Last week met civil unrest in Iran as Iranian citizens demand better living conditions. The buzzworthy topic of cryptocurrency saw its first foray into the energy market as Venezuela seeks drastic measures to restore its economy. China makes big moves to reduce emissions, while conversely the Trump administration proposes an expansion of domestic oil drilling. All this and more in last week’s busy news update.
Civilian Protests in Iran Intensify
Protests in Iran are moving into their second week and continue to spread across the country. The current protests are the largest public display of discontent since the Green Movement nearly a decade ago. Experts believe the protests are a result of poor economy, government corruption, and rising costs of basic needs for Iranian citizens. Specifically, the public is outraged that conditions in the country have not improved since nuclear sanctions were lifted two years ago.
Iran is one of the world’s top oil producers at nearly 4 million barrels per day. The energy market will pay close attention to the protests, as the duration and intensity of the civil unrest could impact the country’s oil sector. Any impact would provide upward price pressure to crude oil and refined product prices.
Cryptocurrency Meets the Oil Economy
President Nicolas Maduro stated that Venezuela will issue 100 million units of its own cryptocurrency in the next few days, following up on his December announcement of the country’s idea to enter the cryptocurrency market. The currency, to be called the “petro,” will be backed by the country’s oil revenue and will be pegged to the oil price of Venezuelan crude (averaging around $59/barrel this prior week). The move into the cryptocurrency market is seen as a way for Venezuela to get around US sanctions for funding to help their crippled economy. While cryptocurrencies have gained major momentum in recent months, many doubt that the petro will create enough interest to save Venezuela’s economy (or that the government will appropriately manage the funds if they are successfully generated).
In Other News
KOTI, a Panamanian-flagged vessel capable of carrying over 5,000 tons of oil, was detained less than a month after the Lighthouse Winmore, a Hong Kong-registered ship, was seized on the same charge. Last week, the UN Security Council adopted new sanctions against North Korea, which include lowering oil-import limits, in response to its Nov. 29 ballistic missile test.
Oil prices eased on Tuesday after hitting mid-2015 highs in early trading, as major pipelines in Libya and the UK restarted and U.S production soared to the highest in more than four decades.
China is suspending the production of more than 500 car models and model versions that do not meet its fuel economy standards, several automakers confirmed Tuesday, the latest move by Beijing to reduce emissions in the world’s largest auto market and take the lead in battling climate change.
There was urgency to move freight before the end of the year, but the combination of frigid weather and tight capacity due to both the holiday and the recently implemented ELD mandate meant that it cost more to move those loads last week. Load-to-truck ratios surged, setting a new all-time record-high of 12.2 loads per truck for vans. Spot rates also reached historic highs: The national average van rate rose 2¢ per mile, the national reefer rate jumped up 6¢, and the average flatbed rate held steady.
The largest public display of discontent in Iran since the 2009 Green Movement has resulted in 21 deaths and 450 arrests, restricted access to social media apps and brought pushback from the Iranian government.
The Trump administration on Thursday proposed opening up nearly all the country’s offshore areas for oil and gas drilling, a move that would touch every coastal state, some that have been off limits to drillers for decades.
Kenworth will debut its hydrogen fuel cell T680 at the 2018 Consumer Electronics Show (CES) next week in Las Vegas, a show normally reserved for connected technologies and artificial intelligence.
President Nicolas Maduro said on Friday that Venezuela would issue 100 million units of its new oil-backed cryptocurrency in coming days, although it is unclear whether any investors will want to purchase the “petro” at a time when the OPEC member is going through a deep economic crisis and its leftist government has little credibility.
Cummins Westport Inc. (CWI) has now secured U.S. Environmental Protection Agency (EPA) and California Air Resources Board (CARB) emissions certifications for all three models in its new 2018 natural gas engine lineup after receiving approval for its 2018 ISX12N heavy-duty engine.
Class 8 truck orders closed out 2017 on a tear according to ACT Research, reaching 37,200 units and topping 30,000 orders the third consecutive month.