PM — Russian oil embargo coming?

It’s unfortunately only Monday, ladies and gentlemen, but we’re hoping the rest of the week will go by a bit faster than the first two days have. Not helping matters: It’s a rather slow afternoon on the homefront so far, with no massive news stories to bring your attention to.

*** SO, WHEN DO WE EAT? You’ll be breaking your fast at 6:20pm CLT this evening in the capital city, and fajr prayers are at 4:03am.

THE BIG STORY TODAY

The EU could trigger a bout of volatility in global oil markets as it considers imposing an embargo on Russian oil embargo soon. EU officials are “now working on ensuring that oil is part of the next sanctions package,” Irish Foreign Minister Simon Coveney told Reuters. Russian oil makes up about a quarter of the EU’s crude imports, which is “contributing to financing this war. We need to cut off that financing … the sooner that can happen the better,” Coveney added. The European Parliament passed a non-binding vote in favor of an embargo last week. If Western countries impose a “real embargo” on Russian energy, the war could end “within a month or two,” Andrei Illarionov, former chief economic adviser to President Vladimir Putin told the BBC. Oil and gas revenues made up 36% of the Russian government’s spending last year.

On the upside, this could be good news for the environment: The move could help the EU set more ambitious goals for its transition to renewable energy as it looks for Russian oil alternatives, EU climate policy chief Frans Timmermans said. The European Commission is now working on proposing a “Repower EU” initiative that would push for a higher percentage of renewable energy for 2030, Timmermans said. The EU’s current plan is to raise renewable energy consumption to 40% by 2030.

It could also be a boon for Egypt’s LNG exports: That push towards alternatives could also open up a window for the EU to import more liquefied natural gas (LNG) from Egypt as part of the bloc’s accelerated transition towards cleaner energy sources. This comes as EU Executive Vice-President Frans Timmermans is in town, telling Prime Minister Moustafa Madbouly yesterday that the EU is looking to ramp up its imports of LNG from Egypt in the short term.

THE BIG STORY AT HOME

Arab African International Leasing (AAIL) is planning to take a EGP 500-600 mn securitized bond issuance by the end of 2023, AAIL Chairman Mahmoud El Sakka told Enterprise, confirming a story in Al Mal. AAIL is also looking to add factoring to its portfolio of services, after landing approval from the Financial Regulatory Authority.

^^We’ll have more on this and other stories in tomorrow’s EnterpriseAM.

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** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

• EU + Egypt talk boosting our LNG exports + green hydrogen ahead of COP27: The EU is looking to up its imports of liquefied natural gas (LNG) from Egypt in the short term — and contribute to building a local green hydrogen production facility in the long term, EU Executive Vice-President Frans Timmermans said in meetings with top government officials.
• Algebra lands USD 15 mn from IFC for new fund: The International Finance Corporation (IFC) has confirmed that it will pour USD 15 mn into Algebra Ventures’ USD 90 mn second tech fund.
• Pharaohs are getting a new coach tomorrow: The Egyptian Football Association is voting on the replacement for Egypt’s national team coach and manager Carlos Queiroz tomorrow, with former players Hossam Hassan and Ehab Galal both in the running.

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Companies have just ten days to file their first quarterly ESG compliance report: Listed firms and non-bank financial services companies need to submit their first quarterly ESG report by 20 April, the Financial Regulatory Authority (FRA) announced last week. The regulator is making it mandatory for corporates to publicly disclose their performance on key environmental, social and governance metrics each year when they submit their annual financial statements, starting 2023. Reach out to Moustafa Taalab at InkankIR, our parent company, if you need some help.

☀️ TOMORROW’S WEATHER- Expect a daytime high of 26°C tomorrow and a nighttime low of 11°C, our favorite weather app tells us.

Elon Musk won’t be joining Twitter’s board of directors, turning down the offer of a seat at the table after becoming the company's single largest shareholder last week when he bought a 9.2% stake. Musk relayed his decision on Saturday — the day he was due to be appointed, Twitter CEO Parag Agrawal said in a note. Musk posted a cryptic emoji of a face with its hand over its mouth shortly after the announcement was made in a since-deleted tweet. The SpaceX founder had publicly called into question Twitter’s approach to freedom of speech, before purchasing the stake for around USD 2.9 bn.

Weapons as ESG assets? A growing debate on classifying arms stocks as sustainability-friendly investments is fueling worries by environmental, social and governance fund managers that their USD 40 tn field is losing credibility, Bloomberg reports, citing fund managers. Arms lobbyists are using Russia’s invasion of Ukraine as a chance to rebrand the defense industry into a tool for preserving democracy, and EU lawmakers have been facing pressure to add defense companies to the bloc’s ESG rulebook. “If we were talking about this two years ago, people would be laughing at us saying how ridiculous that you put a defense stock in an ESG portfolio,” said TAM Asset Management’s chief investment officer.

Women celebrities are urging more women to invest in NFTs and crypto: Mila Kunis and Gwyenth Paltrow were among the speakers at a virtual event earlier this year that urged women to enter the male-dominated NFT space, writes the Washington Post. Twice as many men invest in crypto as women, according to a 2021 CNBC poll. The two celebrities argued that women are conditioned to be risk-averse which puts them at a disadvantage when it comes to acquiring wealth through non-traditional methods. The event was hosted by BFF, a community co-founded by Silicon Valley co-founder Brit Morin, to launch collections of NFTs. The 5k attendees were given a friendship bracelet NFT without charge, even as it is trading for at least USD 3k on the secondary market.

However, the girlboss rhetoric didn’t go over well with everyone: The event and the platform came under fire for limiting the movement to the privileged among women, ignoring women of color and at times not giving them credit for their work. This also came as Kunis badmouthed a similar venture to BFF called Friends With Benefits, which has a Black co-founder and a diverse membership.

???? ON THE TUBE TONIGHT-

(all times CLT)

Luxe Listing Sydney takes you into the surprisingly dramatic world of real estate: Set in Australia’s most populous city, the reality TV series follows a number of real estate companies who are competing to sell and buy some of Sydney’s most glamorous properties. In the first episode, a firm reveals that it has sold USD 500 mn-worth of real estate in the past year alone. It’s interesting to see the dynamics between the different real estate players, how they negotiate a price down, and how they set up open houses and such for their uber rich clients. There’s also a lot of drama within firms and the challenges of running any human-centric business come into play as employees feel burned out or unappreciated. We weren’t sure what to expect when we found the title on Amazon Prime, but it definitely lured us into a whole world we didn’t know existed.

⚽ Just two matches in the leagues today: In La Liga, Rayo Vallecano is playing against Valencia at 9pm, while Serie A will see Bologna and Sampdoria compete at 8:45pm.

???? OUT AND ABOUT-

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El Sohbageyah Tent is holding a concert with songs from “El Zaman El Gameel” today at 9pm. Tomorrow, there will be a concert dedicated to Abdel Halim Hafez.

A swing dancing class is taking place at Dokki’s In The Mood Studio today at 8pm.

Rawabet Art Space is hosting the Abul Gheit Dervishes tomorrow at 10pm.

???? UNDER THE LAMPLIGHT-

The Candy House is a multi-voiced, multi-styled collection of stories exploring tech and humanity: Author Jennifer Egan received a Pulitzer Prize for a similar collection of stories called A Visit from the Goon Squad in 2011 and now more than a decade later she’s back with more. The Candy House imagines a world where a major tech company has created a product named “Own Your Unconscious,” which allows you to download your memories to the cloud and watch them any time you like — and get access to everyone else’s, too. The stories explore the implications of this technology through different characters and scenarios, highlighting humanity’s ever present longing for real connection, love, family, privacy and redemption. While this book is branded a sci-fi novel, it may not be too far off, with Elon Musk touting a similar technology just yesterday.

The EGX30 fell 1.6% at today’s close on turnover of EGP 837 mn (13.3% below the 90-day average). Foreign investors were net sellers. The index is down 10.2% YTD.

In the green: Mopco (+2.1%), Cleopatra Hospital (+1.8%) and EFG Hermes (+1.1%).

In the red: Heliopolis Housing (-5.3%), CIRA (-4.8%) and Orascom Development Egypt (-4.7%).

Enterprise Explains: Dark Web Marketplaces. German authorities last week shut down Russian-language darknet platform Hydra, seizing its servers along with USD 25 mn in BTC. The crackdown came in coordination with US authorities and was apparently spurred by Russia’s war in Ukraine. But just what are dark web marketplaces, how widespread are they, and what risks do they pose?

In a nutshell: Dark web marketplaces either connect buyers and sellers of semi-legal or illegal items and substances, or sell them directly themselves. They exist on the dark web, which is pretty much what it sounds like: a network of hidden sites that work exactly like the internet we all use, but that don’t show up on conventional search engines. You need a special key to access the dark web, the most common of which is Tor, open source browser technology that allows anonymous dark browsing at no charge, research platform Internet Retailing notes.

What do dark web marketplaces trade in? Anything and everything that the criminal underworld might desire. That includes malware and ransomware kits; illicit substances and chemicals; fraud tools like credit card skimmers and cloning devices; stolen data; hacking, spam and phishing tools; counterfeit electronics and pirated software; tutorials on how to commit fraud or hack into systems; and illicit services from creating customized malware to deploying cyberattacks — and all the way up to guns-for-hire. Payment for goods and services on dark web marketplaces are usually made using anonymous cryptocurrencies like BTC.

It was never meant to be like this: The tech behind the Tor network was created by US defense researchers who were trying to build secure communication channels in the 1990s. That project never materialized, but some of the researchers saw the benefit of anonymous, private, and instant communication for rights activism, and launched Tor as a nonprofit, open-access tool. “The dark net does not intrinsically breed criminal activities,” a 2018 academic study published in Security Journal notes.

The dark web likely won’t feel Hydra’s absence for long: Where one marketplace closes, others usually spring up to take its place, a recent Wired article notes. Many of the most well-known marketplaces have already been shut down, including Silk Road, AlphaBay, and Empire Market, but dark web trade shows no sign of slowing.

So just how big is the global dark web market? It’s hard to say, given that underground marketplaces aren’t in the habit of disclosing their finances. One 2020 study identified 38 dark web marketplaces, though there are likely many more. Silk Road — the marketplace that garnered the most brand recognition before it was closed down in 2013 — served over 100k customers in the two years it was operational and was reportedly a USD 1.2 bn operation at its peak, Wired tells us. Hydra amassed some 17 mn customers and 19k vendor accounts, with authorities estimating that sales reached some EUR 1.2 bn in 2020 alone, according to a Vice article.

Dark e-commerce is a growing industry — and its fuelling a cybercrime boom: BTC transactions on the dark web grew to USD 872 mn in 2018 from USD 250 mn in 2012, according to a 2018 report by crypto-payment analytic firm Chainalysis, cited in an IMF blog post. The boom in dark e-commerce is also partly to blame for a recent surge in global ransomware attacks, which were expected to inflict damages exceeding USD 20 bn in 2021, according to a 2017 report (pdf) by CyberSecurity Ventures — that’s 57 times the costs they inflicted in 2015. It was predicted that these global ransomware damages would cost the world in excess of USD 265 bn by 2031.

Egypt, like much of the region, is seeing a growth in malware attacks: Egypt saw some 42 mn malware attacks in 1H 2021 — a 32% y-o-y increase, according to security intelligence firm Kaspersky. The MENA region as a whole saw some 161 mn attacks, a 17% y-o-y increase.

If they’re that bad, why don’t we shut all the dark webs down? Marketplaces use “cutting-edge security techniques to conceal their identities and hide the locations of their servers, making it virtually impossible for law enforcement agencies to disrupt their activities,” cyber security company ZeroFox says. International regulators, financial institutions, and law enforcement agencies all need to work together across borders to offer data protection and cryptocurrency regulation, and disband dark web marketplaces where possible, the IMF tells us.