AFP

Libya’s government replaced the head of the key National Oil Corporation on Thursday in a dramatic move that prompted the United States to warn against any “armed confrontation” over the sector.

The North African country’s vast oil reserves have often been at the heart of political disputes, but the NOC had largely stayed neutral despite years of division since the 2011 toppling of dictator Moamer Kadhafi in a NATO-backed rebellion.

However, in a decree made public on Wednesday, the unity government of Abdulhamid Dbeibah appointed former central banker Farhat Bengdara to replace NOC head and veteran technocrat Mustafa Sanalla.

On Thursday morning, Bengdara took up office at NOC headquarters in Tripoli, where he gave a news conference.

“It’s vitally important under the current conditions that Libya regains its oil and gas export capacity as quickly as possible,” he told journalists.

“The oil sector has fallen prey to political struggles, but we will work to prevent political interference in the sector.”

– ‘Vital’ to stability –

Dbeibah’s move against Sanalla follows months of rising tensions in Libya after the country’s eastern-based parliament appointed a rival government, led by former interior minister Fathi Bashagha and seen as backed by military strongman Khalifa Haftar.

Dbeibah has refused to cede power before elections, and Bashagha has so far failed to take office in Tripoli, raising fears of renewed conflict just two years after a landmark truce ending a ruinous attempt by Haftar to seize the capital by force.

The US embassy said Thursday it was following developments “with deep concern” and stressed that the NOC was vital to Libya’s “stability and prosperity”.

Since April, pro-Haftar groups have blockaded key eastern oil facilities to put pressure on Dbeibah.

As a result, Libya’s crude and condensate exports have fallen from around one million barrels per day in March to just over 400,000 so far in July, according to data intelligence firm Kpler.

The blockade has also contributed to crippling power shortages that sparked angry protests earlier this month.

The blockade also comes amid a supply crunch on global oil markets, rattled by the war in Ukraine, in turn prompting consumer nations to pressure other producers to ramp up output. 

US President Joe Biden is expected to press Saudi Arabia on the subject when he visits the kingdom this weekend.

– Blockade to end? –

Libya meanwhile sits on Africa’s biggest proven crude reserves, with easy access to European markets.

US Ambassador Richard Norland, who has been working on a mechanism to manage the highly disputed revenues from Libya’s crude sales, said Sanalla’s replacement “may be contested in court but must not become the subject of armed confrontation”.

However, the appointment of Bengdara, a Kadhafi-era central banker reportedly close to Haftar, has triggered speculation that Dbeibah made a deal with the military strongman to allow him to keep power in Tripoli.

Emadeddin Badi, a senior fellow at the Atlantic Council, said Bengdara’s appointment was “the product of a momentary convergence between Dbeibah and Haftar, but it could be the basis for a broader deal”.

“Dbeibah gets several things from it,” Badi told AFP. 

“He regains access to state funds, it stymies the US financial mechanism or the momentum to implement it, and Haftar will presumably lift the (oil) blockade and limit, if not completely halt, his support for Bashagha.”

Aydin Calik, an energy analyst at the Middle East Economic Survey (MEES), said he expected the oil blockade would be lifted “very shortly”.

But he warned that the new board was contested, including by Sanalla, who has long mediated disputes to keep Libya’s crude flowing and positioned himself as an interlocutor with foreign powers and oil firms.

Calik told AFP that “uncertainty over who is in charge at NOC raises questions: Who can legitimately export oil? Will international oil companies recognise the new NOC board? What might this mean for their contracts?.”

In a defiant video message on Wednesday evening, Sanalla told Dbeibah that “this institution belongs to the Libyan people, not to you or the Dbeibah family” adding that “the mandate of your government has expired”.

Bengdara insisted Thursday that he had been picked for the job because he was “non-partisan” and “can travel anywhere in Libya”.

Twitter experienced a widespread but brief outage in nations around the globe on Thursday — fresh turbulence for the firm locked in a buyout battle with Elon Musk.

The Downdetector website showed that outage reports spiked in the United States around 8:00 am (1200 GMT), while users reported service interruptions in France, Germany, Britain, Iraq, Libya and elsewhere.

However, by around 1300 GMT reports of disruptions to Downdetector had plunged and users took to the social media platform with jokes.

“People posting on Twitter that Twitter is down,” @NorthmanTrader tweeted.

Another user, @joelyagar, joked: “I’ve just had my most productive 30 minutes for years. In unrelated news, it seems Twitter went down for 30 minutes.”

Twitter did not immediately respond to a request for comment, but acknowledged the service disruption in a tweet.

“Some of you are having issues accessing Twitter and we’re working to get it back up and running for everyone. Thanks for sticking with us,” the firm tweeted.

Service disruptions on social media platforms happen periodically, but major and long-term service outages are not common.

The service problems on Twitter came as the company has embarked on a legal fight with Musk over his moves to walk away from his $44 billion buyout bid that has roiled the company.

Twitter has sued to force Musk to complete the deal after he said he was terminating it over issues including his argument that the company has not been forthcoming about the number of fake accounts.

Musk made his unsolicited bid to buy Twitter without asking for estimates regarding spam or fake accounts, and even sweetened his offer to the board by withdrawing a diligence condition, Twitter’s lawsuit alleged.

The social media platform has defended its fake account oversight and has vowed to force Musk to complete the deal, which contained a $1 billion breakup fee.

Twitter says the number of fake accounts is less than five percent, a figure challenged by Musk.

The firm’s shares, like those of other tech firms, have dropped in value since May.

However, the platform’s shares jumped Wednesday after a hedge fund revealed it had taken a stake in the firm based on its “strong case” against Musk.

Shares were down less than one percent in early trading on Thursday.

The termination of the takeover agreement sets the stage for a potentially lengthy court battle with Twitter, which initially had opposed a transaction with the unpredictable billionaire entrepreneur.

The European Commission is expected next week to ask EU countries to reduce heating and cooling of public buildings and offices to cut demand for gas, according to a document seen by AFP.

In order to better to withstand the drastic fall in Russian gas supplies, which could be cut off altogether, the commission is expected to urge governments across the 27-nation bloc to set limits on the amount of energy used by public buildings, offices, commercial properties and outdoor terraces.

For optimal energy use, it will recommend the rules require that public buildings be heated to no more than 19 degrees Celsius (66 degrees Fahrenheit) and cooled by air conditioning units set no lower than 25°C (77°F°).

“Energy saved during the summer is energy that can be used in winter,” the commission points out in the document.

Energy experts say lowering the thermostat by one degree could cut a building’s heating bill by about 10 percent. Air conditioning units generally struggle and fail to cool a room below 20°C so they waste energy trying. 

The recommendation is part of a series of measures Brussels is investigating to cut the EU’s gas consumption by 25 to 60 billion cubic metres (880 to 2,120 billion cubic feet) per year. 

The EU imported around 140 bcm of gas by pipeline from Russia last year, according to the International Energy Agency.

“Acting now could reduce the impact of a sudden supply disruption by one third,” says the document, which is due to be published on July 20 and could be modified in the interim.

It calculates that 11 billion cubic metres of gas could be directly saved from reducing excessive heating and cooling, and between four and 40 bcm via reduced electricity demand. Another 10-11 bcm could be saved from use by industries, which have already slowed production due to soaring prices.

The document urges EU governments, where this is “technically feasible and enforceable” to introduce binding limits on heating and cooling in “public buildings, offices, commercial buildings (in particular large buildings) … and open spaces like outdoor terraces”. 

“The role of public authorities in leading by example and as an important gas consumer -– 30 percent of the energy consumption — is key in this regard,” the document states.

The commission says that during the “gas winter” — October to March — “large savings can be achieved by deploying alternative heat sources for district heating, heat pumps in households” and energy saving campaigns urging the public to turn their thermostats down by one degree Celsius this winter.

But such “protected” energy customers — under EU legislation that means households, district heating that cannot switch to other fuels and certain essential social services — represent just 37 percent of total EU gas consumption. And simulations show these customers would be the last to be seriously affected by large-scale Russian gas disruptions, the commission says.

It is therefore concentrating most of its efforts on power stations and industry, which use huge amounts of gas.

“Abrupt cuts could damage specific branches of those industries which have little room to switch to other fuels — because gas is being used as feedstock for industrial processes –- or to reduce production without heavy damage,” the commission warns.

“It would be significantly less costly to moderately reduce natural gas demand for a longer period of time, starting earlier, than having to drastically curtail demand suddenly and without proper preparation,” it explains.

By way of encouragement, Brussels urges EU governments to set up “auction systems”, perhaps involving several countries, to compensate industrial consumers who agree to reduce their gas consumption.

If there is a total cut in Russian gas supply from July onwards, EU states might only be able to replenish 65-71 percent of their gas reserves percent before winter, the commission said, quoting forecasts by European gas transmission system operators (ENTSOG).

The commission’s energy saving proposals are due to be discussed by EU energy ministers at a meeting in Brussels on July 26.

Amazon has offered a settlement against EU charges that the online giant undermined rivals by misusing the sensitive information of independent sellers to benefit its own retail business, the EU said Thursday.

The offer by Amazon is a huge step by the US-based behemoth that has denied for years accusations by rivals and regulators that it unfairly uses the troves of data parked on its platform to benefit its own products and services.

In its offer, the US tech giant commits to stop using non-public data such as sales performance and revenue that are “relating to or derived from the activities of independent sellers on its marketplace,” an EU statement said.

Amazon also made an offer to end a second EU investigation on whether its hugely popular Prime service unfairly pushes buyers towards sellers using Amazon’s logistics service.

This probe also looked into the Buy Box in which a user can swiftly make a purchase, skipping through the inconvenience of several screens and choices.

The company said it would display an alternative offer in the Buy Box feature if there is a substantial difference in price or delivery from the first one.

Amazon said while “we… disagree with several conclusions the European Commission made, we have engaged constructively with the Commission to address their concerns.”

This will “preserve our ability to serve European customers and the more than 185,000 European small and medium-sized businesses selling through our stores”.

– ‘Win-win’ –

The EU said it was asking rivals for feedback on Amazon’s concessions by September 9 and, if approved, they would remain in place for five years under close monitoring by Brussels.

Many of these accusations towards Amazon are being answered separately in the EU’s landmark Digital Markets Act (DMA), a major EU legislation set to come into force next year.

The DMA imposes a long list of do’s and don’ts on tech giant gatekeepers, including how they handle the sensitive data of competitors who use their platforms.

Alfonso Lamadrid, a competition lawyer at Garrigues in Brussels said the settlement offer was “a win-win” for both the Commission and Amazon.

On the one hand, it kept the commission from potentially fighting a long battle in court, and “at the same time the commitments essentially anticipate what Amazon would have needed to do to comply with the upcoming DMA,” he said.

Amazon had previously settled a case with the EU commission over e-books and still faces scrutiny with national regulators in Germany, as well as non-EU Britain.

The commission said the settlement would not apply in Italy, where Amazon paid a huge fine and changed its business practices over similar concerns.

Stock markets mostly retreated Thursday as fresh evidence of runaway global inflation ramped up expectations of more aggressive interest rate hikes by central banks.

Eurozone inflation will end the year at 7.6 percent, much higher than previously forecast, the EU said Thursday.

The prediction comes one day after US inflation came in at a blistering 9.1 percent last month, the highest level for more than 40 years, as the Ukraine war fuelled energy prices.

US producer prices rose by a faster-than-expected 1.1 percent in June from the previous month, data released Thursday showed.

Market watchers are now wondering whether the Federal Reserve could hike US borrowing costs by a full percentage point at a scheduled policy meeting this month.

The central bank in June unveiled its first 75 basis-point rise in three decades and is one of dozens to hike rates. 

Singapore and the Philippines became the latest to tighten policy Thursday, a day after Canada, New Zealand, Chile and South Korea announced hikes.

The US inflation reading followed last week’s news of a surprise spike in jobs creation, which suggested the world’s top economy was withstanding the rate hikes, giving the Fed more room for further increases.

“Stubbornly high inflation increases the risk that the (Fed) continues to hike aggressively and triggers a recession,” said Kristina Clifton at Commonwealth Bank of Australia, adding that belief was picking up momentum on trading floors.

The European Commission on Thursday slashed growth forecasts for the eurozone, saying the consequences from the war in Ukraine were continuing to destabilise the economy.

Growing fears of a global recession sent oil prices tumbling, with the main US contract, WTI, losing more than five percent.

Federated Hermes senior economist Silvia Dall’Angelo said that while commodity prices were off their recent peaks, they remained elevated amid risks of further supply shocks.

The Fed’s drive to tighten monetary policy continues to send the dollar higher, and on Wednesday it finally rose above parity with the euro for the first time since late 2002, before falling again.

The euro fell back below parity once again shortly after US markets opened.

Europe’s main stock indices were down around 1.5 percent in afternoon trading, with Milan down more than three percent over fears political tensions within Prime Minister Mario Draghi’s coalition government could bring it crashing down and spark snap elections.

Former anti-establishment Five Star Movement did not support the government in a confidence vote, despite Draghi’s warning that his cabinet would not carry on without it.

On Wall Street stocks tumbled with the Dow falling two percent as data showed wholesale price rises accelerating and bank earnings disappointing. 

JPMorgan Chase reported a drop in second-quarter profits, reflecting the impact of a weakening macroeconomic outlook that led it to set aside funds in case of bad loans.

The big US bank’s earnings came in at $8.6 billion for the quarter, down 28 percent from the year-ago period in results that missed analyst expectations.

Chief Executive Jamie Dimon said key elements in the US economy remained healthy, but that macroeconomic headwinds including inflation “are very likely to have negative consequences on the global economy sometime down the road”.

The bank’s shares fell 3.8 percent as trading got underway.

– Key figures at around 1330 GMT –

London – FTSE 100: DOWN 1.5 percent at 7,052.94 points

Frankfurt – DAX: DOWN 1.6 percent at 12,548.59

Paris – CAC 40: DOWN 1.4 percent at 5,917.51

EURO STOXX 50: DOWN 1.5 percent at 3,401.76

New York – Dow: DOWN 2.0 percent at 30,155.37

Tokyo – Nikkei 225: UP 0.6 percent at 26,643.39 (close)

Hong Kong – Hang Seng Index: DOWN 0.2 percent at 20,751.21 (close)

Shanghai – Composite: DOWN 0.1 percent at 3,281.74 (close)

Euro/dollar: DOWN at $0.9956 from $1.0061 Wednesday

Pound/dollar: DOWN at $1.1770 from $1.1893 

Euro/pound: DOWN at 84.57 pence from 84.59 pence

Dollar/yen: UP at 139.21 yen from 137.36 yen

West Texas Intermediate: DOWN 5.2 percent at $91.32 per barrel

Brent North Sea crude: DOWN 4.4 percent at $95.21 per barrel

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