Hurricane Francine sets sights on Louisiana coast
Hurricane Francine, which has already shut in almost a quarter of the Gulf of Mexico's oil output, is set to strengthen before making landfall in Louisiana on Wednesday evening.
Francine was about 195 miles southwest of Morgan City, Louisiana, according to an 8am ET advisory from the National Hurricane Center, with maximum sustained winds of 90 mph. The hurricane is expected to become a category 2 storm, with winds between 96-110mph, and will bring 5-10 foot storm surge to coastal areas from Vermillion Bay to Port Fourchon, Louisiana. After landfall, the center is expected to move northward across Mississippi on Thursday and Thursday night bringing heavy rains.
Ports along the hurricane's path announced traffic restrictions in advance, with some setting out plans to close until it passes, including the port of New Orleans.
About 412,070 b/d of offshore oil output was off line by midday on Tuesday, according to the Bureau of Safety and Environmental Enforcement (BSEE), as offshore operators including Chevron, Shell and ExxonMobil evacuated workers and curbed operations as a precaution. About 494mn cf/d of natural gas production, or 26pc of the region's output, was also off line.
The Gulf of Mexico accounts for around 15pc of total US crude output and 5pc of US natural gas production.
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US inflation slows to 2.5pc in August
US inflation slows to 2.5pc in August
Houston, 11 September (Argus) — US inflation slowed in August to the lowest rate since February 2021, marking a fifth month of easing inflationary pressures and paving the way for a widely expected cut in the Federal Reserve's target rate next week. The consumer price index (CPI) slowed to an annual 2.5pc in August from 2.9pc in July, the Bureau of Labor Statistics reported today. So-called core inflation, which strips out volatile food and energy prices, rose by 3.2pc in August, matching the July reading, largely due to an uptick in monthly shelter costs. After the report, the CME's FedWatch tool signaled an 83pc probability that the Fed will cut its target rate by a quarter point at next week's Fed policy meeting from 66pc odds Tuesday. Probabilities of a half point cut fell to 17pc from 34pc the prior day. The energy index contracted by an annual 4pc in August, following a 1.1pc gain in July, while the gasoline index contracted by 10.3pc in August, accelerating from a 2.2pc decline in July. Energy services eased to an annual gain of 3.1pc following gains of 4.2pc in July. Food costs rose by 2.1pc in August, slowing from a 2.2pc gain in July. Shelter rose by 5.2pc after a 5.1pc gain in July. Transportation services rose by 7.9pc in August, slowing from 8.8pc in July. Headline CPI rose by 0.2pc in August from the prior month, matching July's monthly gain. Core CPI accelerated a tick to 0.3pc in August following a monthly 0.2pc gain in July, largely as shelter rose to 0.5pc from a prior 0.4pc and transportation services surged to a 0.9pc monthly gain from 0.4pc. After falling to 3.1pc in January, inflation reaccelerated to as high as 3.5pc in March, prompting the Federal Reserve to hold off on widely expected rate cuts after holding its target rate at 23-year highs since July 2023 to contain inflation, which surged as high as 9.1pc in June 2022. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
WMO puts likelihood of La Nina at 60pc from October
WMO puts likelihood of La Nina at 60pc from October
London, 11 September (Argus) — There is a 60pc chance of La Nina weather conditions emerging from October to February next year, the World Meteorological Organisation (WMO) said today. The chance of the El Nino pattern redeveloping during that time are "negligible", it said. La Nina generally leads to a cooling effect on a global level, while El Nino typically has the opposite effect. The weather patterns are naturally occurring, but "are taking place in the broader context of human-induced climate change" that is increasing temperatures globally, the WMO said. The past nine years have been the warmest on record, even with the cooling influence of a La Nina period from 2020 to early 2023, the organisation noted. "Even if a short-term cooling La Nina event does emerge, it will not change the long-term trajectory of rising global temperatures due to heat-trapping greenhouse gases in the atmosphere", WMO secretary-general Celeste Saulo said. Last month was the joint-hottest August on record , and was on average 1.51°C above pre-industrial levels. The Paris climate agreement seeks to limit global warming to "well below" 2°C above pre-industrial temperatures, and preferably to 1.5°C. Global temperatures have been at or close to record highs to date this year and it is "increasingly likely that 2024 is going to be the warmest year on record", EU earth-monitoring service Copernicus said last week. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
No change to oil use soon, transition just began: Appec
No change to oil use soon, transition just began: Appec
Singapore, 11 September (Argus) — Fossil fuel use is not going to change much in the next few years as the energy transition is just beginning, delegates said at the S&P Global Commodity Insights Appec conference in Singapore this week. About 84-85pc of our energy is fossil fuel and that number has remained unchanged for the last 30 years, trading firm Gunvor chairman Torbjorn Tornqvist said. "If I look around, what I see today, is not going to be much different [in 2030]." "The oil industry is being blamed for everything in this respect — the solution seems to be just stop drilling," Tornqvist said. "Clearly, that is not the way." US private equity fund Carlyle's chief strategy officer of energy pathways Jeff Currie thinks the world is "not even in chapter one" of the energy transition story. "We're still, I think as Torbjorn says, at 84pc fossil fuels — that means we're in the introduction. We're not even in chapter one. We got a long way to go." The problem seems to be the "unrealistic targets" that countries and companies have set for themselves in their quest to move away from fossil fuels and lower emissions. "Or you put the target, but you don't put the resources to achieve those targets," Tornqvist said. "It doesn't matter how much we want it. The cost of the energy transition is not fully understood, and it needs to be communicated." But there are ways to go about this. "Solar power is, I think, actually extremely cheap," Tornqvist said. "So there are solutions. The problem is it's not big enough." Another issue is that the transition away from fossil fuels is being largely driven by subsidies, Currie added. "Looking at all the politics and elections everywhere in the world, it's more driven by subsidies — more carrots and less sticks." Southeast Asian countries like Singapore and Thailand have turned to carbon taxes to get producers and consumers to factor in the cost of carbon when making decisions — but the question is whether they should be set higher to be effective. "That would be optimal, but it's unlikely to happen," Currie said. "I think market-based solutions are becoming a thing of the past these days." The pace of renewables growth in Asia is an issue, meaning oil may need to be around for longer. "I strongly believe even in 2050, oil products will take a very important and critical role in the society, especially for Japan," Japanese refiner Taiyo Oil's president and chief executive Takahiro Yamamoto said. "We have very limited renewable energy in our country at this moment." Yamamoto is not worried about oil demand falling even as Japan's population continues to shrink because of the number of refineries that have shut down in the country, threatening oil product supply including transport fuels like conventional jet fuel. "So many refineries have been shut down in the past 10 years. I'm very anxious about how we can keep this supply ability as a country," Yamamoto said. "That's my concern, rather than the shortage of demand or consumption decreasing." But delegates agree it is going to take a while to get to net zero and not everyone is going to get there at the same time. "I think it's a race that will take from now [a] minimum of 10 years," said Kuwait's state-owned KPC managing director of international marketing Shaikh Khaled Ahmad Al Sabah. Not everyone can afford it in some countries, he added. "It needs a lot more investment. It will have a lot of cost. Economics is a big, strong factor in this one." By Reena Nathan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Harris, Trump clash as polls hang in balance
Harris, Trump clash as polls hang in balance
Washington, 11 September (Argus) — Former president Donald Trump and vice president Kamala Harris brawled, often in personal terms, in their first presidential debate on Tuesday, with Trump branding Harris a "Marxist" and Harris saying world leaders know they can manipulate Trump with flattery. With polls indicating an even match between Trump and Harris across the six or seven battleground states that will determine the election outcome, Tuesday's debate — likely the only one they will have — presented a breakout opportunity for the two candidates. While President Joe Biden was unable to stand up to Trump's attacks in their match-up in June — in a debate performance that eventually led to his withdrawing from the race — Harris, a former prosecutor, frequently had Trump on the defensive, casting her 78-year-old opponent as confused and extreme. The debate, held in the crucial swing state of Pennsylvania, started off on a calm note as Harris walked up to Trump to introduce herself — the two politicians were meeting face to face for the first time. Harris touted her plan to extend child tax credits and provide tax deductions for small businesses. Harris cast Trump's plan to impose tariffs of up to 20pc on all imported goods as essentially a national sales tax that would hurt the middle class. Trump argued that his plan would not represent a tax on US consumers because "other countries are going to finally pay us back for all that we've done". But the debate quickly deteriorated, as Trump called Harris a "Marxist", suggested that immigrants moving to the US hunt dogs and cats for personal consumption and asserted that Harris would ban hydraulic fracturing (fracking) on her first day in office. "I have not banned fracking as vice president of the US, and in fact, I was the tie breaking vote on the Inflation Reduction Act (IRA) which opened new leases for fracking," Harris said. When Harris was running for the Democratic nomination in 2019, she said there was "no question I'm in favor of banning fracking", only to abandon that position when running this year. The IRA, the landmark climate legislation that Congress approved in 2022, included a compromise provision demanded by the Republican lawmakers that set aside more areas for leasing in the Gulf of Mexico. Trump appeared to give the Democratic administration credit for keeping the US oil industry intact. "They started getting rid of it, and the prices were going up the roof. They immediately let these guys go where they were." But he contended that US oil output would have been "four-five times" than it is now if he had been re-elected in 2020. US crude output fell sharply in Trump's last year in office as the Covid-19 pandemic devastated demand. Oil output reached a record high of 12.9mn b/d last year and is projected to grow again this year, according to the Energy Information Administration. "If she won the election, the day after that election, they'll go back to destroying our country, and oil will be dead," Trump said. "Fossil fuel will be dead. We'll go back to windmills, and we'll go back to solar." Foreign policy issues presented another area of personal attacks for the candidates. "World leaders are laughing at Donald Trump," Harris said. Trump countered by citing praise for his leadership from Hungary's prime minister Viktor Orban, a controversial leader who frequently clashes with EU leaders over their support for Ukraine. Trump repeatedly refused to say whether he wanted Ukraine to win its war with Russia, merely saying that the war should end. And he argued it would not have started if he had been in office. "If Donald Trump were president, [Russian president Vladimir] Putin would be sitting in Kyiv right now," Harris said. "You adore strongmen instead of caring about democracy." Trump frequently attacked Biden during the debate, prompting Harris to say: "It's important to remind the former president, you're not running against Joe Biden, you're running against me." An average of national polls aggregated by the Washington Post shows Harris with a 2 percentage point lead over Trump this week — a result that pollsters interpret as a statistical dead heat, as the winner is determined in the Electoral College, not in the nationwide voting. It will take some time for the outcome of Tuesday's debate to become apparent in the polls. Harris and Trump have not agreed to hold another debate. Trump's vice presidential pick, Ohio senator JD Vance and Harris' running partner, Minnesota governor Tim Walz, are scheduled to hold a televised debate on 1 October. By Haik Gugarats Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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