Weekly Market Spice

?? Energy and Environmental Policies Update

Rishi Sunak, Chancellor of the Exchequer, has announced a delay in the ban on the sale of new petrol and diesel cars until 2035, citing concerns about the financial burden on the public. Recent polling indicates a decline in support for the ban, with only 36% of voters backing it for 2030, down from 51% in 2021. Additionally, the ban on new oil boilers has been postponed from 2026 to 2035. The Cabinet has also approved plans to raise household grants for boiler upgrades to ￡7,500.

??? Global Oil Prices Surge

Expectations of oil prices hitting $100/barrel have arisen as Saudi Arabia and Russia extend production and export cuts until year-end. The International Energy Agency predicts a record global oil consumption of 101.8 million barrels per day this year, primarily driven by increased Chinese demand.

???? Russian Defense Spending Soars

Russia is set to escalate defense spending by over 25% in 2024, pushing it to nearly 6% of GDP, up from 3.9% this year and 2.7% in 2021. A deficit of Rbs1.6tn is anticipated for 2024, persisting until 2026. President Putin is expected to allocate more funds for pensions and welfare ahead of the 2024 presidential election, potentially extending his rule until at least 2030.

?? Cisco's Bold Move: Acquiring Splunk for $28 Billion

Cisco, a global tech giant, has finalized a $28 billion deal to acquire US software maker Splunk. The purchase, valued at $157 per Splunk share in cash, represents a 31% premium over its closing price. Despite the challenges of high interest rates and an increasingly restrictive antitrust environment, the deal is anticipated to be concluded by Q3 2024.

?? Airlines Vigilant Against Fake Engine Parts

Airlines are on high alert after UK-based AOG Technics was found to have sold parts for GE Model CF6 engines without FAA approval. Nearly 100 engines are suspected to contain parts with forged documentation. Operators will be required to remove and quarantine these counterfeit components. Airlines such as American, Southwest, and United have already identified suspected fake parts from AOG. The CF6 engine is predominantly used to power cargo planes, including the majority of Boeing 767 freighters.