News & Current Affairs

November 19, 2008

Saudi owners ‘talking to pirates’

Saudi owners ‘talking to pirates’

Sirius Star

The Sirius Star has 25 crew – who are said to be unharmed

The owners of a Saudi Arabian oil tanker hijacked by Somali pirates are negotiating a possible ransom, the Saudi foreign minister has said.

The Sirius Star is the biggest tanker ever hijacked, carrying a cargo of two million barrels of Saudi oil – worth more than $100m (£67m).

Saudi’s Prince Saud al-Faisal did not confirm whether a ransom was likely to be agreed, but said talks had begun.

Meanwhile, the Indian navy says it has sunk a suspected pirate “mother ship”.

INS Tabar sank what was believed to be a Somali pirate “mother ship” after it failed to stop for investigation and instead opened fire in the Gulf of Aden, an Indian navy statement said.

We do not like to negotiate with either terrorists or hijackers. But the owners of the tanker, they are the final arbiters of what happens
Prince Saud al-Faisal

The captive crew on the Sirius Star include two British citizens, two Poles, one Croatian, one Saudi national and 19 Filipinos.

The Britons include Peter French, the chief engineer on board the vessel.

The other is Second Officer James Grady, from Strathclyde. Their families released a statement on Wednesday saying they hoped they would be home safely very soon.

There has been a surge in piracy incidents off the coast of Somalia during 2008. On Tuesday, a cargo ship and a fishing vessel became the latest to join more than 90 vessels attacked by the pirates this year.

The pirates who seized the MV Sirius Star and its 25 crew on Saturday are a sophisticated group with contacts in Dubai and neighboring countries.

Much of their ransom money from previous hijackings has been used to buy new boats and weapons as well as develop a network across the Horn of Africa, he adds.

‘Scourge’ of seas

Asked whether a ransom was being negotiated, the Saudi foreign minister said the decision rested with the owners of the tanker.

Map showing areas of pirate attacks

“We do not like to negotiate with either terrorists or hijackers. But the owners of the tanker, they are the final arbiters of what happens there,” Prince Saud al-Faisal said.

“What we know is that we are going to join the task force that will try and eradicate this threat to international trade.”

The tanker’s Dubai-based operators, Vela International Marine Ltd, would not confirm or deny negotiations were taking place.

“Given the sensitive nature of the situation, and to ensure the safety of the crew members, we are not prepared to make any public statement on this issue,” a spokesman told AFP.

The UK Foreign Secretary, David Miliband, said piracy was “a scourge wherever it appears anywhere in the world and at the moment the scourge is focused in the Gulf of Aden”.

He said the Royal Navy was co-ordinating the European response to the incident.

Shipping companies are now weighing up the risks of using the short-cut route to Europe via the Gulf of Aden and Suez canal.

However, travelling around South Africa’s Cape of Good Hope would add several weeks to average journey times and substantially increase the cost of goods for consumers.

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November 18, 2008

Hijacked oil tanker nears Somalia

Hijacked oil tanker nears Somalia

The Sirius Star oil tanker (undated image)

The Sirius Star’s cargo has an estimated value of $100m

A giant Saudi oil tanker seized by pirates in the Indian Ocean is nearing the coast of Somalia, the US Navy says.

The Sirius Star is the biggest tanker ever to be hijacked, with a cargo of 2m barrels – a quarter of Saudi Arabia’s daily output – worth more than $100m.

The vessel was captured in what the navy called an “unprecedented” attack 450 nautical miles (830km) off the Kenyan coast on Saturday.

Its international crew of 25, including two Britons, is said to be safe.

The ship’s operator, Vela International, said a response team had been mobilized to work towards ensuring the safe release of vessel and crew.

Map showing areas of pirate attacks

The hijacking was highly unusual both in terms of the size of the ship and the fact it was attacked so far from the African coast.

The seizure points to the inability of a multi-national naval task force sent to the region earlier this year to stop Somali piracy, he says.

The US Fifth Fleet said the supertanker was “nearing an anchorage point” at Eyl, a port often used by pirates based in Somalia’s Puntland region.

Admiral Mike Mullen, chairman of the US Joint Chiefs of Staff, said the pirates involved were well trained.

“Once they get to a point where they can board, it becomes very difficult to get them off, because, clearly, now they hold hostages,” he told a Pentagon briefing in Washington.

Oil price rises

Hijackings off the coast of East Africa and the Gulf of Aden – an area of more than 1m square miles – make up one-third of all global piracy incidents this year, according the International Maritime Bureau.

THE SIRIUS STAR
The Sirius Star oil tanker (image from Aramco website)
Length of a US aircraft carrier
Can carry 2m barrels of oil
Biggest vessel to be hijacked

They are usually resolved peacefully through negotiations for ransom but, given the value of the cargo in this instance, a military response has not been ruled out, our correspondent says.

At least 12 vessels – including the Ukrainian freighter MV Faina, which was seized in September – remain captive and under negotiation with around 250 crew being held hostage.

This month alone, pirates have seized a Japanese cargo ship off Somalia, a Chinese fishing boat off Kenya and a Turkish ship transporting chemicals off Yemen.

War-torn Somalia has not had an effective government since 1991.

The South Korean-built Sirius Star was seized as it headed for the US via the southern tip of Africa, prompting a rise in crude oil prices on global markets.

The route around the Cape of Good Hope is a main thoroughfare for fully-laden supertankers from the Gulf.

With a capacity of 318,000 dead weight tonnes, the ship is 330m (1,080ft) long – about the length of a US aircraft carrier.

Owned by the Saudi company Aramco, it made its maiden voyage in March.

As well as the two Britons, the ship’s crew members are said to be from Croatia, the Philippines, Poland and Saudi Arabia.


Are you affected by the issues in this story? What are your experiences? Send us your comments

September 13, 2008

Thousands stranded by XL collapse

Thousands stranded by XL collapse

The collapse of the UK’s third largest package holiday group has left tens of thousands of Britons stranded abroad.

The decision to place XL Leisure Group into administration has also left thousands of staff facing the axe.

Chairman Phil Wyatt said he was “totally devastated” by the failure which has grounded XL’s 21 planes. The company flies to about 50 destinations.

There are 67,000 stranded who booked directly with XL, and another 23,000 who booked via other companies.

The Civil Aviation Authority(CAA) also said the firm had 200,000 advance bookings.

‘Sad day’

CAA EMERGENCY HELPLINE
Customers abroad: +44 (0) 2891 856547
Customers in the UK with advance bookings: 0870 5900927

“We’ve made every effort, myself and my fellow directors, to find new funding for the business – and it’s a very sad day for me personally. I am totally devastated,” XL chairman Phil Wyatt said.David Clover, a spokesman for the CAA, said it was making arrangements to help customers of the four tour companies within the XL group.

“In respect of people who are currently abroad we’re making arrangements and working very closely with the travel industry to organize repatriation flights.

“Clearly though, with XL Airways no longer operating, we’re having to bring in substitute aircraft to bring people home.”

He said package deals are covered by the CAA’s Air Travel Organizers’ Licensing (Atol) scheme and those customers will be offered repatriation flights or their money back if they have an advance booking.

Struggling

However, those who booked directly with the airline or XL.com – who are in the minority according to the CAA – will face a fee.

Anyone yet to take their flights should check their insurance policies, and with their banks or credit card companies about refunds, he added.

XL – which carried 2.3 million passengers last year – is the latest travel business to face financial difficulties, as the industry struggles with high fuel costs and an economic downturn.

But an agreement has been reached whereby Straumur investment bank has acquired XL’s German and French subsidiaries, which Straumur considers to be financially viable and sustainable businesses.

They will continue operations as separate commercial entities.

Share prices in holiday firms TUI Travel and Thomas Cook were up 6% and 7% following the collapse of their rival.

Economic downturn

“As the travel industry matures in Europe, there was always going to be pressure on those operating in the mid-market,” said Lastminute.com chief executive Ian McCaig.

A statement on the XL group’s website said: “The companies entered into administration having suffered as a result of volatile fuel prices, the economic downturn, and were unable to obtain further funding.”

XL COMPANIES
XL Leisure Group
XL Airways UK
Excel Aviation
Explorer House
Aspire Holidays
Freedom Flights
Freedom Flights (Aviation)
The Really Great Holiday Company
Medlife Hotels
Travel City Flights
Kosmar Villa Holidays

BBC travel correspondent Tom Symonds added that the industry would be facing an “enormous challenge” as it deals with the fall out of XL’s collapse.

“XL wasn’t just an airline it was a fundamental link Britain’s package holiday industry,” he said.

“Getting these people to and from their holidays will be an enormous challenge not least because of the shortage of aircraft caused by so many airline collapses in recent weeks.

“XL can’t use its own airliners for among other reasons it has no insurance now.”

The CAA said it was working with the travel industry to bring stranded holidaymakers home, and denied it had been responsible for the grounding of XL’s planes.

Airlines BA, Easyjet, BMI, Flybe and Ryanair have offered to fly some of the stranded passengers home.

Easyjet chief executive Andy Harrison told that its fuel efficient planes had helped it cope with the high cost of aviation fuel although on Thursday it said it would cut up to 60 jobs to remain competitive.

Fuel pressures

Mr Wyatt added that spiralling oil prices had increased the firm’s costs “year-on-year by over $80m”.

“So where many people have been making hay with high oil prices, this is the repercussions of that hay – 1,700 people potentially out of work today in the UK,” he said.

Rival TUI warned that rising fuel costs meant that “airlines with less than robust business models” – such as XL and Futura – were now failing.

It added that the government should take steps to ensure all holiday companies must belong to the Atol scheme, which offers package holiday makers financial protection.

In the US, one flight from Orlando to Manchester managed to set off, while one bound for Gatwick was grounded. A source at the airport said accommodation was being found for the “distressed” passengers.

In the UK, air traffic control prevented three XL aircraft from taking off from Manchester Airport.

The XL group, which is based in Crawley, West Sussex, runs an airline and owns several travel companies, including Travel City Direct, Medlife Hotels Limited, The Really Great Holiday Company, Freedom Flights and Kosmar Holidays.

‘Going nowhere’

The company flies mainly from bases at Gatwick, Manchester and Glasgow airports.

Travel writer Simon Calder warned that many thousands of XL customers hoping to fly to the Caribbean, Mediterranean, North Africa and North America, from airports across the UK in coming weeks and days “simply won’t be going anywhere”.

Jim Duwaine, from Portsmouth, said he was given the news when he arrived at Gatwick where he had been due to catch an early morning flight to Menorca.

HELP OFFERED TO XL CUSTOMERS
Flybe – offering flights for 90 euros (£71.50)
BA– offering a one-way discount
Easyjet– flights offered for £75
BMI – provided aircraft to CAA for transport people home
Ryanair – has offered spare plane to CAA for transport

He said: “Absolutely devastated. Got up at midnight planning on going on holiday, but got let down, unfortunately. We’re here, just trying to get some other flights, but it’s not looking good. I think everyone else has got the same idea.”

Other holidaymakers have said they have been quoted vastly inflated prices for replacement flights.

Robert Spurgeon, of Norwich – an XL customer who had been due to fly to Tenerife from Gatwick – said: “We’ve not been told anything but my wife’s been quoted £2,000 for alternative flights.”

Also among those affected are a 130-strong choir on tour to Canada from Wales who were booked on Zoom and lost £50,000 when it folded last month, and then re-booked with XL.

XL is the current kit sponsor of West Ham United but football club said it would end the sponsorship deal and play on Saturday in an unbranded kit.


Are you struggling to make your way home from your holiday destination? Have you paid for a holiday that you may not be able to take? If you were an employee of XL what are your views? Send us your comments

August 14, 2008

Spending on communications falls

Spending on communications falls

Person using mobile phone, PA

Mobile use has doubled in five years, Ofcom says

Britons are spending more time using communications services but paying less for them, says an Ofcom report.

Every day in 2007, the average consumer spent 7 hours and 9 minutes watching TV, on the phone, using the internet or using other services, it says.

Since 2002, mobile use has doubled and PC and laptop use has grown fourfold, says the watchdog’s annual review.

But the average UK household spend on communications in 2007 was £93.63 a month – a fall of £1.53 on 2006.

TV remains the most popular pastime, with the average person watching for 3 hours and 38 minutes a day last year.

In 2007 the average person in the UK spent 24 minutes per day on their computer and 10 minutes using their mobile.

Graph showing household spend on communications services between 2002and 2007

Ofcom’s annual communications market review notes that monthly spend on communications has fallen for three years in a row.

Ofcom says consumers are getting increasingly canny about the way they buy services, switching providers or paying one fee for a bundle of services.

COMMUNICATIONS FACTS
Communications industry revenue topped £51.2bn in 2007
Average households spend £93.63 per month on communications services
87.2% have digital television
80% of new TV sales are high-definition sets
40% buy communications services in a bundled package
44% of adults use text messaging every day
36% of adults use the net every day
Source: Ofcom market review

Lower prices for broadband are one factor, with the average household spending £9.45 for an internet connection in 2007 compared with £9.87 in 2006.

Fierce competition between broadband providers is causing some concern that it may be difficult for the industry to raise the investment needed for faster networks.

But the report shows that broadband take-up is continuing to grow both at home and on the move.

By the end of 2007, Ofcom found, 58% of homes had broadband, compared with 52% a year earlier.

Dongle surge

The real surge, though, came in the use of mobile broadband after a big marketing push by mobile phone companies selling so-called “dongles”.

Between February and June this year, monthly sales of these devices, which give internet access to laptop users, rose from 69,000 to 133,000 a month.

According to Ofcom figures, two million people say they have used mobile broadband via a dongle or similar device and three-quarters of them say they use it at home as well as on the move – evidence that the mobile operators are beginning to compete with fixed-line businesses for broadband customers.

Children watching TV, BBC

TV retains its popularity despite booming net, mobile and computer use

British consumers are also spending more time on the phone than ever before, with a 21% increase in minutes spent on mobile calls.

Even fixed-line calls are holding up with Ofcom seeing just a 2% fall in minutes spent calling.

The Ofcom report paints a picture of a country where consumers are making more and more use of modern media services – from YouTube to personal video recorders – while still retaining an interest in the traditional services.

Digital television is now in use in 87% of British homes, with many having hundreds of channels to choose from. Despite the variety, 57% of viewing in these multi-channel homes is of the five main channels.

Ofcom also noted that while the amount of TV viewing is up on 2006, the longer term trend shows a slight decline in viewing.

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