Oil Cut Debate Set as Saudis Delay Pricing Move
The Petroleum Exporting Countries (OPEC) will hold a virtual meeting on Thursday, April 9 along with other oil-producing nations including Canada and Russia. The meeting will aim to negotiate a truce in the Saudi Arabia and Russia pricing war that has caused the oil market to plummet over the past month.
Saudi Arabia has decided to delay pricing crude for May delivery as they will wait for the result of the outcome of Thursday’s meeting. However, both Saudi Arabia and Russia have stated privately that they are unlikely to cut oil output unless North American producers do the same. Alberta’s Energy Minister Sonya Savage will be joining the meeting, but it is unclear what Canada will ultimately decide. Meanwhile, the U.S. has sent mixed signals over what course of action will be taken, President Trump late Saturday threatened to impose taxes on foreign crude imports to protect the countries domestic oil industry.
President Trump spoke to Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman on Thursday. After speaking with both leaders Trump tweeted that he believed a truce could be worked out between the two countries. This single tweet sparked a record-breaking 25 percent climb in oil prices.
Used Class 8 Sales Drop in February
Used Class 8 truck sales fell by 15 percent in February with the average price dropping for the 10th consecutive month. This data was reported by ACT Research for the last month before the surge of the coronavirus took full effect.
The market had already seemed to have reached the bottom midyear in 2019 after a 25 percent drop in freight rates and was poised for a slow recovery coming into 2020. However, now that COVID-19 has taken a hold of the market it will inevitably extend this downward trend.
Top Energy Stories
The world’s most important commodity is becoming more valuable to store than to use. Normally consumers would at least reap a consolation prize from the price collapse that is ripping apart energy producers’ balance sheets, but few want to fill their cars or take a flight these days. Instead, at least some firms in the energy complex may turn a tidy profit.
Oil soared after U.S. President Donald Trump said Saudi Arabia and Russia would make major output cuts, though uncertainty swirled over the volume of curbs and whether reductions would be made at all.
The Lone Star State is exposed to many of the pandemic and shutdown’s economic ill consequences, with three cities—Austin, Houston and Dallas—home to an abundance of service-sector jobs, especially at risk. A downturn in the oil industry and other businesses big in Texas, including airlines and ports, will likely amplify its pain. Industry analysts expect the oil downturn to outlast the current viral outbreak.
Top Freight Transportation Stories
Oceangoing shipping companies are keeping commerce moving around the world as governments try to keep their staggering economies propped up and supplies heading to increasingly strained communities.
Newly released data from ATRI shows that trucks are continuing to move – in many cases faster than usual – to respond to the demands placed on the industry by the COVID-19 pandemic.
The Stagecoach sale is the latest in Roadrunner’s strategy to downsize and focus on its core logistics and asset-light LTL segments during a time of challenge for the company. Roadrunner, one of the largest carriers in the U.S., has been working to improve its asset-light LTL focus since early 2019.
Top Economic Stories
In the last two weeks, 9.96 million people have filed for unemployment insurance benefits in the US. Tomorrow the US government releases the official US employment figures for the first time since millions of Americans were ordered to close their businesses and stay at home.
Employers shed 701,000 jobs in March, the start of a labor-market collapse that could push the U.S. unemployment rate to record highs.
U.S. President Donald Trump on Thursday invoked the Defense Production Act to aid companies building ventilators for coronavirus patients to receive the supply of materials they need.