AFP

Berlin on Friday took control of the German operations of Russian oil firm Rosneft to secure energy supplies which have been disrupted after Moscow invaded Ukraine.

Rosneft’s German subsidiaries, which account for about 12 percent of oil refining capacity in the country, were placed under trusteeship of the Federal Network Agency, the economy ministry said in a statement.

“The trust management will counter the threat to the security of energy supply,” it said.

The seizures come as Germany is scrambling to wean itself off its dependence on Russian fossil fuels. Moscow has stopped natural gas deliveries to Germany via the Nord Stream 1 pipeline.

The move covers the companies Rosneft Deutschland GmbH (RDG) and RN Refining & Marketing GmbH (RNRM) and thereby their corresponding stakes in three refineries: PCK Schwedt, MiRo and Bayernoil.

Fears had been running high particularly for PCK Schwedt, which is close to the Polish border and supplies around 90 percent of the oil used in Berlin and the surrounding region, including Berlin-Brandenburg international airport.

The refineries’ operations had been disrupted as the German government decided to slash Russian oil imports, with an aim to halt them completely by year’s end.

By taking control of the sites, the German authorities can then run the refining operations using crude from countries other than Russia.

– Energy earthquake –

Russia’s war in Ukraine has set off an energy earthquake in Europe and especially in Germany, with prices skyrocketing as Moscow dwindled supplies.

Germany has found itself severely exposed given its heavy reliance on Russian gas.

Moscow had also built up a grip over Germany’s oil refineries, pipelines and other gas infrastructure through energy giants Rosneft and Gazprom over the years.

Energy deals with Russia were long seen as part of a German policy of keeping the peace through cooperation with Russian President Vladimir Putin’s regime.

The cheap energy supplied by Russia was also key in keeping German exports competitive. As a result, the share of Russian gas in Germany had grown to 55 percent of total imports before the Ukraine war.

But that approach has come back to haunt Germany. 

In early April, the German government took the unprecedented step of temporarily taking control of Gazprom’s German subsidiary, after an opaque transfer of ownership of the company sent alarm bells ringing in Berlin.

Germany has also been scrambling to find new sources of energy as deliveries from Russia have dwindled in the wake of the invasion of Ukraine.

The German government has also taken the stark step of firing up mothballed coal power plants, while putting two of its nuclear power plants on standby through April, rather than phasing them out completely as planned by year’s end. 

Asian markets dropped on Friday, tracking Wall Street losses as investors continue to show concern over persistently high global inflation and the likelihood of further interest rate hikes.

Major markets in Tokyo, Shanghai, Hong Kong, Seoul, Taipei, Mumbai and Sydney were lower, in line with overall market sentiment ahead of a decision from the US Federal Reserve next week.

Asian stocks were on course to extend their weekly declines into a fifth straight week, following on from continuing weakness in US and European equities.

The Nikkei in Tokyo lost 1.1 percent at the close, as investors “found it difficult to aggressively take positions” ahead of a long weekend and the Fed’s upcoming decision, Seiichi Suzuki, chief equity market analyst at Tokai Tokyo Research Institute, told AFP.

China’s factory output and retail sales beat expectations in August, new data released on Friday showed, despite the economy being hammered by Covid-related curbs, heatwaves and a deepening property market slump.

The data did little to buoy China’s main stock market, however, with Shanghai closing down 2.3 percent. Hong Kong closed down 0.9 percent. 

Europe’s main stock markets slid at the open on Friday, with London’s FTSE 100 index particularly impacted by disappointing UK retail sales data.

Wall Street’s three main indices rallied briefly on Thursday, but the gains fizzled. Traders took little comfort from US President Joe Biden’s announcement of a tentative deal to avert a potentially damaging railroad strike.

All eyes remain on the Fed, which has already instituted two consecutive 75-basis-point hikes and is widely expected to carry out a third. 

On Thursday, US retail sales data showed a surprising increase in August, but the report also downgraded sales in the month prior, tempering the good news.

Weekly US jobless claims retreated once again, and industrial production fell modestly in August.

The new data was not enough, however, to offset the widespread bearish sentiment following higher-than-expected US inflation data released earlier in the week, which showed yearly inflation slowing by less than forecast and monthly inflation rising.

– Fed expectations –

Analysts expect the Fed to continue raising interest rates, in a bid to cool an overheating economy and combat inflation, which remains near decades-highs in major economies.

“Because of the dramatic rise in Treasury yields, the Fed is going to have to keep raising rates beyond (next week),” said prominent investor Louis Navellier in his podcast on Thursday.

“I think they might now raise rates in November just before the (US) midterm elections and possibly December.”

Other commentators echoed that view. OANDA’s senior market analyst Edward Moya addressed the concern that further hikes could send the world’s largest economy into a recession.

“The latest round of data suggest the Fed can stick to aggressive rate hikes as the labour market remains strong and as the economy slowly softens,” he said.

“The risks of the Fed sending the economy into a severe recession are growing but right now the data doesn’t support that argument.”

Now that the data is in, markets are fully focused on the Fed’s decision as their next potential pivot, said Fiona Cincotta, senior financial markets analyst at City Index.

“This is a market waiting for the next catalyst,” she told Bloomberg News. 

“What we saw in the selloff on Tuesday is the repricing of expectations of the Fed. Until we really hear from the Fed we are not going to get a very clear direction.”

– Key figures at around 0815 GMT –

Tokyo – Nikkei 225: DOWN 1.1 percent at 27,567.75 (close)

Shanghai – Composite: DOWN 2.3 percent at 3,126.40 (close)

Hong Kong – Hang Seng Index: DOWN 0.9 percent at 18,761.69 (close)

EURO STOXX 50: DOWN 1.5 percent at 3,488.36

London – FTSE 100: DOWN 0.3 percent at 7,261.92

Frankfurt – DAX: DOWN 1.8 percent at 12,727.57

Paris – CAC 40: DOWN 1.5 percent at 6,068.11

New York – Dow: DOWN 0.6 percent to 30,961.82 points (close)

Euro/dollar: DOWN at $0.9960 from $0.9997 

Pound/dollar: DOWN $1.1369 at from $1.1472 

Euro/pound: UP 87.61 pence from 87.14 pence 

Dollar/yen: DOWN at 143.44 yen from 143.45 yen 

Brent North Sea crude: DOWN 0.6 percent at $90.30 per barrel

West Texas Intermediate: DOWN 0.9 percent to $84.34 per barrel

Indonesia has launched an anti-trust investigation into Google over the tech firm’s insistence that its payment system be used for purchases from its app store, authorities said Thursday, accusing it of unfair business practices.

The US internet giant has been under legal scrutiny in a number of countries over its stipulation that its billing system be used by all buyers on Google Play.

Authorities in Jakarta said in a statement they suspected “Google has abused its dominant position by imposing conditional sales and discriminatory practices in digital application distribution in Indonesia”.

Google Play is the largest app distribution platform in Indonesia, a country of around 270 million people.

Third-party developers offering their apps on Google Play are charged a 15 to 30 percent service fee, higher than the five percent imposed by other payment systems, according to an initial probe by the nation’s anti-trust agency.

“The respective developers cannot refuse the obligation because Google can impose sanctions by removing their applications from the Google Play store and preventing them from making updates to their applications,” the agency said.

Google Indonesia said on Friday that it would work with the Indonesian authorities “to demonstrate how Google Play supports developers”.

It added that since early this month, it has started a pilot billing system, allowing an alternative payment system alongside the one used on Google Play.

The American multinational has faced a barrage of legal cases in the United States, Europe and Asia based on similar accusations.

Google has also faced claims that it unfairly forced its search engine and Chrome internet browser on phone makers using the Android operating system.

On Wednesday, the European Union’s second-highest court ruled that “Google imposed unlawful restrictions on manufacturers of Android mobile devices”.

The court upheld the EU’s record fine of more than four billion euros ($4 billion) against Google

That case was the third of three major cases brought against Google by the EU’s competition czar Margrethe Vestager, whose legal challenges were the first worldwide to directly take on Silicon Valley tech giants.

South Korea fined Google nearly $180 million last year for abusing its dominant market position in a similar case regarding the Android system.

Indonesia has launched an anti-trust investigation into Google over the etch firm’s insistence that its payment system be used for purchases from its app store, authorities said Thursday, accusing it of unfair business practices.

The US internet giant has been under legal scrutiny in a number of countries over its stipulation that its billing system be used by all buyers on Google Play.

Authorities in Jakarta said in a statement they suspected “Google has abused its dominant position by imposing conditional sales and discriminatory practices in digital application distribution in Indonesia”.

Google Play is the largest app distribution platform in Indonesia, a country of around 270 million people.

Third-party developers offering their apps on Google Play are charged a 15 to 30 percent service fee, higher than the five percent imposed by other payment systems, according to an initial probe by the nation’s anti-trust agency.

“The respective developers cannot refuse the obligation because Google can impose sanctions by removing their applications from the Google Play store and preventing them from making updates to their applications,” the agency said.

Google Indonesia said on Friday that it would work with the Indonesian authorities “to demonstrate how Google Play supports developers”.

It added that since early this month, it has started a pilot billing system, allowing an alternative payment system alongside the one used on Google Play.

The American multinational has faced a barrage of legal cases in the United States, Europe and Asia based on similar accusations.

Google has also faced claims that it unfairly forced its search engine and Chrome internet browser on phone makers using the Android operating system.

On Wednesday, the European Union’s second-highest court ruled that “Google imposed unlawful restrictions on manufacturers of Android mobile devices”.

The court upheld the EU’s record fine of more than four billion euros ($4 billion) against Google

That case was the third of three major cases brought against Google by the EU’s competition czar Margrethe Vestager, whose legal challenges were the first worldwide to directly take on Silicon Valley tech giants.

South Korea fined Google nearly $180 million last year for abusing its dominant market position in a similar case regarding the Android system.