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European energy prices are surging, creating ‘frightening’ uncertainty

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Sjoerd van der Wal | Getty Images News | Getty Images

LONDON — Europe is facing continued volatility in its wholesale gas markets, prompting concerns across the region that an energy crisis could be about to get even worse.

The front-month gas price at the Dutch TTF hub, a European benchmark for natural gas trading, was around 5% higher by 1 p.m. London time on Wednesday, with the price reaching 93.3 euros per megawatt-hour. Contracts for March and April delivery were also up by 5% on Wednesday, according to New York’s Intercontinental Exchange.

Meanwhile, the European day-ahead price increased to 94 euros per megawatt-hour, according to data from Reuters. While a far cry from the peak of around 182.3 euros seen in December, Wednesday’s activity still marked a significant price rise from the end of 2021, when prices dipped below 70 euros per megawatt-hour.

Wednesday also saw German day-ahead baseload power prices gain more than 50%, while their French equivalents increased 17% during early trade, according to Reuters.

It comes after European benchmark gas prices surged 30% on Tuesday, amid concerns about a cold winter, low gas inventories and Russia constricting supply to Europe.

Over the course of 2021, European wholesale gas prices rose by more than 400%, setting new records.

At Russia’s mercy?

Front-month natural gas contracts in the U.K. were up almost 6% on Wednesday, with contracts for April delivery gaining more than 7%.

Meanwhile, day-ahead prices at the National Balancing Point, the U.K.’s benchmark for natural gas trading, rose more than 10% to around £2.25 per therm.   

The U.K. is particularly reliant on natural gas as an energy source, with more than 22 million households connected to the country’s gas grid. Britain’s largest single source of gas is the U.K. Continental Shelf, which made up around 48% of total supply in 2020. However, the UCS is a mature source, meaning it has to be supplemented with gas imported from international markets.

‘Frightening’ prices for U.K. businesses

The U.K. has limits on how much suppliers are able to charge consumers for energy, with price caps reviewed by the government every six months. The next review is due in February.

Speaking at a press conference on Tuesday, Prime Minister Boris Johnson said the government was “not ruling out” measures such as tax cuts to keep energy prices stable, although he questioned the efficacy of such a move.

Trade body Energy U.K. told the BBC in December that it expected energy bills in the country to rise by up to 50% in the spring. The soaring cost of wholesale gas led to the collapse of a number of British energy suppliers last year.

Several U.K.-based small and medium sized businesses told CNBC on Wednesday that higher energy bills would deal a fresh blow to their already struggling companies.

“I am genuinely terrified about rising energy costs,” Gillian Ferguson, owner of Twisted Empire Bakes, said in an email. “My provider collapsed recently and [our new provider] has suggested we increase our monthly payment by £90 ($122). I’m a wholesale baker working from home with several ovens on the go — I’m not sure how long I will be able to keep swallowing the increases.”

Meanwhile, Craig Bunting, co-founder of independent coffee chain Bear, said energy providers had refused to renew his energy contract because his business is in the pandemic-ravaged hospitality sector, leaving him paying “a stupid amount for electricity.”

Lucinda O’Reilly, director of The International Trade Consultancy, told CNBC: “The rate at which energy prices are rising is going to have a disastrous impact on British manufacturers, who already pay much higher prices than competitors in Europe and the rest of the world.”

“The squeeze on small businesses is already frightening, with many of us putting a stop to investments while a majority of suppliers are sending weekly price increase e-mails,” added Adam Bamford, CEO of Colleague Box. “This could well be the straw that breaks the backs of a number of us.”

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Teladoc Tumbled 38% After Big First-Quarter Loss. Is It Just a Pandemic Play?

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After pandemic drop, Canada’s detention of immigrants rises again By Reuters

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© Reuters. FILE PHOTO: Two closed Canadian border checkpoints are seen after it was announced that the border would close to “non-essential traffic” to combat the spread of novel coronavirus disease (COVID-19) at the U.S.-Canada border crossing at the Thousand Isla

By Anna Mehler Paperny

TORONTO (Reuters) – Canada is locking up more people in immigration detention without charge after the numbers fell during the pandemic, government data obtained by Reuters shows.

Authorities cite an overall rise in foreign travelers amid easing restrictions but lawyers say their detained clients came to Canada years ago.

Canada held 206 people in immigration detention as of March 1, 2022 – a 28% increase compared with March 1 of the previous year. Immigration detainees have not been charged with crimes in Canada and 68% of detainees as of March 1 were locked up because Canada Border Services Agency (CBSA) fears they are “unlikely to appear” at an immigration hearing, according to the data.

The rise puts Canada at odds with Amnesty International and other human rights groups that have urged Ottawa to end its use of indefinite immigration detention, noting CBSA has used factors such as a person’s mental illness as reason to detain them.

A CBSA spokesperson told Reuters that “when the number of entries (to Canada) goes up, an increase in detention is to be expected.” CBSA has said in the past it uses detention as a last resort.

A lawyer told Reuters her detained clients have been in Canada for years.

In the United Kingdom, too, immigration detention levels rose last year after dropping earlier in the pandemic, according to government statistics. Unlike Canada, the United States and Australia, European Union member states have limits on immigration detention and those limits cannot exceed six months.

The rise in detentions puts people at risk of contracting COVID-19 in harsh congregate settings, refugee lawyers say.

Julia Sande, Human Rights Law and Policy Campaigner with Amnesty, called the increase in detentions “disappointing but not surprising,” although she was reluctant to draw conclusions from limited data.

The number of immigration detainees in Canada dropped early in the pandemic, from a daily average of 301 in the fourth quarter (January through March) of 2019-20 to 126 in the first quarter (April through June) of 2020-21.

FEW NO-SHOWS AS DETENTIONS DROPPED

Detaining fewer people did not result in a significant increase in no-shows at immigration hearings – the most common reason for detention, according to Immigration and Refugee Board data.

The average number of no-shows as a percentage of admissibility hearings was about 5.5% in 2021, according to that data, compared to about 5.9% in 2019.

No-shows rose as high as 16% in October 2020, but a spokesperson for the Immigration and Refugee Board said this was due to people not receiving notifications when their hearings resumed after a pause in the pandemic.

Refugee lawyer Andrew Brouwer said the decline in detention earlier in the pandemic shows Canada does not need to lock up as many non-citizens.

“We didn’t see a bunch of no-shows. We didn’t see the sky fall … It for sure shows that the system can operate without throwing people in jail,” Brouwer said.

He added that detainees face harsh pandemic conditions in provincial jails – including extended lockdowns, sometimes with three people in a cell for 23 hours a day.

Refugee lawyer Swathi Sekhar said CBSA officials and the Immigration and Refugee Board members reviewing detentions took the risk of COVID-19 into account when deciding whether someone should be detained earlier in the pandemic but are doing so less now.

“Their position is that COVID is not a factor that should weigh in favor of release,” she said.

“We also see very, very perverse findings … [decision-makers] outright saying that individuals are going to be safer in jail.”

The Immigration and Refugee Board did not immediately respond to a Reuters request for comment.

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Nasdaq futures rise as market attempts comeback from April sell-off, Meta shares soar

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Stock futures rose in overnight trading as the market shook off the April sell-off and investors reacted positively to earnings from Meta Platforms.

Futures on the Dow Jones Industrial Average added 70 points or 0.2%. S&P 500 futures gained 0.7% and Nasdaq 100 futures jumped 1.2%.

The moves came as shares of Meta surged more than 18% after hours following a beat on earnings but a miss on revenue, a sign that investors may see signs of relief in the beaten-up tech sector. Shares were down 48% on the year heading into the results.

Meanwhile, shares of Qualcomm gained 5.6% in extended trading on the back of strong earnings while PayPal rose 5% despite issuing weak guidance for the second quarter.

“I think a lot of people want to believe that earnings are going to pull us out of this, but earnings are not what got us into this,” SoFi’s Liz Young told CNBC’s “Closing Bell: Overtime” on Wednesday. “… But the reality is there are so many macro headwinds still in front of us in the next 60 days that the market is just hard to impress.”

The after-hour activity followed a volatile regular trading session that saw the Nasdaq Composite stoop to its lowest level in 2022, as stocks looked to bounce back from a tech-led April sell-off. The index is down more than 12% since the start of April.

In Wednesday’s regular trading, the tech-heavy Nasdaq ended at 12,488.93, after rising to 1.7% at session highs. The Dow Jones Industrial Average rose 61.75 points, or 0.2%, to 33,301.93 propped up by gains from Visa and Microsoft, while the S&P 500 added 0.2% to 4,183.96.

Investors await big tech earnings on Thursday from Apple, Amazon and Twitter, along with results from Robinhood. Jobless claims are also due out Thursday.

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