Oil Output Agreement Reached by Saudi Arabia and Russia
Russia and Saudi Arabia agreed ahead of this week’s Organization of Petroleum Exporting Countries (OPEC) meeting to extend the existing production cut agreement for an additional six to nine months, with the goal of stabilizing oil prices. The previous round of cuts, announced by OPEC and Russian allies in December of 2018, had raised oil prices by as much as 22 percent by April of this year. With the recent global economic uncertainty surrounding US-China trade relations, however, oil prices were tumbling despite the cuts, ultimately forcing the group to extend them past their original June deadline.
Crude oil prices rose over 2 percent this week, responding to this as well as continued tension in the Middle East. This upward price movement may continue, as a truce between the US and China following the June G20 summit have indicated a possible resolution to the ongoing trade war.
At the summit, US President Trump and Chinese President Xi agreed to restart trade talks, averting for now the possibility of a further escalation in tariffs. With the US agreeing not to impose new tariffs on China, global demand fears have moderately subsided, providing a more bullish outlook for crude oil. Increased crude demand may therefore pair with the aforementioned supply cut extension to raise crude prices as the year continues.
Starsky Robotics Tests Unmanned Truck on Florida Turnpike
Starsky Robotics, a San Francisco-based automated truck technology startup, completed a milestone unmanned test drive this week – sending one of its commercial Volvo semis along a 9.4-mile stretch of the Florida Turnpike. The first test drive of its kind, the truck completed several different maneuvers along the route, including merging onto the highway and changing lanes at speeds up to 55 miles per hour, and operating through a rest area.
While the truck itself was unmanned, to ensure the test went smoothly a teleoperator monitored the truck, navigating it from a remote office location in Jacksonville. Starsky anticipates that these remote operators may monitor between 10 and 30 vehicles per hour in the future. Similar testing will also likely accelerate in the coming months, as Starsky continues encouraging acceptance and adoption of autonomous technology.
In Other News
Iranian crude exports have dropped so far in June to 300,000 barrels per day (bpd) or less after the United States tightened the screw on Tehran’s main source of income, industry sources said and tanker data showed, deepening global supply losses.
An invasive, plant-hopping pest that hitches rides on trucks and other vehicles is spreading along busy transportation corridors in the mid-Atlantic region, threatening billions of dollars worth of commodities including grapes, hops and hardwood.
Market conditions for shippers — often an inverse of those for carriers — slipped some in April after steadily improving in the months prior, according to FTR‘s most recent Shippers Conditions Index report.
The International Energy Agency (IEA) is very concerned about the impact that tensions in the Middle East may have on global energy security and will act if there is any physical disruption to supplies, its executive director said on Monday.
Biofuel has been used in a second container shipping test, and the results have been positive for an industry facing an urgent need to decarbonize.
The new restrictions target the ability of supreme leader Ayatollah Ali Khamenei and the office that administers an economic endowment on his behalf to access accounts in financial institutions with ties to the US.
Bullish movement in forward structure comes even as strong domestic production has built out a considerable supply overhang in recent weeks.
The cost of expanding ports could get more expensive if a Trump administration plan to impose 25% tariffs on ship-to-shore cranes manufactured only in China are implemented.
Trailer orders continued to slide in May as OEMs catch up on building orders from last year. But with few signs that ordering will pick up again this year and a slowing economy, it could mean lower prices for fleets in the future.
Maersk wants to buy warehouses, container terminals and customs brokerage firms to boost its logistics services capabilities, part of a strategic shift toward a landside business the company hopes will produce half its revenue in two years.
Oil output in Iran and Venezuela, under U.S. sanctions, has fallen by more than that of other OPEC members party to a supply cut pact, suggesting President Trump’s policies have had a greater impact on oil production than OPEC itself.
Philadelphia Energy Solutions (PES) will seek to permanently shut its oil refinery in the city after a massive fire caused substantial damage to the complex, the company confirmed on Wednesday.
The US economy isn’t headed for a recession this year, but for freight shippers and many transportation providers, it may seem like one, and the US-China trade war, how long it lasts and how tough it gets, may be the deciding factor.
Despite the rapid pace of improvement in electric powered vehicles, internal combustion engines are staying around for a good long while and so it makes sense to keep looking for ways to improve their overall efficiency.
Trucks and cars equipped with automated features have the potential to enhance safety along the country’s freight and commuter corridors, facilitate the movement of freight and provide access to mobility for disabled individuals, members of the Senate Commerce Committee said recently.
OPEC is expected to roll over a deal on cutting supplies at a meeting next week and discuss deepening the curbs that have been in place since Jan. 1. Meetings on July 1-2 in Vienna will discuss the next steps.
The U.S. operations of the Class I railroads originated 12.9 million carloads and intermodal for the first 25 weeks of this year, down 2.9 percent from the same period in 2018, according to data from the Association of American Railroads (AAR).
Energy security, OPEC production cuts, trade tensions and US oil sanctions are likely to come up in one-on-one talks between US President Donald Trump and world leaders at this weekend’s G20 Summit in Osaka, Japan.
U.S. officials have concluded that drone attacks on Saudi Arabia’s oil industry in May were launched from Iraq, not Yemen, raising concerns that Iran’s allies in the region are trying to open a new front in the conflict between Tehran and Washington.
U.S. crude oil output in April rose to a fresh monthly record, surpassing 12 million barrels per day, according to a government report on Friday.
Senator Baertschiger returned to Oregon and said today that most Republican senators will follow by tomorrow, but the agenda will not include a vote on HB 2020, which would have called for a cap-and-trade program to meet new greenhouse gas (GHG) emissions targets.
The U.S. Department of Transportation has recorded progress with the implementation of positive train control technology, the country’s top transportation official indicated recently.