Money

Michael Simmons

How much is Europe (still) paying Putin for oil?

When sanctions were imposed on Russia there was a big exception: Europe was still buying and paying for oil – leading to a bizarre situation. The West was doing everything it could to help Ukraine while still sending Putin hundreds of millions of dollars a day. But how much was that revenue worth to the Kremlin? As sanctions began to hit Russia, the price of Brent crude (the oil benchmark) soared to $130 a barrel, the highest since the 2008 financial crisis: an increase of over 90 per cent. It’s fallen since then but today it’s still sitting between $107 and $115 dollars a barrel – well above where it had been weeks

Katy Balls

Can Sunak prove he’s a low tax Tory?

When Rishi Sunak first envisaged this year’s spring statement, the idea was that it would be policy light. Instead, it would serve as an economic update on the latest forecast and give him a chance to lay out his broad tax aspirations for the year ahead. However, Russia’s full-scale invasion of Ukraine means that the goalposts have moved. The Chancellor has had to adjust to the fact that he has come to the end of one crisis only to be greeted by the next. With the economic fallout from Ukraine only exacerbating the cost of living crisis, Sunak is under pressure to announce measures to ease the pressure on households. So, what

Isabel Hardman

Could the private sector help fix the NHS backlog?

The Conservative plan to tackle the NHS backlog has, so far, run roughly along the lines of the New Labour approach to the hefty waiting lists in the health service at the turn of the century. More money, more flexibility when using the private sector and greater ‘patient choice’ (which in this context translates as patients who’ve been waiting a very long time being able to get treatment in another part of the country where waiting lists aren’t quite so bad). So far, the main difference is that ministers are just shouting a bit less at hospitals (though GPs might argue they are bearing the brunt this time instead) than

Ross Clark

What the P&O debacle really tells us about Brexit

It goes without saying that sacking your entire staff via a ten-minute video call while their cheaper, foreign replacements sit outside in buses is a pretty disgusting way to treat people. True, P&O’s cross-Channel operation has been rendered unprofitable as a result of Covid, but this wasn’t a case of a headcount reduction or management urging pay restraint until the company can get back on its feet again. It was a wholesale dismissal of workers, plenty of whom will have had decades of service. No wonder some refused to leave their ships. How ironic, however, that so many of the biggest critics of P&O this week are ardent Remainers. What

Kate Andrews

The Bank of England is playing catch up with inflation

The Bank of England has voted to hike interest rates to 0.75 per cent, the third successive rise, which puts rates back to their pre-pandemic levels. Historically, we’re still at ultra low levels, but the rise is anything but insignificant. After the Federal Reserve made its first move to lift interest rates by 0.25 per cent (its first rise since 2018), it was all but guaranteed that the Bank would vote to lift interest rates again. The Fed had been holding out longer than most, with CPI in the United States hitting nearly 8 per cent, a 40-year high, before it took action. But the narrative that price hikes are

Turkmenistan may emerge as a global powerbroker

While the world is watching Ukraine, there is another former Soviet republic that has quietly undergone regime change. Turkmenistan’s 65-year-old former president, known, in the manner of a comic book superhero, as ‘The Protector’, stepped down in February. With Gurbanguly Berdymukhamedov’s departure, the Mejlis Assembly duly called for elections on 12 March. As regime changes go this one was hardly revolutionary. The Protector’s son, having just turned 40 (the minimum age at which a candidate can stand for the presidency) won the election at a canter. The only surprise was that Serdar, ‘The Son of the Nation’, won just 73 per cent of the vote compared to his father’s 97 per cent winning

Kate Andrews

Why Boris can’t blame rising energy prices on Ukraine

Are you ready to take cold showers to do your bit for the war effort? Protestors in Berlin have been holding up placards suggesting they’d sooner do so than use Russia’s gas. Boris Johnson has called on the British public to make similar sacrifices, solemnly telling us that we need to drop cheap Russian energy and ‘accept that such a move will be painful’. The government will spend billions to help ease that pain, he says, but ‘none of us can afford to carry on like this for long’. On the surface, it sounds like the start of an honest conversation: telling voters that the cost of living squeeze we’re

China’s zero Covid strategy is a threat to the global economy

Aside from deterring a few tourists, and people filming fantasy epics, closing down New Zealand during the Covid pandemic didn’t make much difference to the global economy. Neither, come to think of it, did Mark Drakeford’s determination to keep Wales free from Covid-19, and even Australia’s dedication to closing itself down didn’t matter that much as long as the mines stayed open. For most of the last two years ‘zero Covid’ policies have mainly affected the people unfortunate enough to live under them and those trapped from returning home. But China? That is something different. And right now Beijing’s almost certainly doomed attempt to crush the virus is as much

Can Britain afford to spend more on defence?

With rumours swirling that the Ministry of Defence will see its budget boosted in next week’s spring statement it’s hard not to wonder: was Donald Trump right? The former President repeatedly criticised Nato members in Europe for not contributing enough to support the alliance, relying instead on the US to shoulder the burden. And while the UK has met the Nato commitment to spend 2 per cent of its GDP on defence, we’ve seen a massive decrease in our defence budget over the last half century. As war returns to Europe, a consensus view has emerged – that the UK grew complacent when it came to security. We recoiled at

Ross Clark

Britain’s ‘NEETs’ aren’t what they used to be

Remember Neets, the mainly-young people who are ‘not in employment, education or training’? A decade ago they were seen as a group which had grown at alarming speed during the economic crisis on 2008/09. Many older people, by contrast, were continuing to work for longer, possibly as a result of their pensions having diminished in value. Following Covid, however, the profile of the working population has changed sharply again. Your typical Neet now is not a school-leaver who has failed to find anything useful to do with their lives – it is a professional aged 50-70 who has decided to throw in the towel prematurely. The number of people counted

What happens if Russia defaults?

Well down the list of things to worry about as the ghastly Ukrainian tragedy unfolds is the high probability that the Russian government will stop paying its international debts. But this risk should certainly be somewhere on that list – as the fallout from past defaults has shown. We have been here several times before. Moscow also defaulted on its debt in 1998, exacerbating a sell-off across all emerging markets. It led to the collapse of a huge US hedge fund, Long-Term Capital Management, which had to be bailed out to prevent a worldwide meltdown. This came too late to save many other investors from large losses. Ten years later, apparently

Ross Clark

Should we prepare for an oil price crash?

I almost felt a sense of perverse celebration as the meter clocked round to £100 – the first time I have ever spent so large a sum filling my car with diesel. Not so long ago it was costing me closer to £60. After gas and electricity prices, it is suddenly oil prices which are making the news. Some garages have been shown selling the fuel for over £2 a litre. If you live in a rural area and rely on oil to heat your home, you may have experienced an even bigger shock in the past fortnight: the price of domestic heating oil has doubled to around 120 pence

Kate Andrews

Rishi Sunak’s energy bill dilemma

This morning’s revelation that the UK economy grew 0.8 per cent in January, the fastest growth since April last year, is welcome news after a Christmas plagued by Omicron – but it’s news that’s out of date, too. As Capital Economics warns: ‘This is as good as it gets for the year’. Russia’s invasion of Ukraine, the commodity price jump and the cost-of-living crisis will soon show in the figures. Today’s ONS release warns that even in January, businesses were already reporting significant rises in the cost of energy and staff wages. The week after next, Rishi Sunak will present a mini-Budget. The Chancellor faces a conundrum: how to explain the inflation and

Sanctioning Roman Abramovich will change football forever

With refugees fleeing Ukraine, shells raining down on civilians, and threats of chemical weapons being used on the battlefields of Ukraine, it was surely only a matter of time. Today the British government finally added Roman Abramovich to the list of sanctioned Russian oligarchs, freezing his assets, and making sure that he could not profit from any sales. That will impact his entire fortune, of course. But most of all, it will hit Chelsea Football Club – and radically re-shape the fortunes of the Premier League. Abramovich’s departure will mark the beginning of an exodus of global money from British football In the two decades since a then relatively unknown Russian

James Forsyth

Rising energy bills are a price worth paying to stop Putin

Nato countries are being careful not to do anything that Russia could claim is an act of war. Just look at the reluctance from the US to provide Ukraine with Polish fighter jets. Yet Britain and other Nato members are involved in a huge effort to break Vladimir Putin’s war machine through supplying Ukraine with weapons and imposing financial pressure on Moscow. Russia, a G20 country, has been severed from the world economy. It has now surpassed Iran as the most sanctioned country on Earth and it is beginning to occupy a similar economic position. The speed with which Russia has been hit by these economic measures has been a

The commodity kings: have traders finally discovered a moral compass?

Many people around the world were glued to their screens in horror on 4 March, as they watched Russian shells raining down on Ukrainian cities. On a trading floor in central London, the oil traders at Shell were also glued to their screens – but watching the price of Russian oil. It was becoming a lot cheaper than normal (Brent) oil, due to the understandable reluctance to support Putin. But then again, everyone has their price. The Shell traders watched, and waited, as every minute the price was lowered further– to a $23 a barrel discount, then a $24 discount, then a $25 discount. Finally, at around 4 p.m., the

Robert Peston

Is Boris in denial about the looming economic crisis?

The priority for the UK and other rich democracies is to protect the people of Ukraine from the depredations of Putin’s forces. A close second should be protecting the poorest people in our countries and vital public services from the cancerous impact of soaring inflation, made much worse by the West’s economic warfare against Putin’s Russia. The most basic costs of living are soaring. And that means a devastating recession that has already begun for all those but the richest. This blow to living standards will be the worst in living memory, more pernicious than the impact of either the banking crisis or Covid. Talking to ministers and MPs, it is

Russia’s war on Ukraine: the lessons so far

The sheer complexity – and horror – of Russia’s war on Ukraine makes it difficult to distil the essential points. To take only one example, the battlefront north of Kiev, where the Russian convoy is stalled, is significantly different from that along the Black Sea, where Russian forces from Crimea have made substantial progress. A third front, in the east, is consolidating in Russia’s favour, though the fight was much harder and longer than Moscow expected. Amid this complexity, it is important to summarise what we know so far: 1. Vladimir Putin’s decision to invade Ukraine appears to be the most catastrophic strategic mistake since the end of the Cold War and

The problem with International Women’s Day

Am I the only one wondering how long it’ll be before the organisers of International Women’s Day are forced to rename their campaign? How, depending on what they mean by ‘women’, it’ll need to be called ‘International People-with-a-cervix Day’ or ‘International People-who-identify-as-a-woman Day?’ Quite what the founders – a group of American workers who back in 1909 demanded shorter hours, better pay and voting rights – would make of the word ‘woman’ being gradually pushed out of the lexicon as a meaningful term we will never know. But on a better note, they would surely be overawed by the progress made in the past 113 years. Women account for over

How close is Russia to collapse?

Russia is now as closed off to the world as the Soviet Union was before Mikhail Gorbachev made his first tentative steps towards glasnost more than 40 years ago. Pretty much all the progress that post-Soviet Russia had made towards becoming a ‘normal’ country has been reversed within the space of two weeks. Vladimir Putin’s presumed legacy – of stability, predictability and hugely improved living standards for the vast majority of Russians – is vanishing before their eyes. In recent days, Netflix and TikTok have joined what had already become a mass western boycott of Russia. American Express followed Barclaycard and Mastercard in leaving the Russian market. Western supermarkets, including Sainsbury’s, are pulling out;