China Tariffs Reignite Global Oil Demand Fears
Oil prices fell on Friday after a week of gains, following the announcement that China would impose tariffs on $75 billion worth of additional U.S. products, including crude imports. In response, President Trump encouraged US companies via Twitter to start looking into alternatives to doing business with China. This announcement quickly brought widespread commodity demand uncertainty back to the forefront, as investors remained wary of the impact of the continuing trade war to the global economy.
As this was unfolding, Brent prices declined 1% to $59.34 a barrel while WTI prices dropped 2% to $52.75. Although Chinese imports of oil products from the US have decreased in recent months as a side effect of the trade war’s progression, these latest tariffs are some of the first from China to directly hit US crude supplies. This comes as oil demand growth predictions face downward pressure, as crude inventories continue to build in the US and abroad, and global suppliers including those in the Organization of the Petroleum Exporting Countries (OPEC) continue to limit future output. Time will tell whether a potential resolution in the US-China trade conflict can right an already unsteady oil market.
First Electric Models Join Freight Operations
This week, Daimler Trucks North America delivered its first two battery-electric Freightliner eCascadia models for use in daily freight operations at NFI and Penske Truck Leasing. Viewed as a critical early step to the full adoption of electric-powered heavy-duty trucks in North America, these vehicles will first center their operations in Southern California, where they will haul cargo on relatively short routes.
While the large-scale rollout of these trucks isn’t projected to occur until late 2021, both NFI and Penske have offered to pilot the technology, performing the first-iteration deployment of these vehicles in real-world operating conditions. Developers of the technology hope to use this first rollout as a proving ground, collecting feedback that can better inform the broader implementation of electric trucks in the future. While the current range of electric battery technology only permits dedicated short-haul operations, both NFI and Daimler remain optimistic that electric trucks will offer the most viable combination of emissions reductions and reliable design into the future.
In Other News
Yemen’s Houthi rebels struck Saudi Arabia’s Shaybah oil field, one of the kingdom’s largest, Saudi officials and the Houthis said, deepening tensions between Iran and its rivals that have engulfed the region’s energy facilities.
Mack Trucks last week introduced a connected vehicle service focused on proactive vehicle maintenance planning and fleet operations efficiency. Mack’s dynamic maintenance service further expands the partnership with Noregon, an IoT company specializing in connected vehicle solutions.
An Iranian oil tanker that was detained by Gibraltar’s authorities early last month on suspicion of taking crude to Syria has departed the UK overseas territory, after a last-ditch request by the US to halt the vessel’s release was turned down.
Thanks to the recovery of Ocean Network Express (ONE) and incoming member HMM, THE alliance is set to dominate the Asia-US import trades next year with the OCEAN Alliance as the second-largest global trade lane stabilizes via carrier capacity discipline, despite tariff headwinds.
Finding a buyer for Philadelphia Energy Solutions’ oil refinery has grown urgent as the bankrupt company’s funds dwindle and no signs emerge that it is winning a fight for insurance payouts after a June blaze at the plant, according to court documents and bankruptcy experts.
The U.S. apparel industry may have to make some rapid adjustments when new tariffs take hold this fall. A majority of clothing and much of the footwear imported from China are still subject to tariffs starting Sept. 1.
The United States has removed nearly 2.7 million barrels of Iranian oil from global markets as a result of Washington’s decision to reimpose sanctions on all purchases of Iran’s crude, U.S. Secretary of State Mike Pompeo said on Tuesday.
President Donald Trump’s tariffs on Chinese imports are getting a lot of blame for slowing the global economy, but it’s all the uncertainty from his Twitter habit and trade policy more broadly that could be even more harmful.
Truck tonnage surged 7.3%, the largest year-over-year gain since April, compared with July 2018, according to American Trucking Associations. And tonnage increased 6.6% in July over June, according to ATA’s advanced seasonally adjusted For-Hire Truck Tonnage Index.
The government of Canada’s main oil-producing province, Alberta, said on Tuesday it was extending mandatory curtailments on crude production by an extra year through 2020, because of uncertainty about when expanded pipelines may come online.
Google autonomous vehicle spinoff Waymo says it will start testing on public roads in Florida to better experience heavy rain. The Mountain View, Calif., company says tests will begin this month in the Miami area and include highway driving to Orlando, Tampa and Fort Myers. The Florida test vehicles will be driven by humans. They’ll collect data with laser and radar sensors. Heavy rain can affect image quality.
Iran’s leaders have once again warned that maritime security will remain at risk if its oil exports continued to be comprised as the US warns countries of assisting the Iranian tanker Adrian Darya 1 as its sails in the Mediterranean after having been released by the Gibraltarian authorities.
The American Trucking Associations’ (ATA) latest forecast that the industry is expected to need 60,800 more for-hire over-the-road truckload drivers at the end of the year did not startle any trucking executive grappling with the shortage.
The Association of American Railroads (AAR) reported U.S. rail traffic for the week ended August 17, 2019, and, if you’ve been paying attention recently, the results really shouldn’t come as a surprise.
Fourteen months after announcing its intent to develop a Class 8 electric truck, Daimler Truck North America officially delivered the first two Freightliner eCascadia models to representatives from Penske Truck Leasing and NFI at a ceremony in Yountville, Calif.
African states like Chad and Cameroon are shaping up to be big winners from new rules to cut sulfur emissions from ships, providing just the right type of oil to produce cleaner fuels.
Most of the nation’s largest seaports are reporting record cargo volume amid stalled trade negotiations between the United States and China.
The US oil and gas rig count slipped below 1,000 for the first time in nearly 28 months as industry awaits signs that could point the way out of a sluggish, uncertain market, weekly figures from RigData supplied by Enverus, formerly called DrillingInfo, showed Thursday.
The Nebraska Supreme Court upheld the state’s approval of the Keystone XL pipeline Friday, but hurdles to the long-delayed project remain. The court ruled in favor of a state regulator’s decision to approve the route in 2017, bolstering the prospects for the pipeline expansion by TC Energy Corp.
Mexico’s President Andres Manuel Lopez Obrador said on Friday that no new oil and gas contracts will be awarded to private firms if companies already awarded contracts do not produce crude or invest.
The spread between Singapore high sulfur and Marine 0.5% sulfur fuel oil for the prompt months have widened to fresh highs on Thursday, as fundamentals for the fuel oil industry adjust before the International Maritime Organization’s sulfur mandate kicks in January 2020.
The North Carolina Department of Transportation (NCDOT) is seeking public comments on a draft plan to boost the number of electric vehicles (EVs) on the road. The draft plan called upon the NCDOT to develop a plan to increase the number of zero-emission vehicles (ZEVs) registered in the state to 80,000 by 2025.