U.S. Shale Leaves Middle East Oil Producers Staggering
The surge in US crude oil production is affecting Middle East oil producers significantly. The boom in US production is predominantly light sweet oils, which have a lower sulfur content and makes it more attractive as legislation and mandates around the globe call for lowering sulfur limits. The US continues to export more oil to Asia, taking market share away from Middle Eastern countries like Saudi Arabia who also produces very light crudes. US exports to Asian countries – especially India, Taiwan, and South Korea who are currently the largest importers of US crude – trended upward despite a pause of Chinese purchases due to trades disputes with the US.
Autonomous Trucking Likely in Four Stages
Billions of dollars are being poured into technology for autonomous trucking to make it viable for fleets to utilize. McKinsey & Co. believes autonomous trucks will come in four stages ranging from platooning with drivers in both cabs in the next 1-2 years to implementing driverless vehicles with no human interaction by 2027. As automation develops, fleets could see efficiencies increase 25 percent on the road with full automation savings reaching up to 40 percent.
In Other News
The race to bring all-electric trucks to market and electrify the transport industry has culminated into several firsts in 2018 and we have one more before the end of the year. DAF has delivered its first all-electric truck to a customer as part of their test program.
New York based Transfix has been soliciting investors for a $60-100M Series D venture-round at an $800 million valuation. If the company is successful in closing the round, it will be a significant outlier in terms of revenue multiples put on digital brokerages in the space.
Major economic indicators, both US and global, and a series of downgraded outlooks from major freight transport providers point to decelerated but still stable growth for ocean container shipping to long-haul US trucking.
NY Times: How Does Your State Make Electricity?
America isn’t making electricity the way it did two decades ago: Natural gas has edged out coal as the country’s leading generation source, and renewables like wind and solar have made small yet speedy gains. But, each state has its own story.
The seeds for 2018’s stellar year for trailer orders were sown as 2017 drew to a close. Orders for November and December were at least 10,000 more than any of the preceding 10 months, setting the stage for a record start to this year. Monthly records fell for January and February, and April’s orders were the most for that month since 2014.
President Nicolas Maduro turned heads in November 2017 when he named Major General Manuel Quevedo with no oil experience to lead PDVSA, Venezuela’s state-owned oil company. Quevedo’s actions have since raised doubts that he and the other military brass running the company have a viable plan to save it.
Ritchie Bros. Director of Strategic Accounts for Transportation Mike McMahon says the truck order backlog has forced some fleet to hold on to trucks longer since newer trucks aren’t arriving as expected, and the auction market – historically the buying domain of owner-operators – saw an uptick in the number of fleet buyers due to the immediate availability of tractors.
U.S. shale is hitting major oil exporters from the Middle East on multiple fronts. For one, soaring production is lowering prices. But also, U.S. shipments of light crude to Asia are undercutting Saudi exports to the region. Moreover, U.S. exports of refined gasoline and naptha is creating a glut of those products in Asia, forcing prices lower.
Backups and congestion on land and along the nation’s waterfronts due to a lack of customs clearance personnel could be where carriers and shippers see the most immediate effect of a long-term federal government shutdown.
Academics, stakeholders, policymakers and agency officials from every level of government are expected to meet in downtown Washington in January for one of the largest gatherings of the country’s transportation community.
American energy companies have spent billions of dollars in the past decade exploring for natural gas. But in parts of Texas and New Mexico, there is now so much of it that it is sometimes worthless. Some companies have even had to pay buyers to take it away.
Autonomous trucking likely will occur in four waves, with each stage reducing operating costs for motor carriers, according to a new report from business consultant McKinsey & Co.
It is highly unlikely that OPEC and other oil producers would set up a joint structure due to the additional red tape it would create as well as the risk of U.S. monopoly-related sanctions, Russian Energy Minister Alexander Novak said on Thursday.
Alberta’s mandatory 325,000-bpd cuts take effect in January. The decision to force companies to lower output has already provided a jolt to Canadian heavy oil prices. The province believes the full cuts only need to be in place for the first three months of the year. Thereafter, the province will try to unwind the cuts but do so in a way that corresponds with takeaway capacity.
Shippers’ frustration with their inability to pick up containers and return empties at the Los Angeles-Long Beach port complex is rising, as thousands of dollars worth of detention and demurrage charges are getting wracked up due to an unusual period of congestion.
U.S. energy firms added oil rigs for a second week in a row even as oil prices fell to 1-1/2-year lows and headed for losses of more than 20 percent this year. Drillers added 2 oil rigs in the week to Dec. 28, bringing the total count to 885, General Electric Co’s.
The Trump administration announced on Friday a plan designed to make it easier for coal-fired power plants, after nearly a decade of restrictions, to release into the atmosphere more mercury and other pollutants linked to developmental disorders and respiratory illnesses.