LONDON (Reuters) – A New York judge has dismissed criminal charges against Tom Hayes, the British trader who became the face of the global Libor interest rate scandal.

The former UBS and Citigroup trader served more than five years in prison in Britain for conspiring to rig Libor (London interbank offered rate) – a benchmark used to set rates on trillions of dollars in loans, mortgages and derivatives.

The U.S. decision comes after a separate U.S. ruling in August to throw out convictions for rigging Libor against two former Deutsche Bank traders.

Libor, once dubbed the world’s most important number, was discredited after the 2008 financial crisis when authorities in the United States and Britain found traders had manipulated it to make a profit.

Hayes was released from prison in Britain in January 2021 after serving half an 11-year sentence.

Hayes’ legal team is considering further legal options to clear his name, a representative for Hayes said in a statement.

“The U.S. Department of Justice has seen fit to dismiss charges based on the same facts, evidence and case in law that the UK courts used to justify my 11-year prison sentence,” Hayes said.

“That alone should be grounds enough for these cases to be referred back to the Court of Appeal in the UK, and if need be to the Supreme Court, which is yet to hear the case.”

(This story has been corrected to fix a spelling error in the headline.)

(Reporting by Iain Withers, additional reporting by Lawrence White; editing by Jason Neely)

By Arathy Somasekhar

HOUSTON (Reuters) -Oil prices fell on Monday on expectations that U.S. production could rise and as weaker economic data out of China and the country’s widening COVID-19 curbs weighed on demand.

Global benchmark Brent crude futures dropped 94 cents, or 0.98%, to $94.83 a barrel. U.S. West Texas Intermediate (WTI) crude fell $1.37 to $86.53 a barrel, a 1.6% loss.

Both benchmarks notched their first monthly gains since May.

Oil output in the United States climbed to nearly 12 million barrels per day in August, the highest since the onset of the COVID-19 pandemic, monthly government data showed. [L1N31W1JU]

U.S. President Joe Biden was set to call on oil and gas companies to invest some of their record profits in lowering costs for American families, a White House official said.

Biden will call on Congress to consider requiring oil companies to pay tax penalties and face other restrictions, the official said. The president has previously pushed oil companies to raise production rather than use profits for share buybacks and dividends.

The administration has also relied on releasing supplies from the Strategic Petroleum Reserves (SPR) to ease a supply crunch. About 1.9 million barrels were released from the SPR last week as part of the government’s plan to release 180 million barrels.

Meanwhile, factory activity in China, the world’s largest crude importer, fell unexpectedly in October, an official survey showed on Monday, weighed down by softening global demand and strict COVID-19 restrictions that hit production.

“The purchasing managers’ index (PMI) data contracting adds to the post-China congress party blues for oil markets. It is not difficult to draw a straight line from weaker PMIs to China’s COVID-zero policy,” said Stephen Innes, managing partner of SPI Asset Management.

“So long as COVID-zero remains entrenched, it will continue to thwart oil bulls.”

Chinese cities are stepping up zero-COVID curbs as outbreaks widen, dampening hopes of a rebound in demand.

Strict COVID-19 curbs in China have hit economic and business activity, curtailing oil demand. China’s crude oil imports for the first three quarters of the year fell 4.3% year on year for the first annual decline for the period since at least 2014.

Meanwhile, the euro zone is likely to enter recession, with its October business activity contracting at the fastest in nearly two years, a S&P Global survey said.

European Central Bank policymakers are standing behind plans to keep raising interest rates, even if it pushes the bloc into recession and stirs political resentment.

The Organization of the Petroleum Exporting Countries (OPEC) on Monday raised its forecast for medium and long-term oil demand and said $12.1 trillion of investment is needed to meet this demand despite the energy transition.

(Reporting by Noah BrowningAdditional reporting by Florence Tan and Emily ChowEditing by David Goodman, Barbara Lewis and David Gregorio)

(Reuters) – China Southern Airlines Co Ltd has cancelled plans for two Boeing Co 737 MAX flights on Sunday that would have represented the model’s return to passenger flying in China after more than three years, according to the airline’s website.

The 737 MAX was grounded in March 2019 following fatal crashes in Indonesia and Ethiopia but has returned to service around the world with the exception of China and Russia after modifications to the aircraft and pilot training.

China Southern had scheduled flights from its Guangzhou hub to Zhengzhou and Wuhan, Reuters reported on Thursday.

The airline’s website and flight tracking website FlightRadar24 showed the flights had been cancelled. China Southern did not respond immediately to a request for comment.

On Wednesday, Boeing said it had another 138 planes manufactured for Chinese carriers that were in the United States waiting to be delivered, though it had begun remarketing the jets to other carriers given there were no concrete signs that Chinese airlines would accept the planes in the near term.

Earlier this month, a 737 MAX flight by MIAT Mongolian Airlines landed in Guangzhou, marking the first commercial flight by the model in China since 2019.

(Reporting by Jamie Freed in Sydney; Editing by Chris Reese)

By Ryan Woo

BEIJING (Reuters) – After enduring days of lock-in at Foxconn’s vast facility in central China with 200,000 other workers, Yuan finally climbed the fences on Saturday night and escaped the complex, joining others fleeing what they feared was a widening COVID outbreak.

He walked through the night, keeping to a northerly route, towards his hometown of Hebi, every step taking him farther away from iPhone maker Foxconn’s Zhengzhou plant, the Taiwan-based group’s largest in mainland China.

“There were so many people on the road,” Yuan told Reuters on Monday, declining to give his full name because of the matter’s sensitivity.

Since mid-October, Foxconn has been wrestling with a COVID-19 outbreak at its facility in Zhengzhou, the capital of Henan province in central China. Workers were locked in to stop the spread of the coronavirus to the outside word. Foxconn has repeatedly refrained from disclosing the case load.

“We were shut in on Oct. 14, and we had to do endless PCR tests, and after about 10 days, we had to wear N95 masks, and were given traditional Chinese medicine,” said Yuan.

Whenever a positive or suspected case was found at a production line, there would be a public broadcast, but work would continue, he told Reuters.

“People would be called away in the middle of work, and if they don’t show up the next day, that would mean they had been taken away,” Yuan said.

Around 20,000 workers had been put in quarantine on-site, Yuan had heard, but he could not be sure how many were infected, as management did not publicise that information.

China typically isolates vast numbers of people considered close or even potential contacts of an infected person.

The world’s second-largest economy continues to wage war on COVID with disruptive lockdowns, mass testing and quarantines while many other countries have chosen to live with the disease.

For companies with massive manufacturing campuses like Foxconn, that has meant keeping thousands of workers on-site in so-called “closed-loop” systems to keep their production lines running.

“Food for tens of thousands was merely left outside (of the quarantine buildings at the plant),” said a worker surnamed Li, 21.

Li, who is still at the plant, said she was planning to quit.

In a statement on Monday, Apple supplier Foxconn said that reports that 20,000 staff had been diagnosed with COVID were false.

On Sunday afternoon, the company told Reuters in an emailed statement that workers were allowed to leave if they chose to.

Foxconn did not immediately respond to a Reuters request on Monday for further comment.

‘NEVER GO BACK’

Disruptions from China’s zero-COVID policies to commerce and industry have widened in October as cases escalated. Apart from the Foxconn lockdown, the Shanghai Disney Resort was shut from Monday to comply with counter-epidemic requirements, with visitors still inside.

For Yuan, matters came to a head when he heard that a housing complex for workers near his plant had been cordoned off by security on Friday, and that the plant itself was to go under a curfew the next day.

In a panic, Yuan decided to leave the next day, joining streams of other escaping workers. It was not immediately clear if a curfew was eventually imposed.

By Sunday morning, Yuan had hiked to the banks of the Yellow River, the northern boundary of Zhengzhou, where he was stopped 50 km (30 miles) short of Hebi by authorities from the city of Xinxiang on the other side.

“I’ll never go back to Foxconn,” said Yuan, who has since been transported to Hebi and put under quarantine.

“Zhengzhou has put a chill in my heart.”

(Reporting by Ryan Woo; Additional reporting by Beijing newsroom and Ziyi Tang; Editing by Christian Schmollinger)

By David Shepardson

WASHINGTON (Reuters) -Democratic U.S. Senator Chris Murphy said on Monday he wants a U.S. national security review of a Saudi Arabian conglomerate’s stake in Twitter Inc after Elon Musk’s takeover of the social media company.

Murphy said he was asking the Committee on Foreign Investment in the United States (CFIUS) — which reviews acquisitions of U.S. businesses by foreign buyers — “to conduct an investigation into the national security implications of Saudi Arabia’s purchase of Twitter.”

Most foreigners seeking to take even noncontrolling stakes in U.S. companies must seek approval from CFIUS, a powerful Treasury-led committee that reviews transactions for national security concerns and has the power to block them.

On Friday, Saudi Arabia’s Kingdom Holding Company and the private office of Prince Alwaleed bin Talal said they will continue their ownership of Twitter shares valued at $1.89 billion, according to a statement tweeted by Prince Alwaleed.

“The deal is in line with the long-term investment strategy which Kingdom Holding Company is known for,” the statement said.

Alwaleed’s Kingdom Holding is 16.9% owned by Saudi Arabia’s sovereign wealth fund, which is chaired by Crown Prince Mohammed bin Salman.

“We should be concerned that the Saudis, who have a clear interest in repressing political speech and impacting U.S. politics, are now the second-largest owner of a major social media platform,” Murphy wrote on Twitter “There is a clear national security issue at stake and CFIUS should do a review.”

The Saudi embassy in Washington did not immediately comment. Twitter did not immediately respond to a request for comment. A spokesman for U.S. Treasury, which leads CFIUS, declined to comment.

Musk last week closed the $44 billion deal announced in April to take Twitter private. Banks including Morgan Stanley and Bank of America Corp committed to provide $13 billion in debt financing.

(Reporting by David Shepardson in WashingtonEditing by Franklin Paul and Matthew Lewis)

By Nell Mackenzie

(Reuters) – Senate Republicans want the SEC to explain why staff are leaving the nation’s corporate watchdog at the highest rate in 10 years amid a flurry of proposed rules, according to a letter seen by Reuters on Sunday.

The private letter dated Oct. 27 from Senate Republicans to the chair of the Securities and Exchange Commission, Gary Gensler, adds to mounting criticism that the U.S. regulator lacks the internal firepower it needs to accomplish its ambitious rulemaking plans.

Gensler, a veteran Wall Street regulator who was chosen by President Joe Biden, a Democrat, has already clashed with Republicans over the watchdog’s proposals on corporate climate-related disclosures. 

Gensler has previously contended that his new rules are critical to ensuring the U.S. capital markets remain the global “gold standard.”

Republicans have claimed he has overstepped his authority and adopted a hostile stance toward the financial industry.

The SEC has introduced 26 new rule proposals in 2022, more than double the number in 2021 and the highest total of any year in the last five years, the Republican letter says.

The letter, signed by six of the 12 Republicans on the Senate Banking Committee, references a public Oct. 13 report posted on the SEC’s website from the Office of the Inspector General, the SEC’s own internal watchdog, detailing staff attrition and reports of discontent.

Republicans want Gensler to explain how he will address the concerns in the report and also to allow more time for industry feedback on the new rules.

The SEC was not immediately available for comment.

Employees interviewed for the internal watchdog report said they received little feedback on rules they had written, according to the report.

Staff feared an increased risk of litigation because of shortened industry comment periods, the report said.

The SEC is losing employees at its highest pace in 10 years, said the Inspector General’s report. The agency expected attrition in senior officer positions to be 20.8% this fiscal year and 8.4% for attorney positions, it said.

The letter concludes that “efforts to ram through hurried rulemaking without proper analysis, deliberation or consideration of downstream negative impacts is nothing short of regulatory malpractice.”

Senate Republicans Thom Tillis from North Carolina, Mike Crapo from Idaho, Tim Scott from South Carolina, Michael Rounds from South Dakota, Bill Hagerty from Tennessee and Steve Daines from Montana signed the letter.

(Reporting by Nell Mackenzie; Additional reporting by Huw Jones; Editing by Lisa Shumaker)

By Andrew Chung

WASHINGTON (Reuters) -Former President Donald Trump on Monday asked the U.S. Supreme Court to intervene in his fight to prevent a U.S. House of Representatives committee from gaining access to his tax returns for reasons he claims are politically motivated.

Trump filed an emergency request to put on hold a lower court ruling against the Republican former president that upheld the Democratic-led House Ways and Means Committee’s request for the tax materials as a justified part of its legislative work while his attorneys prepare an appeal.

“If allowed to stand, it will undermine the separation of powers and render the office of the Presidency vulnerable to invasive information demands from political opponents in the legislative branch,” Trump’s lawyers wrote, referring to the division of authority among the three branches of the U.S. government.

The fight has lingered since 2019 when the committee sued Trump to force disclosure of the tax returns. Trump was the first president in four decades years not to release his tax returns as he aimed to keep secret the details of his wealth and the activities of his company, the Trump Organization.

The committee in its request invoked a federal law that empowers the chairman of the House Ways and Means Committee to request any person’s tax returns from the IRS.

House Democrats have said they need Trump’s tax returns to see if the IRS is properly auditing presidential returns and to assess whether new legislation is needed. Trump’s lawyers have called that explanation “pretextual” and “disingenuous,” saying the real aim is to unearth politically damaging information about Trump, who is considering another run for the presidency in 2024.

U.S. District Judge Trevor McFadden, a Trump appointee, sided with Congress in December 2021 and threw out the case, finding that the committee holds broad authority over a former president’s tax returns.

In August, the District of Columbia U.S. Circuit Court of Appeals also ruled against Trump, concluding that “every president takes office knowing that he will be subject to the same laws as all other citizens upon leaving office.” The appeals court refused a rehearing on Oct. 27.

(Reporting by Andrew Chung in Washington and Nate Raymond in Boston; Editing by Will Dunham)

NAIROBI (Reuters) – The number of people killed by two car bombs that exploded outside the education ministry in Somalia’s capital Mogadishu has risen to at least 120 people, the health minister said on Monday.

The al Qaeda-linked Islamist group al Shabaab claimed responsibility for Saturday’s blasts, Somalia’s deadliest since a truck bomb killed more than 500 people at the same location five years ago.

The first of the explosions hit the education ministry at around 2 p.m. on Saturday. The second hit minutes later as ambulances arrived and people gathered to help the victims.

Health minister Ali Haji Aden said the death toll stood at 120, while a further 150 people were being treated in hospital.

Al Shabaab, which is seeking to topple the government and establish its own rule based on an extreme interpretation of Islamic law, frequently stages attacks in Mogadishu and elsewhere.

The Islamist group has been under pressure since August when President Hassan Sheikh Mohamud began an offensive, supported by the United States and allied local militias, against them, and sought to dismantle their financial network.

Analysts say the offensive is the most serious threat al Shabaab has faced in years.

(Reporting by Abdi Sheikh; Writing by Hereward Holland, Editing by Angus MacSwan)

By Alex Lawler

ABU DHABI (Reuters) – OPEC raised its forecasts for world oil demand in the medium-and longer-term in an annual outlook released on Monday and said $12.1 trillion of investment is needed to meet this demand despite the energy transition.

The view from the Organization of the Petroleum Exporting Countries, in its 2022 World Oil Outlook, contrasts with that of other forecasters which see oil demand reaching a plateau before 2030 due to the rise of renewable energy and electric cars.    Another decade of oil demand growth would be a boost for OPEC, whose 13 members depend on oil income. The group has been arguing that oil should be part of the energy transition and that focus by investors on economic, social and governance (ESG) issues has worsened an investment shortfall.    “The overall investment number for the oil sector is $12.1 trillion out to 2045,” OPEC Secretary General Haitham Al Ghais wrote in the foreword to the report, which said the figure was up from last year’s estimate.    “However, chronic underinvestment into the global oil industry in recent years, due to industry downturns, the COVID-19 pandemic, as well as policies centred on ending financing in fossil fuel projects, is a major cause of concern.”    OPEC made a shift in 2020 when the pandemic hit demand, saying it would eventually slow after years of predicting ever-increasing consumption. In the report, OPEC maintained its view that world demand will plateau after 2035.

GRAPHIC: OPEC World Oil Demand Forecast https://fingfx.thomsonreuters.com/gfx/mkt/zgpobwzamvd/Pasted%20image%201667239252245.png

    Other predictions from companies and banks see oil demand peaking earlier.     The International Energy Agency on Thursday for the first time in its history of modelling said demand for all fossil fuels was set to peak, with oil demand levelling off in the middle of the next decade.             ENERGY SECURITY DEMAND BOOST    The report said world oil demand will reach 103 million barrels per day in 2023, up 2.7 million bpd from 2022. The 2023 total demand is up 1.4 million bpd from last year’s prediction.     OPEC also raised its demand forecasts for the medium term to 2027, saying the figure is up by almost 2 million bpd by the end of the period from last year.    It said the upward revision reflects a more robust recovery now seen in 2022 and 2023 and a “strong focus on energy security issues” leading to a slower substitution of oil by other fuels such as natural gas, whose price has soared due to Russia’s invasion of Ukraine.    By 2030, OPEC sees world demand averaging 108.3 million bpd, up from 2021, and lifted its 2045 figure to 109.8 million bpd from 108.2 million bpd in 2021. The group had lowered the 2045projection over the last few years.     OPEC and its allies, known as OPEC+, are again cutting supply to support the market. The report sees supply restraint continuing in the medium term, with OPEC output in 2027 lower than in 2022 as non-OPEC supply grows.    Still, OPEC is upbeat about its later prospects, seeing its market share rising. U.S. tight crude supply is seen peakingafter the late 2020s, rather than around 2030 last year.    “Oil is expected to remain the number one fuel in the global primary energy mix,” the report said.  

(Reporting by Alex Lawler; editing by David Evans)

By Nate Raymond

(Reuters) – The U.S. Supreme Court on Monday declined to hear Turkey’s bid to dismiss two lawsuits filed by demonstrators seeking monetary damages after accusing Turkish security forces of injuring them in a 2017 protest in Washington during a visit by President Tayyip Erdogan.

The justices turned away an appeal by Turkey of lower court rulings allowing the litigation to proceed, rejecting the NATO ally’s argument that it has immunity from such legal action in the United States under a federal law called the Foreign Sovereign Immunities Act.

At issue in the litigation is a melee involving members of Erdogan’s security detail that occurred as protesters demonstrated outside the Turkish ambassador’s residence in Washington on May 6, 2017. Erdogan was in the U.S. capital to meet then-President Donald Trump. The incident strained relations between Turkey and the United States.

Two lawsuits were filed in 2018 – one case brought by 15 plaintiffs and the other by five – seeking to hold Turkey’s government responsible and asking for monetary damages for injuries that included concussions, seizures and lost teeth. The plaintiffs sought tens of millions of dollars, according to court papers.

The Foreign Sovereign Immunities Act limits the jurisdiction of American courts over lawsuits against foreign governments.

Andreas Akaras, a lawyer for some of the demonstrators, said in a statement that he and his colleagues “look forward to holding Turkey accountable in a court of law for its terrorizing attack against our clients.”

A lawyer representing Turkey declined to comment.

Turkey has blamed the brawl on demonstrators linked to the Kurdistan Workers Party. The police chief in the U.S. capital described the incident as a “brutal attack” on peaceful protesters.

Criminal assault charges were brought in Washington against several Turkish security agents and others involved. Two of the defendants – not members of Erdogan’s security team – pleaded guilty. Prosecutors dropped charges against 11 agents in 2018.

President Joe Biden’s administration had urged the Supreme Court not to hear Turkey’s appeal to avoid the lawsuits, saying that when foreign security personnel deploy force in ways that are not related to protecting officials from bodily harm they are acting outside their legal protections.

Lower courts ruled against Turkey. The U.S. Court of Appeals for the District of Columbia Circuit in 2021 ruled that while members of the Turkish security detail had a right to protect Erdogan, their actions in this incident did not meet that exception.

Turkey had argued that a failure by the Supreme Court to reverse that ruling threatened to disrupt U.S. foreign relations and “invites reciprocal erosion of immunity for U.S. security agents protecting American presidents, diplomats and missions abroad.”

(Reporting by Nate Raymond in Boston; Editing by Will Dunham)

By Nathan Gomes, Kannaki Deka and David Carnevali

(Reuters) – Emerson Electric Co will sell a majority stake in its climate technologies unit to Blackstone Inc in a deal that values the business at $14 billion, as the U.S. industrial firm pivots to supplying to a booming automation market.

The company will receive an upfront payment of about $9.5 billion, it said on Monday, which it will use to scoop up more firms, especially in the automation segment.

Emerson’s shares edged up 1% in a weak broader market as the company also beat fourth-quarter earnings and revenue.

Businesses are accelerating their efforts to automate their operations amid a shortage of factory workers, and Emerson has doubled down on its software strategy to capture that shift.

The company sold its division that makes waste disposal equipment and hot water dispensers to Whirlpool Corp and merged its software units with smaller rival Aspen Technology.

GRAPHIC: Emerson vs S&P 500 https://graphics.reuters.com/EMERSON-STAKE/mopakmdlapa/EMR%20YTD%20shr%20graphic.png

Emerson, which will retain about 45% stake in the climate tech unit, said Blackstone and co-investors Abu Dhabi Investment Authority and Singapore state fund GIC would contribute $4.4 billion in equity toward the deal, which would be supplemented by $5.5 billion of debt financing. The debt will be equivalent to about four times the new company’s annual cash flow.

“(Emerson) is significantly re-orienting its portfolio to result in a more focused and potentially higher growth enterprise,” Citi Research analysts said.

The deal, expected to close in the first half of 2023, is the latest in a flurry of private equity transactions this year as a selloff in equities on recession worries hammered valuations.

The Climate Technologies business, which will be structured as a joint venture, generated net sales of $5 billion in fiscal 2022.

The deal values the unit at 12.7 times its cash flow in fiscal 2022, a premium to peers such as manufacturers of components and industrial companies that own HVAC businesses, which trade at roughly 10.5 and 11.5 times, respectively.

“The business is poised for accelerated growth as it leads the way in helping consumers and businesses shift to more energy-efficient heating and cooling products as part of their carbon reduction efforts,” global head of Blackstone Private Equity Joe Baratta said.

Emerson said it plans to use proceeds from the deal to invest in automation-related businesses and spend around $2 billion on share repurchases in 2023.

Centerview Partners LLC and Goldman Sachs are financial advisers to Emerson, while Barclays is the lead financial adviser to Blackstone.

(Reporting by Nathan Gomes and Kannaki Deka in Bengaluru and David Carnevali in New York; Additional reporting by Jaiveer Singh Shekhawat in Bengaluru; Editing by Shailesh Kuber, Sriraj Kalluvila and Lisa Shumaker)

By Nigel Hunt and Naveen Thukral

LONDON/SINGAPORE (Reuters) -Grain was flowing out of Ukraine at a record pace on Monday under an initiative led by the United Nations aimed at easing global food shortages despite Russia warning it was risky to continue after it pulled out of the pact.

Russia said on Monday that the deal was hardly feasible as it was impossible to guarantee the safety of shipping after its withdrawal over the weekend following what it said was a major Ukrainian drone attack on its fleet in Crimea.

Other participants, however, were pressing ahead with the deal while France said it was talking to other European Union states about how to boost Ukraine grain exports via land routes.

Ukraine is one of the world’s largest grain exporters and the conflict with Russia led to the closure of its seaports in February, driving up food prices and contributing to a steep rise in acute hunger across the globe.

The deal, signed on July 22, created a safe corridor to allow exports to resume from three Ukrainian ports and helped to ease the crisis with more than 9.5 million tonnes of corn, wheat, sunflower products, barley, rapeseed and soy exported under the pact.

U.N. aid chief Martin Griffiths said on Monday the corridor does not provide cover for military action, adding there were no ships involved in a deal were transiting it on the night of Oct. 29, when Russia says its vessels in the Bay of Sevastopol in Crimea were attacked.

A record volume of 354,500 tonnes of agricultural products was carried on vessels leaving Ukrainian ports on Monday as part of the Black Sea grain deal, a spokesperson for Odesa’s military administration said.

“Civilian cargo ships can never be a military target or held hostage. The food must flow,” tweeted Amir Abdullah, the U.N. official who coordinates the programme.

Russia, however, cast doubts about the future of the pact.

“In conditions when Russia is talking about the impossibility of guaranteeing the safety of shipping in these areas, such a deal is hardly feasible, and it takes on a different character – much more risky, dangerous and unguaranteed,” Kremlin spokesman Dmitry Peskov told reporters.

GREATER RISKS

Lloyd’s of London insurer Ascot said on Monday it was pausing writing cover for new shipments using the Ukrainian grains corridor.

“From today we are pausing on quoting new shipments until we better understand the situation,” Ascot head of cargo Chris McGill told Reuters. “Insurance that has already been issued still stands.”

Marcus Baker, global head of marine and cargo with broker Marsh, said that the change in the risk environment over the last 48 hours was “very significant”.

“Given the change in circumstances it is not surprising that underwriters have taken the decision to suspend the facility until there is greater clarity,” Baker said.

Turkey, which helped broker the deal, remained committed to the deal which involves the inspection of cargoes at a Joint Coordination Centre in Istanbul.

“Even if Russia behaves hesitantly because it didn’t receive the same benefits, we will continue decisively our efforts to serve humanity,” President Tayyip Erdogan said in a speech.

Turkish Defence Minister Hulusi Akar told his Russian counterpart Sergei Shoigu on Monday that Moscow should re-evaluate the suspension of its participation.

GRAIN PRICES CLIMB

Wheat prices rose on Monday, climbing around 5% to $8.71 a bushel in Chicago, but remained far below a peak of $13.63-1/2 set in early March shortly after the conflict began.

The strong pace of wheat exports from Russia, which harvested a record crop this summer, has helped to bolster supplies on the world market.

Consultancy Sovecon on Monday estimated that Russia would export 4.5 million tonnes of wheat in October, up from 2.8 million in the same month last year.

Corn prices rose around 1% to $6.87-1/2 a bushel in Chicago on Monday while soybean oil rose more than 2% to 73.36 cents per lb.

Traders warned that hundreds of thousands of tonnes of wheat booked for delivery to Africa and the Middle East could now be at risk.

“If I have to replace a vessel which was due to come from Ukraine, what are the options? Not much really,” said one Singapore-based grains trader who supplies wheat to buyers in Asia and the Middle East.

Ukraine is also a major exporter of corn and there were concerns that shipments to the European Union were at risk.

“As far as Europe is concerned, corn is a bigger issue than wheat as we are getting into peak season for Ukrainian corn in November,” said one grain trader said.

Analysts warned that although global agricultural commodity prices have come off record highs in recent months, local retail food prices remain high and could now face further upside.

“Typically, it takes about two months for higher grain prices to filter through the supply chain and impact consumers at the retail level,” said a Sydney-based analyst.

“But food processors do not have much forward coverage, so it is likely to be a lot quicker.”

(Repoting by Reuters bureaux, writing by Nigel Hunt, editing by David Evans)

By Johann M Cherian and Sruthi Shankar

(Reuters) -Britain’s FTSE 100 closed at a fresh five-week high on Monday as a fall in sterling lifted dollar-earners such as AstraZeneca and Unilever, while shares in EasyJet rallied on speculation of a takeover by British Airways owner IAG.

The blue-chip index rose 0.7% to close at its strongest level since Sept. 23 and marked its first monthly rise in three.

Global companies such as AstraZeneca, Unilever and BP, which draw large parts of their revenue overseas, rose nearly 2% as sterling slid. [GBP/]

Investors will look to the Bank of England and the U.S. Federal Reserve for any signs of easing in their aggressive monetary policy tightening cycles, with each expected to hike rates by 75 basis points this week.

“It all adds up to an increasingly difficult tightrope for monetary policy makers on both sides of the Atlantic to walk, as they look to bring inflation under control without doing too much economic damage in the process,” Russ Mould, investment director at AJ Bell, said.

UK markets have recouped some of the sharp losses made earlier in October when former Prime Minister Liz Truss’s economic plan sent borrowing costs sharply higher and triggered political turmoil.

Truss was replaced by former finance minister Rishi Sunak who reversed almost all of her plans and brought a measure of relief to the UK’s financial markets.

The FTSE 250 index, most exposed to the domestic economy, edged down 0.2% on Monday but marked monthly gains of 4.2%.

The banking sector gained 1.3% after a Sunday Times report said more windfall taxes in the UK were unlikely.

Easyjet jumped 6.1% after a Times report said that International Consolidated Airlines Group (IAG) is to renew its EU consolidation plans, fuelling speculation that Easyjet could be a takeover target. IAG rose 5.4%.

Centrica Plc rose 4.7% after brokerage Jefferies upgraded the stock to “buy” and raised its price target, citing strong fundamentals.

(Reporting by Johann M Cherian in Bengaluru; Editing by Subhranshu Sahu, Shailesh Kuber and Andrew Heavens)