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Russia gained’t resume gasoline provides to Europe till western sanctions are lifted, the Kremlin has warned.
Dmitry Peskov, Kremlin spokesman, blamed the “collective West” for its choice to close down flows by way of the essential Nord Stream pipeline.
He instructed the Interfax information company: “The issues pumping gasoline happened due to the sanctions western nations launched towards our nation and several other corporations.
“There are not any different causes that would have triggered this pumping downside.”
It marks Russia’s clearest admission so far that its cuts to power provides are a retaliation towards western sanctions, quite than a results of technical faults, because it beforehand claimed.
Gazprom’s choice late on Friday to not flip the Nord Stream pipeline again on after three days of upkeep sparked a pointy rise in gasoline costs and has left EU nations scrambling to roll out emergency measures.
Table of Contents
12:51 PM
Hospitality corporations name for ‘fast and decisive’ motion
Kate Nicholls, chief govt of UKHospitality, additionally requires Truss to behave “rapidly and decisively”.
Congratulations to Liz Truss on her election as the brand new chief of the Conservative Social gathering and our Prime Minister.
We very a lot sit up for working carefully together with her and the brand new Cupboard within the coming weeks, as we attempt to save lots of the hospitality business, which is experiencing crushing price rises.
The brand new Authorities should act rapidly and decisively to handle the hovering power payments which can be dealing with customers and companies.
With the correct package deal of help – together with a discount within the headline fee of VAT for the sector to 12.5pc, a enterprise charges vacation, the deferral of all environmental levies, the reinstatement of a HMRC Time to Pay scheme and the reintroduction of a commerce credit score insurance coverage scheme for power – the sector shall be nicely positioned to help development by way of producing jobs and native funding.
Pre-pandemic, our business spent £10bn a yr in high-street regeneration and employed 3.2m folks however with power payments for hospitality companies rising 300% on common – and as excessive as 750pc in some circumstances – we desperately want a package deal of help put in place if we’re to have the ability to play our half within the UK’s financial restoration and development.
12:47 PM
BCC: Truss should take instant motion to help enterprise
Sarah Howard, Chair of the British Chambers of Commerce, warns of a bleak outlook for companies until the brand new PM acts rapidly.
We wish to congratulate Liz Truss on operating a profitable marketing campaign to develop into the UK’s new Prime Minister.
She should now take instant steps to help the economic system. The final few months have been tough for everybody, time is operating out and pressing motion is wanted to cope with the prices’ disaster.
We consider the nation has already entered a recession and that inflation will hit not less than 14pc within the months forward.
Like households, corporations have been telling us of unsustainable rises of their power payments and the way tough it’s to search out new fastened time period contracts to buffer towards additional value hikes.
Until the brand new Prime Minister addresses these issues head-on then the economic system will drift additional into harmful waters and the outlook for each companies and customers shall be bleak certainly.
12:46 PM
Liz Truss guarantees to sort out power disaster
Liz Truss has reiterated her willpower to sort out the power disaster, each when it comes to hovering payments and points with power provide.
However as soon as once more, there isn’t any precise element.
She mentioned:
I’ll govern as a Conservative. We have to present we are going to ship over the following two years. I’ll ship a daring plan to chop taxes and develop the economic system.
12:43 PM
Markets unmoved by PM vote
Markets seem nonplussed by the end result of the Tory management race – not less than for now.
The pound is buying and selling across the $1.15 stage, whereas the FTSE 100 continues to be buying and selling 0.7pc decrease.
It has been a prolonged management marketing campaign and Truss’ election will come as no shock. Merchants will now be centered on the precise insurance policies she’ll enact amid hovering power payments and a cost-of-living disaster.
12:40 PM
Liz Truss chosen as new PM
Liz Truss has gained the race with 81,326 votes. Rival Rishi Sunak acquired 60,399.
Ms Truss begins her acceptance speech saying it was an honour to be elected after what she manufacturers one of many longest job interviews in historical past.
12:38 PM
Liz Truss confirmed as new prime minister
The outcomes are in and Liz Truss has been confirmed as Britain’s new prime minister.
The previous overseas secretary, who’s lengthy been tipped because the favorite, emerged victorious as the brand new chief of the Conservative Social gathering after a prolonged contest with Rishi Sunak.
12:21 PM
EU: Russia might ship extra gasoline however is selecting to not
Russia might ship extra gasoline to Europe by way of different routes to compensate for the closure of the Nord Stream pipeline, however Moscow is selecting not to do that.
That is in accordance with a European Fee spokesman, who mentioned: “If there was a technical downside which was impeding provides by way of Nord Stream 1, there could be a chance, if there was willingness, to ship gasoline to Europe by way of different pipelines. That is one thing we’re not seeing occurring.”
The spokesman added that this behaviour was proof of Russia “weaponising” its gasoline provides to Europe. Russian gasoline big Gazprom has blamed the Nord Stream closure on western sanctions and technical points.
11:39 AM
ECB poised to announce largest fee rise in historical past of eurozone
The European Central Financial institution is poised to ship the most important rate of interest rise for the reason that creation of the euro because it fights to carry surging inflation below management.
Szu Ping Chan has extra:
Economists count on the central financial institution to boost all three of its key rates of interest by 0.75 share factors on Thursday, after knowledge confirmed that costs rose by a report 9.1pc within the yr to August.
This is able to symbolize the most important fee hike for the reason that single forex was created in 1999.
The ECB can also be anticipated to revise up its inflation forecasts and minimize development projections once more as Russia’s restriction of gasoline provides to the Continent threatens to throw the bloc right into a extreme recession.
Peter Praet, chief economist of the ECB till 2019, mentioned it was time for the central financial institution to behave forcefully.
He mentioned: “I’d do 75 foundation factors. They should give a powerful sign that they imply enterprise. It’s clear that with inflation at 9.1pc, you can not maintain rates of interest at zero.”
The ECB will launch quarterly forecasts for development, jobs and inflation alongside its rate of interest choice.
11:25 AM
London Grosvenor On line casino staff to stake 72-hour strike
Employees at Grosvenor On line casino venues in London have voted to stroll out for 72 hours this weekend in a row over pay.
About 150 staff on the group’s seven casinos throughout the capital voted by 91pc to reject retention bonus funds of £600 and £800, branding them “completely insufficient”.
The employees are primarily croupiers and sellers but additionally embody meals and beverage ready and kitchen workers.
The Unite union insisted that Grosvenor Casinos, which is a part of the Rank Group, might afford to supply extra.
Sharon Graham, Unite common secretary, mentioned:
Right here we go once more: Grosvenor Casinos is one other large cash firm that’s raking it in however refusing to pay its staff a wage that they’ll stay on.
It’s simply not acceptable and this large vote for motion underscores the sense of anger throughout this workforce.
11:08 AM
Oil pushes larger forward of Opec assembly
Oil costs pushed larger this morning forward of an Opec assembly this afternoon that is count on to substantiate one other modest rise in manufacturing.
At its final assembly, the producer cartel agreed to a small enhance of 100,000 barrels per day for September – six instances decrease than its earlier selections.
It is anticipated to announce an identical transfer for October, although it might additionally choose to chop output to elevate costs which have tumbled lately amid recession fears.
Benchmark Brent crude gained 2.6pc to commerce at $95.50 a barrel, whereas West Texas Intermediate rose an identical quantity to simply over $89.
10:52 AM
Aston Martin shares plunge on cut-price capital elevate
Shares in Aston Martin have slumped this morning after the automotive maker confirmed it is promoting shares at a steep low cost in an upcoming capital elevate.
The appropriate problem, backed by Saudi Arabia’s sovereign wealth fund, will elevate gross proceeds of about £575.8m. The difficulty value of 103p per new share represents a 78.5pc low cost to the tip of final week.
Shares in Aston Martin tumbled as a lot as 14pc to the underside of the FTSE 250.
10:37 AM
Kremlin threatens retaliation over G7 oil value cap
The Kremlin has warned the West it can take “retaliatory measures” over a G7 proposal to impose a cap on the value of Russian oil.
G7 finance ministers agreed the cap on Friday in response to Russia’s actions in Ukraine, however Moscow has vowed to halt gross sales to nations imposing it.
10:21 AM
Reduce pink tape on fracking to safe power safety, Liz Truss urged
Liz Truss will fail to unleash her fracking revolution if she doesn’t overhaul planning legal guidelines, the power business has warned, because the Metropolis braces for hovering gasoline costs.
Ben Woods reviews:
The favorite to develop into the following prime minister has been instructed that “complete coverage help” is required to hurry up planning and environmental permissions for fracking if the controversial type of power provide is to develop into widespread throughout the nation.
Ms Truss bolstered her help for fracking as a instrument for shoring up Britain’s power safety within the face of Russian aggression by telling BBC One’s Sunday with Laura Kuenssberg that extracting shale gasoline with onshore drilling was amongst her priorities.
The International Secretary’s help got here after reviews claimed she would elevate the ban on fracking “inside days” of changing into prime minister after already stating that she would overturn a suspension on drilling that has been in place since 2019.
Nevertheless, the fracking business has warned Ms Truss that she would want to take pressing steps to free power corporations from the planning and regulatory burdens that would maintain again their makes an attempt to start drilling with haste.
09:59 AM
Service sector development slides as prices surge
The UK service sector continued to increase in August, however development softened to its slowest fee within the final 18 months.
Whereas gross sales continued to rise, they had been dampened by financial uncertainty, decrease shopper confidence and worries over hovering inflation and excessive power payments.
The S&P International Providers PMI dropped to 50.9 in August from 52.6 the earlier month.
09:44 AM
European shares slide on Putin’s gasoline shutdown
European shares have sunk into the pink this morning after Russia halted gasoline provides by way of Nord Stream.
The continent-wide Stoxx 600 index fell 1.7pc within the first hour of buying and selling, whereas Germany’s DAX sank 3.1pc, heading for its greatest one-day share fall in two months.
German utilities together with Uniper, RWE, E.ON and PNE dropped between 2.9pc and 10pc.
EU leaders will meet later this week to debate emergency measures amid fears the power disaster will result in blackouts and rationing this winter and push the area into recession.
09:33 AM
Aston Martin launches £575m rights problem again by Saudis
Aston Martin has confirmed a £575m rights problem supported by Saudi Arabia’s sovereign wealth fund.
The luxurious automotive model it can launch the rights problem – a share supply to present traders meant to boost new money –as a part of a previously-announced £653m fundraising.
Aston Martin mentioned the brand new funding shall be used to pay down its money owed and to enhance the agency’s liquidity.
The automotive maker mentioned its rights problem had acquired “irrevocable commitments” from traders together with Saudi Arabia’s Public Funding Fund, the Yew Tree Consortium and Mercedes-Benz.
PIF, which is managed by Crown Prince Mohammed bin Salman, is Saudi Arabia’s sovereign wealth fund, one of many greatest on the earth.
09:17 AM
Get used to larger power payments, Philip Hammond warns Brits
Philip Hammond, the Tory former chancellor, has warned that households should get used to larger power payments.
Jack Maidment has extra:
Lord Hammond mentioned the following authorities should take motion to fight the brief time period “battle impact” on power costs however he confused that individuals have to be “real looking” that “power costs should not going to return to the place they had been 18 months in the past”.
He mentioned that “this winter, the following six, 9 months goes to be extraordinarily tough” and the UK should keep away from a “wage/value spiral” the place wages chase costs, resulting in “entrenched inflation that we merely cannot eliminate”.
Lord Hammond mentioned that if the nation can “maintain our nerve” he believes that inflation will begin to fall from the spring subsequent yr.
09:08 AM
Pound slides to new low forward of PM announcement
Sterling has slumped to a recent post-pandemic low as Russia halted gasoline flows by way of the Nord Stream pipeline and merchants awaited the end result of the Tory management election.
The pound fell as little as $1.1444 – its weakest stage towards the greenback since March 2020. In opposition to the euro it was largely unchanged at 86.44p.
The pound has been one of many worst performing currencies this yr amid surging inflation, a looming financial slowdown and political uncertainty.
The newest slide comes simply hours earlier than Liz Truss is predicted to be named as Britain’s subsequent prime minister.
08:40 AM
FTSE risers and fallers
The FTSE 100 slid in early buying and selling as traders stay on edge forward of the naming of the brand new prime minister.
The blue-chip index fell 0.7pc after shedding greater than 1pc final week amid fears about surging costs and a looming financial slowdown.
Banking shares, that are delicate to rate of interest rises, had been the most important drag, with HSBC, Barclays and Lloyds all within the pink.
Dechra Prescribed drugs was the most important faller, falling about 7pc at the same time as its full-year income met expectations.
Power and mining shares had been the principle winner. BP and Shell each posted reasonable features as traders seemed forward to attainable output cuts at an Opec assembly later right this moment.
The domestically-focused FTSE 250 slumped 0.9pc. Countryside Partnerships jumped greater than 5pc after receiving a £1.25bn takeover supply from Vistry.
08:22 AM
Vistry buys rival housebuilder Countryside for £1.25bn
Housebuilder Vistry Group has snapped up rival Countryside in a £1.25bn deal amid indicators the property market is beginning to run out of steam.
The money and share supply totals about 249p a share and marks a 9.1pc premium to Countryside’s closing value on Friday. It follows a Telegraph report that Vistry was exploring a bid.
The deal will see the Countryside model added to Vistry’s current secure together with Bovis Houses, Linden Houses and Drew Smith.
Countryside put itself up on the market in June after rejecting two unsolicited takeover bids from US investor Inclusive Capital value as much as £1.5bn. It additionally confronted stress from activist Browning West to promote the enterprise.
In-Cap mentioned it was withdrawing from the bidding course of and supported Vistry’s supply.
Greg Fitzgerald, chief govt of Vistry, mentioned the deal “will create a pacesetter within the Partnerships housing sector, with the dimensions and experience to speed up worthwhile development throughout each partnerships and housebuilding, and increase the supply of a lot wanted inexpensive housing throughout England”.
Learn extra on this story: Housebuilder plots takeover amid hopes of construction boom under Truss
08:08 AM
Kwasi Kwarteng: UK can afford to borrow extra
A Authorities below Liz Truss can afford to borrow extra to supply help with power payments however shall be accountable with public funds, Kwasi Kwarteng has mentioned.
Mr Kwarteng, who’s tipped to be Chancellor below Ms Truss, sought to reassure traders amid reviews she’s making ready a package deal of direct help and tax cuts value as much as £100bn.
He wrote within the Monetary Instances:
Given the severity of the disaster we face, there’ll should be some fiscal loosening to assist folks by way of the winter. That’s completely the correct factor to do in these exceptionally tough instances.
We all know households are nervous, and decisive motion is required to get households and companies by way of this winter and the following. They want certainty.
08:03 AM
FTSE 100 falls on the open
The FTSE 100 has misplaced floor on the open as markets digest Putin’s newest gasoline cuts and the temper stays nervous forward of the announcement of the brand new prime minister later right this moment.
The blue-chip index fell 0.7pc to 7,232 factors.
07:52 AM
Euro sinks to 20-year low towards greenback
In a additional signal of the financial influence of Putin’s gasoline cuts, the euro has tumbled to a 20-year low towards the greenback.
The euro fell 0.7pc to $0.9884 in early buying and selling. That is its first fall under $0.99 in 20 years and its lowest since December 2002.
The frequent forex has continued to weaken for the reason that begin of the yr because the power disaster threatens to push the bloc into recession.
However the newest fall comes after Russia mentioned the Nord Stream gasoline pipeline to Europe will stay shut indefinitely.
07:46 AM
Europe races to stave off power disaster
Europe is racing to stave off an power disaster this winter that is threatening to show into an financial and monetary disaster too.
Putin’s choice to halt gasoline provides by way of the Nord Stream pipeline has left the bloc speeding to place emergency measures in place.
Nations at the moment are figuring out tips on how to curb demand dramatically and in addition stop wild market swings that would spark wider market disruption.
Sweden and Finland created emergency backstops on the weekend to assist utilities fighting collateral necessities in a bid to forestall a “Lehman” second.
EU power ministers are additionally set to debate radical proposals to curb energy costs after they maintain an emergency assembly on Friday – together with gas-price caps and a suspension of energy derivatives buying and selling.
The bloc has been constructing its gasoline stockpiles, with storage websites practically 82pc full. Germany’s storage is now 86pc full.
However Klaus Mueller, president of Germany’s Federal Community Company power regulator, warned final month that even with gasoline storage at 95pc, there would solely be sufficient for two-and-a-half months of demand if Russia switched off flows.
07:38 AM
Putin’s Nord Stream shutdown drives up gasoline costs
Good morning.
We begin the week with one other surge in gasoline costs after Putin minimize off provides by way of the essential Nord Stream pipeline.
The gasoline hyperlink was on account of restart on Saturday after three days of deliberate upkeep. However Gazprom made a last-minute choice on Friday to not restart provides, blaming an oil leak.
EU leaders had been bracing for such an end result as Putin continues to make use of power provides as a weapon.
The bloc is now speeding to roll out emergency measures to forestall blackouts and rationing this winter because the power disaster threatens to push the area into recession.
5 issues to start out your day
1) Reduce pink tape on fracking to safe power safety, Liz Truss urged – She is predicted to elevate the ban on drilling ‘inside days’ of changing into prime minister
2) Truss confirms perception in Financial institution of England independence – The International Secretary says it could be “utterly incorrect” for her to dictate the trail of rates of interest
3) Virgin Money staff to display pronouns on name badges – It follows strikes by different banks NatWest, HSBC and Halifax
4) Matalan searches for a buyer as brutal high street conditions take their toll – The founding household has hoisted a “on the market” signal over the low cost retail chain, because it grapples with the bruising circumstances on the excessive avenue.
5) Britain’s pubs confront a bleak winter as energy costs spiral – For a lot of pub landlords, there may be little they’ll do to attempt to maintain their heads above water
What occurred in a single day
Asian shares slipped this morning whereas the euro took a recent spill after Russia shut a significant gasoline pipeline to Europe.
Markets face extra uncertainty from US-China rigidity – the Biden administration is contemplating strikes to curb US funding in Chinese language expertise corporations and can permit Trump-era merchandise import tariffs to proceed whereas the levies are reviewed.
Information of extra coronavirus lockdowns in China added to the jittery temper, with blue chips down 0.6pc. MSCI’s broadest index of Asia-Pacific shares exterior Japan eased 0.1pc, and Japan’s Nikkei was off 0.3pc.
Developing
Company: Dechra Prescribed drugs (full-year outcomes)
Economics: Composite PMI (UK, EU), companies PMI (UK, EU, China), retail gross sales (UK, EU)
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