Pipeline to the Royal Mail: Czech Sphinx’s Russian gas activities are cause for concern: ALEX BRUMMER
Europe has done a great job of extricating itself from Russian gas supplies since the start of the war in Ukraine.
The Kremlin’s share of the gas market has plummeted from 35 percent to 8 percent, as users switched suppliers to Norway and liquefied natural gas (LNG) producers in Qatar and the US.
One major leak has occurred, namely the transit of gas via Ukraine, mainly to Slovakia and Austria.
That agreement came to an end on January 1 when Ukraine’s Naftogaz refused to renew its last five-year transit agreement with Russia’s Gazprom.
The mystery is why, given the extensive Western sanctions against Russia, this contract remained in place.
The policy was seen as an economic benefit for Kiev, which will lose around £800 million in transit costs due to the lockdown. Less discussed are the other beneficiaries.
Russia links: Royal Mail bidder Daniel Kretinsky has a 49% stake in the Eustream pipeline that pumps gas to Slovakia through the company EPH
This includes SPP Infrastructure, the group that controls the Eustream pipeline that pumps gas to Slovakia.
The minority owner of 49 percent in the pipeline is EPH, part of Czech sphinx Daniel Kretinsky’s sprawling empire, which also includes stakes in West Ham FC and Sainsbury’s.
Putin’s gas has enriched Kretinsky and his partners, and is one of the reasons why Kretinsky has been able to amass enough wealth to allow him to make a £3.6 billion bid for Royal Mail owner International Distribution Services.
The Slovakia/Austrian pipeline was able to operate under an exemption from the EU.
It does not change the fact that Russia’s horrific war against Ukraine has intensified through the use of drones and advanced missiles to attack civilian and energy generation targets.
The attack has cost lives in the war-torn country.
Kretinsky and his fellow infrastructure investors have continued to receive dividends from the pipeline, so it is extraordinary how the proposed deal for the Royal Mail passed the National Security & Investment Act under such circumstances.
Britain played a central role in efforts to hamper Russia’s economy, pushing British oligarchs out of the country, seizing billions of pounds of financial assets, ending the listing of Russian shares in London and more. much more.
Even if Kiev were the intended beneficiary of keeping the trans-Ukrainian line open, it would be difficult to justify the gains from the Russian connection.
Royal Mail business secretary Jonathan Reynolds and the Royal Mail unions may view Kretinsky as a legitimate businessman. But families of the dead, injured and dispossessed in Ukraine may have a different view. The British government should do the same.
Exporting pain
The economic prospects are not improving for Rachel Reeves.
Growth could get a boost in 2025 as money moves to the public sector after her budget.
But wealth creation through the private sector is neglected. And with the government absorbing much of the country’s borrowing capacity, there is a risk that private sector investment will be crowded out.
The Manufacturing Purchasing Managers Index tells a continued bleak story, with activity contracting at the fastest pace in eleven months.
Britain tends to mock the weakness of the eurozone economies, but this ignores the fact that Europe is Britain’s largest trading partner.
This has contributed to the biggest drop in exports and new orders in ten months.
Normally, Britain can count on its dominant services sector and the City to save us. There is no better time for the Chancellor to boost confidence by helping to deliver a new equivalence deal for London’s derivatives market.
Crucial as it is, lifting stamp duty on share trading could go a long way in reviving sentiment in Britain’s battered stock markets.
Rocket science
Britain punches well above its weight in science, as evidenced by the UK’s record for Nobel Prizes and tech startups.
It is very worrying that analyzes by the FT show that the number of core subjects has decreased over the past five years. The number of bachelor’s degrees in chemistry has fallen by 25 percent and that of life sciences by 15 percent.
An increase in education spending of £2.3 billion over two years is proposed, with money from the VAT levy on independent education. It would be best deployed to revive the appetite for laboratory and technical training.
Ministers must close the scientific gap if research progress is not to be blunted.
DIY INVESTMENT PLATFORMS
A. J. Bell
A. J. Bell
Easy investing and ready-made portfolios
Hargreaves Lansdown
Hargreaves Lansdown
Free fund trading and investment ideas
interactive investor
interactive investor
Invest for a fixed amount from € 4.99 per month
Sax
Sax
Get £200 back in trading fees
Trade 212
Trade 212
Free trading and no account fees
Affiliate links: If you purchase a product, This is Money may earn a commission. These deals have been chosen by our editors because we believe they are worth highlighting. This does not affect our editorial independence.