Day: March 1, 2022

Global supply chains, already hit hard by the pandemic, are facing further disruption and cost inflation as airspace closures after Russia’s invasion of Ukraine affect the air freight industry.

Transport between Europe and north Asian destinations like Japan, South Korea and China has become particularly problematic due to reciprocal airspace bans that bar European carriers from flying over Siberia and Russia airlines from flying to Europe.

Airlines responsible for moving around 20% of the world’s air cargo are affected by those bans, Frederic Horst, managing director of Cargo Facts Consulting, told Reuters on Tuesday.

Germany’s Lufthansa LHAG.DE, Air France KLM AIRF.PA, Finnair FIA1S.HE and Virgin Atlantic have already canceled north Asian cargo flights over airspace issues, though major Asian carriers like Korean Air Lines 003490.KS and Japan’s ANA Holdings 9202.T are still using Russian airspace, as are Middle Eastern airlines.

Pure cargo carriers like Russia’s AirBridgeCargo Airlines and Luxembourg’s Cargolux are also subject to the airspace bans, in a move that could send air freight rates — already elevated due to a lack of passenger capacity during the pandemic — soaring further.

In December, air cargo rates were 150% above 2019 levels, according to the International Air Transport Association (IATA), adding to inflation affecting industries and economies around the world.

Sanctions imposed on Russia in the wake of its invasion of Ukraine are expected to further disrupt global supply chains.

Russia’s AirBridgeCargo alone moves just under 4% of global international air cargo, with most of that between Europe and Asia, Horst said.

“All up you could be looking at perhaps a quarter of air cargo between Asia and Europe needing to find alternate means of transportation,” Horst said.

“Yields are high enough that flying a longer route via Southeast Asia, South Asia or the Middle East is an option, but it will still pull capacity out of the market.”

Demand for air cargo last year was 6.9% above 2019’s pre-pandemic levels, according to IATA, as e-commerce surged during the pandemic and shipping container shortages and port bottlenecks led to more products being flown by air. In December, air cargo rates were 150% above 2019 levels, IATA said.

Asia-North America cargo routes are expected to be less affected than European routes, analysts say, because many carriers already use Anchorage, Alaska as a cargo hub and stopover point.

Japanese automakers Toyota Motor Corp 7203.T and Nissan Motor Co 7201.T said on Tuesday they were keeping an eye on any disruption to supply chains as a result of what Russia calls its “special operation” in Ukraine.

U.S.-based United Parcel Service Inc UPS.N and FedEx Corp FDX.X, two of the world’s largest logistics companies, have halted deliveries to Russia.

Source: Voice of America

ADDIS ABABA— The African Union has condemned disturbing reports of ill-treatment of African citizens in Ukraine trying to flee the country but are being refused the right to cross borders safely.

Thousands of Africans and other foreign nationals, particularly students, have been scrambling to leave Ukraine following Russia’s invasion.

But as hundreds of thousands throng to Ukraine’s various land borders, overwhelming authorities in neighbouring countries, reports have emerged that Africans are being treated differently and sometimes prevented from leaving.

Several people have shared videos and testimonies on social media, denouncing discrimination at train stations and border posts.

“Reports that Africans are singled out for unacceptable dissimilar treatment would be shockingly racist and in breach international law,” AU Chair, Senegal’s President Macky Sall, and Moussa Faki Mahamat, head of AU Commission said in a joint statement.

The statement added that all people have the right to cross international borders during conflict, and should enjoy the same rights to cross to safety from the conflict in Ukraine, notwithstanding their nationality or racial identity.

“The Chairpersons commend the efforts by African Union Member State countries and their embassies in neighbouring countries to receive and orientate African citizens and their families trying to cross the border from Ukraine to safety,” the statement concluded.

Source: NAM NEWS NETWORK

The 31 members of the International Energy Agency said Tuesday they’d release 60 million barrels of oil from their strategic reserves to bolster the world’s oil markets in the wake of the Russian invasion of Ukraine.

The United States and large energy-consuming countries in Europe have not sanctioned Russian oil, but prices have spiked since the invasion. On Tuesday, the price of a barrel of oil was more than $100 for the first time since 2014.

Russia is the world’s third-largest producer of oil, accounting for roughly 12% of the oil market. Sixty percent of Russian oil goes to Europe, while about 20% goes to China. The U.S. also imports Russian oil.

The release is "to send a strong message to oil markets" that there will be "no shortfall in supplies" the group said Tuesday.

"The situation in energy markets is very serious and demands our full attention," IEA Executive Director Fatih Birol said.

The U.S. will account for about half of the release announced by the IEA.

The IEA’s action is only the fourth time it has led a coordinated release of strategic oil reserves since reserves were created following the Arab oil embargo of 1974.

It is unclear if releases affect the price of oil.

Last November, amid spiking gas prices, U.S. President Joe Biden released 50 million barrels, a move followed by several other countries. The move had very little impact on the price of gasoline, which has continued to rise. The price of one gallon of gas in the U.S. is now 90 cents more than it was a year ago.

"The release of the reserves is notable, but as we saw back in November, it's just not viewed as a kind of game changer in any way," Craig Erlam, senior market analyst at commodity futures trading firm OANDA, told Reuters.

Source: Voice of America

A leading cybersecurity firm says it has discovered a “highly sophisticated” piece of malware being used by Chinese hacking teams to attack government and critical infrastructure targets.

Symantec, a division of U.S.-based software designer and manufacturer Broadcom, said the earliest known sample of the malware, which has been dubbed Daxin, dates back to 2013, while Microsoft first documented the hacking tool in December 2013.

A report by the company’s Threat Hunter Team says Daxin is “without doubt” the most advanced piece of malware it has seen used “by a China-linked actor.” The unit says Daxin was discovered along with other hacking tools previously used by Chinese cyberattackers.

The hackers have deployed Daxin against “organizations and governments of strategic interest to China.” The malware permits the attackers to communicate directly with infected computers on highly secured networks where direct internet connectivity is not available, allowing them to extract data without raising suspicions.

Vikram Thakur, a technical director with Symantec, told Reuters that Daxin “can be controlled from anywhere in the world once a computer is actually infected.” Thakur said Daxin’s victims included high-level, non-Western government agencies in Asia and Africa, including justice ministries.

Source: Voice of America