Cyprus may be placing growing emphasis on political progress at the expense of commercial returns in its natural gas strategy, according to energy expert Dr Charles Ellinas, who warned on Wednesday that the government appears increasingly willing to grant concessions to multinational energy companies to keep offshore projects moving.

His comments came after ExxonMobil and QatarEnergy declared the Pegasus and Glaucus fields in Block 10 of Cyprus’ exclusive economic zone (EEZ) to be commercially marketable. While the announcement marks an important milestone in the development process, Ellinas cautioned that it should not be interpreted as a final commitment to move ahead with production.

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Marketable Does Not Mean Approved For Development

Speaking to the Cyprus News Agency, Ellinas said the companies were effectively meeting a procedural deadline after confirmatory drilling established the commercial viability of the discoveries.

“This does not mean that it will proceed with development,” he said, noting that a final investment decision is unlikely before 2029 and that exports are not expected to begin before 2033.

For Ellinas, the more important question is not whether the fields have been declared marketable, but under what commercial terms they will eventually be developed. After years of delays, he argued, the government appears increasingly focused on demonstrating progress while paying less attention to the long-term economics that will ultimately determine the value of the projects.

Concessions May Be Rising As Margins Tighten

That concern is closely linked to the economics of future gas exports, which Ellinas believes are becoming increasingly challenging. He noted that ExxonMobil has already signed memorandums of understanding with Egypt to transport Cypriot gas through Egyptian infrastructure, potentially via the Segas liquefaction terminal in Damietta or a planned new terminal in Port Said.

Even so, he questioned whether those export routes would generate sufficiently attractive returns.

“Based on the liquefied natural gas prices expected at the time ExxonMobil starts exporting, the margins are small. For it to become commercially viable, Cyprus must make concessions,”

he said.

According to Ellinas, industry developments suggest the government has already granted significant concessions, potentially leaving the state with only a modest share of future profits if LNG prices remain weak and Brent crude prices also soften.

In his view, the negotiating dynamic can easily become self-reinforcing. Once governments begin relaxing commercial terms to preserve project momentum, companies often return seeking additional concessions.

Commercial Reality Is Catching Up With Political Ambition

Ellinas believes Cyprus has now reached the point where political priorities are beginning to outweigh commercial considerations. After years of delays following the country’s offshore discoveries, securing an export route has become increasingly important. That urgency, he warned, could weaken the government’s negotiating position.

He pointed to Italian energy company Eni, which has yet to reach a final investment decision on the Kronos field in Block 6 of Cyprus’ EEZ. Although the technical studies have reportedly been completed, the continued delay suggests commercial issues remain unresolved.

“It seems that the problems are continuing, so that the company cannot announce a final investment decision,”

he said, adding that Eni may also be seeking additional concessions.

Global LNG Supply Could Push Prices Lower

The broader market outlook may make those negotiations even more difficult. Ellinas expects global LNG supply to increase by as much as 40%, a development that would likely place significant downward pressure on prices.

“With those huge quantities entering the market, it is expected that LNG prices will decrease considerably,”

he said.

That outlook, he added, is also likely to influence future discussions with Chevron, which holds rights to Block 12 alongside Israel’s NewMed Energy and BG Group, owned by Shell. Block 12 contains the Aphrodite gas field.

According to Ellinas, Chevron previously estimated that developing and exporting Aphrodite would cost around €4 billion without a floating processing platform. Cyprus later requested that such a platform be included, and the company agreed. Even so, he believes negotiations are unlikely to end there.

“I believe they will come and start asking us for more concessions,” he said. “I hope they do not, but I am worried about it.”

ExxonMobil’s Wider Position In The East Mediterranean

Ellinas also highlighted ExxonMobil’s expanding footprint in the eastern Mediterranean, noting that the company now controls a substantial strategic area through its interests in Blocks 4 and 10A. In his view, that gives the company greater flexibility when assessing future discoveries and export options.

He said drilling in the new blocks remains strategically important, even though Pegasus and Glaucus already contain sufficient gas to support exports to Egypt. If additional discoveries significantly increase available volumes, Egypt’s existing infrastructure may eventually prove insufficient, creating the need for alternative export solutions.

That flexibility benefits ExxonMobil by allowing it to keep multiple development options open while postponing major investment commitments. For Cyprus, however, Ellinas warned that continued delays combined with growing concessions could ultimately leave the country with less favourable commercial terms for some of its most valuable energy assets.

Global air passenger demand fell 2.2% year on year in May as the conflict in the Middle East continued to weigh on the aviation sector, according to the International Air Transport Association (IATA). Measured in revenue passenger kilometres (RPKs), demand declined alongside a 2.3% reduction in capacity, measured in available seat kilometres (ASKs). Even so, airlines continued to fill more seats on average, pushing the global passenger load factor up 0.1 percentage points to a record 83.5% for the month.

According to IATA, the overall decline was largely driven by the Middle East. Excluding the region, global passenger demand would have increased by 0.7%.

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Middle East Disruption Distorts The Global Picture

The gap between international and domestic markets became more pronounced in May. International passenger demand declined 1.6% year on year as capacity fell 2.4%, yet the international load factor still improved by 0.7 percentage points to 83.7%. Without the disruption in the Middle East, international demand would have risen 3.1%.

Domestic markets, by contrast, remained under greater pressure. Revenue passenger kilometres fell 3.1% from May 2025, while capacity declined 2.1%, bringing the domestic load factor down 0.8 percentage points to 83%.

IATA Director General Willie Walsh said the conflict in the Middle East continued to have the greatest impact on airlines in the region. Middle Eastern carriers recorded a 28.4% year-on-year decline in passenger demand in May, although that represented a marked improvement from the 46.6% drop reported in April.

“That’s a significant improvement on the 46.6% decline recorded for April, a sign of the region’s resilience,” Walsh said.

He added that North America and Asia also experienced year-on-year declines, driven largely by weaker domestic markets in the United States and China.

Fares, Fuel And Margin Pressure

Despite those headwinds, Walsh said passenger demand remained “largely resilient,” although the impact of the conflict is likely to persist.

He pointed to the recent decline in oil prices as an encouraging development but cautioned that uncertainty surrounding supply through the Strait of Hormuz remains a significant risk. Even if crude prices continue to ease, it will take time before lower costs are reflected in jet fuel prices.

With airlines operating on margins of around 2%, Walsh said carriers have little choice but to continue testing passenger demand with higher fares as they seek to offset elevated fuel costs.

Regional Performance Shows A Split Market

Performance varied considerably across regions, highlighting the uneven impact of current market conditions.

Africa recorded the strongest overall passenger growth in May, with demand rising 6.6% year on year as capacity increased 7%. Even so, the region’s load factor slipped 0.3 percentage points to 73.7%.

Latin America and the Caribbean also delivered solid results, posting 6.1% growth in passenger demand alongside a 4.6% increase in capacity. As a result, the regional load factor improved by 1.2 percentage points to 83.4%.

European airlines remained in positive territory, reporting a 2.7% increase in passenger demand while expanding capacity by 1.8%. The region also achieved the highest load factor worldwide at 85.9%, up 0.8 percentage points from a year earlier.

Elsewhere, the picture was weaker. Asia-Pacific, the largest aviation market by share, saw demand decline 1.4% as capacity fell 2.4%, although its load factor still rose by 0.9 percentage points to 84.3%.

North America also recorded softer results, with demand slipping 0.8% while capacity was broadly unchanged, edging up 0.1%. That left the region’s load factor at 82.8%, down 0.7 percentage points from May 2025.

The Middle East remained by far the weakest-performing region. Passenger demand fell 28.4% year on year, while capacity declined 23.9%, pushing the regional load factor down 4.7 percentage points to 75.9%.

International Markets Show Greater Resilience

International travel proved more resilient than domestic markets in May. According to IATA, the pace of decline moderated compared with April, while several regions recorded their highest-ever May load factors. The Middle East was the only region to see its international load factor decline.

Asia-Pacific airlines increased international passenger demand by 1.3% despite a 1.1% reduction in capacity, lifting the regional load factor by 2 percentage points to 85.3%. IATA said tighter restrictions on jet fuel imports in Vietnam contributed to significant cuts in short-haul capacity, resulting in weaker intra-Asia international traffic.

European carriers also delivered solid results. International demand rose 3.8% as capacity expanded 2.3%, pushing the load factor up 1.2 percentage points to 85.4%. IATA also highlighted a 15% increase in direct traffic between Europe and Asia, reflecting a continued shift towards non-stop routes.

North American airlines reported more modest growth, with international demand increasing 1% and capacity rising 0.6%. That helped lift the regional load factor by 0.4 percentage points to 84%.

The Middle East remained the weakest-performing international market. Passenger demand fell 28.8% year on year, while capacity declined 24.3%, reducing the international load factor by 4.8 percentage points to 76.1%. Although comparisons with last year continue to reflect the impact of the conflict involving Iran, IATA said conditions improved compared with April, with the pace of decline almost halving month on month.

Latin American airlines posted the strongest international performance, with demand rising 10.5% alongside a 9% increase in capacity. African carriers also recorded healthy growth, with international demand up 8.9% and capacity increasing 8.3%, lifting the regional load factor to 73.4%.

Domestic Markets Remain Under Pressure

Domestic aviation continued to face greater headwinds in May, with IATA reporting a 3.1% decline in revenue passenger kilometres across domestic markets.

China recorded the sharpest slowdown, with passenger demand falling 6.2% as capacity declined 5.5%. According to IATA, the weaker performance may have reflected both higher airfares and the timing of the Dragon Boat Festival, which took place in June this year rather than May.

The United States also saw domestic demand weaken. Passenger traffic declined 1.9%, while capacity slipped 0.3%, bringing the domestic load factor down 1.4 percentage points to 81.8%.

India remained the strongest domestic aviation market, with demand rising 10.1% and capacity increasing 7.9%. The country’s load factor improved by 1.7 percentage points to 85.5%.

Brazil and Japan also remained in growth territory, with domestic demand increasing 2.8% in both markets. Australia, meanwhile, was broadly unchanged, with demand edging down 0.1% and capacity declining 0.3%.

Residential photovoltaic systems in Cyprus are entering a new phase. The transition from net metering to net billing, growing curtailments of renewable generation, the increasing role of battery storage, changes to subsidy schemes and the launch of the competitive electricity market are reshaping the economics of rooftop solar for thousands of households.

Those changes have direct implications for both existing and prospective solar owners. They affect the financial performance of residential systems while raising practical questions about self-consumption, electricity exports and whether investing in battery storage now makes economic sense.

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Drawing on publicly available information and updates from the relevant energy authorities, the following overview outlines the most important developments and answers some of the questions most frequently raised by residential consumers.

From Net Metering To Net Billing

For years, net metering has been the standard model for residential photovoltaic systems in Cyprus. Publicly available data indicate that around 100,000 households currently operate under the scheme, with a combined installed capacity of approximately 450 MW, representing about 43% of the country’s total solar capacity.

From 1 January 2026, however, new residential solar installations will no longer qualify for net metering and will instead be connected under the net billing framework. The change fundamentally alters how electricity is valued, making it increasingly important for prospective investors to reassess the economics of a new installation.

Why The Difference Matters

The key difference between the two systems lies in how imported and exported electricity is settled.

Under net metering, electricity imported from and exported to the grid is offset on a bi-monthly basis using energy quantities. Any surplus generation is carried forward to the next settlement period, while electricity shortfalls are billed at the applicable retail tariff. Depending on the contract, accumulated surpluses are generally reset without compensation after three years.

Net billing works differently. Settlement is based on the monetary value of electricity rather than the amount of energy generated. Power exported to the grid is compensated at the wholesale price, while electricity imported from the grid is charged at the retail tariff. In practice, households sell electricity at a lower price than they pay to buy it back, making self-consumption significantly more valuable than under the previous system.

Why Storage Is Becoming More Important

Battery storage increases self-consumption by storing surplus solar energy for use later in the day, when photovoltaic panels are no longer generating electricity. That makes storage considerably more valuable under net billing, where maximising on-site consumption has a greater impact on overall savings.

Even so, installing batteries remains an investment decision that depends on installation costs, system size and future technology prices. For many households, however, battery storage is evolving from an optional upgrade into an increasingly important tool for protecting long-term returns.

What Happens To Existing Net Metering Contracts

Existing net metering agreements remain valid until they expire, typically after 15 years, and are not affected by the rules governing new installations.

Once those agreements come to an end, homeowners will be able to move to net billing or consider other options available under the competitive electricity market.

What Happens To Accumulated Surpluses

Most net metering agreements provide for accumulated energy surpluses to be reset after one or three years, depending on the terms of the contract. Some older agreements still provide compensation for unused surpluses, although such arrangements have become increasingly uncommon.

At the beginning of 2026, EPC Supply decided, under the framework of the 2024 renewable energy grant scheme, that accumulated surpluses would be reset without compensation. The company also decided that the reset would recur every three years for all affected contracts.

The decision prompted strong reactions from residential solar owners, leading to parliamentary debate and a presidential referral. The matter is now awaiting a final decision by the Council of Ministers.

Are New Support Schemes Available

The policy shift is also reflected in changes to government support programmes. The popular Fotovoltaika Gia Olous scheme ended on 31 December 2025, and no replacement grant programme is currently available.

A new scheme, Anavathmizo – Exoikonomo, is expected to launch in September 2026 with a budget of €20 million. It will focus on residential energy upgrades and is expected to support the installation of photovoltaic systems combined with battery storage. The approach is consistent with the European Union’s “energy efficiency first” principle, which prioritises reducing energy consumption before expanding generation capacity.

Residential Solar And The Competitive Electricity Market

Another significant change is the opportunity for residential solar owners to participate in the competitive electricity market. Under the current regulatory framework, households that are not participating in subsidy schemes may monetise surplus electricity through agreements with licensed electricity suppliers or aggregation entities operating in the market.

That creates new commercial opportunities, but it also places greater emphasis on understanding technical limitations, contractual arrangements and market pricing. As the market evolves, informed decision-making is becoming increasingly important.

Why Curtailments Happen

Curtailments remain one of the most frequently discussed issues among residential solar owners. Every electricity system must continuously balance generation with demand to maintain grid stability.

When solar production is high but electricity demand is low, the grid can experience oversupply conditions that threaten the security of supply. In those circumstances, the Cyprus Transmission System Operator may instruct the Distribution System Operator (EAC) to temporarily reduce photovoltaic generation.

Curtailments follow a specific order of priority. Large-scale solar parks are limited first, followed, where necessary, by newer residential installations. Older household systems, which account for roughly half of all residential photovoltaic installations, were connected without ripple-control equipment and are therefore not subject to curtailment.

Can Curtailments Be Avoided

One option is to operate a photovoltaic system in zero-export mode, either temporarily or permanently.

Under this configuration, the electricity generated is consumed within the property rather than exported to the grid, unless temporary exports are permitted. Whether this improves the financial outcome depends on several factors, including household consumption patterns, system size and the presence of battery storage.

Operating completely off-grid is possible only with approval from the relevant authorities and is generally limited to remote locations where a grid connection is impractical. Such systems require a technical study by a qualified electrical engineer and typically combine photovoltaic panels with battery storage. A backup diesel generator is usually required to ensure a reliable power supply.

Homeowners planning to expand or modify an existing photovoltaic installation must also obtain the necessary approvals from EAC Supply. Depending on the scope of the changes, a revised agreement or the installation of ripple-control equipment may be required.

A Market Reset For Homeowners

Residential solar in Cyprus is entering a new operating environment. Net billing, curtailments, battery storage, changes to surplus treatment and the gradual liberalisation of the electricity market are reshaping the economics of rooftop photovoltaic systems.

For households considering a new installation, understanding self-consumption, battery economics and future electricity pricing will become increasingly important. Existing system owners, meanwhile, will need to assess how evolving market rules may affect their current agreements and long-term returns.

Cyprus used its six-month Presidency of the Council of the European Union to advance key initiatives on digital policy, artificial intelligence, research and innovation, according to Deputy Minister Nicodemos Damianou, who said the country helped shape a more ambitious agenda for Europe’s technological future.

Speaking on CyBC’s Apo Mera se Mera, Damianou said the Presidency had received broad recognition from European partners, crediting careful preparation, strong coordination and effective execution throughout the six-month term.

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“The broad recognition that the Cyprus Presidency has received from our European partners reflects the serious preparation, collective effort and effective management that have characterised these six months,” he said in a statement following the interview.

A Presidency Measured By Outcomes

Damianou said the success of a Council Presidency should be measured not by the number of meetings it hosts, but by the progress it delivers. Cyprus, he argued, focused on advancing priorities that support Europe’s competitiveness in technology, research and innovation.

He said much of that agenda has been shaped by the Draghi report, published in September 2024, which warned that Europe risks falling behind unless it significantly increases investment in technological development.

Since then, the European Union has placed greater emphasis on strategic autonomy, technological independence and a single market capable of helping innovative businesses scale more effectively across member states.

According to Damianou, that challenge remains significant, with around 85% of European businesses still relying on technologies developed outside Europe, including cloud services and artificial intelligence.

A Broad And Demanding Policy Agenda

Against that backdrop, the Cyprus Presidency oversaw negotiations on a wide range of legislative and policy files covering cybersecurity, connectivity, digital infrastructure, artificial intelligence, space technologies, research and innovation.

Damianou noted that Europe’s dependence on external technologies also extends to the space sector, where many satellite capabilities continue to rely on systems developed outside the bloc.

Artificial intelligence remained at the centre of discussions. A conference held in Nicosia during the Presidency examined how member states can strengthen Europe’s technological capabilities and shape the next phase of AI development together.

Research Funding And Europe’s Next Framework Programme

Cyprus also helped move forward negotiations on the EU’s next research and innovation framework programme covering the 2028-2034 period.

Damianou described the discussions as particularly challenging because they required consensus among all 27 member states. He added that the programme is expected to have roughly double the budget of Horizon Europe, which currently stands at around €95 billion.

He said research funding is increasingly viewed as a strategic investment that supports industrial competitiveness, technological sovereignty and the retention of highly skilled talent.

Protecting Minors In A More Complex Digital World

Alongside legislative work, the Presidency also prioritised online child protection. Damianou said advances in artificial intelligence have made the digital environment more complex, increasing concerns about the safety of younger users.

Discussions focused on two key issues: setting appropriate minimum ages for access to online platforms and establishing more effective age-verification systems. He argued that relying solely on platforms to verify users’ ages has proved insufficient, as many services still depend largely on self-declaration.

Cyprus As A Showcase For Innovation

Beyond legislative work, Damianou said the Presidency provided Cyprus with an opportunity to present its own research and innovation ecosystem to European partners.

He said closer cooperation between Cypriot researchers, businesses and public officials and their counterparts across Europe was among the Presidency’s less visible but important achievements.

Cyprus also showcased ongoing work in medicine, artificial intelligence and digital technologies, reinforcing its ambition to become a regional hub for innovation, knowledge and international cooperation.

What Citizens Should Expect Next

What Citizens Should Expect Next

Looking ahead, Damianou said Cyprus will continue expanding its digital transformation agenda while placing greater emphasis on helping citizens make fuller use of services that are already available online.

He pointed to the recently launched online police service, which was used by around 850 people during its first week to obtain criminal record certificates electronically. At the same time, the long-awaited digital justice system has entered its pilot phase in cooperation with the Cyprus Bar Association and the judicial service, while additional digital projects are progressing for the Road Transport Department, the Deputy Ministry of Migration and the Registrar of Companies.

Work is also accelerating on the Digital Citizen initiative, with further developments expected over the next six months and throughout 2027. Although digital identity has already been used in elections, Damianou said wider adoption remains a priority.

He noted that around 42,000 citizens accessed online civil registry services over the past year to obtain documents such as identity cards and birth certificates. Even so, many people continue to visit citizen service centres for procedures that are already available digitally.

For Damianou, that highlights the next challenge: expanding digital services is no longer enough. Encouraging wider public awareness and greater confidence in using them will be equally important as Cyprus continues its digital transformation.

The broader objective, he added, is for Cyprus to contribute to a Europe with a stronger technological base while remaining open to international cooperation, a vision reflected in the Cyprus Presidency’s motto: “An autonomous Union, open to the world.”

The European Union is moving to close one of the most controversial loopholes in cross-border e-commerce. From July 1, the bloc will introduce a fixed €3 customs duty on low-value parcels imported from outside the EU, targeting the growing volume of online purchases from platforms such as Shein, Temu and AliExpress.

A Temporary Measure Targeting A Structural Problem

Under the new rules, parcels valued at less than €150 will be subject to the €3 charge. Until now, such shipments were exempt from customs duties under the EU’s de minimis threshold. Although they were still subject to VAT and customs declarations, they entered the bloc duty-free.

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Brussels argues that the system has become increasingly difficult to manage, putting European retailers at a competitive disadvantage while making it harder for customs authorities to enforce safety, environmental and consumer protection rules across billions of small imports.

How The €3 Duty Will Work

Rather than applying once per parcel, the charge will be based on customs classifications.

For example, a package containing a T-shirt and a pair of shoes would incur two separate €3 charges because they fall under different product categories. By contrast, several identical T-shirts shipped in the same parcel would normally attract a single €3 charge.

Designed as an interim solution, the measure is expected to remain in force from July 1, 2026, until July 1, 2028, although officials have left open the possibility of an extension if necessary.

Once the EU’s e-commerce customs data hub becomes operational, the temporary measure is expected to be replaced by the bloc’s standard customs tariffs.

Why Brussels Is Acting Now

Brussels introduced the measure following a sharp increase in low-value imports. EU data show that 4.6 billion low-value parcels entered the bloc in 2024, while almost 5.9 billion individual items were shipped directly from third countries to EU consumers in 2025.

Most of that trade is concentrated in China. According to EU figures, 91% of low-value shipments arriving in 2024 originated there, highlighting the growing influence of Asian e-commerce platforms on the European market.

Beyond competition concerns, EU institutions argue that the sheer volume of small parcels makes it increasingly difficult for customs and market surveillance authorities to verify compliance with European safety, environmental and consumer protection rules.

Particular scrutiny has focused on toys, cosmetics, electronics, food supplements and personal protective equipment sold directly to consumers through non-EU platforms.

Targeted inspections carried out across the EU in 2025 found that more than 60% of products checked in those categories failed to comply with EU standards because of issues such as missing labels, prohibited ingredients or inadequate safety documentation, according to the European Commission.

The Wider Policy Goal: Fairness, Safety And Enforcement

According to the Council of the European Union, the new measure is intended to address “unfair competition for EU sellers, health and safety risks for consumers, high levels of fraud and environmental concerns.”

More broadly, the initiative reflects a shift in Brussels’ approach. Rather than treating low-value e-commerce imports as a niche customs issue, policymakers increasingly view them as a broader challenge for market integrity, consumer protection and regulatory enforcement.

Who Pays The Charge?

Although the €3 duty applies to businesses, consumers could ultimately bear the cost if online platforms pass it on through higher prices, delivery fees or other charges.

According to the European Commission, the duty is not a tax on consumers. Legal responsibility rests with the declarant, such as the seller, importer, IOSS holder or their representative, while consumers are expected to become liable only in limited circumstances.

A separate handling fee is also being considered as part of the wider customs reform. The final amount is expected to be agreed before member states begin applying it, no later than November 1, 2026.

What It Means For Shoppers In Cyprus And Across The EU

For shoppers in Cyprus and elsewhere in the EU, the most noticeable impact will be on low-cost purchases from non-EU platforms. Small orders may become slightly more expensive, while parcels containing different categories of products could incur multiple €3 charges.

Timing will also be important. As with other imports from third countries, customs duties are generally determined when goods enter the EU customs system and are cleared, rather than when the order is placed.

A similar principle already applies to larger imports, including passenger vehicles imported into Cyprus from outside the EU. Customs charges arise when the vehicle enters the country and is cleared, with passenger cars generally subject to a 10% import duty and 19% VAT.

Simply placing an order before July 1 may therefore not be enough to avoid the charge if the parcel arrives and is cleared after the new rules take effect. The purchase date alone does not determine whether the duty applies.

For online shoppers, the practical assumption is straightforward: if a parcel from a non-EU country is released through EU customs on or after July 1, the new €3 charge may apply, even if it was ordered earlier.

How Platforms May Respond

Online retailers may seek to reduce the impact by importing goods into European warehouses in bulk before distributing them to customers. In that case, products would no longer enter the EU as individual low-value parcels, although they would still be subject to the standard customs procedures and duties that apply to larger commercial shipments.

One of the policy’s objectives is to encourage larger, more traceable consignments. That would allow customs authorities to inspect imports more efficiently instead of processing millions of individual parcels arriving through airports and ports across the bloc.

For the EU, the measure is intended to strengthen enforcement as much as raise revenue, giving customs authorities greater oversight of a system that has become increasingly difficult to manage.

Two natural gas fields in Cyprus’ exclusive economic zone have been declared commercially viable by ExxonMobil and QatarEnergy, marking an important step in the development of the island’s offshore energy resources.

A Milestone For Cyprus Offshore Development

The Pegasus and Glaucus fields, both located in Block 10 of Cyprus’ exclusive economic zone (EEZ), were formally declared marketable on Tuesday during a signing ceremony at the Presidential Palace in Nicosia attended by executives from ExxonMobil, QatarEnergy and the Cypriot government.

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President Nikos Christodoulides described the announcement as a strong vote of confidence in Cyprus’ offshore potential.

“It is clear evidence and a vote of confidence in the prospects of Cyprus’ EEZ, but also in the prospects of the eastern Mediterranean to develop as a potential energy corridor for Europe. We look forward to even more positive announcements in the near future,” he said.

Christodoulides also said discussions on additional offshore blocks are continuing.

“We are discussing more blocks in detail,” he said, expressing hope that further announcements would follow. He added that the presence of ExxonMobil and QatarEnergy has been one of the most significant developments for Cyprus’ energy sector in recent years.

From Exploration To Development

For ExxonMobil, the declaration marks the next stage of a process that began when Block 10 was awarded in 2017. John Ardill, the company’s vice president for global exploration, said the project progressed through the Glaucus discovery in 2019 and the Pegasus discovery in 2025 before reaching the current milestone.

“So, with all of that under our belt, we now reach the second milestone,” Ardill said. “It is very important to recognise the success of the exploration and this milestone of declaring marketability. This really takes us from energy exploration to energy development, which is a fundamentally different step.”

Ardill noted that ExxonMobil is currently active in Cyprus, Egypt and Greece, with drilling programmes under way across all three countries. In Cyprus, the company plans additional drilling later this year as part of the Pegasus appraisal programme.

A Wider Offshore Strategy

Energy Minister George Papanastasiou said the government intends to expand exploration activity further, including work in Blocks 4 and 10A, as Cyprus continues assessing the commercial potential of its offshore resources.

“We are very proud of this milestone, as well as our very strong partnership with QatarEnergy,” he said. “We discovered the Glaucus deposit in 2019, and Pegasus last year, and we are carrying out exploratory drilling to understand the subsoil, which now allows us to move with sufficient confidence towards declaring marketability. This is an important milestone.”

He said further appraisal drilling is expected later this year, followed by the front-end engineering and design (FEED) phase. A final investment decision is targeted for 2029, while first natural gas production is planned for 2033.

“We are committed to 2033, but we hope to move faster,” he said.

Infrastructure Options Under Review

Asked how the gas could ultimately reach international markets, Ardill said ExxonMobil is evaluating several development options. These include an onshore processing facility in Cyprus connected by pipeline to Egypt, the use of Egypt’s existing liquefied natural gas infrastructure, and floating LNG facilities.

He noted that floating LNG solutions are generally more expensive, while an onshore liquefaction plant would require substantially larger reserves than those identified to date. Based on current assessments, a pipeline to Egypt appears to be the most practical option, supported by existing infrastructure and ongoing cooperation between the Cypriot and Egyptian governments.

That approach is consistent with broader regional energy plans. Cyprus and Egypt have already signed agreements covering Block 6 of Cyprus’ EEZ with the TotalEnergies-Eni consortium, under which Cypriot gas is expected to be transported through Eni’s infrastructure to the SEGAS LNG terminal in Damietta for export.

What Comes Next

While the declaration of marketability marks an important milestone, several technical steps remain before drilling can begin in Blocks 4 and 10A. ExxonMobil said it will first reprocess existing seismic data to improve its understanding of the subsurface before moving ahead with future drilling programmes.

Cyprus recorded a general government fiscal surplus of €552.9 million during the first five months of 2026, according to preliminary figures released by the Cyprus Statistical Service (Cystat). Higher tax revenue and stronger social contributions helped offset continued growth in public spending.

Revenue Growth Outpaced Spending

The surplus for the January-to-May period amounted to 1.4% of gross domestic product, compared with €544.5 million, or 1.5% of GDP, in the corresponding period of 2025.

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Total government revenue increased by €282.5 million, or 4.8%, reaching €6.2 billion from €5.92 billion a year earlier.

Income Tax, VAT And Contributions Drive Gains

Taxes on income and wealth recorded the largest increase, rising by €115.2 million, or 8.4%, to €1.49 billion. Social contributions also posted solid growth, climbing by €102.2 million, or 5.2%, to €2.07 billion.

Revenue from taxes on production and imports rose by €93.1 million, or 4.9%, to €2.00 billion. Within that category, net VAT receipts increased by €138 million, or 11.0%, to €1.39 billion.

Additional support came from capital transfers, which rose to €38.8 million from €12.4 million, and from the sale of goods and services, which increased by €9.4 million to €433.2 million.

Those gains were partly offset by lower property income, which declined by €24.2 million to €68.5 million, and a €39.6 million fall in current transfers to €115.7 million.

Expenditure Continues To Expand

Government expenditure rose by €274.1 million, or 5.1%, to €5.65 billion, compared with €5.38 billion in the same period of 2025.

Intermediate consumption increased by €52 million to €590.3 million, while compensation of employees, including imputed social contributions and civil servants’ pensions, rose by €47.6 million to €1.64 billion.

Social benefits recorded the largest increase in absolute terms, climbing by €108.2 million, or 4.9%, to €2.31 billion. Interest payments also rose significantly, increasing by €32.3 million, or 15.7%, to €238.4 million.

Current transfers climbed by €70.5 million, or 19.6%, reaching €429.3 million.

Capital Spending Softens

Capital expenditure moved in the opposite direction, falling by €26.8 million, or 6.0%, to €418.7 million. Gross capital formation declined by €25.4 million to €327.7 million, while other capital expenditure edged down to €90.9 million. Subsidies also decreased, dropping by €9.6 million to €31.8 million.

Preliminary Data Carry Caveats

Cystat noted that the figures remain preliminary, with estimates used for several general government entities, particularly within the local government subsector, as complete data had not yet been submitted by the relevant authorities.

Hotel occupancy across the city and district of Paphos is running around 20% below the same period last year, according to Cyprus Hotels Association (PASYXE) President Thanos Michaelides.

Speaking to the Cyprus News Agency, Michaelides said the decline is particularly noticeable during the peak summer months of June, July and August, when hotels would normally expect occupancy to exceed 90%. This year, however, average occupancy is hovering at around 70%.

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Last-Minute Bookings Are Helping, But Not Enough

Michaelides said bookings have picked up in recent weeks, supported mainly by last-minute reservations. While the trend has eased some of the pressure on the sector, it has not been enough to restore occupancy to typical seasonal levels.

Industry Response Focuses On Local Demand And Value

Hotels are responding by placing greater emphasis on the domestic market, rolling out targeted promotional offers and maintaining high service standards to attract both local and international visitors.

Michaelides expressed confidence that these efforts will help sustain demand through the remainder of the summer as the sector continues working to recover from earlier losses.

Cyprus entered 2026 with a weaker external position, as the country’s current account deficit widened in the first quarter and its international investment position deteriorated, according to preliminary data released on Tuesday by the Central Bank of Cyprus (CBC).

Deficit Worsens Amid Softer Services Performance

The current account deficit widened to €1.27 billion in the first quarter of 2026 from €1.01 billion a year earlier, an increase of €263 million. Excluding special purpose entities (SPEs), the deficit reached €1.37 billion, compared with €1.12 billion in the first quarter of 2025.

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According to the CBC, the deterioration was driven mainly by a larger secondary income deficit and weaker net exports of services. Financial services, telecommunications, computer services and information services all weighed on the balance, although the impact was partly offset by an improved goods balance and a narrower primary income deficit.

Financial Flows Remain Positive

Despite the weaker current account position, Cyprus recorded net financial inflows of €1.14 billion during the quarter, exceeding the level reported a year earlier. The increase reflected a smaller net outflow in portfolio investment together with stronger net inflows under other investment, the CBC said.

External Balance Sheet Weakens

Cyprus’ international investment position also deteriorated during the quarter. The country’s net liability position widened to €28.31 billion at the end of the first quarter from €28.17 billion three months earlier.

After excluding SPEs, net liabilities increased to €10.03 billion from €8.93 billion at the end of 2025. Gross external debt rose to €226.66 billion from €225.19 billion, while external debt assets edged down slightly to €223.53 billion from €223.62 billion. As a result, net external debt increased by €1.57 billion to €3.14 billion.

Excluding SPEs, gross external debt stood at €59.94 billion, up from €59.18 billion at the end of 2025. Over the same period, net external debt improved slightly to minus €30.46 billion from minus €30.95 billion.

Trade Links Show Mixed Picture

The CBC reported current account surpluses with Germany and Russia during the first quarter, while deficits were recorded with Greece, the United Kingdom and the United States.

At the regional level, Cyprus narrowed its current account deficits with both the European Union and the euro area, providing a modest offset to the broader weakening in the country’s external balance.

Cursor is expanding its AI coding platform to mobile devices with the launch of Cursor Mobile, allowing users to prompt coding agents directly from their smartphones.

Announced on Monday, the app builds on the Cursor 2.0 redesign introduced in October, which shifted the platform’s focus toward autonomous coding agents rather than a traditional code editor. Users can launch new agents or continue conversations started on desktop.

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A Mobile Interface For A Changing Workflow

The launch reflects a broader shift in AI-assisted software development. As coding agents become increasingly capable of handling implementation tasks, developers are spending less time navigating large codebases and more time reviewing, guiding and supervising AI-generated work.

That evolution also makes mobile devices a more practical interface. They are well suited to reviewing progress, sending prompts and managing ongoing workflows, even when the underlying development is taking place remotely.

Cursor is not alone in moving in that direction. Anthropic and OpenAI have also introduced mobile experiences for their coding products, signalling that competition is extending beyond model performance and editor integration to the overall developer workflow.

The Shift From Editing To Orchestration

For years, professional development tools were built around the assumption that developers would spend most of their time writing and editing code on desktop computers. AI coding agents are beginning to change that dynamic by taking on more of the implementation work, allowing developers to focus increasingly on directing, reviewing and refining outputs.

Anthropic’s Claude Code lead, Boris Cherny, recently described how dramatically his own workflow has changed.

“Most of my coding now is on my phone,” Cherny said. “I would have said ‘you’re crazy’ if you told me that six months ago, but yeah, here we are.”

Why The Mobile Bet Matters

Cursor’s latest release expands access to its AI coding agents beyond the desktop, reflecting broader changes in how developers interact with AI-powered tools. As coding increasingly involves prompting, reviewing and coordinating AI-generated work, mobile devices are becoming another way to stay connected to software projects throughout the development process.