More Americans Are Getting Turned Down for Loans, Fed Data Shows

Alex Tanzi
Mon, July 17, 2023 



(Bloomberg) -- Americans are increasingly likely to get turned down when they apply for credit, according to a new Federal Reserve survey that shows the combined impact of high interest rates and a cautious turn among the country’s lenders.

The rejection rate for loan applicants jumped to 21.8% in the 12 months through June, the highest level in five years, according to the latest edition of the Fed survey, which is published every four months. Overall credit applications declined to the lowest level since October 2020.

In the previous survey, published in February before the collapse of Silicon Valley Bank and other US lenders, the rejection rate was 17.3%. The increase since then has been broad-based across age groups, and highest among those with credit scores below 680.

In auto loans, for the first time since the survey began in 2013 the rejection rate — which climbed to 14.2% from 9.1% — exceeded the application rate.

What’s more, almost one-third of auto-loan applicants expected that their loan would be rejected, a record high. There were also steep increases in reported expectations that requests for new mortgages, mortgage refinancing or increases in credit-card limits would be turned down.

SO MUCH FOR BEING WOKE
BlackRock names Aramco boss to board

THEY HAVE ABANDONED ESG

BlackRock (BLK) CEO Larry Fink  kept to his pledge to no longer use the acronym ESG.

China Development Forum 2023 in Beijing

Updated Mon, July 17, 2023 
By Natalie Grover

LONDON (Reuters) - The world's top asset manager BlackRock has named Amin Nasser, the chief of the world's largest oil company Saudi Aramco, as an independent director.

Nasser joined Saudi Arabia's state oil giant as a petroleum engineer in 1982, and decades later in 2019 led Aramco's initial public offering.

His expertise in the Middle East will fill the gap left by Bader Alsaad, chairman of the board of the Arab Fund for Economic & Social Development, who is not standing for reelection on BlackRock's board in 2024, the asset manager said on Monday.

BlackRock has sought to strike a balance on the issue of climate change, continuing to invest in fossil fuel companies, while nudging them to adopt energy transition plans.

In a note to clients earlier this month, the asset manager estimated global average annual investment in the energy system would jump to $4 trillion through 2050, up from $2.2 trillion in recent years.

BlackRock, which had about $9.4 trillion assets under management as of end-June, has projected that by 2030 at least three quarters of its investments will be with issuers of securities that have scientific targets to cut greenhouse gas emissions on a net basis.

Aramco, for its part last October unveiled a $1.5 billion sustainability fund to initially focus on areas including carbon capture and storage, greenhouse gas emissions, as well as hydrogen, ammonia and synthetic fuels.

However, Nasser said the current global energy transition plan was flawed.

"We need to realise that today alternatives are not ready to shoulder a heavy load of the growing energy demand and therefore we need to work in parallel until alternatives are ready."

Saudi Arabia and fellow Gulf Arab states have sought to bolster their green credentials. Riyadh in 2021 said the kingdom aims to reach net zero emissions of greenhouse gases, mostly produced by burning fossil fuels, by 2060.

Scientists say the world needs to cut greenhouse gas emissions by around 43% by 2030 from 2019 levels to stand any chance of realising targets agreed in the 2015 Paris Agreement.

UK Support to Rejoin the EU Passes 50% for the First Time Since Brexit



Ellen Milligan
Mon, July 17, 2023 

(Bloomberg) -- More than half of Britons would vote to rejoin the European Union for the first time since the nation opted to leave the bloc seven years ago, YouGov polling showed.

Some 51% of Britons told the polling company that they would vote for the UK to become an EU member again, while 32% said they’d stay out, according to the survey conducted last week. The proportion in favor of rejoining has risen 11 points since January 2021, when Brexit formally took place.

The findings reflect growing disillusionment among British voters about Brexit, which triggered years of divisive debate in Parliament before the UK finally left the bloc.

Britons are yet to see the promised fruits of departure from the EU, with UK holidaymakers facing longer queues at European airports and shoppers facing higher food prices fueled by both Brexit curbs on migrant workers and its effect on supply chains. A trade deal with the US, meanwhile, held as one of the great prizes of Brexit, doesn’t look likely to materialize anytime soon.

Seven years on from the referendum, the UK remains in a cost-of-living crisis with inflation outstripping price rises elsewhere in Europe. Meanwhile, many regions which voted for Brexit are more likely to face a widening wealth and opportunity gap relative to richer parts of the UK, according to Bloomberg analysis earlier this year.

Some 57% of Britons told YouGov the UK was wrong to vote for Brexit in 2016, the highest figure the polling firm has recorded. One in five Britons who voted to leave the EU in 2016 now say it was the wrong decision.

Conservative Prime Minister Rishi Sunak has repeatedly said he believes in Brexit and the opportunities it presents, but his government is nevertheless seeking to renegotiate parts of the UK’s exit deal that it fears will cause disruption and added costs to businesses and consumers.

UK officials are currently in talks with their EU counterparts to delay upcoming tariffs on electric vehicles shipped between the UK and the EU and the government is also weighing options to limit the cost of post-Brexit border checks on European food imports due to start in the next six months.

In April, Bloomberg reported that Sunak also hopes to reach an agreement to let Britons use EU e-gates for passport checks, another friction point for tourists and business travelers since Brexit.

IT'S A FUCKING WALL

Saudi Arabia is exploring plans to raise $2.7 billion for its futuristic mega-city in an effort to complete most of the construction by 2030

Hasan Chowdhury
Mon, July 17, 2023 

Saudi Arabia's futuristic city in the desert aims to accommodate 9 million people, NEOM

Saudi Arabia is seeking a $2.7 billion loan from local lenders for its Neom project, per Bloomberg.

The planned city is a central part of the kingdom's plans to diversify its economy.

It aims to accommodate 9 million people in a mirror-like structure that's 170 km in length.

Saudi Arabia's mega-city project is reportedly seeking to raise a 10 billion riyal, or $2.7 billion, loan to help fuel the development of the kingdom's futuristic city in the desert.

Neom, the company behind the venture, is turning to local lenders as it seeks to finance the early stages of the project, Bloomberg reported. A loan could be agreed within months, it said.

The Neom development is expected to include two huge buildings as part of a project known as The Line. It aims to be a "civilizational revolution that puts humans first," The Wall Street Journal first reported, citing a video in which Crown Prince Mohammed bin Salman discussed the project.

According to the Neom website, The Line will be just over 100 miles long and 200 meters wide, and will have no roads and cars. It will sit 500 meters above sea level on the border of the Red Sea with mirror-like walls encasing it.

Saudia Arabia hopes the city will be zero-carbon and accommodate 9 million people. Facilities are planned to be located within a five-minute walk from where people live to ensure "people's health and wellbeing" are prioritized, according to details from Neom's site.

The Line forms just one part of Crown Prince Mohammed bin Salman's grand vision to diversify the oil-rich state's economy as the world seeks to shift away from fossil fuel consumption in an effort to meet net-zero emission commitments.

Plans for the Neom development were unveiled in 2017 but progress has been slow. The Crown Prince told Bloomberg in 2018 that the city would be completed in 2025.

Other parts of the vision include building a tourist destination on Saudi Arabia's West coast, as well as embarking on a global investment spree to increase the kingdom's stakes in everything from sports to tech companies.

Representatives for Neom did not immediately respond to Insider's request for comment made outside of normal working hours.

S N A F U 

Typo sends millions of US military emails to Russian ally Mali

MORE DANGEROUS THAN A RUSSIAN TROLL FARM

Bernd Debusmann Jr - BBC News, Washington
Mon, July 17, 2023

A spokesperson said the defence department was aware of the issue and it was being taken seriously

Millions of US military emails have been mistakenly sent to Mali, a Russian ally, because of a minor typing error.

Emails intended for the US military's ".mil" domain have, for years, been sent to the west African country which ends with the ".ml" suffix.

Some of the emails reportedly contained sensitive information such as passwords, medical records and the itineraries of top officers.

The Pentagon said it had taken steps to address the issue.

According to the Financial Times, which first reported the story, Dutch internet entrepreneur Johannes Zuurbier identified the problem more than 10 years ago.

Since 2013, he has had a contract to manage Mali's country domain and, in recent months, has reportedly collected tens of thousands of misdirected emails.

None were marked as classified, but, according to the newspaper, they included medical data, maps of US military facilities, financial records and the planning documents for official trips as well as some diplomatic messages.

Mr Zuurbier wrote a letter to US officials this month to raise the alarm. He said that his contract with the Mali government was due to finish soon, meaning "the risk is real and could be exploited by adversaries of the US".

Mali's military government was due to take control of the domain on Monday.

Mr Zuurbier has been approached for comment.

Boost for Wagner as Mali shuns UN troops

The robot maker who lost £100,000 to cyber criminals

US military communications that are marked "classified" and "top secret" are transmitted through separate IT systems that make it unlikely they will be accidently compromised, according to current and former US officials.

But Steven Stransky, a lawyer who previously served as senior counsel to the Department of Homeland Security's Intelligence Law Division, said that even seemingly harmless information could prove useful to US adversaries, particularly if it included details of individual personnel.

"Those sorts of communications would mean that a foreign actor can start building dossiers on our own military personnel, for espionage purposes, or could try to get them to disclose information in exchange for financial benefit," Mr Stransky said. "It's certainly information that a foreign government can use."

Mali has become increasingly close with Russia since a 2020 coup unseated its former government

Lee McKnight, a professor of information studies at Syracuse University, said he believed the US military was fortunate that the issue was brought to its attention and the emails were going to a domain used by Mali's government, rather than to cyber criminals.

He added that "typo-squatting" - a type of cyber-crime that targets users who incorrectly misspell an internet domain - is common. "They're hoping that a person will make a mistake, and that they can lure you in and do stupid things," he said.

When contacted by the BBC, a spokesperson said the defence department was aware of the issue and it was being taken seriously.

They said the department had taken steps to ensure that ".mil" emails are not sent to incorrect domains, including blocking them before they leave and notifying senders that they must validate intended recipients.

Both Mr McKnight and Mr Stransky said human errors were prime concerns for IT specialists working in government and the private sector alike.

"Human error is by far the most significant security concern on a day-to-day basis," Mr Stransky said. "We just can't control every single human, every single time".

Key Opposition Leader Charged in Malaysia Weeks Before Polls

Ram Anand and Kok Leong Chan
Mon, July 17, 2023

(Bloomberg) -- The election director of Malaysia’s biggest opposition coalition Perikatan Nasional has been charged with the country’s colonial-era sedition laws, just weeks before he is set to spearhead the alliance in the state elections next month.

Muhammad Sanusi Md Nor was charged on two counts of sedition at a Sessions Court in the state of Selangor over remarks that allegedly could incite disloyalty to the country’s rulers, local media reported Tuesday, citing court charges. He pleaded not guilty and was granted bail.

Sanusi is the latest among a group of PN leaders to face court charges since Prime Minister Anwar Ibrahim took office last November. PN president Muhyiddin Yassin, who is also Malaysia’s former premier, and the alliance’s former information chief Wan Saiful Wan Jan were both charged with graft earlier this year.

To be sure, the development is not expected to cause an immediate setback to Sanusi, as the court proceedings are expected to play out well after the state elections conclude. He also remains eligible to contest in the polls.

“Let the law take it course,” Anwar told reporters after speaking at an event at Sekinchan in Selangor. “The palace lodged the report, the police investigated the case and the Attorney General’s Chambers decided to prosecute. I don’t want to interfere.”

When asked about the Sedition Act, Anwar said “we try not to use sedition as a policy but when it involves the royalty? We have never used sedition when they criticized me as PM. In this case, we have to defend the dignity of the royalty to avoid an unhealthy trend in politics.”

Sanusi allegedly questioned the decision making of both Selangor Sultan Sharafuddin Idris Shah and Malaysia’s King Sultan Abdullah Ahmad Shah in his political speech in Selangor on July 11, according to media reports. He had issued an apology to the Sultan of Selangor last Friday.

Selangor is among the states headed for elections in August, alongside Kedah, Penang, Terengganu, Kelantan and Negeri Sembilan. Sanusi is the caretaker chief minister of the northern Kedah state.

GREEN CAPITALI$M

Another major utility is accelerating its transition to renewables



Julian Spector
Mon, July 17, 2023 at 1:30 AM MDT·3 min read

DTE Energy, one of Michigan’s largest utilities, pledged to build far more renewable energy as part of a long-term plan finalized Wednesday.

The 20-year plan would spend $11 billion on clean energy construction in Michigan and hasten the closure of DTE’s remaining coal plants. Notably, the utility proposal won support from a cohort of 21 different community groups spanning the environmental, labor, energy and business domains. The resulting “settlement agreement” still needs to be approved by state utility regulators, but that broad public buy-in bodes well for its chances.

The Michigan utility, which serves electricity to 2.3 million customers, is the latest example of how investor-owned utilities are embracing more rapid clean-energy adoption thanks to falling costs and the likelihood of stricter emissions-reduction policies. The federal Inflation Reduction Act makes this shift even more financially attractive for utilities by providing a decade of predictable tax credits for clean energy deployment.

DTE had previously pledged to achieve net-zero carbon emissions by 2050, adopting the midcentury timeline that has become standard for the power sector since Xcel Energy led the way in 2018. But around the country, climate hawks, consumer advocates and a growing number of state legislators are pushing for a quicker shift to clean energy, both to avoid locking in new fossil fuel investments and to lower the price of electricity for households.

After winning a legislative trifecta in the 2022 elections, Michigan Democrats introduced an ambitious bill last month to mandate a carbon-free grid by 2035. That policy, which is still being debated in the legislature, would make Michigan the most ambitious state for grid decarbonization, as well as the first state to align with President Biden’s goal of cleaning up the electricity sector by 2035. DTE’s resource planning started two years ago, so it had largely wrapped up by the time the new legislative proposal arrived this summer.

The utility’s new strategy will shutter the 3,400-megawatt Monroe coal plant in 2032, three years ahead of schedule. That move will bring an end to DTE’s use of coal power, which supplied 77 percent of its electricity as of 2005. DTE will also develop 15 gigawatts of in-state renewable power by 2042, balanced by an expansion of energy storage to 780 megawatts by 2030 and 1,800 megawatts by 2042.

Earthjustice attorney Shannon Fisk called the Monroe plant the “third-largest climate polluter in the country”; in its next long-term resource plan, DTE will examine closing it even earlier, in 2030.

Since renewables have become so economical relative to fossil fuels, the utility’s accelerated embrace of clean energy will save a considerable amount of money, in addition to reducing emissions.

“We are also proud this plan puts our customers first by reducing the future costs of our clean energy transformation by $2.5 billion, while reliably generating cleaner, affordable energy now, and for generations to come,” CEO Jerry Norcia said in a statement.

The resource plan reflects utilities’ growing appetite for a renewables-heavy future. DTE started with wind and solar development, and it now calls itself “Michigan’s largest producer of and investor in renewable energy.” After seeing firsthand how the technologies work, the company grew comfortable speeding up the pace of clean energy deployment, which in turn has made it possible to close coal plants ahead of schedule and still ensure a reliable grid.

Should the Michigan government enact a 2035 carbon-free standard, the utility — and all the others in the state — would have to introduce new plans to meet the goal. In other words, DTE may have to ratchet up its clean energy plans yet again in the near future.

GREENWASHING

House Republicans propose planting a trillion trees as they move away from climate change denial


STEPHEN GROVES
Mon, July 17, 2023

WASHINGTON (AP) — As Speaker Kevin McCarthy visited a natural gas drilling site in northeast Ohio to promote House Republicans' plan to sharply increase domestic production of energy from fossil fuels last month, the signs of rising global temperatures could not be ignored. Smoke from Canadian wildfires hung in the air.

When the speaker was asked about climate change and forest fires, he was ready with a response: Plant a trillion trees.

The idea — simple yet massively ambitious — revealed recent Republican thinking on how to address climate change. The party is no longer denying that global warming exists, yet is searching for a response to sweltering summers, weather disasters and rising sea levels that doesn't involve abandoning their enthusiastic support for American-produced energy from burning oil, coal and gas.

“We need to manage our forests better so our environment can be stronger," McCarthy said, adding, “Let's replace Russian natural gas with American natural gas and let's not only have a cleaner world, let's have a safer world.”

The Biden administration has also boosted exports of liquefied natural gas to Europe after Russia, one of the continent's largest suppliers of energy, invaded Ukraine. The Democratic president has also said that coal, oil and gas will be part of America’s energy supply for years to come.

Scientists overwhelmingly agree that heat-trapping gases released from the combustion of fossil fuels are pushing up global temperatures, upending weather patterns around the globe and endangering animal species. But the solution long touted by Democrats and environmental advocates — government action to force emissions reductions — remains a non-starter with most Republicans.

Enter the idea of planting a trillion trees. A 2019 study suggested that planting trees to suck up heat-trapping carbon dioxide from the atmosphere could be one of the most effective ways to fight climate change. Major conservation groups, and former President Donald Trump, who downplayed humanity's role in climate change, embraced the idea.

But the tree-planting push has drawn intense pushback from environmental scientists who call it a distraction from cutting emissions from fossil fuels. The authors of the original study have also clarified that planting trees does not eliminate “the urgent need to reduce greenhouse gas emissions.”

Planting one trillion trees would also require a massive amount of space — roughly the size of the continental United States. And more trees could even increase the risk of wildfires by serving as fuel in a warming world.

“There is a lot of value to planting trees, but it is not a panacea,” said Mark Ashton, a professor of forest ecology at Yale School of Forestry and Environmental Studies.

The GOP’s new approach on climate was apparent in 2021. McCarthy and other GOP lawmakers, led by Arkansas Rep. Bruce Westerman, backed a bill to incentivize growing timber forests in the U.S. as part of a worldwide effort to plant 1 trillion trees. Westerman said he expects a similar proposal to advance this year.

For Republicans, the bill checks the right boxes. It is friendly to the timber industry and touts a climate solution — sequestering a massive amount of carbon from manmade emissions — that would also partially alleviate the need to wean the country off fossil fuels.

Now that he has a slim House majority, McCarthy has also pushed for expanded energy production. He made the “ Lower Energy Costs Act” the top legislative priority of the new GOP majority, as signified by its bill number — H.R. 1. The proposal, which passed the House on a mostly party-line vote in March, would spur American energy production, especially oil, gas and coal.

Democrats like President Joe Biden rejected the bill as a “thinly veiled license to pollute,” but Republicans argued it would reduce carbon emissions because U.S.-produced fossil fuels are usually cleaner than those produced overseas.

“What we’ve been able to demonstrate to the Republican conference is that the strategies that actually work are those that are actually increasing U.S. resources,” said Louisiana Rep. Garret Graves, one of McCarthy’s top lieutenants on energy and environmental issues. “It lowers energy prices, it lowers emissions, and it makes us more energy independent.”

The energy legislation also would increase production of critical minerals such as lithium that are used in batteries for electric vehicles, computers and cellphones — a priority Biden shares. House Republicans and many Democrats have also advanced proposals to speed permitting for energy projects of all types, including those for “clean energy” such as wind, solar and geothermal power.

“I keep reminding Republicans that H.R. 1 made energy affordable, reliable, and clean,” said Utah Rep. John Curtis, who has become a leading Republican voice on environmental issues. “We’re very quick to point out that it made it affordable and reliable. Sometimes we forget to remind people: yes, and clean. That’s an important part.”

But not all Republicans agree that there's a need to address climate change. Rep. Scott Perry, who leads the hard-right House Freedom Caucus, in a hearing Thursday alleged that the Biden administration's climate agenda was tackling “a problem that doesn't exist."

Perry went on to declare — without evidence — that global leaders pushing to reduce carbon dioxide emissions are “grifting.”

Nearly across the board, House Republicans have tried to undo parts of Biden's climate agenda, deriding them as expensive and burdensome. They have targeted government incentives for clean energy projects and denounced investment strategies that account for environmental impact. Last week, they moved to restrict the Department of Defense from using funds to implement the president's executive orders on climate.

“You are seeing a recognition in the Republican Party that climate change is something they are going to have to at least acknowledge because their constituents are dealing with it on a daily basis and it's having an increasing economic toll,” said Lena Moffit, executive director of Evergreen Action, an environmental group that promotes urgent action. “But you cannot say you are committed to putting out the house fire while you pour more gasoline on it.”

Still, Curtis said he has seen an eagerness among Republicans to engage on the issue since he started the Conservative Climate Caucus two years ago. The group has grown to 84 Republicans, representing over one-third of the GOP conference.

Curtis said he decided to launch the caucus after he struggled to respond when asked about climate change by constituents in Utah, where he represents a district marked by ski resorts and national parks.

“I would get a lot of these young people who would come to town hall meetings and I would see the disappointment in their eyes when I didn’t have a good answer for them,” Curtis said. “I felt like, in many ways, we were losing a generation of Republicans on this issue.”

GREEN STEEL

A surprising new industry could bring countless jobs to the Rust Belt: ‘This … prioritizes American workers’


Nina Phillips
Mon, July 17, 2023 at 9:00 AM MDT·2 min read

In the next few years, the steel industry is expected to decline significantly — a fact that could directly affect the over 44,000 Americans who currently work in steel-related jobs.

But a new version of the steel industry — called “green steel” — could bring countless new jobs and completely revitalize the decaying rust belt, Grist reports.

Green steel refers to steel made with green hydrogen, a fuel source that uses clean energy such as wind or solar to generate power by separating the hydrogen and oxygen contained in water molecules. The process, unlike traditional steel production methods, doesn’t release carbon pollution.

At the moment, steel and iron manufacturing is considered one of the top producers of carbon pollution and one of the highest energy-consuming processes in the industrial field. Steel production accounts for around 7% of global air pollution, according to Canary Media, with each ton of steel produced creating over 1.83 tons of carbon pollution, per The World Counts.

What’s more, traditional steel manufacturing needs an absurd amount of power. According to The World Counts, it takes 20 gigajoules of energy to create just one ton of steel, which is enough to run the average central AC system nonstop for about 100 days.

The developments in green steel technology come as several Rust Belt states are struggling to employ their steelworkers. A study from the Ohio River Valley Institute found that, currently, regional steel-related jobs are expected to fall 30% by 2031. However, green steel could add between 27% and 43% more jobs — potentially more than making up for that loss.

It seems as though investment in green steel will continue as the industry falls deeply in line with the government’s new goals for reducing air pollution. By 2030, the government hopes to reduce air pollution by at least 50% when compared to 2005 levels, World Resources Institute reported.

In a statement released in April 2021, The White House explained the U.S.’s pollution goals, stating that: “Meeting [our] 2030 emissions target will create millions of good-paying, middle class, union jobs” and that the plan would “ensure economic competitiveness, advance environmental justice, and improve the health and security of communities across America.”

“This target prioritizes American workers,” the statement added.

The bridge to Crimea is crucial to Russia's war effort in Ukraine and to asserting Moscow's control




In this handout photo taken from video released by the Investigative Committee of Russia on Monday, July 17, 2023, investigators work at an automobile link of the Crimean Bridge connecting Russian mainland and Crimean peninsula over the Kerch Strait not far from Kerch, Crimea. Traffic on the key bridge connecting Crimea to Russia's mainland was halted on Monday, July 17, after reports of explosions that Crimean officials said were from a Ukrainian attack.

 (Investigative Committee of Russia via AP)

The Associated Press
Updated Mon, July 17, 2023 

The bridge connecting Crimea and Russia carries heavy significance for Moscow, both logistically and psychologically, as a key artery for military and civilian supplies and as an assertion of Kremlin control of the peninsula it illegally annexed in 2014.

An attack on the bridge before dawn Monday, killing a couple and seriously injuring their daughter, left a span of the roadway hanging perilously. The damage initially appeared to be less severe than what was caused by an assault in October, but it highlighted the bridge’s vulnerability.

Russia blamed Ukraine for both attacks. A spokesman for the Ukrainian Security Service on Monday did not directly acknowledge responsibility but said the service would reveal details about organizing the blast once Ukraine achieves victory in the war.

A CRITICAL CONNECTION

The Crimean Peninsula extends south from Ukraine’s mainland, with road connections on two isthmuses, one of which is less than 2 kilometers (1 mile) wide, and by a bridge from a narrow spit. Those links to Ukraine go into territory occupied by Russian forces that come under attack from the Ukrainian military.

The bridge, which connects Crimea’s eastern extremity with Russia’s Krasnodar region, provides the only fixed link that steers clear of the disputed territory.

The 19-kilometer (12-mile) bridge over the Kerch Strait that links the Black and Azov seas carries road and rail traffic on separate sections and is vital to sustaining Russia’s military operations in southern Ukraine.

A SYMBOLIC STRUCTURE

The bridge is the longest in Europe and a subject of considerable pride in Russia. Construction began in 2016, about two years after Russia's annexation, and was completed in little more than two years. The pace of construction was impressive but led some critics to question whether it was hastily designed and built.

The bridge was constructed despite strong objections from Ukraine and is the most visible and constant reminder of Russia’s claim over Crimea.

President Vladimir Putin drove across the bridge at its formal opening. Putin is also closely connected to construction tycoon Arkady Rotenberg, whose company got the $3.5 billion contract for the bridge.

CONSEQUENCES OF THE ATTACK

Rail traffic on the bridge reportedly was restored within a few hours Monday but it was unclear when full road service could be restored. Ferries were being organized to try to ease the burden, but it was not immediately clear whether the vessels could accommodate demand. Crimea’s beaches and mountains are popular with summer tourists.

Russian authorities advised people who wanted to leave Crimea quickly to go via Russian-controlled territory in Ukraine. That would add up to 600 kilometers (350 miles) to their journey and likely raise their anxiety about going through insecure areas.

Russian officials denounced Monday’s attack but did not immediately specify retaliatory measures, although Russia has responded with cruise missiles and drone barrages to other Ukrainian attacks.

___

Follow AP’s coverage of the war in Ukraine: https://apnews.com/hub/russia-ukraine

Drone boats give Ukraine a cheap, 'asymmetric' edge against Russia and may have just damaged a key bridge

Chris Panella
Updated Mon, July 17, 2023 

THEY LOOK LIKE DALEK DRONES FROM DR. WHO

It's been reported that naval drones were used to attack the Kerch Strait Bridge.

United 24/Ukrainian government

Waterborne drones are an inexpensive asset, giving Ukraine an "asymmetric" naval edge against Russia.


Russia blamed Ukraine for using the drones to attack the Kerch Strait Bridge in Crimea on Monday.


The bridge is key for Russian economic, military, and cultural interests in occupied Crimea.

Ukraine has heavily relied on cheap-but-effective airborne drones for attacks on front-line Russian positions and on targets behind enemy lines. Waterborne drones are also inexpensive and devastating, and there are indications they were used to damage a key Russian bridge into Crimea.

On Monday, explosions rocked the 12-mile Kerch Strait Bridge, damaging the roadbed, halting traffic, and killing two adults. Russian authorities blamed Kyiv, vowing "targeted and quite inhumane" repercussions.

It's at least the second time the bridge has been damaged in less than year. Last October, a bomb-laden truck exploded, severely damaging the bridge and killing three people. It was closed to normal vehicle traffic until February 2023 and railway traffic until May 2023.

Russian state media attributed Monday's incident to Ukraine's unmanned drones, and Ukrainian state media outlet, Ukrinform, citing sources in the Security Service of Ukraine, said the SBU and Kyiv's naval forces carried out the nighttime attack and that unmanned surface vessels were involved.

An anonymous source from Ukraine's Security Service also confirmed to CNN that Ukraine's naval drones carried out the attack, as did a state official.

In general, unmanned surface vehicles (USVs) — commonly called drone boats — are remotely operated waterborne vessels. There's been a push to develop waterborne drones for both Ukraine and the US, the latter increasing production to counter China while the former looks for ways to counter Russia's formidable military.

Ukraine has been crowdfunding the development of a full-blown naval drone fleet, noting that the unmanned vessels first gave them an operational advantage to target Russian ships in October 2022. "The killers of Ukrainian civilians — warships armed with missiles — became targets themselves," a state-run fundraiser said.

They can pack a punch, and they're relatively cheap, too, especially compared to a traditional warship or the defenses required to defeat these unmanned surface vessels.

"The cost of manufacturing and fielding these vehicles is considerably less — many magnitudes less — than the cost of trying to defend against them and just basic resource allocation in trying to interdict and destroy these assets," said Samuel Bendett, a research analyst with the Center for Naval Analyses' Russia Studies Program.

"So again, the cost of defending against such vehicles falls on the defender — a single ship, a fleet, or an entire country — while the cost of manufacturing them is considerably smaller."

The result is an "asymmetric advantage" for Ukraine. They stress Russian defenses at a low cost to the Ukrainians and their available resources.

While Ukraine didn't take responsibility for the attack, Kyiv has repeatedly threatened to target the bridge.

Crimea24TV/AFP via Getty Images

The Kerch Bridge, which may have been the target of these assets, is a valuable access point for Moscow, connecting Russia to Crimea and allowing economic and cultural control over the illegally occupied territory.

It also served as an ideal transportation route for Russia's military equipment before its February 2022 invasion. Supply routes have mostly shifted to northern land bridges since October's attack, according to Bendett, but the repeated incidents raise a host of questions about how Russia is going to defend the Kerch Bridge.

"These USVs don't travel for thousands of kilometers, they have to operate in relative proximity to their operators or their launching point," Bendett said. "How do you defend a long bridge like that? Where do you place your defenses? Do you fly patrols around it? Do you install sensors on it all the time? Do you have maritime patrols all the time?"

In short: "It's difficult to properly and completely defend an asset as large as a bridge like that."

And although it's too early to tell how significant Monday's attack on the bridge is and what the impacts will be, especially since only part of the roadbed was damaged, Kyiv can, assuming its forces were the ones who executed the attack, can presumably count this as a win.

"Ukraine exploited its [the Kerch Strait Bridge] vulnerability by launching relatively cheap and inexpensive USVs in what turned out to be a successful attack," Bendett said.

Ukraine’s sea drone attack on Crimea bridge signals shift in strategy

Roland Oliphant

THE TELEGRAPH
Mon, July 17, 2023 

Ukraine’s security service told local media that it and the navy pulled off the attack using surface drones

Sunday’s sea and air drone attack on Sevastopol harbour and the Kerch road bridge highlight a shift in maritime warfare, the vulnerability of Crimea, and uncomfortable truths about high-stakes remote strikes.

Officially Ukraine is coy about attacks on Russian territory, public officials confining themselves to nudges and winks rather than explicit claims of responsibility.

But the SBU, Ukraine’s security service, has briefed local media that it and the Ukrainian navy pulled off the attack using surface drones.

There is clear footage of the attacks using the sea drones.

But images from previous Ukrainian maritime drone attacks give us a rough idea of what they look like - and how their designers have combined modern navigation tech with sea sports kit and old-fashioned bomb making.

The drones we have seen so far resemble sharp-prowed speed boats around 5.5 metres long.

Towards the bow, a rotatable camera stands on a small tower. Towards the stern, another tower contains what appears to be the communications array used for control - possibly a Starlink terminal.

Propulsion also seems to be from a non-military source: likely a petrol-driven water jet produced by Canadian firm Sea Doo, a maker of civilian jet skis.

The only discernible military grade, non-commercial kit are two pressure detonators taken from the Soviet-designed FAB-500 aerial bomb.

Unmanned bomb ships are nothing new. Sir Francis Drake sent fireships against the Spanish Armada in 1588.

Western navies - and the Royal and US navies in particular - have been thinking about fending off fast-moving small boats ever since an al-Qaeda suicide bomber on a speed boat attacked the USS Cole in 2000.

But modern drone technology has driven down costs and means navies do not need suicide helmsmen to get close to their targets.

When around half a dozen of the Ukrainian bomb-boats attacked the Black Sea Fleet at anchor in Sevastopol harbour, some naval experts hailed a turning point in naval warfare.

No Russian ships were sunk, but at least two were damaged, one apparently seriously, and by penetrating Sevastopol Bay’s heavily defended harbour mouth, the drones proved a new and serious threat had arrived on the Black Sea.

Monday morning’s attack shows that threat remains potent and continues to evolve. Other navies will be studying it carefully.

The Kerch bridge is one of Russia’s major vulnerabilities.

Completed in 2018, it was both a major engineering achievement and a symbol of Vladimr Putin’s conquest of Crimea four years earlier.

It also eased pressure on an overburdened ferry that was the only other direct route from the Russian mainland.

Now it is a critical bottleneck in the logistics network supplying Russia’s forces in southern Ukraine. And it is proving difficult to protect.

Ukrainians first attacked it in October last year, with a truck bomb that blew a hole in the road and set fire to a train on the neighbouring rail section. The bridge was out of action for weeks.

Monday’s attack shows despite Russia’s best efforts, a 12-mile bridge is difficult to secure.

The Kerch bridge is one of Russia’s major vulnerabilities and is proving difficult to protect - Reuters

The apparently undamaged railway section is more important from a military point of view than the damaged road section, but closing the bridge again will put inevitable pressure on the troops trying to hold back Ukraine’s counter-offensive.

Russian authorities have already re-routed tourist traffic via the “new territories” of occupied Ukraine, with obvious risks for both the civilians and military logistics. There were reports of heavy traffic jams on Monday afternoon.

Lastly, it highlights the uncomfortable moral compromises involved in prosecuting any war, but especially high-stakes operations behind enemy lines.

Russian authorities say the alleged drone strike killed a civilian couple and wounded their fourteen-year-old daughter as the family drove across the bridge.

October’s truck bomb attack, which killed five people including the driver of the lorry, raises trickier ethical questions. Was the driver a willing participant? If so, is suicide bombing ever admissible? If not, is there any excuse for duping a civilian into carrying a bomb?

The Kerch bridge is a legitimate military target. Some collateral damage is inevitable in a total war of national survival. And those deaths are nothing compared to the well documented and clearly deliberate atrocities committed by Russia during the war.

But war is always a murky, dirty business, no matter which side you are on. There is no point in pretending otherwise.

Drone Boats Used In Kerch Bridge Strike: Reports (Updated)

Howard Altman
Mon, July 17, 2023 

Kerch bridge USV attack

The Ukrainian federal security service, known by the acronym SBU, carried out Sunday's attack on the Kerch Bridge in cooperation with the country's navy using uncrewed surface vessels (USVs), according to state media and many other reports. The attack badly damaged the bridge linking Russia to the Crimean peninsula it has occupied since 2014.

We must highlight that these are initial reports and there is a massive information war also being fought by both sides. The War Zone could not independently verify these claims at this time, but they have been reconfirmed by various outlets. Still, Ukraine has a history of not giving information out on high-profile long-range attack. The possibility that this is a misdirect to obscure another form of attack is very real and must be kept in mind.

Close-up view of damaged Kerch Bridge span. 

(Satellite image ©2023 Maxar Technologies.)

View of the damaged Kerch Bridge span. 

(Satellite image ©2023 Maxar Technologies.)

Russian officials say it forced a halt to vehicle traffic and killed two motorists and injured their young daughter. Railroad traffic, across the bridge, however, continued, they say. You can read more about the strike and its potential impact in our initial coverage here.

This would mark the latest escalation in Ukraine's use of USVs, which you can read more about later in this story.

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“A nighttime attack on the Kerch Strait Bridge was a special operation conducted by the Security Service of Ukraine (SBU) and the Ukrainian Navy,” the official Ukrainian Ukrinform news agency reported Monday. “According to Ukrinform's sources in the SBU, the SBU and the Ukrainian Navy are behind a nighttime explosion at the bridge. Unmanned surface vessels were used to attack the bridge.”

"It was hard to get to the bridge, but this was eventually done," the SBU said, according to Ukrinform, adding that SBU Chief Vasyl Maliuk stated that the bridge is a legitimate target for Ukraine.

The bridge was attacked by Ukrainian sea drones, an anonymous Ukrainian official told The Washington Post Monday.

CNN had a similar report, saying "a source in Ukraine’s Security Service (SBU) told CNN this attack was a joint operation of the SBU and Ukraine’s naval forces. The source spoke on condition of anonymity because they had not received authorization to speak on the record."

The SBU’s quick acknowledgment of its role in the attack is in stark contrast to how Ukraine reacted after the previous Kerch Bridge strike on October 8, 2022. Ukrainian officials like Maj. Gen. Kyrylo Budanov, head of the Defense Intelligence Directorate, played coy about their role in that attack. It was only until recently, when, as we reported, Ukrainian Deputy Defense Minister Hanna Maliar listed that operation among Ukraine’s accomplishments during the 500 days of all-out war.

Of course, by Monday morning, Russian officials were blaming Ukraine.

The Russian Foreign Ministry condemned what it called a “terrorist attack” on the bridge.

“A criminal case was opened after the terrorist attack, and the necessary investigative actions are being taken,” the Russian Foreign Ministry said. “We are confident that those guilty will be found and will not escape justice. If the investigation finds that the surface drones that attacked the bridge are of Western origin, and that Western countries played a role in planning, sponsoring and conducting this operation, it will confirm their complicity in the Kyiv regime’s terrorist activity.”

The Foreign Ministry “strongly condemns the terrorist attack on the Crimean Bridge, which is a purely civilian facility. We hope that the international community and relevant multilateral agencies will put their foot down and give a proper assessment of yet another crime committed by the Ukrainian authorities. The damage to the Crimean Bridge caused by the terrorist attack will be repaired shortly. All attempts to disrupt the transport link to the peninsula and tear Crimea from the rest of Russia are invariably futile.”

https://twitter.com/mfa_russia/status/1680951468067631105

“The Kyiv regime committed another barbaric crime,” Kherson Oblast occupation governor Volodymyr Saldo said Monday on his Telegram channel. “Damage to the structures of the Crimean Bridge is secondary. Primarily, Ukrainian propaganda mocks the death of civilians on the bridge. This shows the true face of those who are now sitting on Bankova Street in Kyiv or hiding somewhere in bunkers.”

USVs Weapon Of Choice

If the SBU claim is true this marks not just the second Ukrainian attack on the bridge, but a big increase in the capabilities of its USV fleet.

Starting last October, Ukraine began using USVs to attack Sevastopol in Crimea, home to Russia’s Black Sea Fleet. You can read more about that attack in our story here.

There have been numerous Ukrainian USV attacks since then, both in Crimea and reportedly in the open waters of the Black Sea, according to Russia.

The Russian Defense Ministry claimed that it foiled yet another aerial drone and USV attack on Sevastopol on July 16.

https://twitter.com/gloooud/status/1680832616864399367

It is roughly 320 nautical miles (368 miles) from the closest Ukrainian-controlled shore to the Kerch Bridge, taking the most direct route around Crimea to the bridge. That is a very long-range strike that is unprecedented for Ukrainian USVs used against littoral targets. If the attacks on Russian vessels deep to the south in the Black Sea are indeed as Russia has purported them to be, such a long-range capability has been demonstrated. There is also the possibility that they were clandestinely launched much closer via a mothership vessel, but there is no evidence of that at this time.

Russia keeps a very close watch on the bridge and its approaches for just this kind of an attack. The span is heavily defended, but clearly not enough if indeed USVs got through and did this kind of damage. The low-slung area of the bridge that was hit would have maximized the impact from the blast from a explosive laden USV below.

Key Span

The Kerch Bridge is a key span for Russian logistics as it fights Ukraine's counteroffensive pushing slowly south toward Crimea. As we mentioned earlier this morning, vehicle traffic that normally would flow across the bridge is being rerouted via routes through territory in Kherson and Zaporizhzhia oblasts that Russia occupies.

Taking out the bridge makes for a much longer trip to southern Ukraine, though if the rail lines are still operating as Russian officials claim, that would certainly reduce the impact of this attack. But beyond the inconvenience factor, it also means that Russian resupply efforts by road have to travel far closer to the front lines and well within the operational distance of Ukraine's extended-range strike weapons. These weapons pose more of a threat to static vehicles and bridges (as we have seen targeted in the recent past) and key roadways areas though, not hitting moving vehicles.

https://twitter.com/GlasnostGone/status/1680942863721406464 https://twitter.com/georgewbarros/status/1680770032119283712

Saldo said that he and Sergie Askenov, the occupation governor of Crimea, have been working on plans to make those routes easier to travel with the increased traffic.

Those regions “will be fully involved in the organization of traffic for people to Crimea along the land route along the Azov coast, an alternative to the Crimean bridge,” said Saldo. “Kherson region is preparing to increase the transport and passenger flow. At the moment, most of the road from Melitopol to the Dzhankoy checkpoint within the region has been overhauled, the entrances to the checkpoint have been expanded. Measures will be taken to expedite the screening of people and vehicles.”

Specialists are working on the possibility of directing part of the tourist flow through the Armyansk checkpoint, he added.

“It could be used by tourists heading to the eastern coast of Crimea,”

Meanwhile, the ferry crossing from the Krasnodar Territory has resumed its work - the first batch of passengers from the port of Kavkaz has already arrived at the port of Kerch, the Russian Defense Ministry’s Zvezda News reported on its Telegram channel Monday. “However, for now, only passengers of regular buses can use the sea route.”

https://twitter.com/NatalkaKyiv/status/1680959700135755778

https://twitter.com/aborealis940/status/1680895219410116610

Deputy Prime Minister Khusnullin said officials should know in a few hours the extent of the damage.

“I personally went downstairs and looked,” he told Zvezda News. “Now designers and builders are working out technological schemes for repairs, discussing whether it is possible to start the machines. A couple more hours - and there will be a decision. The divers are finishing their inspection of the supports.”

https://twitter.com/OAlexanderDK/status/1680868585290309632

"Previously, the railway bridge supports were not damaged, now they are studying automobile supports. In two hours there will be information, we will confer for now, outline a plan of action," the deputy prime minister told Zvezda.

While the ability of train traffic across the bridge will certainly help Russian logistics, it remains to be seen just how much and just how long it will take to repair the bridge after this attack.

In the wake of this attack, Russia announced it was canceling the Black Sea Grain Initiative, hammered out over the summer to allow grain and other food and fertilizer to be shipped out via Ukraine's Black Sea ports of Odesa, Chornomorsk and Yuzhny.

https://twitter.com/Reuters/status/1680958032291692547

There is also the possibility that Russia will carry out retaliatory strikes across Ukraine.

We are certainly be watching for future developments and will update this story when there is more information to report.

Update 4:41 p.m. Eastern:

During a televised speech Monday, Russian President Vladimir Putin vowed a response to the attack.

"The terrorist act seriously damaged the road along several spans of the Crimean Bridge, and as a result auto and railway traffic was halted.”

However, railway traffic has already been restored, he said.

“Considering that this is the second terrorist attack on the Crimean Bridge, I am waiting for specific proposals on how to improve the security of this strategically important transport facility. We discussed this in detail this morning.”

Putin added that the attack was “senseless” because the bridge hadn’t been used for military logistics for a while.

“Of course there will be a response from the Russian side,” he said. “The Defense Ministry is preparing adequate proposals.”

https://twitter.com/OAlexanderDK/status/1681029040528846853?s=20

Contact the author: howard@thewarzone.com