2024-05-08 11:10
STOCKHOLM, May 8 (Reuters) - Telefonica Germany (TEF.MC) New Tab, opens new tab will move one million 5G customers to Amazon Web Services (AWS) cloud later this month, company executives told Reuters, in a bold move by the U.S. online retailer to break into the global telecoms market. While some telecom networks have moved IT and other non-core operations to the public cloud, the move by the subsidiary of Spanish group Telefonica is a global first where an existing mobile operator is switching its core network to a public cloud. Big cloud-computing services firms such as Amazon (AMZN.O) New Tab, opens new tab and Microsoft (MSFT.O) New Tab, opens new tab have been trying to move more into the telecoms sector, lured by billions of dollars in potential revenue, but operators have been wary of the capability of public clouds in handling a mobile network. "I want to see it working for at least one to two quarters and have a roadmap to move at least 30-40% of my customer base by 2025-2026," said Mallik Rao, Chief Technology & Information Officer at O2 Telefonica, also known as Telefonica Germany. The company has 45 million customers in Germany. AWS and O2 Telefonica did not disclose financial details of the deal. The core network, which consists of high-performance servers in data centers, is the heart of a mobile network that securely routes data and calls at high speeds. A public cloud will cut costs, increase scale and allow repairs to be done without service disruption. "As the network becomes more defined by software, traditional players need to up the ante to keep up with the threat of the big tech," said analyst Paolo Pescatore at PP Foresight. "We will hear the word 'frenemy' used a lot more." U.S.-based Dish (DISH.MX) New Tab, opens new tab, which built its mobile network from scratch, became in 2021 the only telecom company to use AWS cloud for its core network. "Dish was much easier because they had no existing systems that had to be modified to work with the cloud," AWS vice president Jan Hofmeyr said in an interview. Nokia, which also worked with Dish, will provide the software and AWS will provide its infrastructure for Telefonica Germany. "The cloud players continue to get better ... and building more credibility with the operators to be able to move network functions into the cloud," said Raghav Sahgal, president of cloud and network services at Nokia. Telefonica first worked with AWS and Ericsson, and then swapped to Nokia and AWS, Rao said. "The days of trial are over. I don't want to keep on trying." The global telecom cloud market is expected New Tab, opens new tab to reach $108.7 billion by 2030 from $19.7 billion in 2021, making it a growth driver for companies such as Amazon. "We want to make it a business to run telco workloads," AWS' Hofmeyr said, adding that the company expects more deals with other operators in the next 12 months. "I would say in most cases the discussion is about timing versus should we move into the cloud." Sign up here. https://www.reuters.com/business/media-telecom/amazon-breaks-into-europe-5g-networks-with-telefonica-cloud-deal-2024-05-08/
2024-05-08 11:10
May 8 (Reuters) - Refiner HF Sinclair (DINO.N) New Tab, opens new tab on Wednesday surpassed first-quarter profit estimates aided by higher fuel sales and announced a new share buyback program of $1 billion. Global fuel supplies have tightened this year following outages at Russian refineries after Ukrainian drone attacks shut a significant section of Russia's refining capacity during the quarter. U.S. product supplied, a proxy for demand, averaged at 20.10 million barrels per day (bpd) at the end of March, compared with 19.7 million bpd a year earlier, according to U.S. Energy Information Administration data. HF Sinclair's sales volumes of refined products rose 22.4% to 631,470 bpd, while renewable fuel sales also increased. The company's refinery utilization rose to 89.2% from 73.5% a year ago. Its throughput averaged 643,300 bpd, a 15% rise over the year earlier, as it saw lower turnaround activities at its refineries. "As we head into summer driving season, we expect a favorable market environment and believe we are well positioned to generate strong earnings and cash flows," CEO Tim Go said. HF Sinclair's refinery gross margin, however, declined 45% to $12.70 per produced barrel in the first quarter, it said, as fuel prices scaled back. Larger rivals Marathon Petroleum (MPC.N) New Tab, opens new tab and Valero Energy (VLO.N) New Tab, opens new tab have also beaten their quarterly profit estimates despite a slump in margins. Dallas, Texas-based HF Sinclair posted adjusted net income of 71 cents per share for the three months ended March 31, compared with average analysts' estimate of 65 cents per share, according to LSEG data. Sign up here. https://www.reuters.com/markets/commodities/hf-sinclair-beats-quarterly-profit-estimates-tight-fuel-supply-2024-05-08/
2024-05-08 11:07
May 8 (Reuters) - Global commodity trader Trafigura has agreed to buy more of UK-based biodiesel firm Greenergy, boosting its position in renewable energy after unveiling plans to acquire the firm's European business roughly two months ago. Major commodities traders are still trying to figure out where to invest their record earnings from the last few years. With no clear winner or money-maker in the renewables race, they are spreading their investments across a plethora of technologies - from hydrogen and ammonia to geothermal, biomethane and solar - to get their foot in the door of whichever takes off. Trafigura on Wednesday expanded its deal with Brookfield Asset Management and its listed affiliate Brookfield Business Partners to buy Greenergy's Canadian business for an undisclosed sum. Greenergy, which has manufacturing plants in the UK and the Netherlands, entered the Canadian market in 2013 and offers a variety of road fuels including higher percentage biodiesel blends from its rail-fed terminals in Ontario and British Columbia. Trafigura in 2019 established an internal fund to invest in alternative and renewable energy technologies. Like its peers, the trading house cashed in on price spikes in global commodity and energy markets in 2022 after western powers imposed sweeping sanctions on Russia over its invasion of Ukraine. They are estimated to be collectively sitting on billions of dollars in profit even after paying out record dividends. However, commodity traders already control large areas of global oil, gas and power markets, and have found it difficult to grow, while poor returns in recent years on wind, solar and hydrogen have irked some investors. Still, production of renewable fuels is rising as refiners look for ways to offset carbon emissions, while trading shops are also looking to boost efforts to reduce their carbon footprint. Although the production and consumption of carbon-heavy commodities is expected to drop in the coming decades, trading gross margins from low-carbon segments is expected to double by 2030 and further increase two-to-threefold to an average of $60 to $70 billion by mid-century, according to consultancy firm Oliver Wyman. Low-carbon commodities will likely "eventually compensate for the inescapable decline of fossil commodities," the analysts added. Sign up here. https://www.reuters.com/markets/deals/trafigura-acquire-greenergys-canadian-business-2024-05-08/
2024-05-08 10:40
NICOSIA, May 8 (Reuters) - Aid for Gaza was being loaded onto a ship in Cyprus on Wednesday in what was expected to be the first cargo to be delivered using a U.S. pier built to expedite supplies to the besieged enclave. Containers were being stacked on the U.S. flagged Sagamore, docked at the port of Larnaca, on Wednesday. Some containers to the ship were labelled as aid from the United Arab Emirates. Konstantinos Letymbiotis, a Cyprus government spokesperson, said a U.S jetty built to handle aid shipments to Gaza had been completed. "We are completing the loading of aid onto a U.S. vessel now in Larnaca and once the platform is in place this part of the process (shipment) can commence," he said. It was unclear when the vessel would depart. Israel's military campaign against Hamas, in response to Hamas's attack on Israel on Oct. 7, has devastated the tiny Gaza Strip, where aid agencies warn its 2.3 million people are facing imminent famine. Cyprus opened a sea corridor in March to ship aid directly to Gaza, where deliveries via land have been severely disrupted by border closures and Israel's military operations. U.S.-based charity World Food Kitchen (WCK) used the route twice before seven of its workers were killed in an Israeli air strike on April 1. Gaza lacks port infrastructure and the U.S. has built a custom-made offshore jetty to take delivery of aid shipments. Once delivered, aid would be offloaded onto U.S. military logistics support vessels and then to a causeway where it would be loaded onto trucks for onward delivery, U.S. officials have said. Sign up here. https://www.reuters.com/world/middle-east/aid-gaza-loading-cyprus-us-offshore-jetty-completed-2024-05-08/
2024-05-08 10:39
Rate cut to 3.75% from 4.00% Riksbank says will proceed cautiously in easing policy Rate-setters worried about weaker crown STOCKHOLM, May 8 (Reuters) - Sweden's central bank cut its key interest rate to 3.75% from 4.00% on Wednesday, as expected, and said it was likely to cut the rate two more times in the second half of the year if inflationary pressures remain mild. After a two-year hiking cycle, central banks around the world are weighing when to start easing policy. But the timing is proving tricky as rate-setters assess geopolitical tensions and fret over getting inflation back to target levels. Sweden's central bank had said in March it saw a good chance to cut rates in May or June, and data since then has confirmed that inflation is set to stabilize around 2% after peaking at over 10% in late 2022. "If the outlook doesn't change, we can cut rates a further two times during the second half of the year," Riksbank Governor Erik Thedeen told reporters. Most analysts in a Reuters poll had forecast a quarter point cut, the first in eight years by the Riksbank. The focus is now on how fast rates come down. "We have pencilled in a pause for the June meeting followed by three more rate cuts by year-end," Capital Economics' Chief European Economist Andrew Kenningham said. He said a positive surprise in inflation figures for April and May could put a June cut back on the table. The Riksbank, however, is worried easier policy could undermine the Swedish crown and add to inflationary pressures, especially if Sweden gets out of synch with the European Central Bank and the U.S. Federal Reserve. "Monetary policy needs to be characterized by caution," Thedeen said. The crown, which weakened after the decision was published, is currently trading at around the same level against the euro as during the global financial crisis in 2008-2009. Thedeen said today's dip in the crown was likely short-lived but much will depend on how other central banks act. (.KIXI) New Tab, opens new tab The ECB is expected to cut rates in June, but easier policy from the Fed, the global bellwether for central banks, may have to wait. Australia's central bank warned on Tuesday rates were unlikely to come down soon while rate-setters in Norway had a similar message last week. The Bank of England will announce its latest policy decision on Thursday with a rate cut not expected until June at the earliest and possibly later in the summer. After eight rate hikes in less than two years, Sweden's economy has ground to a halt and many households are struggling with mortgage payments at their highest level for more than 15 years. Sweden's economy shrank 0.2% in 2023 and remained weak during the first three months of the year. The last time the policy rate was lowered was in early 2016 when it fell to -0.50%, its lowest ever level. Sign up here. https://www.reuters.com/markets/europe/swedens-riksbank-makes-first-rate-cut-since-2016-expects-two-more-2024-2024-05-08/
2024-05-08 10:17
LONDON, May 8 (Reuters) - The pound eased on Wednesday ahead of a Bank of England decision on interest rates at which analysts expect the central bank to telegraph when investors can expect borrowing costs to begin to decline. Sterling was down 0.13% on the day at $1.2493. The pound also slipped against the euro, which gained 0.1% on the day to trade at 86.06 pence . The pound has lost nearly 2% against the dollar so far in 2024 but remains the second-best performing major currency behind the Chinese yuan, which is down by only 1.5% in the offshore market . The futures market shows traders believe the BoE is likely to start lowering rates by August and could deliver two quarter-point cuts by the end of this year. After the BoE's most recent policy meeting six weeks ago, the expectation was for three 25-basis-point cuts. But since then, the data has shown Britain's economy continues to chug along, wage growth - a focal point for the central bank - is moderating, though only slowly, and overall inflation is gradually declining towards the 2% target. "Whether the Bank of England cuts rates in August or June may seem academic and not actually of much importance," Caxton FX strategist David Stritch said. "But on the contrary, a June cut would mean that the BoE still has five meetings before the end of 2024 - plenty of time to cut and maybe cut again." Almost more importantly, investors expect far fewer cuts this year from the U.S. Federal Reserve than they did at the start of January, a situation that has driven the dollar up across the board and overpowered some of the dynamics that might otherwise support the pound. Vanguard, one of the world's largest asset managers, believes the BoE will cut rates by half a percentage point, which would bring the base rate to 4.75%, compared with a previous forecast of an entire percentage point this year. "We still think the Bank will start easing in August. But a more hawkish Fed and ECB, renewed growth and firming core inflationary pressures lead us to dial down our expectations for the pace of rate cuts thereafter," said Shaan Raithatha, senior economist at Vanguard. Sign up here. https://www.reuters.com/markets/currencies/pound-hunkers-down-ahead-bank-england-decision-2024-05-08/
