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Tag Archives: EU

Chart: EU Natural Gas Soars to Record High

Source : Bloomberg

Chart: EU Population Declines for Its Second Year

Source : Statista

Charts: The ECB Raised Its 3 Key Interest Rates by 50bps in July 2022

The first increase since 2011, ending eight years of negative rates.

Source : Trading Economics

Black Box for New Cars Now Mandatory in the EU

Marie-Julie Van de Sijpe wrote . . . . . . . . .

From July 2022 onwards, all cars, trucks and buses manufactured in Europe will now have to be equipped with a black box, just like in airplanes.

The principle was voted on in the European Parliament in 2019, with the aim of improving road safety. The new rules for the road only apply to vehicles that are new to the market – people who drive around with a somewhat older car do not have to change cars or get one installed.

The new black box for cars comes with all sorts of safety applications: it records all driving data from speed and acceleration, to belt use and braking.

It also includes advanced systems that assist drivers to stick to the speed limit. Moreover, there is an option to install an alcohol lock.

Just like in airplanes, the device would come with an in-vehicle data recorder for incidents, with the difference being that it will not record any conversations inside the vehicle.

It will be easier for experts to access the driver’s data, as it helps to provide liability in case of serious accidents, by simply providing information about the first 30 seconds before and 10 seconds after the impact.

“It will be useful for serious accidents, which are a minority in relation to the total number of cases. The judicial authorities will not ask for the data after every accident. There are only 7,000 to 8,000 serious accidents out of 45,000 bodily injury accidents each year,” Benoît Godart, road safety spokesman at the Vias Institute, told La Libre.

Some motorists’ associations are not pleased with this decision and see it as “an additional cost for new cars”.

“The price of the device is about a hundred euros. This will be reflected in the price of the car and will also be included in the insurance,” Pierre Chasseray, general delegate of the French association “40 million motorists”, told France Info on Monday.

The black box mandate will be extended to private cars and other second-hand commercial vehicles from 2024 onwards.

Source : The Brussels Times

Chart: Which Country Has The Highest Debt in the EU?

Source : Statista

One Plug and Done: EU to Require Common Way to Charge Phones

Kelvin Chan wrote . . . . . . . . .

Forget rummaging through the junk drawer. Soon, Europeans will only need to reach for one cable to charge their smartphones and other devices.

European Union officials said they inked a provisional agreement Tuesday that will require a uniform charging cord in the 27-nation bloc. It’s part of a wider effort to make products sold in the EU more sustainable and cut down on electronic waste.

The new rules, which will take effect by fall 2024, mean EU consumers will only need to use a common USB Type-C cable for small and medium-sized rechargeable, portable electronic devices.

“European consumers were frustrated with multiple chargers piling up within their homes,” Alex Agius Saliba, the European Parliament’s lead negotiator, said at a press briefing in Brussels. “Now, they will be able to go with a single charger for all portable electronics, which is an important step to increase consumer convenience.”

The devices covered include mobile phones, tablets, e-readers, earbuds, digital cameras, headphones and headsets, handheld videogame consoles, keyboards and mice, portable speakers and navigation devices.

Laptops also are covered, but manufacturers will have extra time to comply.

The rules apply only to devices sold in the European single market, which consists of 30 countries. However, like the EU’s strict privacy regulations, they could end up becoming a de facto standard for the rest of the world.

While many electronics makers have started adopting USB-C sockets into their devices, Apple has been one of the main holdouts.

Apple, which did not respond to a request for comment, has previously said it’s concerned the rules would limit innovation and hurt consumers. The company’s iPhones come with its own Lightning charging port, though newer models include cables that can be plugged into a USB-C socket.

The EU rules also outline standards for fast charging technology and give consumers the right to choose whether to buy new devices with or without a charger, which the EU estimates will save consumers 250 million euros ($266 million) a year.

Reducing electronic waste is another goal. The EU estimates disposed or unused chargers account for 11,000 metric tons of e-waste in Europe every year.

“One in every three chargers that is bundled with these products is never opened from its original packaging,” according to an impact assessment from the European Commission, the bloc’s executive arm, Saliba said.

To keep pace with the latest advances, there are also provisions to draw up standards further down the line for wireless charging, which is seen as the next leap forward for charging technology, Saliba said.

The EU spent more than a decade trying to cajole the electronics industry into adopting a common charging standard, an effort that whittled different charging plugs down to a handful until the commission forced the issue with draft legislation last September.

The European Parliament and European Council are expected to give formal approval to the agreement after the summer break.

Source : AP

Infographic: EU’s Energy Dependency

See large image . . . . . .

Source : Visual Capitalist

The European Union Seeks Independence from Russian Oil and Gas

Stanley Reed wrote . . . . . . . . .

The European Commission on Tuesday outlined ambitious proposals to “make Europe independent from Russian fossil fuels well before 2030.”

Europe has been hit with exorbitant natural gas prices in recent months because of tight supplies, exacerbated by restrictions by Russia and worries that Moscow would cut flows in response to Europe’s support for Ukraine.

“We must become independent from Russian oil, coal and gas,” the commission’s president, Ursula von der Leyen, said in a news release. “We simply cannot rely on a supplier who explicitly threatens us.”

The proposals will be discussed at a meeting of European leaders in France this week. If enacted by member countries, the measures are likely to be a huge boon for a variety of energy businesses, from the suppliers of liquefied natural gas in Qatar and around the Gulf of Mexico to builders of solar energy parks and offshore wind farms. The question is whether they can be executed rapidly enough to prevent further harm to household finances and the broader economy.

“If we react to the current crisis with a warlike reaction,” said Marco Alverà, chief executive of Snam, the Italian natural gas company, “we can do a lot in six months.”

Other countries are moving swiftly to cut ties with Russia after its invasion of Ukraine. On Tuesday, President Biden announced a ban on U.S. imports of Russian oil and natural gas. “This means Russian oil will no longer be acceptable to U.S. ports and the American people will deal another powerful blow to this war machine,” he said.

Britain also declared on Tuesday that it would phase out imports of Russian oil by the end of the year; Russian gas supplies would not be affected.

The Russian invasion of Ukraine is turning into a watershed moment for Europe on energy matters. Europe has long relied on Russia for a large portion of its oil and gas, trusting in what many European leaders thought was a mutually beneficial business relationship.

In recent months, though, Russia has appeared to exacerbate an already tight natural gas market by declining to provide Europe with any gas above contracted amount. After Russia’s invasion of Ukraine last month, European gas prices have risen to astronomical levels, comparable to more than $500 a barrel for oil. High gas prices have also sent electricity prices much higher, putting pressure on both consumers and businesses.

Clearly, recent weeks have shaken Ms. von der Leyen and her colleagues into action. The proposals announced on Tuesday are a mixture of short-term measures intended to avoid repeating the debacle of recent months in energy markets next year as well as medium-term proposals to accelerate the installation of equipment to generate enormous amounts of clean energy like wind and solar power.

One goal is to cut natural gas imports from Russia by two-thirds this year, while hugely expanding renewable energy, said Frans Timmermans, the commission’s executive vice president for green energy, during a news conference at European Union headquarters in Brussels.

The Russia-Ukraine War and the Global Economy

Rising concerns. Russia’s attack on Ukraine has started reverberating across the globe, adding to the stock market’s woes and spooking investors. The conflict could cause​​ dizzying spikes in prices for energy and food, and severely affect various countries and industries.

The cost of energy. Oil prices already are the highest since 2014, and they have jumped as the conflict has escalated. Russia is the third-largest producer of oil, providing roughly one of every 10 barrels the global economy consumes.

Gas supplies. Europe gets nearly 40 percent of its natural gas from Russia, and it is likely to be walloped with higher heating bills. Natural gas reserves are running low, and European leaders have accused Russia’s president, Vladimir V. Putin, of reducing supplies to gain a political edge.

Food prices. Russia is the world’s largest supplier of wheat and, together with Ukraine, accounts for nearly a quarter of total global exports. In countries like Egypt and Turkey, that flow of grain makes up more than 70 percent of wheat imports.

Shortages of essential metals. The price of palladium, used in automotive exhaust systems and mobile phones, has been soaring amid fears that Russia, the world’s largest exporter of the metal, could be cut off from global markets. The price of nickel, another key Russian export, has also been rising.

Financial turmoil. Global banks are bracing for the effects of sanctions intended to restrict Russia’s access to foreign capital and limit its ability to process payments in dollars, euros and other currencies crucial for trade. Banks are also on alert for retaliatory cyberattacks by Russia.

“Instead of continuing to fund fossil-fuel imports and fund Russian oligarchs, renewables create new jobs here in Europe,” he said.

Mr. Timmermans declined to answer a question on whether the European Union would follow the United States in banning imports of Russian oil. “I think we should wait with our comments until we have heard the announcement,” he said.

Perhaps the most crucial of the proposals aims to fill natural gas storage facilities to 90 percent of their capacity. The idea is to create a buffer against cold weather that eats up gas supplies, and to prevent blackmail by suppliers like Russia.

The magnitude of the task that these proposals are trying to tackle was manifest in some of the numbers the bloc released on Tuesday. Some 45 percent of the European Union’s gas came from Russia in 2021, while Russia was also Europe’s largest supplier of oil at 27 percent, more than three times the next largest, Norway.

The European Union says it will accomplish these goals by saving energy and diversifying supplies. Officials released documents showing that substantial new supplies of liquefied natural gas could come from countries like the United States, Qatar and Egypt. The problem, though, is that Europe will need to compete with other major L.N.G. consumers like China, South Korea and Japan, and the additional demand from Europe might push prices up higher for everyone.

“It is going to be like adding another China in the market,” said Henning Gloystein, a director at Eurasia Group, a political risk firm.

Source : New York Times

EU Cuts 2022 Euro Zone Growth Forecast, Sharply Raises Inflation View

Jan Strupczewski wrote . . . . . . . . .

Euro zone economic growth will be slower than earlier expected this year because of a new wave of COVID-19 infections, high energy prices and continued supply-side disruptions, while inflation will be much higher, the European Commission said.

In its regular economic forecasts, the EU executive arm said gross domestic product in the 19 countries sharing the euro would grow 4.0% this year and 2.7% in 2023.

The forecast is a cut compared to last November, when the Commission forecast 4.3% growth in 2022 and 2.4% in 2023 and is close to the latest view of the International Monetary Fund, which expects growth of 3.9% this year and 2.5% in 2023.

“Multiple headwinds have chilled Europe’s economy this winter: the swift spread of Omicron, a further rise in inflation driven by soaring energy prices and persistent supply-chain disruptions,” European Economic Commissioner Paolo Gentiloni said. “With these headwinds expected to fade progressively, we project growth to pick up speed again already this spring.”

The Commission expects inflation this year will be 3.5%, well above the European Central Bank’s target of 2.0%, and much higher than its own forecast from November of 2.2%. This is also a more pessimistic forecast than that of the ECB from December, when the bank projected inflation at 3.2% this year.

Worried by the longer than earlier expected surge in consumer prices, the ECB has taken a hawkish turn and started preparing markets for the end of its unconventional stimulus with some hawkish board members calling for a rate hike already this year.

But the Commission, like the IMF, forecast inflation would slow again next year to 1.7%, below the ECB’s target, so a potential rate rise would come just as price growth slows again. The ECB’s own inflation in December was 1.8% for 2023.

“Price pressures are likely to remain strong until the summer, after which inflation is projected to decline as growth in energy prices moderates and supply bottlenecks ease. However, uncertainty and risks remain high,” Gentiloni said.

The Commission said risks to the growth outlook were even as the COVID-19 infection wave could have a longer lasting impact and bring fresh disruptions to supply chains, but also household consumption could grow more strongly and investment, thanks to the EU recovery fund, could generate stronger activity.

Inflation could turn out higher if more cost pressures are passed on from producers to consumers and if that boosts the likelihood of wage growth to compensate.

“Risks to the growth and inflation outlook are aggravated by geopolitical tensions in Eastern Europe,” the Commission said referring to the risk of Russian military aggression against Ukraine.

Source : Reuters

Chart: Wage Growth Surged in the US and UK, and to a Lesser Extent in the Euro Area

Source : Goldman Sachs