Montoro Investigation: An investigation is ongoing into former Minister of Finance, Cristóbal Montoro, and his firm Equipo Económico, which is accused of a "pay-to-play" scheme to influence legislation for clients. An email from December 2013, discussing "paying this economic team that has direct contact with the Minister of Finance, Cristóbal Montoro" to influence the Congress of Deputies for tax benefits, is the origin of the probe. The judge suggests this practice "could have been habitual and known". Equipo Económico allegedly had a "great capacity" to connect companies with the Ministry of Finance and influence the drafting of laws, even leading to a patronal group (AFGIM) drafting reform proposals that were adopted, specifically for reducing the electricity tax and the Economic Activities Tax.

Spain Wildfires: Spain is currently battling two significant wildfires declared at level two severity (IGR 2) as of July 18, 2025

Spain's Mortgage Surge: The signing of mortgages on homes in Spain surged by 54.4% in May 2025 compared to the previous year, marking the eleventh consecutive month of annual increases and the best May since 2022. This significant increase is primarily driven by falling interest rates, which have remained below 3% for four consecutive months

I. Widespread Power Outage and Investigation

A. Incident Description:

• On Monday, a significant power outage affected nearly the entire Spanish territory, with the exceptions of the Canary Islands, the Balearic Islands, Ceuta, and Melilla.
• The outage occurred around 12:30 PM peninsular time.
• The President of the Government, Pedro Sánchez, stated that the incident involved a "sudden loss" of 15 gigawatts of energy production within five seconds, representing 60% of the electricity being consumed at that moment. This was described as "something that had never happened before."
• Red Eléctrica Española (REE), the private operator managing the grid, reported two consecutive incidents of generation loss immediately preceding the outage.
• The first incident, in the southwest of the peninsula, was initially overcome.
• A second, compatible with a loss of generation, occurred just 1.5 seconds later, leading to oscillations and the final blackout 3.5 seconds after that.
• REE indicated that "it is very possible that the affected generation could be solar," though this is not a definitive conclusion.
• The electrical system has since been normalized, with REE successfully recovering the grid using hydroelectric and combined cycle gas generation.

B. Investigation into Sabotage:

• The Audiencia Nacional (National Court) has opened preliminary proceedings to investigate whether the blackout was an act of computer sabotage on critical Spanish infrastructure and if it could constitute a crime of terrorism.
• Judge José Luis Calama has requested reports within ten days from the Centro Criptológico Nacional (National Cryptologic Center) and Red Eléctrica Corporación SA to determine the cause(s) of the blackout.
• The Judge also requested a preliminary report from the Police Information Headquarters within ten days.
• The magistrate noted that while the cause is currently unknown, "cyberterrorism is among one of the possible" options, necessitating a judicial investigation.
• The incident is considered serious as it affected computer systems supporting "essential services to society such as health, energy, industry or transport," creating a "critical situation for the well-being and sense of security of all citizens."
• The investigation cites Article 573 of the Penal Code, which states that computer crimes can be classified as terrorism if their purpose is to severely destabilize the constitutional order or the functioning of essential services.

C. Conflicting Statements and Government Response:

• Red Eléctrica Española (REE): Eduardo Prieto, director of Operation Services at REE, has "ruled out that the cause of the blackout was a cyberattack," stating that "effectively there has been no type of intrusion in the control systems that could have caused the incident."
• President Pedro Sánchez: While acknowledging the Audiencia Nacional's investigation is within the "logical order of a democratic state's society," Sánchez stated that the government does not have "conclusive" information that the incident was a terrorist attack. He also said it would be "imprudent" to rule out any hypothesis, but equally "imprudent" to point to one or another hypothesis.
• The government is committed to investigating the cause of the failure and has indicated that "responsibilities will be demanded from private operators."

D. Impact on Essential Services:

• The blackout impacted essential services, including transportation, education, and potentially healthcare.
• Transportation: Thousands of train passengers were stranded, and some train lines remained interrupted even after the power was restored. Metro services in major cities like Madrid and Barcelona have recovered, and airports are functioning normally.

• 
  

1. Government Coalition Dynamics and Policy Disagreements

• Yolanda Díaz, the second Vice-President and leader of Sumar, has attempted to ease tensions with the PSOE regarding the recently announced increase in defense spending.
• Despite past criticisms, Díaz insists the coalition "enjoys good health" and will "exhaust the legislature."
• The source quotes Díaz saying, “Es verdad que tenemos posiciones diferentes, en esta materia de manera singular,” ("It is true that we have different positions, particularly on this matter.") acknowledging the disagreements.
• Pedro Sánchez, the Prime Minister, announced that Spain would reach 2% of GDP in defense spending this year, an investment of €10,471 million.

• A separate, but related, point highlights a new tender from the Ministry of Interior for the purchase of Israeli bullets, six months after announcing the cancellation of such a contract due to the conflict in Gaza. Díaz demanded an "immediate rectification" and a parliamentary appearance from the minister, calling it a "vulneración flagrante de los acuerdos" ("flagrant violation of the agreements") within the government, especially during the "genocidio en directo del pueblo palestino" ("live genocide of the Palestinian people").
• In a separate matter, Díaz considers it "normal" that Pedro Sánchez will not attend the funeral of Pope Francis, explaining that the head of state (the King) attends accompanied by part of the government.

2. Economic Trends in Spain (Source 2):

• The number of new housing mortgages constituted in Spain in February reached 39,084, a 4.3% increase compared to February 2024.
• This marks the eighth consecutive month of growth in mortgage signings.
• The February 2025 figure (39,084) is the highest recorded for the month of February since 2011.
• The average mortgage amount was €157,018, a significant 16.2% year-on-year increase. The total capital lent rose by 21.2%.
• The average interest rate for new mortgages was 2.96%, with an average term of 25 years.

• The Euribor continued its downward trend, closing March at 2.398%.
• Cantabria (+55.6%), La Rioja (+53.3%), and the Basque Country (+39.7%) saw the largest increases in mortgage signings, while the Canary Islands (-38.7%), Navarre (-34.3%), and the Balearic Islands and Madrid (-20% in both) saw decreases.

3. The Papal Succession and Future Direction of the Catholic Church (Source 3):

• The upcoming conclave will involve 133 cardinals from 71 countries, making it the largest and most diverse group in history.
• A central question is whether the next Pope will be part of the reformist wing, aligning with Francis, or the conservative wing.
• Historian Juan María Laboa describes the conclave as "the most bewildering in history" due to the large number of cardinals with little connection to Europe and who are largely unknown to each other.

4. Legal Challenges and Political Accusations

• The Supreme Court is holding a preliminary hearing regarding a lawsuit filed by Alberto González Amador, the partner of Madrid regional president Isabel Díaz Ayuso, against the First Vice-President and Minister of Finance, María Jesús Montero.
• González Amador is seeking €40,000 in compensation for alleged illegitimate interference with his right to honor due to Montero's public statements.
• Neither González Amador nor Montero were required to attend the hearing; only their lawyers were present. Montero is represented by the State Legal Service (Abogacía del Estado).
• This hearing follows a failed conciliation attempt in October where Montero and her representatives did not attend.
• The lawsuit stems from statements Montero made during a parliamentary session in March 2024, accusing Ayuso of living "in a flat that was paid for with fraud against the Public Treasury" and "with commissions related to masks in the worst situation of the pandemic."