AFP

The United States said Tuesday it was raising with Saudi Arabia a prison sentence handed to a US citizen over tweets critical of the kingdom, another source of tension between the historic allies. 

The State Department confirmed the detention of Saad Ibrahim Almadi, a US citizen of Saudi origin, and said the United States brought up his case starting in December and as recently as Monday.

Almadi was sentenced to 16 years in prison for the tweets, his son Ibrahim confirmed to AFP.

“We have consistently and intensively raised our concerns regarding the case at senior levels of the Saudi government, both through channels in Riyadh and Washington,” State Department spokesman Vedant Patel told reporters.

“Exercising freedom of expression should never be criminalized,” he said.

The Washington Post reported that Almadi, who lives in Florida and had gone to visit family, was detained in November at the airport regarding 14 tweets he wrote over the previous seven years.

The newspaper, quoting the son Ibrahim, said that Almadi, who is 72, was sentenced on October 3 to 16 years in prison with a travel ban of another 16 years after that.

The son told the newspaper that his father had expressed only “mild” opinions with tweets mentioning corruption in Saudi Arabia and the killing of Jamal Khashoggi, the US-based columnist who was dismembered in 2018 after being lured into the kingdom’s Istanbul consulate.

Almadi was charged in part with supporting and funding terrorism and trying to destabilize the kingdom, said his son, who confirmed the Post’s reporting to AFP.

The State Department said no US representative was present at the sentencing as Saudi Arabia originally gave a later date for the hearing before moving it up.

“We did not hear back from the Saudi government until after the October 3 date” of the sentencing, Patel said, without confirming the details of the decision.

The death of Khashoggi, who wrote for The Washington Post, triggered outrage in Washington although then president Donald Trump boasted of saving the powerful crown prince, Mohammed Bin Salman, from major repercussions.

President Joe Biden declassified intelligence that showed that the crown prince ordered the killing and vowed to get tougher, including over Saudi Arabia’s deadly offensive in Yemen.

Biden in July nonetheless traveled to Saudi Arabia and was photographed in a fist-bump with the crown prince on a trip seen as seeking the kingdom’s help to lower gas prices by pumping more oil.

But OPEC+, led by Saudi Arabia, on October 5 announced a major cut in production just ahead of US congressional elections, outraging Biden who vowed consequences.

Saudi Arabia has long faced criticism over human rights. Blogger and rights activist Raif Badawi served 10 years in prison through March and was publicly lashed 50 times for charges over content on his website.

United Airlines reported strong third-quarter results Tuesday and said it does not expect inflation and other macroeconomic headwinds to derail the travel industry’s comeback.

The major US carrier improved in key revenue benchmarks compared with the comparable pre-pandemic 2019 stretch, making the period “by most metrics, the best operational quarter in our history,” as Chief Executive Officer Scott Kirby put it.

Compared with the 2019 quarter, United had about 10 percent fewer passengers and also about 10 percent lower seat capacity in the just-finished quarter.

But revenues were about 13 percent higher, thanks to lofty ticket prices in the wake of torrid consumer demand.

“Despite growing concerns about an economic slowdown, the ongoing COVID recovery trends at United continue to prevail and we remain optimistic that we’ll continue to deliver strong financial results in the fourth quarter, 2023 and beyond,” Kirby said.

Profits for the quarter ending September 30 were $942 million, about double the year-ago level, with revenues jumping 66 percent to $12.9 billion.

United pointed to three “durable” industry-wide trends that it expects to override economic headwinds: continuing pent-up travel demand after the coronavirus pandemic; the beneficial impact of hybrid work on travel demand; and “external supply challenges” that will limit industry supply.

Shares of United jumped 7.1 percent to $39.88 in after-hours trading.

Major global equities rose Tuesday, with sentiment boosted by upbeat US earnings and relief over the demise of the new British government’s controversial fiscal plan.

Analysts pointed to better-than-expected reports from Goldman Sachs and Johnson & Johnson as a positive driver for stocks, along with shifting investor sentiment.

On Wall Street, both the Dow and S&P 500 climbed more than one percent following a day of strong trading in Asia and Europe.

“Better-than-expected US earnings reports sparked a rally on Wall Street with positive momentum reverberating across European equities,” Interactive Investor analyst Victoria Scholar told AFP.

US industrial production also picked up more than anticipated in September, according to official data Tuesday, bouncing back after a dip in August.

But Craig Erlam, senior market analyst at OANDA, warned the upbeat investor sentiment might not last, saying there was a “strong feeling of a bear market rally about trading over the course of the last week.”

“From the post-US-inflation rebound to what has now been a strong start to the week — in part driven by the UK’s decision to no longer shoot itself in the foot — nothing about this screams sustainable.”

Companies in the S&P 500 are expected to see earnings growth of just 1.6 percent, the lowest rate in two years, according to Factset.

– UK turbulence –

Frankfurt stocks closed up one percent on Tuesday as a key survey showed German investor confidence climbed slightly in October, but remained at a low level.

London gains were muted after the Bank of England poured cold water on a newspaper report that it could delay the sale of government bonds again to help maintain market stability.

A BoE spokesperson described the Financial Times story as “inaccurate”.

The British pound retreated slightly after jumping Monday above $1.14 as the UK government sensationally ripped up its controversial debt-fuelled budget.

After a volatile few weeks during which the pound hit a record low, new finance minister Jeremy Hunt sought Monday to reassure investors as he scrapped tax cuts and warned of tough spending cuts.

Monday’s move, which dealt a blow to Prime Minister Liz Truss’s authority, sent sterling up as much as two percent at one point and the cost of government borrowing tumbled, while the FTSE 100 jumped.

“Investors continue to monitor the political and economic turbulence surrounding the UK,” noted XTB analyst Walid Koudmani.

Markets in China fluctuated a day after authorities delayed the release of third-quarter economic figures, which analysts said were likely to show the weakest growth since the pandemic owing to Covid-19 lockdowns.

The decision comes as the Communist Party holds a key gathering at which President Xi Jinping is expected to be handed a third term.

Oil prices slumped Tuesday in response on the expectation that the United States will draw more barrels than expected from its strategic reserves heading into the winter season.

– Key figures around 2030 GMT –

New York – Dow: UP 1.1 percent at 30,523.80 (close)

New York – S&P 500: UP 1.1 percent at 3,719.98 (close)

New York – Nasdaq: UP 0.9 percent at 10,772.40 (close)

London – FTSE 100: UP 0.2 percent at 6,936.74 (close)

Frankfurt – DAX: UP 0.9 percent at 12,765.61 (close)

Paris – CAC 40: UP 0.4 percent at 6,067.00 (close)

EURO STOXX 50: UP 0.6 percent at 3,463.83  (close)

Tokyo – Nikkei 225: UP 1.4 percent at 27,156.14 (close)

Hong Kong – Hang Seng Index: UP 1.8 percent at 16,914.58 (close)

Shanghai – Composite: DOWN 0.1 percent at 3,080.96 (close)

Pound/dollar: DOWN at $1.1332 from $1.1358 on Monday

Dollar/yen: UP at  149.21 yen from 149.04 yen

Euro/dollar: UP at $0.9862 from $0.9841 

Euro/pound: UP at 87.01 pence from 86.64 pence

Brent North Sea crude: DOWN 1.7 percent at $90.03 per barrel

West Texas Intermediate: DOWN 3.1 percent at $82.82 per barrel

burs-jmb/bgs

French cement giant Lafarge SA was slapped with a $778 million fine Tuesday for making millions in payments to the Islamic State and another jihadist group to build its business in Syria.

The US Justice Department said the company and its Syrian subsidiary actively sought the Islamic State (IS) group’s help to squeeze out competitors when the radical Islamists controlled large parts of Syria and Iraq in 2013-2014, operating an effective “revenue sharing agreement” with them.

It also paid access and protection money to associates of IS and the similarly radical Al-Nusrah Front, ultimately earning some $70 million in revenues during the period, with a Lafarge executive saying the cooperation was “to share the cake.”

Lafarge agreed to the fine and to plead guilty to one count of conspiring to provide material support to US-designated foreign terrorist organizations, the first time a corporation has faced the charge.

– ‘Unthinkable choice’ –

US officials said Lafarge, now owned by Swiss giant Holcim Group, made itself a handmaiden to terror for profits.

“In the midst of a civil war, Lafarge made the unthinkable choice to put money into the hands of ISIS, one of the world’s most barbaric terrorist organizations, so that it could continue selling cement,” US prosecutor Breon Peace said, using another acronym for IS.

“This unprecedented charge and resolution reflect the extraordinary crimes committed and demonstrates that corporations that take actions in contravention of our national security interests in violation of the law will be held to account,” Peace said.

In a statement, Lafarge said the company and its defunct subsidiary Lafarge Cement Syria “have accepted responsibility for the actions of the individual executives involved.”

“We deeply regret that this conduct occurred and have worked with the US Department of Justice to resolve this matter.”

Holcim, which took over Lafarge in 2015 without knowledge of the Syria business dealings, said it had been cleared of any wrongdoing by US authorities.

“None of the conduct involved Holcim, which has never operated in Syria, or any Lafarge operations or employees in the United States,” it said.

Holcim shares traded in Switzerland were suspended temporarily when the announcement was made but ended the day up 2.8 percent at 42.82 Swiss francs ($43.07). 

– Millions in payments –

Lafarge began operating a 680 million euro ($670 million) cement plant in  northern Syria in 2010, the year IS swept the region with a brutal campaign to establish its extremist “caliphate.”

That sparked a counter-offensive by the Iraq military and Syrian Kurdish forces backed by the US-led international coalition in the region.

The US designated IS and Al-Nusrah terror organizations, threatening tough penalties against anyone working with them.

Rather than withdraw like other companies, Lafarge kept working to market its cement, the Justice Department said.

From 2013 to 2104, it paid IS and Al-Nusrah around $5.9 million, some for raw materials, some as payments based on the volume of cement sold and some simply as monthly “donations.”

Lafarge paid another $1.1 million to intermediaries between the two groups.

It also worked out a deal with IS to make it harder for cheaper Turkish cement suppliers to sell their goods in the same area, allowing Lafarge to keep its prices higher.

– Sharing ‘the cake’ –

Company executives knew of the arrangement, the Justice Department said.

In 2014, a senior supervisory official who reported directly to Lafarge’s chief executive wrote to officials in the Syria subsidiary about negotiations with IS.

“We have to maintain the principle that we are ready to share the ‘cake,’ if there is a ‘cake,'” he wrote, defining cake as “profit.” 

Lafarge “negotiated and made unlawful payments at a time when these groups were gaining territory and brutalizing innocent civilians in Syria and elsewhere and were actively plotting against Americans,” said US Assistant Attorney General Matthew Olsen.

Lafarge still faces charges in France for complicity in crimes against humanity.

In May, a French appeals court approved the charge, opening the door for a trial of the company and eight executives, including former CEO Bruno Lafont.

Lafarge continues to fight that case, but now faces the possibility of the introduction of evidence from the US prosecution.

Unlike in the United States, it does not have the option of negotiating a settlement, which is disallowed under French anti-terrorism statutes.