US Sanctions on Iran: Impact on Oil Supply
The US sanctions on Iran will go into effect early November to curb Iran’s economy after the US pulled out of the Iranian nuclear deal. To make up for the declining Iranian crude oil output, other countries are fighting for waivers or increased crude production from other countries. Multiple major Iranian customers such as South Korea, India, and Japan are requesting waivers from Washington to buy Iranian crude. While there is a chance for the waivers will be granted, the US also has been insisting purchases from Iran must drop to zero. China, a major customer of Iran, is planning on continuing to import Iranian crude despite the sanctions. While China and US trade tensions continue, it is unlikely that China will comply with US sanctions. It is reported that 22 million barrels of Iranian crude is set to deliver to China in October and November. In the past, China would receive between 1 and 3 million barrels from Iran each month.
On the other hand, Iraq wants to know where their excess crude will go and how buyers will use its oil. Iraq is the second largest crude oil producer in the Organization of Petroleum Exporting Countries (OPEC). Iraq is currently producing a record of 4.78 million barrels per day (mmbd) and is expected to rise between 5 and 6 mmbd by 2024, according to the countries Oil Minister Jabbar Al-Luaibi.
ATRI Report Finds Trucking Congestion Costs Top $74 Billion Annually
The American Transportation Research Institute (ATRI) determined that traffic congestion on the US National Highway System (NHS) added nearly $74.5 billion in operational costs to the trucking industry in 2016. This is a 0.5 percent increase year over year compared to 2015. The study uses a unique truck GPS database to calculate delays on the NHS. They found 1.2 billion hours of lost productivity or 425,533 commercial truck drivers sitting idle for a working year. To view the full report see, Cost of Congestion to the Trucking Industry: 2017 Update.
In Other News
U.S. oil exports to China have slowed to a trickle amid the trade spat between Washington and Beijing, in an abrupt reversal that is upending global crude trade flows and forcing American producers to find new buyers.
The many uncertainties over the implementation of the new low-sulfur emission regulations to take effect in 2020 include whether enough low-sulfur fuel will be available, how the rules will be enforced, and whether shippers will feel an impact beyond higher prices.
Ontario-headquartered Hydrogenics Corp., a developer and manufacturer of hydrogen generation and fuel cell power modules, has opened its newest North American facility in Carlsbad, Calif. The site will focus primarily on the integration of hydrogen fuel cell systems into heavy-duty truck and bus platforms for customers in California.
Medium-duty commercial battery-electric vehicles are a viable alternative to diesel and gasoline-powered Classes 3-6 trucks in urban settings where the freight haul is less than 100 miles, according to a new guidance report from the North American Council for Freight Efficiency.
The disappearance of a journalist who was last seen entering the Saudi consulate in Istanbul earlier this month has shaken up U.S.-Saudi relations and injected risk into the oil market. Also see, U.S.-Saudi Tensions Put Oil-Price Discounts Into Play.
Attaining environmental benefits and lower cost of ownership are driving more commercial fleets to electrify. In the “Curve Ahead: The Future of Fleet Electrification” report, industry stakeholders identify their main motivations and barriers to electrification, as well as strategies to move the commercial electric vehicle market from niche to mainstream.
Batteries for electric vehicles, long touted as a cleaner mode of transportation, are being built in countries such as China and Germany that rely on dirty coal to power their industries.
Nigerian National Petroleum Corp. Monday said it has shut down a key oil pipeline network in the southeast, following a fire caused by an explosion that was triggered by suspected oil thieves.
The end of 2018 will mark a milestone in freight and commuter railroads’ ongoing efforts to implement positive train control (PTC). Come Dec. 31 — the federal due date — the 41 railroads that are mandated to adopt the technology will have spent a decade working on their PTC systems, including three years past the original end-of-2015 deadline.
There are signs that the Permian basin is overheating, including high costs for frac sand, six-figure salaries for truck drivers, and clogged roads from truck traffic make West Texas one of the deadliest places to drive in the country. Output is still growing, but pipeline bottlenecks have cut the monthly growth rate down by three-quarters.
At his first meeting with foreign oil majors, Mexico’s leftist president-elect pushed the companies to prove themselves by quickly pumping oil from recent finds, sources say, but gave no sign of offering up new fields to reverse dwindling output.
Canadian oil companies are hedging production, booking oil-by-rail shipments and otherwise scrambling to find storage as Western Canada Select (WCS) suffers from a price discount as large as $50 per barrel below WTI.
On Nov. 6, voters may spoil BP’s welcome. That’s when it will be decided whether to limit drilling in an initiative that some say could cut the state’s oil output by more than half. The vote is being closely watched, not only by companies keen to join the Colorado boom but also by outsiders who see a potential blueprint for blocking development.
Quarterly earnings and industry data confirm shippers moved up freight movement into July, earlier than a normal year, but intermodal providers believe activity will increase in the next six weeks for the holiday season.
CSX Transportation reported a strong third quarter not only for investors, but also service metrics that track whether shippers are receiving satisfactory service. While shippers often bemoan how much Class 1 railroads fixate on operating ratios, CSX is the only provider offering better train speeds and lower terminal dwell times while volumes are on the rise.
The US Environmental Protection Agency aims to adopt final rules for fuel economy standards by March and year-round sales of higher ethanol blends by May, according to a fall regulatory agenda released Wednesday by the Trump administration.
OPEC has urged its members not to mention oil prices when discussing policy in a break from the past, as the oil producing group seeks to avoid the risk of U.S. legal action for manipulating the market.
Major OPEC producer Iraq would like to know how and where its oil will be used, as demand rises for Middle East cargoes to replace shipments from fellow group member Iran.
Uber Technologies Inc., in its ongoing quest to move beyond its unprofitable business of connecting drivers with passengers, is adding a new tractor-trailer rental business to help big-rig truckers haul freight around the country.
The last-minute rush of US imports from China ahead of higher tariffs that take effect Jan. 1 marks a point of no return for the trans-Pacific trade. The increase in US tariffs to 25 percent from 10 percent won’t have immediate impact on volume, but there is little sign of a de-escalation of the trade war between China and the United States.
An unprecedented volume of Iranian crude oil is set to arrive at China’s northeast Dalian port this month and in early November before U.S. sanctions on Iran take effect, according to an Iranian shipping source and data on Refinitiv Eikon.
Traffic congestion on the U.S. National Highway System (NHS) added nearly $74.5 billion in operational costs to the trucking industry in 2016, a 0.5 percent increase over 2015, according to research by the American Transportation Research Institute (ATRI).
Infrastructure funding programs across several states eventually will serve as models for federal transportation agencies, experts at a conference hosted by a tolling advocacy group indicated Oct. 15. Also see, Infrastructure, Climate to be Priorities for Democrats in Congress in 2019
The Trump administration is pushing to ease the rollout of new international rules to power commercial ships with environmentally cleaner fuels, fearing the measures will drive up costs for consumers and businesses.
Asian buyers of Iranian oil are gaining confidence they will win U.S. consent for some imports to continue even after American sanctions snap back next month.
Canadian Pacific Railway (CP) said it expects the new regulation, much like the electronic logging device (ELD) rule imposed in the United States last year, to tighten Canadian truck capacity and allow their domestic service to attract freight.
Boom times are back for at least one company in Canada’s oil heartland. Canadian Pacific Railway Ltd. may match or exceed its record 2014 pace of 110,000 crude carloads next year as a pipeline crunch stokes demand for shipping by train.