Posts belonging to Category Climate change



Oil falls after record U.S. shale output forecast

Shale production alone will hit a record 8.4 million barrels per day next month

Oil fell on Wednesday after the U.S. government said shale output would rise to a record next month, denting a rally that sent prices to their highest this year. Brent futures eased by 53 cents to trade at $65.92 a barrel by 1312 GMT, still within sight of Monday’s high for the year of $66.83. U.S. futures were at $55.77 a barrel, down 31 cents, having touched a 2019 peak of $56.39 earlier.

The U.S. Energy Information Administration said in a monthly report on Tuesday shale production alone will hit a record 8.4 million barrels per day next month, suggesting little chance of a near-term slowdown in overall U.S. crude output.

http://www.reuters.com

Tesla Gigafactory in Shangai To Be Complete In Summer Of 2019

10% of the total planned capacity of the plant

The breakneck pace of work at Tesla’s Shanghai Gigafactory continues with the announcement that the company has started an energy conservation assessment in cooperation with several governmental agencies. In a further update, Chinese media noted that the project would be completed in the summer of 2019.

The first phase of the Tesla Gigafactory in Shanghai is only an estimated 10% of the total planned capacity of the plant and will be producing the first cars by the end of this year.

The factory will produce Tesla’s smaller Model 3 and Model Y vehicles, launching with the Model 3 and starting production of Model Y essentially in parallel with production in the United States (at Tesla’s Gigafactory 1 in Nevada).

http://www.cleantechnica.com

Amazon, GM in talks to invest in electric pickup truck maker Rivian

Rivian Automotive LLC valued up to $2 billion

Amazon.com Inc and General Motors Co are in talks to invest in Rivian Automotive LLC in a deal that would value the U.S. electric pickup truck manufacturer at between $1 billion and $2 billion, people familiar with the matter.

The deal would give Amazon and GM minority stakes in Rivian, the sources said. It would be a major boost for the Plymouth, Michigan-based startup, which aspires to be the first carmaker to the U.S. consumer market with an electric pickup.

If the negotiations conclude successfully, a deal could be announced as early as this month, the sources said, asking not to be identified because the matter is confidential. There is always a chance that deal talks fall through, the sources cautioned.

http://www.reuters.com

Tesla to buy energy tech company Maxwell Technologies

The deal represents a 55% premium over Maxwell’s closing stock price

Tesla plans to acquire energy technology company Maxwell Technologies for about $218 million, the company said Monday. Tesla will buy the company’s 45.9 million shares for $4.75 a share in an all-stock transaction. The deal represents a 55 percent premium over Maxwell’s closing stock price of $3.07 a share Friday and would value the company at around $218 million. 

Maxwell makes ultracapacitors, devices that can store and rapidly deliver surges of energy. Tesla CEO Elon Musk is a fan of the technology for electric cars. Musk has said in the past that the technology could be a more likely source of a breakthrough in electric vehicle technology than batteries. Musk even once said on Twitter that he had planned to conduct research on them at Stanford University.

http://cnbc.com

Oil prices collapsed

Supply Glut Fears Return

Oil prices collapsed on Tuesday for the second time in a week. During midday trading, WTI fell below $55 per barrel and Brent dropped below $65 per barrel. Both benchmarks are off more than $20 per barrel from their October highs. “Oil prices are under pressure in the face of ample supply, falling stock markets and an increasingly gloomy economic outlook,” Commerzbank said on Tuesday.
Tuesday also saw a plunge in global equities, which is dragging down all sorts of different sectors, including oil prices. “I think you’re going to see a risk-off type of market,” Tariq Zahir, a New York-based commodity fund manager at Tyche Capital Advisors LLC, told Bloomberg. “It wouldn’t be surprising to see new lows being printed on oil” if crude stocks rise sharply. U.S. crude oil inventories likely rose by 3.5 million barrels last week, a sign that the surplus continues to build. In fact, concerns about a supply glut are growing by the day. The IEA said in its November Oil Market Report that the global surplus could average 0.7 million barrels per day (mb/d) in the fourth quarter.

The New Bear Market In Oil

U.S. shale production is skyrocketing

WTI dipped below $60 per barrel in early trading on Friday, the lowest price level in nearly a year. With prices down more than 20 percent from the October peak, WTI is now officially in a bear market.
Many of the factors that conspired to push oil prices up in recent months have all seemed to reverse course at exactly the same time.
First, U.S. shale production is skyrocketing. The EIA reported an unbelievable increase of 400,000 bpd in U.S. oil production in the first week of November, pushing output up to 11.6 million barrels per day (mb/d). The agency rounds off weekly estimates to the nearest hundred thousand barrels, somewhat obscuring the trajectory of growth, but the huge increase is notable by any standard.

World's longest sea bridge to open in China

The 55km bridge links Hong Kong and Macau to the Chinese mainland

The world’s longest sea bridge is set to open this week, linking the cities of Hong Kong and Macau to the Chinese mainland as part of a broader contentious plan to integrate the special administrative regions into China.
The $20bn Hong Kong-Zhuhai-Macau bridge officially opens on Tuesday in a ceremony that Chinese president Xi Jinping is reportedly planning to attend. Officials are billing the 55km bridge as a key part of the Greater Bay Area plan, a campaign to connect Hong Kong and Macau to 11 Chinese cities to form a high-tech region to rival Silicon Valley.
The bridge links Hong Kong’s Lantau island to Zhuhai on the southern coast of Guangdong province and the gambling hub of Macau, a popular tourist spot for Chinese visitors.

Saudi Arabia invests $1 billion in electric carmaker Lucid Motors

A serious rival to Tesla

Saudi Arabia’s Public Investment Fund (PIF) has agreed to invest more than $1 billion in Lucid Motors, adding to the emerging competition facing U.S. electric vehicle maker Tesla Inc. The funding will enable Silicon Valley-based Lucid to achieve the commercial launch of its Lucid Air electric vehicle in 2020, PIF said in an announcement on Monday. Lucid joins Daimler-owned  Mercedes, BMW and Volkswagen’s  Audi and Porsche divisions in the battle for dominance in the market for premium battery cars.
In August, Tesla founder Elon Musk said the Saudi sovereign wealth fund could help him to take his company private. The Lucid investment, which PIF said is more than $1 billion but did not give an exact figure, is also part of Saudi Arabia’s plan to build an environmentally friendly economy, to diversify the kingdom away from reliance on crude oil.

Flurry of electrifying announcements from the auto industry

Mercedes challenges Tesla with an all-electric SUV

Mercedes-Benz unveiled its first fully electric SUV today in Stockholm, the first in a long line of electric vehicles the automotive juggernaut will roll out over the coming years as part of its new EQ sub-brand. The EQC will run to 60 mph in under five seconds, go 200 miles between charges, and when it enters production in 2020, it will find itself in a world of increasingly fierce competition.
The EQC unveil comes amid a flurry of electrifying announcements from the auto industry. Later this month, Audi will debut its own electric SUV, the e-Tron. BMW just began taking orders for its upcoming iX3 electric SUV. Tesla is showing the production version of its gobsmacking, revived Roadster at the Grand Basel motor show in Switzerland this week. Jaguar is gearing up to start US deliveries of its much-lauded electric i-Pace later this year.

http://www.wired.com

Trump Is Fracturing OPEC

Trump tweets

Trump’s tweet over the weekend that Saudi Arabia agreed to add 2 million barrels per day (mb/d) of supply confused the oil markets, pushing prices down a bit on Monday. Most analysts dismissed the statement, concluding that Trump was confused when the Saudis told him they have 2 mb/d of spare capacity, and not that they had planned to bring that capacity online.
A few days on from that episode, however, it actually doesn’t look that black and white.
Indeed, Trump’s tweet suggests that he very much believes that 2 mb/d of Saudi supply is coming online, and despite the attempt by the Saudis to clarify, by stating that they have surplus capacity waiting to be used in the event of a pinch, the statement was interpreted in different ways by the oil market.
https://www.oilprice.com/

U.S. record oil exports bite into Russia, OPEC market share in Asia

U.S. crude production hit all-time highs

Record crude oil volumes exported from the United States will be heading to Asia in the next couple of months to take another piece of the market away from Russia and producers in the Organization of the Petroleum Exporting Countries (OPEC). The United States is set to export 2.3 million barrels per day (bpd) in June, of which 1.3 million bpd will head to Asia, estimated a senior executive with a key U.S. oil exporters.
Data from the Energy Information Administration shows U.S. oil exports peaked at 2.6 million bpd two weeks ago. [EIA/S] The record outbound volumes come as U.S. crude production hit all-time highs, depressing U.S. prices to discounts of more than $9 a barrel below Brent crude futures on Monday, the widest in more than three years and opening an arbitrage for excess supplies to other markets. WTCLc1-LCOc1
https://www.reuters.com/

Oil price falls

Oil slumps as OPEC, Russia look to raise output amid U.S. surge

Oil prices slumped on Monday, extending steep declines from Friday, as Saudi Arabia and Russia said they may increase supplies and as U.S. production gains show no signs of abating. Brent crude futures were at $75.09 per barrel at 0452 GMT, down $1.35, or 1.8 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures were at $66.22 a barrel, down $1.66, or 2.5 percent. Brent and WTI have fallen by 6.4 percent and 9.1 percent respectively from peaks touched earlier in May.
In China, Shanghai crude oil futures tumbled by 4.8 percent to 457.7 yuan ($71.64) per barrel. The Organization of the Petroleum Exporting Countries (OPEC), as well as top producer but non-OPEC member Russia, started withholding supplies in 2017 to tighten the market and prop up prices, which in 2016 fell to their lowest in more than a decade at less than $30 per barrel.
https://www.cnbc.com/

OPEC Deal In Jeopardy

Iran And Saudi Arabia Square Off

Iran and Saudi Arabia are at odds over what to do next with the OPEC agreement, a conflict that could sow the seeds of the agreement’s demise over the course of the next year. As the WSJ notes, the dispute centers around exactly what price the cartel should be targeting. Iran’s oil minister has said that the group should not push prices too high because it would likely spark an even greater production response from shale drillers. “If the price jumps [to] around $70…it will motivate more production in shale oil in the United States,” Iranian oil minister Bijan Zanganeh told the WSJ. Zanganeh has suggested $60 is about the right price for now.
Meanwhile, Saudi Arabia, which has much higher budgetary requirements and a desperate need to lift oil prices in order to bolster the valuation of the Saudi Aramco IPO, is unofficially aiming for $70 per barrel. Saudi oil minister Khalid al-Falih has repeatedly dismissed concerns about a shale wave. Instead, the Saudis are hoping to keep the limits in place regardless of what U.S. shale does, at least for the next year or so. In the meantime, Saudi Arabia is trying to stitch together a more permanent framework with Russia for 2019 and beyond.

China wants half of the electric vehicle business

China signed a deal to secure a huge amount of the global supply of cobalt, key component of electric cars batteries

China has signed a huge deal to secure the lion’s share of global cobalt supply — a core component of electric car batteries. The deal will see GEM — a $4.6 billion company listed on the Shenzhen stock exchange — purchase 50,000 tonnes of cobalt from mining company Glencore over the next three years. According to the Financial Times, that’s equal to half of the world’s total cobalt supply in 2017 — and comprises around one third of Glencore’s total production estimates through 2020.
The Glencore deal locks in China’s position as a market leader in the manufacturing of electric car batteries globally — given that it already produces more than 80% of the world’s refined cobalt. Prices for the metal have doubled over the past two years as electric vehicle manufacturers scramble to secure adequate supplies.
http://businessinsider.com…  March 15, 2018

Huge Chinese Demand for Natural Gas

United States is well-positioned

China’s push for cleaner air and fuel is driving an unprecedented demand for natural gas, and the United States is well-positioned to seize this opportunity and export even more of its growing gas production to the thirsty nation.
U.S. companies have plans for even more liquefied natural gas (LNG) export trains and facilities to come online in the coming years, and this winter’s surge in Chinese LNG demand and imports underpins a second wave of LNG investment in the United States, analysts and company executives believe.
http://www.oilprice.com…  March 13, 2018