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LONDON, June 25 (Reuters) - Portfolio investors have rebuilt their position in crude oil after reassurance from Saudi Arabia and its OPEC⁺ allies that any planned future increases in production would be contingent on market conditions.

Last week hedge funds and other money managers turned their attention to boosting Brent positions, after a large jump in NYMEX and ICE WTI the week before, according to records filed with exchanges and regulators.

Fund managers purchased the equivalent of 69 million barrels of futures and options linked to Brent over the seven days ending on June 18, the fourth fastest increase for any week since 2013.

Rapid Brent buying came after fund managers purchased 42 million barrels of NYMEX and ICE WTI, as well as 26 million barrels of Brent, the previous week.

As a result, positions and prices have reverted to where they were before OPEC⁺ announced on June 2 it would increase production from the start of the fourth quarter of 2024, subject to market conditions.

Total Brent and WTI positions amounted to 300 million barrels on June 18 up from an immediate post-announcement low of 164 million on June 4 but barely changed from 319 million on May 28.

Fund managers are pessimistic about the outlook for prices in the short term, with the net position in only the 13th percentile for all weeks since 2013.

But expectations OPEC⁺ was about to flood the market with extra barrels have been allayed after official briefings emphasising the contingent nature of the planned production increases.

Futures prices have also reverted to the same level as before the production increases were announced, with the front-month contract closing at $85 per barrel on June 18 compared with $84 on May 28.

The round trip in positions and prices triggered by the OPEC⁺ surprise announcement appeared to have been completed by the middle of last week.

EUROPE GAS OIL

Fund managers also purchased the equivalent of 28 million barrels of futures and options linked to European gas oil over the seven days ending on June 18, a record for the last decade.

The net position doubled to 60 million barrels (67th percentile) from 31 million barrels (36th percentile) the week before.

The sudden bullishness likely explains why commodity trader Trafigura has loaded gas oil in the Persian Gulf onto a very large crude carrier (VLCC) to carry it west to Europe.

The shipment marks the first VLCC to move diesel in bulk from the Middle East to the West in nearly a year, data from Kpler show (“Trafigura charters supertanker to load gasoil from Mideast”, Reuters, June 24).

U.S. NATURAL GAS

Portfolio managers continued to increase their bullish position in U.S. gas but at a slower rate than in recent weeks as inventories proved stubbornly high and the price rally ran out of momentum.

Hedge funds and other money managers purchased the equivalent of 47 billion cubic feet (bcf) in the two main futures and options contracts linked to the price of gas at Henry Hub in Louisiana.

Funds have increased their position in 14 of the most recent 17 weeks by a total of 2,845 bcf since February 20, but last week’s increase was one of the smaller increments.

The resulting net long position of 1,170 bcf (58th percentile for all weeks since 2010) on June 18 was up from a net short of 1,675 bcf in the middle of February (3rd percentile).

Working gas inventories were 592 bcf above the prior ten-year seasonal average on June 14 down from a surplus of 664 bcf on March 15.

In percentage terms, inventories were 24% above the ten-year seasonal average down from a surplus of 40% some 13 weeks earlier.

But stocks were still 1.47 standard deviations higher than average and on that measure the surplus had not narrowed at all.

Persistently high inventories have begun to test investors’ faith in a rapid reversion to normal after major gas producers announced cuts to drilling programmes in February.

As disgruntled Parisians complain about the impending Games, organizers face a steep challenge: Deliver an Olympics on time and on budget—and breathe life into its battered reputation

On one of the first warm spring evenings in May, in cafes and offices and on boulevards across Paris, thousands of smartphones started buzzing in unison.

Inside the No. 9 metro, rush-hour passengers scrambled to check their messages—then rolled their eyes. “IMPORTANT,” read the alert. “Message from the Interior Ministry regarding the security perimeter for the Opening Ceremony of the Olympics.”

The official purpose of the communication was to make locals aware of a QR code they will need to access vast swaths of the city during the Olympic Games, which descend on the French capital from July 26 to August 11. But for many Parisians, the high-pitched interruption was little more than an unwelcome reminder that the Olympics is coming.

A running joke in France is that the national pastime isn’t soccer or rugby or even pétanque. It’s complaining. And even by that lofty standard, the Games’ imminent arrival has raised the usual griping to historic levels, as picture-postcard corners of Paris have been overrun by construction crews and locals prepare a mass exodus during the chaos of les Jeux.

The Place de la Concorde, once home to a public guillotine, now houses an even more incongruous installation: a miniature campus for the Olympics’ “urban park,” where 25,000 people a day will fill the blue plastic seats for skateboarding, BMX cycling, breakdancing and 3-on-3 basketball. Ornate fountains and lampposts have been boxed up in giant wooden crates to shield them from damage. Above the Concorde’s cobblestones, those hulking stands cropped up almost overnight. And below them, one of Paris’s busiest metro stations is shutting down. These are the concessions, organizers say, that must be made when turning a living museum into a functional sports arena.

A few steps away, the 124-year-old Pont Alexandre III, a gilded bridge over the Seine, has been fitted with bleachers for the Opening Ceremony, the triathlon and the finish of the road-cycling time trials, among other moments.

To those who view them as eyesores, these installations have only intensified the grumbling. “Help! The Olympics have invaded Paris,” cried a recent op-ed in the Journal du Dimanche newspaper. “Olympics: We are not ready,” read another message projected in giant letters on the face of the Arc de Triomphe during an anti-Games protest. An April poll by the French Institute of Public Opinion found that only 48 percent of French people trusted the country to organize the Olympics successfully, down seven points since February.

But what many locals don’t realize is how high the stakes are for these Olympics—far higher than the inconvenience of crowded subways and noisy Americans for three weeks. Over the past decade, the reputation of the Olympics has taken a beating. Instead of delivering a global party every two years, its recent history has been all turmoil all the time.

From the Sochi 2014 Winter Olympics, tainted by a vast Russian doping conspiracy, to 2016’s Summer Games in Brazil—beset by budget overruns, inefficiency and a pool that mysteriously turned green—the Games’ global standing fell faster than a diver off the 10-meter board. Things devolved further during the pandemic. In 2020, the already wildly expensive and unpopular Tokyo Games were delayed by a year and then held under a cloche of intense Covid-19 protocols. Then came Beijing: empty arenas, even more invasive Covid restrictions and the uncomfortable optics of Olympics held in service to an autocratic regime.

Viewers didn’t conceal their boredom with the whole enterprise. The 17-day Tokyo Olympics drew an average of 15.5 million prime-time television viewers in the U.S., according to NBC, making it the broadcaster’s smallest Summer Games audience since it took over the rights in 1988. It also marked a 42 percent decline since the Rio Olympics held just five years earlier. (The Winter Olympics is in even worse shape, with the Beijing Games also drawing NBC’s lowest-ever prime-time TV audience.)

After a century of waiting for the event to return to Paris for a third time, following 1900 and 1924—and a decade during which the Games lurched from crisis to fiasco to minor catastrophe—the ambition is to restore the fun, the glitz and the prestige of the Games. Whether Parisians like it or not.

“Enough with this Games-bashing!” Paris Mayor Anne Hidalgo told the city council recently. “Enough. Enough of all these buzzkills who don’t want us all to celebrate something together. We’re here and we’re doing it.”

Even if a three-week party succeeds in quieting detractors, there’s no such thing as a completely calm, trouble-free Olympics. The first time Paris hosted, in 1900, the Games took five months to complete. And even London 2012, which is held up as a paragon of what the modern, reasonable Games can be, was viewed with deep, British skepticism right up until the Opening Ceremony, as locals worried about public transit and security staffing shortages.

Paris 2024 comes with its own specific set of concerns: the lingering threat of terrorist attacks, a creaking transit system that even the mayor admits isn’t prepared to absorb the increased traffic or the possibility of labor unrest. But France’s long history in hosting major sporting events means it’s still regarded as a relatively safe choice.

That’s why in 2017 the International Olympic Committee leapt at the chance to lock them in as a lower-maintenance, less controversial host. Both Paris and Los Angeles were bidding for 2024 until, out of nowhere, the IOC announced that it would take the rare step of awarding two Summer Olympics at once. Los Angeles agreed to handle the 2028 Games while Paris took 2024.

“There had been permanent panic with Rio and then the pandemic with Tokyo,” says David Wallechinsky, the former president of the International Society of Olympic Historians. “The Olympic movement needed a well organized, calm Olympics.”

After the excesses of Beijing 2008, where the bill ran to an estimated $40 billion, Sochi ($50 billion), and Tokyo (more than $20 billion, according to government auditors), the Paris Olympics promised to be more reasonable, more responsible. The idea was to bring these Games back to something closer to London 2012, which, after much hand-wringing, turned into a rain-free, national celebration of Cool Britannia. The total cost in Paris has been widely reported to be around $10 billion, putting it under London and Rio, with 97 percent of the budget coming from private funding.

“Paris 2024 wants to show that there is a different way to organize the Games,” says the organizing committee president, Tony Estanguet, who won three gold medals in his former life as an Olympic canoeist for France. “Recently we’ve seen Olympics where money was no object. But for us, it’s important to be as sober as possible.”

Paris can afford to be a little more sober in dressing up the city in part because certain city planners—Louis XIV, for instance—had their own extravagant taste. You don’t have to do much to the Palace of Versailles to make it look extraordinary on television. That said, organizers did end up doing major landscape work on the grounds to make them suitable for equestrian competition after discovering the fields were on a slight slope.

These Olympics have also leaned on French history to stretch the definition of “Paris 2024” as far as it will go. Some events will be held on the outskirts of the city proper—still others as far away as Marseille, on France’s southern coast. And then there’s the surfing competition, which will take place 10,000 miles from the City of Light in the French overseas territory of Tahiti. No surfers will make the round trip to attend the Opening Ceremony.

And still, Estanguet points out, this constitutes keeping things on a more reasonable scale without sacrificing the Parisian wow-factor.

“Our hallmark,” he likes to say, “will be audacity.”

Nothing encapsulates that audacity more than organizers’ plans to make an Olympic star out of a murky body of water that no sober Parisian would ever take a dip in—a river, in fact, where swimming has been banned for more than a century. Not only will they sail athletes on barges down the Seine in the Opening Ceremony, they will send athletes into the Seine for the triathlon and open-water swimming events. This has turned into the plan that launched a thousand headaches at Paris 2024 headquarters: Whether or not the Seine will be clean enough has turned into one of the greatest intrigues of the Paris Olympics.

Last summer, officials had to cancel the test event in the Seine due to a high concentration of bacteria in the water. As recently as February, tests found that the levels of E. coli were 20 times higher than what is allowed by World Triathlon, the sport’s governing body. That was before the city unveiled a newly built underground storage tank designed to store wastewater during heavy storms and prevent it from running into the Seine in May. As long as Paris doesn’t experience biblical downpours in July, city officials say, the river should be perfectly safe to compete in. Those who have to swim in it aren’t so sure.

“We need a plan B,” says the defending open water Olympic champion from Brazil, Ana Marcela Cunha. “The Seine is not made for swimming.”

No matter what happens, according to people familiar with the organizers’ thinking, the athletes are expected to get in the water.

The same question seems to arise with every Olympics: Who are the Games really for? Over one million tickets have been sold for people who want to attend the Paris Games, and more than 10,000 athletes are heading to France. But that’s a drop in the Seine compared with the audience of billions watching from home. In other words, the Olympics aren’t necessarily for the people at the Games. Which means a host city isn’t just a host city—it’s a giant television sound stage.

That’s a role Paris knows how to play. Every camera shot is designed to look like a postcard, says the organizing committee’s CEO Étienne Thobois. And wherever possible, venues have been dropped in front of iconic Paris landmarks. Viewers are about to be fed a nonstop carousel of shots of the Eiffel Tower, the Arc de Triomphe and pink sunsets over the Champs-Elysées. Paris 2024 has vastly increased the number of “beauty cams” set up in high places with the sole purpose of delivering pretty, Instagram-worthy shots of the city to broadcasters.

“It’s going to be powerful, spectacular and dazzling,” Estanguet says. “We know that this is also about the image of the country, about tourism, and, in some way, making people say, ‘Wow, what is this country? I have to go see this.’”

The Rio Olympics had beach volleyball on the picturesque sands of Copacabana. Paris saw that bet and raised it with a beach volleyball stadium at the foot of the Eiffel Tower. Whether or not getting there will be a tourist’s nightmare hardly matters to the audience watching around the globe. Paris has tried to mitigate potential transportation issues by urging people to work from home during the Games (seemingly forgetting that many Parisians clear out of the capital in midsummer anyway) and doubling the price of metro tickets to $4.30 for nonresidents.

It helps that Paris has been able to lean on a healthy foundation of sports infrastructure. Some 95 percent of the venues already exist, such as the Stade de France, which will host track and field, or the Bercy concert hall, for gymnastics and basketball. But the remaining 5 percent of new construction has generated a disproportionate number of the negative headlines.

The Olympic Stadium, Athletes’ Village and Aquatic Center are all located just north of the city in the département of Seine-Saint-Denis, the poorest in mainland France. Organizers have said that they hope the construction projects there will act as a stimulus to the area by extending transport links and providing more housing once the Athletes’ Village is converted into 3,000 apartments, but critics have accused the Games of disregarding the needs of longtime residents. Local activist groups have decried the loss of public spaces, the forced relocation of homeless people and the sudden whitewashing of neighborhoods that existed long before anyone worried about where the diving venue might go.

“The history of these sports mega-events shows that there is a high risk of ‘social cleansing’ in the streets,” the collective Revers de la Médaille (Flip Side of the Medal) wrote in an open letter to the Games’ organizers. “Right now, everything leads us to believe that Paris 2024 will follow the same pattern.”

Paris 2024 officials insist that they have acted responsibly and that the Games will pour billions of euros into the area. But Seine-Saint-Denis isn’t the only place discontent has bubbled up. Closer to the city center, signs of irritation are hiding in plain sight.

Steps from the Place de la Concorde, graffiti that has yet to be painted over captures a popular sentiment that isn’t suitable for print. Even the construction workers erecting skate parks in front of the gilded Luxor Obelisks are occasionally interrupted by passersby who most certainly won’t be buying tickets.

“People ask a lot of questions,” said Lucas Prado, a construction site manager at the Place de la Concorde. “Obviously, not all of them are happy.”

“My job is to convince people,” Tony Estanguet explains.

During his career as an Olympic athlete, Estanguet’s job was to carry the French flag into the Opening Ceremony, paddle his canoe as hard as he could and win gold medals. Now it’s sitting in endless meetings with elected officials, broadcasters and sponsors, who are paying for all of this and will help him meet a pledge: that the Games won’t turn into yet another taxpayer-funded boondoggle. (See: Rio, Tokyo.)

Paris hopes to set itself apart in many ways, but the most important (and rarest) distinction would be delivering the Games on budget, on time and almost entirely through private funding. In the final months before the Olympic flame is lit, organizers say, they are on track to pull it off. Securing the money took around 75 local sponsors, including huge commitments from the luxury conglomerate LVMH and the pharmaceutical giant Sanofi. But the process hasn’t always been smooth, with some of the largest backers waiting until the final 12 months before the Games to come on board.

Where they all agree is that reviving the prestige and relevance of the Olympics can help craft the image France hopes to project to the world in 2024. The country wants to be seen as the center of a sensible Europe that is able to marry an old-world taste for the finer things with a forward-thinking sense of global responsibility—all while making breakdancing an Olympic sport. Paris understands that the Games can no longer be an act of national self-indulgence for the host, exiting out of time and hitting pause on real-world issues. And it knows that these are the new standards on which it will be judged.

“You can’t organize the Games anymore without asking yourself some fundamental questions,” Estanguet says. “We have a planetary challenge here, and the Games must do their part. The Olympics aren’t going to fix everything. They’re not going to bring about world peace on their own. But they have to try to help.”

The U.K.’s closely watched plan might be shut down amid logistical, political and legal issues

Two years ago, the British government decided to spend big to outsource a migration problem.

To deter migrants seeking asylum from illegally entering the country, it announced a radical plan: Those smuggled on makeshift dinghies to British shores would be sent to Rwanda, a small country in central Africa, where they would remain. The U.K. government handed Rwanda a £120 million (about $150 million) down payment and told it to get ready to host thousands of potential refugees.

Shortly after, Hope Hostel, a neatly kept yellow-fronted hotel in the Rwandan capital of Kigali, was rented out with British taxpayer funds to accommodate the expected planeloads of asylum seekers. Hotel manager Ismael Bakina and his team of 40 have been keeping busy ever since, changing the sheets on 100 double beds weekly, trimming decorative pot shapes into the bushes that adorn the hotel’s entrance and mowing the lawn on its mini-soccer pitch.

But on a recent day the beds at Hope Hostel were untouched. The suggestion box at the reception desk sat empty. No one has yet come to stay. “We are still waiting,” Bakina said, standing near a sign that reads: “Come as a guest, leave as a friend.”

No one may ever arrive. The U.K. government’s plan—criticized by some as inhumane, praised by others as a pragmatic response to a global migration crisis—has faced logistical, political and legal hurdles. So far, it’s been a huge waste of money. Just two migrants have volunteered to go to Rwanda after being paid £3,000 by the British state. Meanwhile, record numbers of migrants are crossing the English Channel to Britain so far this year, according to official data.

Britain’s Rwanda plan highlights the increasingly bold—and often legally fraught—plans that countries are taking as they grapple with a surge of migrants crossing into countries illegally and asking to be considered refugees. At least 920,000 asked for asylum in the U.S. during its 2023 fiscal year, and 1.14 million did the same in Europe last year.

President Biden in early June barred people who enter the U.S. illegally from seeking asylum. Asylum seekers must now cross at an official port of entry. Dozens of European nations are also exploring the idea of sending asylum seekers to third countries to stay while their refugee claims are considered or even to live there permanently.

The Rwanda plan is a cautionary tale of how complicated it can be.

The U.K. government has spent years locked in a fight with human-rights lawyers who argue that Rwanda isn’t a safe place to house asylum seekers. It has expended enormous political capital on the project, passing a law that prevents British courts from deeming Rwanda unsafe for asylum seekers, getting Rwanda to overhaul its own judicial system and offering the African nation up to £490 million in payments if the project gets off the ground.

Faced with yet more legal hurdles, the British government began rounding up migrants in April to be sent to Rwanda. British Prime Minister Rishi Sunak has called an election for July, and promises to get flights off if he is elected. The opposition Labour Party, who are favorites to win, say they will immediately scrap the policy.

“I am not going to flog a dead horse,” Labour Party Leader Keir Starmer said in a speech recently. “I am not interested in a gimmick.”

Other countries are interested. Advisers to U.S. presidential nominee Donald Trump are studying the Rwanda plan. Italy’s leader Giorgia Meloni organized a letter by 15 European countries asking the European Commission to explore new powers to process asylum applications outside EU territory. The election manifesto of the main center-right party in European parliamentary elections, the European People’s Party, calls on sending asylum seekers to “safe third countries.”

“The penny is dropping,” said Sunak during a recent campaign stop. “The challenge is growing, our security is being threatened and that is the only way to solve it.”

At the moment, asylum seekers are generally allowed to stay in their host country while their claims are processed to determine whether they are in need of protection. This system has been exploited by people smugglers to also move economic migrants, who aren’t under threat but want better working opportunities, into Western nations.

Many asylum systems are now clogged, and it often takes years for cases to be decided. By then, it’s often difficult for countries to expel or deport those who lose their case. In the U.S., most asylum seekers are found to not be refugees, but few are deported. Less than half of the asylum claims are approved in France. British officials last year approved around two-thirds.

Italy recently struck a deal to send certain asylum seekers to Albania. If the migrants win their case they can come to Italy. If not, they get sent off back home. In return, Albania gets money from Italy.

Britain’s plan goes a step further: sending asylum seekers to live in Rwanda, and barring them from the U.K. even if they are deemed refugees. The government argues the policy meets international law by offering refugees protection from persecution in their home countries and, crucially, will dissuade economic migrants from coming.

The United Nations High Commissioner for Refugees says that the 1951 Refugee Convention doesn’t forbid working with other countries to process asylum applications. However, there need to be important safeguards and “the UK’s plan didn’t have those safeguards,” said Matthew Saltmarsh, a spokesman for the UNHCR. Rwanda has in the past sent refugees on to other countries where they risked harm, a process known as refoulement, according to the agency. Furthermore, migrants sent by Britain are unlikely to assimilate into Rwandan society and would likely attempt a dangerous journey back to Europe, he said.

The Rwandan government contests this, pointing out it already houses 130,000 refugees from neighboring African countries. “We have worked very hard to make it safe,” said Yolande Makolo, the spokeswoman for the Rwandan government. “We have no apologies about being involved in an innovative partnership that could be one of the solutions to a problem that has gone on for far too long.”

The White Cliffs

On a recent blustery day on Britain’s south coast, a U.K. Border Force ship pulled into the port of Dover with around 60 asylum seekers wearing bright orange life vests. The group had been intercepted at sea traveling from France on a black rubber dinghy.

Together with another dinghy that morning, a total of 141 people were being processed. “It’s a quiet day for us,” said one Border Force official watching on.

The mostly male passengers, some without shoes, filed off the boat to be checked by doctors and then arrested for illegal entry. Within weeks, they are usually taken to hotels or other government accommodation where they live, at taxpayer expense, until their cases are decided.

To get to Britain, migrants often gather in makeshift camps in Northern France. When the wind is calm, smugglers cram between 50 and 100 people onto rafts made of the materials used to build children’s bouncy castles. The 9-foot-long boats often deflate somewhat during the trip and nearly always let in water. Crossing the channel can take over six hours, during which the migrants get wet and cold. Some 200 migrants are estimated to have died crossing in the past decade.

Once in U.K. territorial waters, the smugglers call for help, sometimes dialing the British equivalent to 911, and lifeguards or Border Force boats come to lift the migrants out of their rafts and sail them to Dover. The U.K. now employs two tugboats equipped with cranes working 12-hour shifts to haul discarded dinghies out of the water.

A decade ago, such boat crossings were rare. Lax controls on the border with France meant migrants hid in trucks that crossed into the U.K. via the underwater Channel Tunnel or on vehicle ferries from the port of Calais. Then in 2015, Britain and France tightened up checks on trucks.

In 2018, just 300 people made the crossing in small boats, the majority Iranians. By 2022, it was 45,000, and smuggling gangs were bringing in people from across the Middle East, northern Africa and as far away as Vietnam.

By 2020, the exponential rise caused panic in Downing Street, according to former government aides. Britain was leaving the European Union, a process that was meant to see the country take control of its borders. But migrants were leaking across at an alarming rate. The most obvious solution was to send the asylum seekers back to France, where they would be in a safe country, but the French didn’t want them. A latticework of human-rights law made deporting failed asylum seekers legally complex and time-consuming.

With thousands of applications, it was taking on average nearly two years for the Home Office to interview asylum seekers and determine whether they were refugees. Unable to find government housing for them, many were placed in hotels, a tab that cost taxpayers some £3.1 billion last year.

A smorgasbord of solutions were floated by Home Office officials, including using wave machines to wash boats away from British shores, officials say. But if migrants couldn’t be forcibly stopped or easily removed, officials concluded the best option was to make Britain the most unpalatable destination possible, former officials said.

Sending asylum seekers abroad isn’t a new concept. Following a European migration crisis in 2016, the EU signed a deal with Turkey for forced returns of Syrian migrants to Turkey in exchange for €6 billion (about $6.79 billion at the time) in aid. Under a Trump-era policy known as Remain in Mexico, tens of thousands of asylum seekers waited in Mexico until they got court dates in the U.S., a policy the Biden administration ended in 2021 and which is still the subject of court cases.

The British plan was inspired by a controversial decade-old Australian policy that saw migrants trying to arrive illegally by boat sent to Nauru, a remote small pacific island, or Papua New Guinea.

The UNHCR said there were several instances of reported self-harm among the offshored migrants who grew desperate. Papua New Guinea’s top court said the agreement was illegal in 2016. Still, the boats now rarely turn up. In 2023, 74 people turned up on four boats. None stayed in Australia.

“You don’t need to send that many back,” said Alexander Downer, the former foreign minister of Australia who helped devise its plan and has advised the U.K. government on migration issues. “If there’s a better-than-even chance you might get sent to Rwanda, they’ll stop coming. No one is going to pay 3,000 to 5,000 pounds to go from France to Rwanda.”

Switzerland of Africa

The small landlocked African nation is best known for the 1994 genocide where nearly one million mainly ethnic Tutsis died during a 100-day civil war. Since then, the country is credited with undergoing a social and economic transformation under the iron-fisted rule of President Paul Kagame, who has been in power for 24 years.

The country is sometimes called a tropical “Switzerland of Africa” for its capital’s clean streets and low crime rate. Government officials say Kagame brought order to a traumatized nation. Human-rights groups say that Kagame has built a quasi-police state. Among those recently calling out Rwanda’s human-rights record: the British Foreign Office.

Despite being one of the most densely populated countries in Africa, Kagame positioned Rwanda to be a welcome home for refugees. In 2019, Rwanda signed an agreement with the UNHCR to take in asylum seekers stranded in Libya. So far, more than 2,200 migrants have been sent to a camp south of the capital.

In 2022, Britain struck its migrant deal. It pledged £370 million for an Economic Transformation and Integration Fund to bolster Rwanda’s economy, of which £270 million has been disbursed. If Rwanda manages to take at least 300 asylum seekers, it would get an additional £120 million.

The U.K. also pledged to pay to get asylum seekers to Rwanda and house them for five years. The sums turned out to be eye-watering. A one-way ticket to Rwanda would cost £11,000, according to the U.K. Home Office. Officials decided they couldn’t use commercial flights and needed a chartered aircraft, with trained handlers to accompany about 50 migrants at a time.

Once in Rwanda, the U.K. would pay a further £151,000 per person to cover housing, food and medical insurance over five years. If an asylum seeker wanted to subsequently leave Rwanda, the U.K. would hand Rwanda £10,000 to facilitate their departure.

Quantifying the plan’s success is difficult, according to an analysis published by the Home Office. Much depends on trying to work out how many migrants would be subsequently deterred from coming to the U.K.

If only 300 people are sent to Rwanda, the cost comes out at £2 million per migrant, and the deterrence effect is likely negligible, according to the Migration Observatory, at the University of Oxford. If 20,000 migrants are sent, the cost drops closer to £200,000 per asylum seeker and the deterrence is more sizable.

In Rwanda, even if they aren’t deemed refugees, the asylum seekers would be granted residence and work permits, receive access to educational training courses and be offered purpose-built accommodation or rent a place of their own, say Rwandan officials. Each migrant would get a monthly stipend of roughly $1,400 for five years, leaving them well off by Rwandan standards. A Rwandan schoolteacher earns on average $340 a month, according to the Anker Research Institute.

“It is the most humane mechanism out there for relocated individuals and the most dignified one,” said Doris Uwicyeza Picard, the coordinator of Rwanda’s migration and economic development unit. Rwanda wants migrants to settle and contribute to its economy, she said.

At the Gashora refugee center south of Kigali, refugees sent by the UNHCR from Libya are housed in a collection of brick houses surrounded by a fence topped with barbed wire. On a recent morning, sobs from two newly arrived young women could be heard over the din of the crowds lining up to receive mosquito nets.

“Their intention was to go to Europe, and this is not Europe, you don’t expect them to be that happy,” said Ruyumbu Fares Augustin, the camp manager. More than 1,600 have then been resettled in third countries including Canada, Sweden and France. None have asked to stay in Rwanda.

Stop the boats

When then-British Prime Minister Boris Johnson announced the Rwanda plan in April 2022, there was an immediate backlash. The Archbishop of Canterbury and a group of fellow bishops said in an open letter that the plan “shames us as a nation.” A flurry of legal complaints followed.

Two months after the plan was announced, seven migrants were loaded onto the first flight to Rwanda. Minutes before takeoff, the European Court of Human Rights in Strasbourg issued an injunction to stop it. Despite Brexit, the U.K. still adheres to the European human-rights convention, though Sunak is now threatening to pull out.

When Sunak became prime minister in late 2022, he made “Stop the Boats” a key plank of his electoral strategy—a slogan that had also been used in Australia. Last November, Britain’s Supreme Court ruled the Rwanda plan didn’t comply with U.K. law because there was a real risk that Rwanda could process claims incorrectly and send migrants to places where they could face persecution.

The U.K. government responded by signing a treaty with Rwanda stating that no one sent by Britain could be forcibly sent on to another country. Rwanda organized for some 100 lawyers to take a special course in migration law to better process refugee claims and created an asylum appeals tribunal, made up of judges from several nations.

The Sunak government then passed a new law last summer stating that migrants arriving by small boat aren’t allowed to claim asylum at all, and that the government must remove them to another safe country. More than 50,000 migrants have since entered, but Britain has nowhere to send them.

In April, migrants began to be rounded up and placed in special detention centers awaiting a trip to Rwanda, creating panic. The Irish government complained that migrants were fleeing over the border from the British province of Northern Ireland to avoid being sent to Africa. Other asylum seekers went underground. Of the initial cohort of 5,700 asylum seekers identified to be sent to Rwanda, the Home Office said it could locate just over half of them. Some of those rounded up have now been released.

Ayoub, a 36-year-old Iranian who sailed across the Channel over a year ago to claim asylum, was previously informed he might be sent to Rwanda. The former engineer, who is living in northern England awaiting his case to be decided, said he would have done things differently if he had known he could be sent to Africa. “I would have changed my plan 100%,” he said, sucking on a cigarette. “I would have tried to reach the U.S.”

Downer, the former Australian official, said walking away from the scheme now would encourage new boat crossings. “The number of crossings will go way up—just watch,” he said. “Then they will start all over again trying to fix it.”

Protectionist policies are exacerbating inflation, according to one of the largest agricultural commodity traders

The world is headed for “food wars” as geopolitical tensions and climate change push countries into conflict over waning supplies, said one of the world’s largest agricultural commodity traders.

“We have fought many wars over oil. We will fight bigger wars over food and water,” said Sunny Verghese, chief executive of Olam Agri, a Singapore-based agricultural trading house.

Speaking at the Redburn Atlantic and Rothschild consumer conference last week, Verghese warned that trade barriers imposed by governments seeking to shore up domestic food stocks had exacerbated food inflation.

Big agricultural commodity traders, which reaped record profits in 2022 after Russia’s invasion of Ukraine sent food prices soaring, have been accused of exacerbating flood price inflation through profit-boosting mark-ups.

But Verghese argued elevated food price inflation was in part the result of government intervention. A proliferation of non-tariff trade barriers in 2022 in response to the war — 1,266 from 154 countries by his count — had “created an exaggerated demand supply imbalance”, he said.

Wealthier countries were building up surpluses of strategic commodities, leading to exaggerated demand, and in turn higher prices, Verghese said. “India, China, everybody has got buffer stocks,” he said. “That is only exacerbating the global problem.”

Food prices started to climb in the wake of Covid-19 and surged following Russia’s invasion of Ukraine as some exports of grain and fertilisers were blocked by the conflict. This deepened food insecurity in poorer countries and left consumers all over the world facing a cost of living crisis.

With this rise and climate change hampering agricultural production globally, governments are increasingly turning to protectionist policies.

In 2022, Indonesia banned palm oil exports to protect the local market while last year India imposed export restrictions on certain types of rice in an effort to curb rising domestic prices ahead of parliamentary elections, after a volatile monsoon disrupted production and spurred fears of a supply shortage.

“That was precisely the wrong thing,” Verghese said. “You’re going to see more and more of that.”

Olam Agri, which processes and supplies grains and oilseeds, edible oil, rice and cotton is part of the wider Olam Group. The food and agribusiness, which supplies ingredients, feed and fibre to global brands from Nestlé to Unilever, has had a difficult year.

The trader, which has a large footprint in Asia and Africa, was investigated by authorities in Nigeria last year after news reports claimed it was involved in a multibillion dollar fraud. Shares in the company jumped in February when it was cleared of wrongdoing.

Olam Group was also forced to issue a profit warning for the first half of 2023. Even after a better second half, it reported a 56 per cent drop in full-year profits to S$278.7mn (US$205.8mn), blaming this on high interest rates and “exceptional losses” caused by low yields from its almond orchards in Australia.

The group said the slump in profits was partly the result of a lower contribution from Olam Agri, following the sale of a 35 per cent stake in the business in 2022 to a subsidiary of Saudi Arabia’s Public Investment Fund for $1.24bn. Olam Agri is 51 per cent owned by Singaporean state-owned investment company Temasek Holdings.

Olam Group has long-standing plans to float Olam Agri in Saudi Arabia, but these have been repeatedly delayed since the trading arm was split from its food ingredients business in 2020. Headquartered in London, Olam Food Ingredients is one of the world’s biggest suppliers of cocoa, coffee, nuts and spices.

Addressing the impact of climate change on global yields, Verghese urged the gathering of consumer industry executives, including the bosses of Coca-Cola and Associated British Foods, to “wake up” and take more action on climate change.

Governments should charge a tax for carbon, he argued. “Carbon is free today, so we are polluting indiscriminately,” he said.

The world will spend $2tn on clean energy this year, and start-ups are racing for a share of that cash.

Over the past four years, data from market intelligence platform Sightline Climate shows that start-ups tackling the energy transition have raised $35bn from venture capitalists searching for new ideas on how to generate, distribute, and store renewable energy.

Developing renewable projects, such as building solar and wind farms, attracted the largest share of this money. Nuclear power, especially the promise of nuclear fusion, drew the second-largest amount of investment, followed by companies offering small-scale power systems, such as rooftop solar and batteries, and then by companies that are developing batteries or other ways to store energy.

Here are the top 12 start-ups across those sectors, listed by the total funds they have raised.

Gurgaon-based ReNew Power was the first Indian renewable company to list on Nasdaq, raising $1.2bn through a special-purpose acquisition company deal. ReNew has a portfolio of 15.6GW of clean energy generation as India races to hit a target of installing 500GW of renewable capacity by 2030.

Greenko, another of India’s huge wind and solar producers, has an installed capacity of 7.5GW and is expanding into green ammonia, signing a deal with Malaysia’s Petronas last October. 

US solar and storage developer Intersect Power operates in California and Texas, and is looking to both build out more renewable generation and provide more clean energy to data centres.

Commonwealth is one of the most high profile start-ups chasing the dream of recreating the nuclear fusion that happens in the sun.

Unlike nuclear fission, when atoms are split, fusion does not produce significant radioactive waste, making it a potential source of safe, nearly limitless carbon-free electricity.

Backed by Italian oil major Eni, Commonwealth attracted nearly $2bn in funding from investors including Tiger Global and Bill Gates, and said it had reached a pivotal milestone in March for its magnet technology. 

TerraPower is a next-generation nuclear power plant under construction in Wyoming. The company was founded by Bill Gates, who said this month that he would “put in billions more”.

TerraPower has started construction on a sodium-cooled reactor in Wyoming, and plans to couple it with a molten salt energy storage system, providing built-in gigawatt-scale energy storage.

TAE is a nuclear fusion start-up, backed by Google and Chevron, that was spun out of the University of California, Irvine in the 1990s. It uses a proprietary reactor design that fuses a hydrogen proton with boron, which it believes is safer than other fusion methods.

The UK’s largest household energy supplier is rolling out solar panels and batteries for homes, as well as its Kraken energy management platform. It became profitable earlier this year and has recently entered the US renewables market for the first time with the acquisition of two solar farms: one in Ohio and one in Pennsylvania.

After announcing a deal to buy Renu Energy in North Carolina earlier this year, California-based Swell now sells and installs solar panel and battery units across the US. Swell’s business involves aggregating those home batteries into “virtual power plants” that can be used by utilities to bolster the grid.

Washington, DC-based Arcadia connects homes with its community solar farms, allowing people to use solar power without having to install their own panels. It has more than 2GW of solar energy under management, with more than 200,000 homes and 2,500 organisations connected to solar farms.

Sweden’s answer to the battery gigafactories of the US and Asia is critical to Europe’s hopes of building its own electric vehicle supply chain. However, the company has said it is reviewing its plans to build a new factory in Borlange in central Sweden and carmaker BMW recently cancelled a €2bn contract for batteries.

South Korean battery maker SK On signed an $11bn deal with Ford in 2021 to help electrify the carmaker’s fleet, but has run into problems as the market for electric vehicles has slowed down. More recently, it has said that Europe is too reliant on Chinese made batteries.

This battery recycling start-up established by Tesla co-founder JB Straubel aims to reduce the need to mine lithium by reusing the materials in existing batteries. Its factory in Nevada is processing the equivalent of 250,000 dead electric vehicle batteries a year into the raw materials to make new batteries.

Hedge fund links former Segantii employee to Morgan Stanley trading probe

Evolution Capital Management says in court filings it believes Robert Gagliardi told banker, ‘I know who my daddy is’

A hedge fund has named a former Segantii Capital Management employee in connection with several trades that used confidential information from Morgan Stanley. 

Evolution Capital Management said in court filings that it believed its former employee Robert Gagliardi, a block trading specialist nicknamed “Gags”, was linked to several of the trades that US authorities scrutinised in the probes that led to the Wall Street bank paying a $249mn fine.

It also highlighted his relationship to the former head of the bank’s US equity syndicate, Pawan Passi. It said it believed the block trader referred to Passi as his “daddy” who had “put [him] in the fncking game” on block trades.

Evolution made the statements about Gagliardi in court filings for a London lawsuit that he brought against it, which centres on his claim that he is entitled to a $7.5mn bonus after leaving the firm. 

In a breach-of-contract claim, Gagliardi said his returns had exceeded expectations, including generating more than $67mn between May and December 2021, and Evolution had “in bad faith” failed to pay the bonus.

Evolution responded, in a court document filed this month, that one reason not to now pay the bonus was that it believed Gagliardi was one of the unnamed investors that the Securities and Exchange Commission and Department of Justice were referring to in statements published in January about the Morgan Stanley block trading probe. Evolution is countersuing him for the $7mn it paid him during the 11 months he worked there. It also disputed that Gagliardi had generated such high returns.

The SEC and DOJ documents cited by Evolution in its filing describe several occasions when investors bet against companies after talking to Morgan Stanley bankers who had access to confidential information about upcoming block trades. Block trades are sales of large amounts of a company’s stock, which can depress its share price. 

The authorities did not name or announce any actions against anyone who traded using the information that they penalised Passi and the bank for sharing. The SEC charged the bank and Passi with fraud, and the bank entered into a non-prosecution agreement with the US attorney’s office in Manhattan. Passi admitted to misconduct and agreed a deferred prosecution agreement with the US attorney.

Gagliardi worked at Hong Kong-based Segantii at the time of the trades that the SEC and DOJ describe, and later joined Evolution. 

Segantii is now shutting down after Hong Kong’s Securities and Futures Commission last month announced a case against it, alleging criminal insider dealing. That separate case does not involve Gagliardi and relates to trading that took place before he joined the firm. Segantii has said it plans to defend itself “vigorously”. 

Passi, Morgan Stanley and the US attorney’s office for the Southern District of New York all declined to comment and Segantii, Evolution and the SEC did not respond to emails seeking comment.

A spokesman for Gagliardi said it would “be inappropriate for him to comment in detail outside of that [court] process”, and that it was “disappointing that the Financial Times has chosen to report on these proceedings at this stage”.

He said Gagliardi “regards the latest claims as a desperate attempt to rewrite history after the event, and he looks forward to responding and robustly defending his position”. He said Gagliardi “categorically denies any insinuations of wrongdoing” and “has never been accused of or charged with any wrongdoing nor has he faced any regulatory restrictions”.

Court documents setting out Gagliardi’s response to Evolution’s latest filing, which links him to the US cases, are expected to be filed by July 5.

Evolution said in its defence against Gagliardi’s claim that Passi was “one of [his] closest contacts”.

It said it believed Gagliardi had told Passi in an August 2021 phone call, while working at Evolution, that “I know who my daddy is” and said Passi had “put [him] in the fncking game” on block trades, adding that he “would be at the kiddie table if it wasn’t for” Passi. 

It said that in an April 2021 phone call with his Evolution colleague Robert Toresco, Gagliardi had said words to the effect of: “You keep talking about fncking process, process, process. I don’t get what that means.”

“If you think that when the head of MS ECM calls me, I’m not going to trade, then you are fncking crazy. This is crazy. We are getting looks that only a few guys get.” Passi was the head of the bank’s US equity syndicate desk, which sits within its equity capital markets, or ECM, business.

In his claim against Evolution, Gagliardi said the Nevada-based hedge fund had “aggressively recruited” him and told him he would be paid a bonus linked to his contributions to its revenue, and to the business’s profits.

He said in court filings that he “adhered to [Evolution’s] rules, guidance and procedures insofar as explained and/or applicable to him” and said Evolution’s claims in its filings that he had violated its rules were either not raised with him at the time or “not suggested to be serious and/or urgent”.

He said Evolution and its founder Michael Lerch took a series of steps they would not have taken had they had “genuine or serious concerns” about him.

These included paying legal fees around December 2021 to support him “in any criminal and/or SEC investigation” and taking steps in January 2022 towards certifying him as a “fit and proper” person under the Financial Conduct Authority’s regime.

They also included appointing him to its risk committee in October 2021 and paying his assistant — who executed trades for him — a discretionary bonus. He said that in January 2022 he and Evolution spoke about the prospect of it investing in an independent fund he would manage.

Evolution said Lerch had thought that involving Gagliardi in the risk committee would make him “more likely to . . . respect [Evolution’s] risk management process”.

The hedge fund, which employed Gagliardi from April 2021 until March 2022, said that when the SEC served it with a subpoena related to block trades in January 2022, it realised that Gagliardi “appeared to be central to (as opposed to merely ancillary to) the US criminal investigation” into block trading that led to the Morgan Stanley fine. 

Evolution said the SEC and DOJ documents published this year gave the impression that during the 2018-2021 period covered by their probes, Gagliardi “was engaged in regular conduct . . . which was or which involved at the very least using confidential information to enter trades and thus generate profits so as to give him an unfair advantage over other market participants”. 

It said paying a discretionary bonus “to an employee who had engaged in such disreputable conduct (even where that conduct pre-dated his employment by [Evolution]) would be liable to bring the employer into disrepute itself with its clients, potential clients and the market generally”. Evolution did not say why it believed Gagliardi was the investor in question. 

It said it believed he was the investor the SEC was referring to when it described three occasions on which a hedge fund bet against companies after talking to Passi ahead of block trades. Two of the occasions related to shares in the clinical services company Medpace, and the third related to the home leasing group Invitation Homes.

Evolution said it also believed Gagliardi was the investor in a trade involving Canada Goose, which the Department of Justice described in a document outlining its case. Those trades took place while Gagliardi worked at Segantii.

A court filing from Gagliardi dated January 12 this year said: “No regulator anywhere in the world has ever made allegations against [Gagliardi] or taken action against him.”

Evolution tried to sue Gagliardi in New York, saying in a November 2022 court filing that he was not entitled to the bonus and should repay a bonus already paid, but he won an anti-suit injunction last year that halted the US proceedings.

In its New York filing, Evolution said US authorities had confiscated Gagliardi’s phone in connection with a federal criminal investigation into his block trading practices.

In his London claim, filed days later, he said he had “not been accused of any wrongdoing” and added: “Any suggestion by [Evolution] that [Gagliardi] engaged in, or has been accused of engaging in, any improper or criminal conduct is false.” 

In the judgment granting the anti-suit injunction, a London judge said there was a “plausible basis for contending” that an email sent by Toresco “‘spins’ . . . for maximum effect” Gagliardi’s ties to the US.

Rivian shares rise in aftermarket trading as automakers plan creation of a joint venture on vehicle software

Volkswagen VOW3 0.33%increase; green up pointing triangle Group is investing $1 billion in electric-pickup maker Rivian Automotive RIVN 8.63%increase; green up pointing triangle, with plans to spend up to $5 billion as part of a software-development partnership.

The deal, disclosed Tuesday, should provide a lift for the balance sheet of the loss-making startup and help lower the cost of Rivian’s next generation of vehicles. For VW, the deal is aimed at bolstering its software unit, which has struggled with quality issues.

VW said it would invest $2 billion in the creation of a jointly-owned software company that uses Rivian’s vehicle technology as the foundation for programs that will go into both automakers’ future vehicles in the latter half of the decade.

The German automaker said it also planned to purchase a $3 billion stake in Rivian over a few years, including the initial $1 billion injection.

The cash provides Rivian a financial cushion as it works toward the launch of new vehicles, which the company has said will be more affordable than its current offerings that start at $70,000.

Rivian’s shares rose about 30% in aftermarket trading.

Rivian Chief Executive RJ Scaringe said in an interview that the company now had enough money to fund operations long enough to become a cash-generating business.

“The capital is only one portion of the value for us,” Scaringe said. Spreading the cost of Rivian’s software over a larger fleet of vehicles through the VW tie-up would lower parts costs for Rivian as well, he said.

The Irvine, Calif.-based company reported a net loss of $5.4 billion last year.

Before the VW investment, Rivian had sought to conserve cash in part by postponing plans for a new factory in Georgia, which the company said would allow it to save around $2 billion on the launch of its next vehicle, the R2 SUV.

Under the deal, VW is adding a new partner in its efforts to overhaul its troubled software unit, Cariad, after quality issues held up the launch of several models. In October, Volkswagen hired a veteran of Tesla and Rivian to head up the software unit with a mandate to speed up development.

The VW investment comes as young EV companies such as Rivian—one-time Wall Street darlings during a euphoric period for electric cars—face plateauing sales and questions about demand for their vehicles. Another startup, Fisker, filed for bankruptcy protection last week after running out of cash.

Rivian is one of the most prominent among a group of electric upstarts that went public in recent years, as investors piled into companies promising to repeat Tesla’s success.

Rivian’s R1T pickup, R1S SUV and battery-powered delivery van were a success with customers and critics, but the company struggled to turn a profit on them. The company reported a gross loss of $39,000 on every vehicle it sold in the first three months of the year.

Rivian has burned through billions of dollars, and its cash-on-hand fell to roughly $6 billion at the end of March, down from $8 billion at the end of December.

In an effort to reduce costs, Rivian recently overhauled its sole factory, in Normal, Ill., and redesigned its vehicles to make them cheaper to build. Executives have said the changes will enable the company to report its first gross profit by the end of the year.

The joint venture with VW will incorporate some of the design improvements made by Rivian, including a reduction in the number of computer chips and cables that power the vehicles, Scaringe said.

Rivian is scheduled to host investors at its factory on Thursday.

LONDON, June 25 (Reuters) - U.S. meal delivery group Doordash (DASH.O), opens new tab flagged an interest in a takeover of Britain's Deliveroo (ROO.L), opens new tab last month, two people familiar with the matter told Reuters.

San Francisco-based Doordash made the approach to Deliveroo, but talks ended after disagreement on valuation, said one of the people, speaking on condition of anonymity because the matter is private. There are no talks ongoing, the person added.

Deliveroo's shares, which have fallen by 68% since an August 2021 high of 395.9 pence, closed at 127.5 pence on Tuesday, valuing the London-listed firm at 2.1 billion pounds ($2.66 billion). Doordash shares fell 2% to $111.68 after the report, before recovering some of that loss. Its shares are up 1.7% on the day.

A slowdown in demand for online food delivery since the COVID-19 pandemic and investors’ preference for more profitable companies amid higher interest rates have weighed on Deliveroo's shares since its March 2021 initial public offering.

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The company works with 180,000 restaurants and retail partners, and operates a network of 140,000 riders.

Amazon (AMZN.O), opens new tab is Deliveroo's largest shareholder with a 13.23% stake, followed by DST Global with 7.54%, while Deliveroo CEO Will Shu has a 6.46% holding, LSEG data shows.

Shu founded Deliveroo in February 2013, alongside his childhood friend Greg Orlowski, the company says on its website.

At the outset of the company's 2021 listing, Shu was the sole holder of Class B shares that gave him additional voting power, by owning 57.5% of the voting rights.

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However this year, those shares were automatically converted into class A shares, Deliveroo's IPO prospectus shows.

Doordash, which has a $46.57 billion market, considered buying Deliveroo in 2022, the Sunday Times reported. Both companies declined to comment at the time.

In an interview with the Financial Times in January this year, Doordash CEO Tony Xu said the group is looking to diversify outside of its core market in the U.S.

Doordash acquired Finnish rival Wolt in an all-share transaction worth $8 billion in 2021.

Online food delivery companies have looked to pivot away from unprofitable markets. Germany’s Delivery Hero said in May it planned to sell its Taiwan business to Uber and sold its minority stake in Deliveroo in January, according to reports.

Deliveroo reported a return to order growth in its first quarter, with a 2% increase year-on-year driven by its operations in France, the United Arab Emirates and Hong Kong.

Gross transaction value (GTV), a measure of the orders placed through its platform, rose 6% to 1.83 billion pounds.