Coronavirus A Threat To Oil Markets & UP Headcount Cuts | Weekly News Update

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Why The Coronavirus Is A Real Threat To Oil Markets

As the coronavirus spreads across China and to other parts of the world, restricted travel can contribute to slowing economic demand growth and has brought oil and diesel markets down.  The virus has been reported in the U.S. in limited cases in major travel hubs between the U.S. and China, such as Washington D.C., Chicago, and California.  Although there are no reported deaths in the U.S. the death toll in China has climbed to 81, with significantly more infected.  West Texas Intermediate (WTI) and Brent crude oil prices dropped 14 and 12 percent since the beginning of the year.  Wholesale diesel prices have also dropped over 21¢ per gallon or 8 percent during the same timeframe.

 

Union Pacific Predicts More Headcount Cuts and Yard Consolidation in 2020

The COO at Union Pacific (UP), Jim Vena, claims the company is not yet “at the 50-yard line” when it comes to improving the efficiency and profitability of the railroad.  UP plans to cut an additional 3,000 workers in 2020.  This is on top of the railway reducing 20 percent in crew starts—the number of crews that start a train journey—and an 11 percent dip in carloads in 2019.  UP reached an operating ratio of 59.7 percent in the fourth quarter and 60.6 percent for the year.  The goal to reach in 2019 was 60 percent, while the new goal is to hit 55 percent in 2020.

 

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Oil Price.com: Why The Coronavirus Is A Real Threat To Oil Markets

It impairs your breathing, causes extreme fatigue and fevers. It kills. And beyond that, it’s keeping oil prices low by threatening to stifle oil demand in one of the world’s largest oil markets.

WSJ: Report Puts $1 Trillion Price Tag on Cutting Ship Carbon Emissions

The shipping and energy sectors will need to spend at least $1 trillion to meet a target of substantially cutting carbon dioxide emissions from ships by 2050, according to a new study.

Reuters: Saudi Arabia says all options open at OPEC+ meeting, including further cuts

Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman Al-Saud said all options are open at an OPEC+ meeting in early March, including further cuts in oil production, Al Arabiya television reported.

 

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HDT: Waymo Begins Autonomous Mapping Runs in New Mexico and Texas

Waymo, the autonomous car and truck technology division of Google’s parent company, Alphabet, has begun mapping interstate highways in New Mexico and Texas. The move is seen by many tech observers as a prelude to long-haul evaluation runs of tractor-trailers under autonomous control systems.

Supply Chain Dive: Union Pacific predicts more headcount cuts and yard consolidation in 2020

Union Pacific is not yet at the 50-yard line when it comes to improving the efficiency and profitability of the railroad, COO Jim Vena said on an earnings call Thursday. Further headcount reduction and network shifts are to come, executives said.

WSJ: Transport Stocks Are Still Flashing Warning Signals

Transportation stocks haven’t hit a new high in 16 months, a potentially ominous sign for investors betting on a pickup in global growth.

 

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WSJ: Trade Tensions With Europe Flare as Trump Flexes Economic Muscle

Fresh threats by the U.S. to place tariffs on some of its closest allies—just days after reaching an initial trade deal with China—show that economic pressure remains President Trump’s weapon of choice in international disputes.

WSJ: U.S., India Draft Trade Pact for Unveiling in Possible Trump Visit

Officials in India and the U.S. are preparing a limited bilateral trade agreement that could be unveiled during a visit by President Trump to New Delhi in the coming weeks, current and former government officials in both countries said.

WSJ: Brexit Divorce Deal Clears U.K. Parliament

The Brexit divorce deal completed its passage through Parliament on Wednesday evening, ensuring that the U.K. will leave the European Union at the end of the month.

 

This weekly publication is designed to highlight relevant industry news to provide professionals in the transportation, supply chain, and energy sectors with up-to-date information in a rapidly changing marketplace. This update is purely a compilation of industry news and as such, does not necessarily reflect the opinion of Breakthrough. We do not warrant or guarantee accuracy or completeness of information. For additional information, please contact us at info@breakthroughfuel.com.

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