OPEC Pursues Formal Pact with Russia
Saudi Arabia and its Organization of Petroleum Exporting Countries (OPEC) allies are proposing a partnership with Russia and the ten supporting countries in agreement of the OPEC+ production cuts. The goal to further develop the relationship is to more efficiently set a price floor on crude oil prices. Some OPEC producers, including Iran, have opposed a tighter partnership as currently every nation has equal say in the OPEC accord. Iran fears it would be dominated by Saudi Arabia and Russia, further solidifying that the big three oil producers – Russia, US, and Saudi Arabia – largely influence price behavior. OPEC nations and the supporting countries led by Russia will meet in Vienna on February 18 to discuss the proposal.
On the other hand, US continues to see booming oil production ultimately taking market share from OPEC+ nations. There is also a bipartisan group of US senators rolling out a bill called No Organizations of Petroleum Exporting Countries or NOPEC. The bill would allow the Justice Department to sue OPEC members for antitrust violations. The bill is gaining traction as OPEC and Russia work closer to solidifying their relationship.
Self-Driving Truck Startup Ike Raises $52 Millions
Ike, a self-driving startup founded by former employees of Apple, Google, and Uber Advanced Technologies Group, has raised $52 million in a Series A funding. The funding will help expand its 30-person team to build and deploy a viable product commercially. Ike does not strive to be the first self-driving truck on the road, but they believe they will have the best product on the road. Ike is currently focusing on the systems philosophy, design, and architecture before laying the foundation. However, Ike plans to test its first truck on the road this year.
In Other News
If you’ve missed the headlines lately, electric vehicles (EVs) are coming, and they are arriving soon. There is an interesting parallel to the hype machine that is pushing electric vehicles as the future of transportation today and the hype machine that pushed another darling fuel just a few years ago, though, offering a cautious tale that must be watched.
In a global collapse of oil prices five years ago, scores of American oil companies went bankrupt. But one field withstood the onslaught, and even thrived: the Permian Basin, straddling Texas and New Mexico.
When Saudi Arabia’s powerful energy minister met with Prince Mohammed bin Salman in late 2016, he intended to dissuade the king’s son from taking the world’s most valuable company public. It didn’t work. Prince Mohammed ordered the minister, Khalid al-Falih, to get Saudi Arabian National Oil Co. listed as soon as possible, according to people with knowledge of the meeting.
California policymakers are intent on making sure that electric vehicles — and the charging stations and other infrastructure needs associated with them — transform the state’s transportation sector. But it won’t come cheaply.
Saudi Arabia and its Persian Gulf allies are proposing a formal partnership with a 10-nation group led by Russia to try to manage the global oil market, according to OPEC officials, in an alliance that would transform the cartel.
Ike, the autonomous trucking startup founded by veterans of Apple, Google, and Uber Advanced Technologies Group’s self-driving truck program, has raised $52 million in a Series A funding round led by Bain Capital Ventures.
Infrastructure policy needs to be among the major mentions during President Donald Trump’s State of the Union address Feb. 5, stakeholders and senior aides told Transport Topics recently. A new infrastructure plan from the administration ideally should call for greater reliance on federal dollars and less dependence on the private sector.
There is ample spare capacity in other oil producers and strategic reserves to compensate for a loss of Venezuela’s crude exports, helping explain the tepid reaction of global oil prices to U.S. sanctions announced a week ago.
U.S.-backed members of Venezuela’s opposition converged on the Colombian border city of Cúcuta to arrange a new challenge against Venezuela’s autocratic leader, Nicolás Maduro: food shipments that would be transported into the crisis-stricken country in coming days.
The American Transportation Research Institute released an analysis of the impacts on the growth of ecommerce, including the challenges and opportunities posed by more regionalized retail supply chains and the proliferation of urban “last mile” deliveries have presented.
His comments on trade were short and direct, calling for passage of the United States-Mexico-Canada Agreement (USMCA) and the lesser-known Reciprocal Trade Act. He shared no concrete news on the ongoing trade negotiations with China, but reinforced structural changes are at the heart of U.S. demands, along with reducing what Trump sees as a “chronic trade deficit” with the country. On infrastructure investment, the President said: “I know that the Congress is eager to pass an infrastructure bill — and I am eager to work with you on legislation to deliver new and important infrastructure investment, including investments in the cutting-edge industries of the future.”
Autonomous truck technology has the potential to change the cost structure of the carrier industry. A McKinsey & Company report said that a fully autonomous trucking market would cut operating costs by 45 percent, saving carrier companies between $85 billion and $125 billion annually.
“Relentless competition” and widespread urbanization are two of the top trends that will reshape trucking and logistics in the US and elsewhere as e-commerce expectations set by Amazon and its customers challenge traditional delivery strategies and processes, speakers at the SMC3 Jumpstart 2019 Conference in Atlanta said Jan. 28-30. That means problems rooted in truck capacity and driver availability are likely to get worse, rather than better, regardless of the economic cycle.
Driven by tight trucking capacity and the threat of tariffs, intermodal volumes increased 5.6% in 2018, their highest growth in five years, according to the Intermodal Association of North America’s annual report.
Venture capital (VC) dollars keep pouring into technology start-ups focused on shipper freight visibility, fueling an arms race in that sector of logistics software, as evidenced by a $50 million investment into Chicago-based software provider FourKites Tuesday.
Players in the trucking and transportation space also have found a home at CES, a point I tend to hammer home as justification for heading back out there in 2020. Paccar was the predominant truck OEM at this year’s event, showcasing the Peterbilt Model 220EV electric medium-duty truck and announcing a partnership between Kenworth and Toyota to develop a fuel-cell electric version of the T680 tractor.
A bill introduced Monday, Feb. 4, in the California Senate would require Class 4 and heavier trucks to undergo more stringent emissions testing than currently required before registering or even operating in the state. The tests could also be an added annual expense for carriers who run in California.
When Daimler Trucks announced in January plans shelve its truck platooning program, I think it took a lot of industry-types by surprise. In reassessing its work on truck platooning – a practice the company has tested for several years and many thousand miles in the U.S – the German truck maker said test results have shown that fuel savings even in perfect platooning conditions are less than expected, adding those savings further diminish when the platoon disconnects, and the trucks must accelerate to reconnect.
Just 10pc of the global shipping fleet have scrubbers to reduce air pollution, although the vessels that do tend to be ships that use large amounts of marine fuel, shipbroker Clarksons said. Of the existing vessel fleet, 509 vessels have been fitted with scrubbers and 1,189 vessels are pending retrofit
Paul Shekoski is not sitting idly by waiting for the U.S.-China trade war to end. Shekoski’s company relies on imports of weather-monitoring devices it has made in China. But last year, it paid more in duties than it made in profit because of President Donald Trump’s tariffs. Now he’s examining every legal option to avoid the duties — including relocating his production to Mexico.
Truck orders got off to a slow start in 2019 with early reports from industry analysts ACT Research and FTR tracking a 26% decline in January compared to December 2018.
U.S. rail traffic rose by just 1.1 percent to 2,554,655 carloads and intermodal units last month compared with January 2018 levels, according to Association of American Railroads (AAR) data.
The former oil industry lobbyist now in charge of the Interior Department says he’s prepared to balance the interests of environmentalists against an administration that has put a priority on opening public lands to energy development.
A senior administration official said on Friday that U.S. national security depends on affordable energy, and slammed cartels when asked if President Donald Trump would support a bill targeting the OPEC production group’s oil supply cuts. Also see, Congress Moves to Counter OPEC’s Pursuit of Pact with Russia.
Democratic officials and activists are pushing the party to unify behind a plan to quickly wean the U.S. economy off fossil fuels and cement climate change as a central issue in the 2020 election. Also see, Liberal Democrats Formal Call for a ‘Green New Deal’ Giving Substance to a Rallying Cry