UK accused of handing out £14bn in oil and gas subsidies
Britain has been accused of handing out almost £14bn in subsidies to the oil and gas industry since signing the Paris climate deal five years ago.
Companies received £9.9bn in tax relief for new exploration and production, as well as £3.7bn in payments for decommissioning sites between 2016 and 2020, according to campaign group Paid to Pollute, which cited OECD analysts.
The Government denied subsidising the fossil fuel industry, saying it follows guidelines issued by the International Energy Agency on phasing out subsidies.
Campaigners will appear in the High Court next month to argue that the UK’s oil and gas production strategy conflicts with its commitment to reaching net zero by 2050. They’re citing the development of a new oil field off the coast of Scotland, which is part-owned by Shell.
A number of countries committed to gradually eliminating fossil fuel subsidies at the COP26 climate summit this month. However, the UK refused to join an alliance of nations that set a date for phasing out production.
BBC Three will return to TV screens for the first time in six years after the plans were given the green light by regulator Ofcom.
The youth-focused channel was made online-only in 2016 as part of a major cost-cutting drive by the public service broadcaster.
But after a string of popular hits – including Normal People, Fleabag and Killing Eve – the BBC will bring the channel back on air in January.
Ofcom, which carried out a lengthy review of the proposals, said the move will help the BBC improve its reach among younger underserved viewers. The regulator will require 75pc of BBC Three’s shows to be original UK productions.
US urges Russia to open the taps as oil prices surge
The US is trying to persuade Russia to ramp up its oil output in an effort to tame the recent surge in prices.
The White House, which this week announced it would release 50m barrels of oils from its strategic reserves, is now lobbying the Kremlin to step up production, the Interfax news agency reported, citing Russia’s foreign ministry.
Tensions are rising between production cartel Opec – alongside allies such as Russia – and major consumers as they grapple for control over the turbulent global oil market.
The coordinate release of reserves by countries including the US, China and the UK comes after Opec resisted repeated calls to accelerate its production to help ease prices.
The production group is now said to be considering a pause to increases in its output in retaliation.
Barclays: Flutter and Entain now price in ‘significant risk’
Analysts at Barclays reckon Flutter and Entain shares now price in “significant risk” and seem cheap amid the looming threat of tighter regulation.
The bank writes that recent coverage on problem gambling in the UK has added pressure on the Government ahead of the publication of the Gambling Review’s white paper, expected early next year.
Ladbrokes owner Entain and Flutter, which owns Paddy Power and Betfair, both dropped on Wednesday following a Telegraph report that more than 160 MPs and peers are calling for a £2 cap on online betting.
Barclays said Flutter shares were pricing in a 60pc cut to online earnings, while Entain shares were pricing in a downgrade of around 40pc.
Hochschild surges as Peru backs down on mine closures
Miner Hochschild has been given a much-needed boost this morning after Peru appeared to back down from threats to shut two of the company’s key mines.
The FTSE 250 firm lost a third of its value on Monday after it emerged the Peruvian government may force it to shutter two silver miners.
But Hochschild surged as much as 26pc this morning – clawing back much of its losses – after the threats appeared to ease.
Chief executive Ignacio Bustamante said:
We are pleased that our Inmaculada and Pallancata mines can continue to operate without further uncertainty and, furthermore, we reaffirm our goal to increasing our resources and extending our mine lives, in accordance with current legislation.
American fast food favourite Wendy’s could be given a new lease of life in the UK as bosses look to expand its presence in Blighty after a successful relaunch.
Wendy’s, which returned to the UK in June after a two-decade hiatus, is planning to open a further 50 sites across the country next year.
The burger chain said it was seeking franchise partners and also had its eye on Europe, with launches in France, Germany and Spain.
Abigail Pringle, Wendy’s chief development officer, said: “We have seen incredible success that outperformed our expectations, and it’s clear to us that customers are loving our fresh, high-quality food.”
Wendy’s opened five restaurants in Reading, Stratford, Oxford, Croydon and Romford earlier this year. New locations planned for 2022 include Brighton, the Midlands and discussions are ongoing with franchise partners in Scotland, Wales, Northern Ireland and the Republic of Ireland.
The blue-chip index rose as much as 0.2pc before paring gains, with Ferguson, BHP and Anglo American among the biggest driving forces.
The progress was held back by heavyweight stocks Vodafone and Imperial Brands, however, which both fell nearly 4pc as they began trading ex-dividend.
The FTSE 250 gained 0.3pc, with All Bar One owner Mitchells & Butler rising as much as 7pc after narrowing losses. The biggest gainer was Vivo Energy, which jumped 20pc after it announced a $2.3bn (£1.7bn) takeover deal.
Tensions between the US and China continue to escalate this morning, with Beijing saying it will take all measures necessary to protect its companies and threatening retaliation over the latest wave of US sanctions.
The US government added 12 firms to its trade blacklist on Wednesday over national security and foreign policy concerns, in some cases citing their help in developing the Chinese military’s quantum-computing efforts.
Commerce ministry spokesperson Shu Jueting described the measures as groundless and said China reserved the right to take countermeasures.
All Bar One owner Mitchells & Butlers has narrowed its losses for the year, but warned it was facing a hit from surging energy and wage costs.
The pub and restaurant group, which also owns brands including Toby Carvery, Miller & Carter and Browns, slimmed its pre-tax losses to £42m for the year to 25 September, down from £123m the previous year.
Sales dropped 9.6pc over the year due to lockdown closures, but the company said trading had picked up 2.7pc in the last eight weeks as punters flocked back. Shares jumped as much as 7.6pc in early trading.
However, Mitchells & Butlers issued a cautious outlook on the upcoming year, saying it was battling a rise in costs, especially in utilities and employment.
The group said that while it was mitigating the impact of these cost rises, there would “inevitably” be an impact on its full-year performance.
Chief executive Phil Urban said:
The trading environment remains challenging and cost headwinds continue to put pressure on the sector.
However, we have strengthened our balance sheet and returned to profitability and cash generation, allowing us to resume our capital plan and Ignite programme which will deliver sales and efficiency improvements to help combat these challenges.
The latest barrage of downbeat economic data is casting something of a shadow over the upcoming arrival of Olaf Scholz, who yesterday secured an agreement to replace Angela Merkel as Chancellor at the helm of a new coalition government.
Germany has tightened some restrictions to combat rising cases, including shutting Christmas markets and barring unvaccinated people from bars, gyms and leisure centres in some regions.
But fears are growing about a full-blown lockdown in line with neighbouring Austria.
The GfK survey found that Germans were significantly more pessimistic about the outlook for the economy than last month. Income expectations also dropped, while the willingness to splash out on big purchases hit a nine-month low.
GfK consumer expert Rolf Buerkl said:
Consumer sentiment is currently being squeezed from two sides. On the one hand, the number of cases in the fourth wave of the coronavirus pandemic is exploding, which threatens to overwhelm the health system and could lead to further restrictions.
On the other hand, the purchasing power of consumers is dwindling due to a high inflation rate of 4pc. The outlook for the upcoming Christmas season is now somewhat bleak.
There’s even more misery over in Germany this morning, where a slew of new data has compounded fears about the outlook for Europe’s largest economy.
The forward-looking GfK barometer showed consumer confidence tumbled to -1.6 for December, down 2.6 points from the previous month.
Meanwhile, estimates for economic growth in the third quarter were revised down from 1.8pc to 1.7pc.
The figures reflect the huge inflationary pressures weighing on Germany’s manufacturing-heavy economy. These are now being compounded by renewed Covid worries, with a recent surge in cases sparking fears of another lockdown.
Equity markets in Asia mostly fell on Thursday as a batch of strong economic data spurred expectations that the Federal Reserve will withdraw its vast financial support and lift interest rates earlier than thought. The S&P 500 and Nasdaq closed on Wednesday with healthy gains ahead of the Thanksgiving break. But the Dow edged slightly lower, and Asia largely followed suit.