-high inflation has been eating up salaries and prompting walkouts across various industries in the UK.

The latest action by rail workers, which will be repeated on Saturday, is part of a summer of strike action by the sector and others at a scale not seen since the 1980s under former prime minister Margaret Thatcher.

The dispute over pay rises and working conditions has shown little sign of resolution and is likely to be exacerbated by news this week that UK inflation topped 10 per cent in July for the first time since 1982.

The global impact of the war in Ukraine on energy and food prices, and, to a lesser extent, post-Brexit trade frictions are blamed for the surging cost-of-living crisis in Britain.

Tens of thousands of railway staff are set to walk out over the two days, leaving a skeleton train service and stranding holidaymakers and commuters, even if home-working continues for many office staff after COVID restrictions were lifted.

Meanwhile, London transport workers serving the underground "Tube" and bus network will walk out on Friday, creating three days of travel misery in southeast England.

"It's extremely unreliable these days, so I'm finding I'm having to drive, park and pay a lot more," recruitment consultant Greg Ellwood, 26, said at an unusually quiet Euston station in London.

"We're all just trying to make a living and get by... So I've got all the sympathy in the world for them," he added, referring to the strikers.

'Defend jobs' 

Among the sectors also calling strikes are dockers at Felixstowe, Britain's largest freight port situated in eastern England, who will start an eight-day stoppage on Sunday.

The waves of industrial action could continue into the autumn, since the Bank of England (BoE) forecasts inflation will top 13 per cent later this year, tipping the economy into a deep and long-lasting recession.

"We will continue to do whatever is necessary to defend jobs, pay and conditions during this cost-of-living crisis," Sharon Graham, head of major British union Unite, said this week.

"This record fall in real wages demonstrates the vital need for unions like Unite to defend the value of workers' pay," Graham said.

She hit out at suggestions, including from BoE Governor Andrew Bailey, that pay rises were in part fuelling inflation.

"Wages are not driving inflation," she insisted ahead of the latest UK inflation data that showed rocketing food prices were the main factor behind July's spike.

Inflation has soared worldwide this year also on surging energy prices, fuelled by the invasion of Ukraine by major oil and gas producer Russia.

Mick Lynch, general secretary of the Rail, Maritime and Transport union (RMT), urged the UK government to get involved in talks over pay, jobs and conditions.

"Instead of waging an ideological war against rail workers, millions of voters would rather that the Government allow for a fair negotiated settlement," he said at a picket line at Euston.

Pay deals 

But a transport department spokesperson blamed union leaders like Lynch for inflicting "misery" on millions, urging them to work with industry "to agree a deal that will bring our railways into the 21st century".

Some proposed strikes planned for the British summer have been halted after unions and companies agreed pay deals at the eleventh hour.

But while British Airways ground staff and plane refuellers at Heathrow airport have scrapped proposed walkouts, other sectors are holding firm.

More than 115,000 British postal workers employed by former state-run Royal Mail plan a four-day strike from the end of August. 

Telecoms giant BT will face its first stoppage in 35 years and walkouts have recently taken place or are soon to occur by Amazon warehouse staff, criminal lawyers and refuse collectors.

Major UK business lobby group, the CBI, this week acknowledged workers' ongoing "struggle with rising costs like energy prices" and said employers were "doing their level best to support staff".

It also claimed, however, that "the vast majority" of companies "can't afford large enough pay rises to keep up with inflation".

Analysts are forecasting sector-wide stoppages to last beyond the summer as inflation keeps on rising.

It comes as teachers and health workers have hinted at possible walkouts should they not receive new pay deals deemed acceptable.

HONG KONG — Markets rose with oil prices on Wednesday following a rally on Wall Street, with Asia given a lift after China's premier called for more measures to boost the struggling economy.

Investors remain on edge as they try to navigate an uncertain landscape while central banks hike interest rates to fight runaway inflation, in turn fuelling fears of a possible recession.

While officials at the Federal Reserve (Fed) and its peers are expected to keep tightening monetary policy for the rest of the year, talk is building that they will be able to ease up in 2023 — and maybe even cut rates — if the pace of price rises comes down.

Minutes from the Fed's July meeting will be pored over when they are released later in the day, with investors hoping for some insight into policymakers' thinking and an idea of its plan for next month's gathering.

"We expect the... minutes to have a hawkish tilt," Carol Kong, at Commonwealth Bank of Australia, said. "We would not be surprised if the minutes show [officials] considered a 100 basis points increase in July."

The bank lifted rates by 75 points in both June and July.

Forecast-beating earnings from retail titans Walmart and Home Depot provided optimism that US consumers remain resilient even as inflation remains elevated and borrowing costs are going up.

In a sign of the work ahead for banks in battling inflation, figures on Wednesday showed prices rose in Britain last month at their fastest pace since 1982 as food costs rocketed. The news sent sterling sharply higher against the dollar.

After a slow start Asia picked up on the positive lead from Wall Street, helped by hopes for some stimulus by finance chiefs in China.

The country's central bank announced a surprise interest rate cut on Monday and a report Tuesday said Premier Li Keqiang called on six key provinces — accounting for about 40 per cent of the economy — to bolster pro-growth policies.

The moves come after the latest batch of data showed the economy remained under pressure.

Analysts said markets are concerned about the debilitating impact of lockdowns and other strict containment measures implemented as part of the government's zero-COVID strategy.

"Visibility over the evolution of China's zero-COVID policy is low and recent messaging has suggested virus containment remains a top policy priority of the country," said Adam Montanaro, investment director of global emerging markets equities at abrdn.

"Not only do investors hate uncertainty, but the negative economic impact of this policy is increasingly visible."

Hong Kong and Shanghai enjoyed healthy gains, while Tokyo, Sydney, Singapore, Wellington, Taipei, Mumbai and Bangkok were also up — though Seoul and Manila dipped.

In early trade, London stocks were up along with Paris and Frankfurt.

Equities have enjoyed several weeks of gains since hitting their June lows, and while the initial bounce was broadly seen as a bear market rally there is hope that they may have already reached their nadir.

"It looks like a bottom, acts like a bottom, and trades like a bottom, then it probably is a bottom," said OANDA's Edward Moya in a note.

"Bear market rally calls are suddenly becoming quiet these days. The risks of the Fed sending the economy into a recession are easing as inflation is slowly coming down.

"The Fed's soft landing seems achievable and that has allowed this rally to continue."

Oil prices bounced after dropping for three days straight on demand worries as economies slow, while the possibility of an Iran nuclear deal has led to talk of a boost to supplies.

"The crude demand outlook is taking a big hit after... disappointing Chinese economic activity readings and as Germany struggles," Moya added.