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Saturday, June 15, 2019

week ending Jun 15

 Bond Markets Are ‘Almost Taunting the Fed’ With Global Rate-Cut Bets  - Bond markets around the globe are acting like central-bank rate cuts are only a rubber-stamp away from becoming a reality. Just look at the size and scope of the recent rally, which has dragged down yields across the curve. For example, the aggregate rate on longer-maturity sovereign debt ended last week at 1.18%, a level last seen two weeks before Donald Trump was elected U.S. president, according to a Bloomberg Barclays index of securities issued by major economies including the U.S., Germany and U.K. That’s despite repeated assurance from Federal Reserve policy makers that they will be “patient” in making their next move. “It’s almost a new form of bond market vigilante-ism,” Michael Purves, chief global strategist at Weeden & Co., told Bloomberg Television on Tuesday. Markets “seem to be almost taunting the Fed here,” he said. Rallies in long-dated bonds have pushed yields to multi-year lows Fed Chairman Jerome Powell has a chance for rebuttal when he delivers the central bank’s next rate decision on June 19. His peers in Europe and Japan have taken defensive stances lately, as data show inflation is failing to pick up as hoped. In Europe, there’s concern that inflation expectations are becoming unmoored, and Bank of Japan Governor Haruhiko Kuroda has asserted more stimulus is possible if inflation loses momentum. The moves are underpinned by conviction that another global easing cycle is on its way. The pressure is showing particularly in the U.S., where yields on two- and 10-year Treasuries have sunk more than a percentage point from highs reached in late 2018. The two-year yield slid to 1.77% last week, the lowest since December 2017. Pricing in futures markets shows expectations for more than 50 basis points of Fed cuts by the end of this year. Across Europe, countries are rushing to the market to take advantage of the low-yield environment, with Italy and Spain expected to issue bonds via syndication. Yields in the latter touched an all-time low this month. Portugal and Germany both sold benchmark debt at record-low yields in auctions Wednesday, while the U.S. is also due to sell $24 billion of 10-year securities. Moribund price pressures are at the crux of this year’s unexpected boom trade in global bonds, and especially in the long-dated assets most vulnerable to having their profitability eroded over time. According to a Bloomberg Barclays index, Treasuries maturing in a decade or more have returned 9% in 2019 -- showing some of the vigor seen during the 25% surge in 2014, the last full year the Fed pinned rates near zero.

Trump says ‘devalued’ currencies put US at a disadvantage and the Fed doesn’t have a ‘clue’ - President Donald Trump said Tuesday the U.S. is at a disadvantage compared to other major currencies like the euro as other central banks keep interest rates low while the Federal Reserve’s rates are higher by comparison. “The Euro and other currencies are devalued against the dollar, putting the U.S. at a big disadvantage,” Trump tweeted, adding the Fed doesn’t have “a clue.” Trump also said in a separate tweet the U.S. has low inflation, calling it “a beautiful thing.” The dollar fell slightly against the euro following Trump’s tweets, but remained little changed. Trump has repeatedly gone after the Fed for what he considers to be tight monetary policy. The Fed hiked rates four times in 2018. In December, after the central bank raised rates for the last time last year, Trump eviscerated the Fed. Trump called the Fed “the only problem our economy has” in a tweet, noting they “don’t have a feel for the Market.” Trump also told CNBC’s Joe Kernen on Monday that the Fed “made a big mistake: They raised interest rates far too fast. ” Meanwhile, China keeps devaluing its currency, Trump added. “Don’t forget: the head of the Fed in China is President Xi ... he can do whatever he wants.” But market expectations for lower rates have increased recently after the release of weakening economic data. The Labor Department’s jobs report for May showed employment growth of just 75,000, well below estimates. Meanwhile, manufacturing activity growth slowed last month to its slowest pace since October 2016. The data, coupled with comments from Fed Chair Jerome Powell, led traders to price in a 78% chance of lower rates by July, according to the CME Group’s FedWatch tool. Powell said last week the Fed will “act as appropriate” to keep the current economic expansion going.

A Morgan Stanley economic indicator just suffered a record collapse - Morgan Stanley’s Business Conditions Index, which captures turning points in the economy, fell by 32 points in June, to a level of 13 from a level of 45 in May. This drop is the largest one-month decline on record and the lowest level since December 2008 during the financial crisis, according to the firm.  “The decline shows a sharp deterioration in sentiment this month that was broad-based across sectors,′ economist Ellen Zentner said in a note to clients. “Fundamental indicators point to a broad softening of activity, but analysts did not widely attribute the weakening to trade policy.”Every subindex of the Business Conditions Composite fell in June, expect for the credit condition category, which “is consistent with the recent easing in broad financial conditions,” Zentner said.  Fears of a possible economic slowdown were raised last week after a much worse than expected jobs report. The economy added just 75,000 jobs in May, according to the Labor Department last Friday. A report Thursday showed a spike in jobless claims last week. Manufacturing activity last month grew at the slowest pace in two years. Worries about a trade deal getting passed between the U.S. and China weighed on stock markets in May. Perversely, that weak sentiment actually boosted equities this month because traders are hoping the Federal Reserve will cut interest rates. But some investors are starting to worry that the economy could fall into an outright recession.

Q2 GDP Forecasts: Around 2% -- From Merrill Lynch::Core retail sales popped 0.5% mom in May with positive revisions. Industrial production and inventories were also solid. The data lifted 2Q GDP tracking by 0.4pp to 2.5% qoq saar. 1Q GDP tracking was unchanged at 3.2%.[June 14 estimate]  From the NY Fed Nowcasting Report  The New York Fed Staff Nowcast stands at 1.4% for 2019:Q2 and 1.7% for 2019:Q3 [June 14 estimate].   And from the Altanta Fed: GDPNow: The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in thesecond quarter of 2019 is 2.1 percent on June 14, up from 1.4 percent on June 7. After this morning's retail sales release from the U.S. Census Bureau, and this morning's industrial production report from the Federal Reserve Board of Governors, the nowcast of second-quarter real personal consumption expenditures growth increased from 3.2 percent to 3.9 percent. [June 14 estimate]CR Note: These estimates suggest real GDP growth will be around 2% annualized in Q2.

U.S. Budget Gap Balloons to $739 Billion Despite Tariff Revenue - The shortfall was 38.8% more than the same period a year ago, the Treasury Department said in its monthly budget review released on Wednesday. So far in the fiscal year that began Oct. 1, a revenue increase of 2.3% hasn’t kept pace with a 9.3% rise in spending. As Trump ratcheted up the trade war with China with higher levies on imports from the Asian nation, the U.S. recorded $4.9 billion in customs duties in May, bringing the total to $44.9 billion in the first eight months of the fiscal year -- almost double the same period a year earlier. Trump has repeatedly boasted that the U.S. is taking in billions in dollars through the tariffs, though importers in America are actually paying the levies. Even so, those extra funds have failed to keep the budget gap from increasing under Trump, driven by a combination of Republican tax cuts that will add up to about $1.5 trillion over a decade, and increased government spending. The deficit is forecast to reach $897 billion this fiscal year, from $779 billion last year, and rise to more than $1 trillion in fiscal 2022, according to the Congressional Budget Office. The White House has said the tax cuts will pay for themselves by creating more revenue through faster and sustainable economic growth. In May, the fiscal deficit increased to $207.8 billion, up 41.5% from the same month last year. The forecast in a Bloomberg survey of economists was $202.5 billion.

US Government Spending Soars To All Time High As Deficit Hits Record For Month Of May --Another month, another frightening jump in the US budget deficit. And this time with a record surge in government spending to boot.  According to the latest Treasury data, the US budget deficit in May - not a traditionally high-spending month for the US government - was a whopping $208 billion, missing the $200 billion deficit expected, and well worse than the $147 billion deficit recorded last May. And even though there may have been one-time calendar effects and time-shifts at play, the deficit was also the biggest budget deficit for the month of May on record. For May, receipts rose 6.9% y/y to $232.1.3BN but it was the surge in outlays that was jarring: last month, the US government spent a whopping $439.8BN, a 20.9% increase from prior year's $363.9BN in outlays. This was the most the US government has ever spent in one month!  As a result, the budget deficit for the first eight months of the fiscal year shot up to $738.6 billion, a whopping 38.8% higher than the $532 billion reported for the same period last year, largely the result of soaring government spending, while receipts are starting to turn lower. As of May, year-to-date receipts were up 2.3%, while outlays rose 9.3%. The jump in the deficit was despite the bump in customs duties, which almost doubled to about $44.9 billion this fiscal year from $24.8 billion a year ago, reflecting the Trump administration’s tariffs on Chinese imports. Meanwhile, on a trailing 12 month basis, the deficit rose again, hitting just shy of $1 trillion, or $958 billion, the highest since February 2013, when it was just above $1 trillion. Unfortunately, since receipts are set to decline even more in the coming months, the overall budget deficit is set to widen further in the years to come as the Republican tax cut package and increased spending for defense and other priorities boost government outlays. Some policy makers and economists are flagging concern about the growing debt burden, saying it risks America’s credit quality among borrowers, while other economists see more room to run. So far it has yet to dent the yield on US treasury debt, which recently tumbled to levels not seen in years, and certainly when the total US deficit was far lower. According to the CBO, the budget deficit in fiscal 2019 will widen to $897 billion, up by $118 billion from a year earlier; any economic recession will result in a far greater number. Incidentally, for the first 8 months of the year, the US has already spent $739 billion, leaving just $160 billion in additional spending before the US surpasses the CBO's deficit forecast.  Finally, and perhaps most concerning, is that for the first 8 months of this fiscal year, gross interest payments on US Treasury debt hit $354 billion, $46 billion, or 11% more than in the same month period last year.

House panel wraps up final 2020 spending bill as Senate lags - The House Appropriations Committee on Tuesday advanced the $24.9 billion Financial Services and General Government spending bill, the last of 12 annual spending bills to advance to the floor. “With this bill we complete our full committee markups, and continue an orderly appropriations process to get the people’s business done on time,” said Committee Chair Nita Lowey (R-N.Y.). The bill was approved 30-21 along party lines. The Committee moved the 12 bills at a breakneck pace, and plans to pass them in the House before June is up. The first five will come to the floor Wednesday in one “mini-bus” package, followed by a second 5-bill package next week. The remaining bills, including the Financial Services bill and the contentious Homeland Security spending bill that deals with immigration and the border, are likely to be packaged together as well. The Senate, in the meantime, has lagged in its appropriations process, and has yet to introduce a single appropriations bill for the 2020 fiscal year, which begins Oct. 1. Senate leaders have opted to wait until they strike a deal on overall spending levels with the House and the White House, though progress has been scant. The Financial Services bill approved Tuesday included a 3.1 percent pay raise for federal workers, a $12 billion budget to upgrade and modernize the Internal Revenue Service, and provided $16.2 million funds for election security measures. The bill would also make DACA recipients eligible for federal employment and ban the use Treasury funds for President Trump’s proposed border wall. Trump transferred $601 million from a Treasury fund toward the wall earlier this year after Congress refused to allocate the $5.7 billion he requested toward the cause. Also included in the bill was a provision that would keep penalties from financial institutions that provide banking to both recreational and medical cannabis businesses in states where they are legal.

August recess under threat as yearly spending bills pile up - The lack of a spending deal with fewer than 20 legislative days remaining until the August recess is prompting some GOP senators to discuss the possibility of cutting short the Senate’s August break. Sen. David Perdue (R-Ga.), who is up for reelection next year, said he will ask Senate Majority Leader Mitch McConnell (R-Ky.) to consider trimming the annual recess in order to tackle government spending bills. The effort to shorten the recess was successful in 2018 after Perdue and other lawmakers sounded the alarm on a pileup of spending measures. This year, the Senate is even further behind schedule on its to-do list. Senators have done little legislating this year and still have on their agenda a border supplemental spending bill, defense authorization, a highway reauthorization and the annual appropriations bills. “We only have 19 working days between now and the end of July. If we don’t stay here in August at least some of the time, it’s hard for me to believe we’re going to get all of this appropriated by Sept. 30,” Perdue said Tuesday, citing the end of the fiscal year. “We have got to get defense and HHS done,” he added, referring to the two biggest spending bills funding the Pentagon and the departments of Labor and Health and Human Services. “If we don’t get it done, I’m still of the mind that we need to be here in August. I don’t know how it would be any other way. It’s just a reality, we’re not doing our jobs and we got to get it done,” Perdue said.

Senate Democrats will seek to force vote on Trump authority for Iran war - If some key Democrats get their way, the Senate will have to vote on the limits of President Donald Trump’s ability to go to war with Iran. The vote would come as part of floor debate on the fiscal 2020 defense authorization. The Senate Armed Services Committee last week turned back an effort to express opposition to military action against Iran without a new authorization from Congress, except in cases of self-defense.Members of the Armed Services Committee voted 14-13 that an amendment from Virginia Democrat Tim Kaine was outside the jurisdiction of the panel.“The Armed Services Committee is not able to talk about military activity in Iran. It’s like the scene in Dr. Strangelove where ... there will be no fighting in the war room. It was amazing to me,” Kaine said. “I think it was surprising to a number of the members of the committee, that one day after having aclassified all-members meeting to talk specifically about this issue, we were not able to take it up in the committee.”Kaine said he and other Democratic senators would seek a floor vote during the defense debate, which could take place in the middle of June. “We will be able to take it up on the floor. The jurisdictional objection was just an objection to the committee action. It’s not an objection on the floor,” Kaine said during a brief interview on May 23. The procedural problem came about because it is the Foreign Relations Committee, on which Kaine also serves, that generally has jurisdiction over authorizations for the use of military force and related policy matters.

Iran gears up for high-stakes diplomacy amid tension with U.S. - As its nuclear deal with world powers unravels amid heightened tensions with the U.S., Iran will see a week of high-stakes diplomacy capped by the first visit of a Japanese prime minister to Tehran since the 1979 Islamic Revolution. Shinzo Abe will arrive on Wednesday in Iran after earlier meeting with President Donald Trump, whose maximalist approach toward the Islamic Republic has seen America re-impose sanctions once lifted by the 2015 accord and create far-reaching newer ones. German Foreign Minister Heiko Maas also will visit Tehran as well this week. What Abe will be able to accomplish remains unclear, as Iran already has warned Europe it will begin enrichment of uranium closer to weapons-grade levels by July 7 if it doesn’t come up with new terms to the deal. It also comes as Japan tries to negotiate its own trade deals with Trump, who has been quick to impose tariffs on other nations. But Abe, whose nation relies heavily on Mideast crude oil to power its economy, already has acknowledged the challenge. “Between Japan and the United States, there should be close collaboration so that this tension surrounding Iran should be mitigated and alleviated, and it shouldn’t culminate in armed conflict,” Abe said in a May news conference with Trump in Tokyo. The current crisis, which has seen the U.S. hurry an aircraft carrier strike group and B-52 bombers in the region, takes root in Trump’s decision last year to withdraw the U.S. from the nuclear deal. That accord saw Iran agree to limit its enrichment of uranium in exchange for the lifting of economic sanctions Trump, in withdrawing from the deal, pointed to the accord not limiting Iran’s ballistic missile program, nor addressing what American officials describe as Tehran’s malign influence across the wider Mideast. Those who struck the deal at the time described it as a building block toward further negotiations with Iran, whose Islamic government has had a tense relationship with America since the 1979 takeover of the U.S. Embassy in Tehran and subsequent hostage crisis.

Iran Blasts Deceitful Pompeo, Calls New Sanctions An Act Of Economic Terrorism -- Pompeo’s words were "deceitful, untrue and merely in service of appealing to the public opinion," blasted Abbas Mousavi, a senior Iranian diplomat, after Washington imposed sanctions against Iranian petrochemical companies despite an earlier promise of negotiations without preconditions.  On Friday, the US Treasury announced it has imposed a new wave of sanctions against Iranian energy businesses. The move is meant to stifle the revenues of the elite Islamic Revolutionary Guard Corps (IRGC), which Washington declared a terrorist organization earlier in April. This infuriated Iran's foreign minister, who, as RT reports, exclaimed that this proves that US Secretary of State Mike Pompeo made an empty promise to Tehran less than a week ago, when he said he was ready to start “a conversation with no preconditions." “Only one week was needed for the US president’s claim that he was ready to negotiate with Iran to be proven hollow.” .. “America’s maximum pressure policy is a failed policy tried numerous times before by the country’s previous presidents. This is a wrong path and the US government can be sure that it will not achieve any of the goals set for this policy,” He called the sanctions an act of “economic terrorism” and said Tehran will not yield to Washington’s pressure.

Pompeo, without offering evidence, blames Iran for Gulf tanker attacks — US Secretary of State Mike Pompeo blamed Iran for an attack on two tankers in the Gulf of Oman, saying the assessment was based on intelligence but offering no evidence for his claim."It is the assessment of the United States government that the Islamic Republic of Iran is responsible for the attacks," Pompeo said in specially scheduled remarks at the State Department Thursday as investigations into the attacks were beginning.Pompeo spoke hours after the two tankers were attacked in the Gulf of Oman, and less than a month after four other ships in the region were struck in what appears to be a similar way. National security Adviser John Bolton blamed Iran for those strikes at the time, again without offering evidence that Tehran was responsible.Iran's Foreign Minister Mohammad Javad Zarif said "suspicious doesn't begin to describe" this latest incident, noting that one of the tankers is Japanese owned and that the attack took place as Japanese Prime Minister Shinzo Abe was visiting Iran in an effort to calm tensions between Washington and Tehran. "Reported attacks on Japan-related tankers occurred while PM [Shinzo Abe] was meeting with Ayatollah [Khamenei] for extensive and friendly talks. Suspicious doesn't begin to describe what likely transpired this morning," Zarif tweeted.

US stages provocation in the Persian Gulf - The Trump administration’s thuggish secretary of state, Mike Pompeo, made a presentation to the media Thursday afternoon in which he asserted that Iran was responsible for suspected attacks on two oil tankers in the Gulf of Oman near the strategic Strait of Hormuz. These charges carry with them the threat of a war that would transform much of the Eurasian landmass into a battleground. The allegations made by Pompeo, who publicly professes that his every action is guided by the Bible, are a pack of lies. “It is the assessment of the United States government that the Islamic Republic of Iran is responsible for the attacks that occurred in the Gulf of Oman today,” Pompeo told reporters during his brief remarks at the State Department. Fire and smoke billowing from Norwegian-owned Front Altair tanker said to have been attacked in the waters of the Sea of Oman on June 13, 2019 [Credit: ISNA] “This assessment is based on intelligence, the weapons used, the level of expertise needed to execute the operation, recent similar Iranian attacks on shipping, and the fact that no proxy group operating in the area has the resources and proficiency to act with such a high degree of sophistication,” the secretary of state continued. The assessment is “based on intelligence,” but no intelligence has been provided to anyone. It is derived from the “weapons used,” but the guilty verdict has been delivered against Iran before any investigation has been conducted to determine what those weapons were. And it is buttressed by allegations of “recent similar Iranian attacks on shipping” which are just as unsubstantiated as the latest ones. Larding up his indictment, Pompeo provided a list of alleged Iranian transgressions over the last month including the sabotage of four ships anchored off the UAE port of Fujairah last month—an accusation that US National Security Adviser John Bolton vowed to substantiate by presenting evidence to the United Nations Security Council, but then never did.

Why would Iran attack two tankers near the Strait of Hormuz?  - In a brief press conference Thursday, Secretary of State Mike Pompeo expressed no doubt about who attacked two tankers in the Gulf of Oman, saying Iran was “responsible for the attacks.” He did not, however, immediately offer any proof of the intelligence behind that assessment. The attack certainly bears the hallmark and capabilities of previous aggressive actions undertaken by Iran and its paramilitary cohorts in the Persian Gulf. But questions abound over who actually stands to benefit most from an attack in a region beset by violence and convoluted proxy conflicts raged between and Iran and Saudi Arabia and its allies. Was the attack carried out by Iran, or other Gulf States seeking to sow conflict ― or did the Islamic Revolutionary Guard Corps operate outside of Tehran’s directives to further its own agenda?  CNN reported, citing a U.S. defense official, that the crew of the Arleigh Burke-class guided-missile Bainbridge reported seeing an unexploded limpet mine on the side of one of the tankers involved in Thursday’s attack in the Gulf of Oman.A limpet mine was believed to be the cause of an attack on four tankers in May off the coast of the United Arab Emirates, which the U.S. pinned on Iran, according to the BBC.. No state or group has claimed responsibility for the attacks on the tankers, one of which was carrying oil to Japan, whose Prime Minister Shinzo Abe was on a diplomatic mission in Iran to help ease tensions in the region. The attacks occurred in the Gulf of Oman. 

‘Deja Vu’ of Iraq War Lies as US Blames Iran for Tanker Attack Without Single Shred of Evidence -- — In a press conference that immediately evoked memories of the lead-up to the 2003 invasion of Iraq, U.S. Secretary of State Mike Pompeo on Thursday claimed Iran was behind alleged attacks on two oil tankers in the Gulf of Oman without presenting one single shred of evidence.“This assessment is based on intelligence, the weapons used, the level of expertise needed to execute the operation, recent similar Iranian attacks on shipping, and the fact that no proxy group operating in the area has the resources and proficiency to act with such a high-degree of sophistication,” said Pompeo, who did not provide any details on the intelligence he cited.After asserting Iran was also behind a litany of attacks prior to Thursday’s tanker incident—once again without presenting any evidence—Pompeo said that,”Taken as a whole, these unprovoked attacks present a clear threat to international peace and security.” Pompeo—who has a long history of making false claims about Iran—did not take any questions from reporters following his remarks, which were aired live on America’s major television networks. “Mike Pompeo has zero credibility when it comes to Iran,” Jon Rainwater, executive director of Peace Action, told Common Dreams. “He’s long been actively campaigning for a confrontation with Iran. He has a track record of pushing bogus theories with no evidence such as the idea that Iran collaborates closely with al-Qaeda.”“Once again Pompeo is not waiting for the evidence to come in,” Rainwater said, “he is picking facts to suit his campaign for confrontation with Iran.”

Seven Reasons To Be Highly Skeptical Of The Gulf Of Oman Incident --Caitlin Johnstone - In a move that surprised exactly zero people, Secretary of State Mike Pompeo has wasted no time scrambling to blame Iran for damage done to two sea vessels in the Gulf of Oman on Thursday, citing exactly zero evidence. “This assessment is based on intelligence, the weapons used, the level of expertise needed to execute the operation, recent similar Iranian attacks on shipping, and the fact that no proxy group operating in the area has the resources and proficiency to act with such a high-degree of sophistication,” Pompeo told the press in a statement. Here are seven reasons to be extremely skeptical of everything Pompeo said:

  • 1. Pompeo is a known liar, especially when it comes to Iran. Pompeo has a well-established history of circulating blatant lies about Iran and the behavior of the Iranian government, and he recently told an audience at Texas A&M University that when he was leading the CIA, “We lied, we cheated, we stole. We had entire training courses.”
  • 2. The US empire is known to use lies and false flags to start wars. The US-centralized power alliance has an extensive and well-documented history of advancing preexisting military agendas using lies, false flags and psyops to make targeted governments appear to be the aggressors. This is such a well-established pattern that “Gulf of Tonkin” briefly trended on Twitter after the Gulf of Oman incident. Any number of government agencies could have been involved from any number of the nations in this alliance, including the US, the UK, the KSA, the UAE, or Israel.
  • 3. John Bolton has openly endorsed lying to advance military agendas. I wrote an article about this last month because the Trump administration had already begun rapidly escalating against Iran in ways that happen to align perfectly with the longtime agendas of Trump’s psychopathic Iran hawk National Security Advisor. At that time people were so aware of the possibility that Bolton might involve himself in staging yet another Middle Eastern war based on lies that The Onion was already spoofing it.
  • 4. Using false flags to start a war with Iran is already an established idea in the DC swamp. Back in 2012 at a forum for the Washington Institute Of Near East Policy think tank, the group’s Director of Research Patrick Clawson openly talked about the possibility of using a false flag to provoke a war with Iran, citing the various ways the US has done exactly that with its previous wars.
  • 5. The US State Department has already been running psyops to manipulate the public Iran narrative.
  • 6. The Gulf of Oman narrative makes no sense.
  • 7. Even if Iran did perpetrate the attack, Pompeo would still be lying.  Pompeo’s statement uses the words “unprovoked” twice and “Iran’s provocative acts” once, explicitly claiming that the US empire was just minding its own business leaving Iran alone when it was attacked out of the blue by a violent aggressor. Sometimes the things put out by the US State Department feel like they’re conducting experiments on us, just to test the limits of our stupidity.

Staff Officers Hope for War With Iran to End Bronze Star Drought. — Many U.S. military staff officers are hoping for war with Iran, Duffel Blog has learned. These officers cite two reasons, sources familiar with the subject report: First, the U.S. has already gone to war with two of Iran’s neighbors and is familiar with the region. Second, many strategists believe the Iranian military machine will be defeated quickly, leading to a quick award of bronze stars before an even quicker departure from the ancient country. “Finding excuses to write myself up so the colonel can sign a bronze star citation is difficult without a legitimate war,” Army Maj. James Forsyth said. “I don’t really want to do anything overtly valiant, because that could also be career threatening.” “I just want people to see my bronzie license plate and assume that I did.” As the wars in Iraq and Afghanistan have wound down, staff officers have been searching for ways to earn the once-prestigious decoration. Forsyth and his generation of officers joined too late for the Great Medal Giveaways of Aught-One and Aught-Three. Back then, simply doing your job was often enough. Citations include actions such as organizing mundane resupply convoys or reporting semiaccurate intelligence to the brigade commander on enemy strength and disposition. Present-day lieutenant colonels and above earned their bronze stars in the early days in OIF when the bar was incredibly low—even serving on brigade staffs that never left Kuwait. For enlisted personnel, the minimum bar has always been tied to valorous action. At present, and against all common sense, even officers have to storm a strongly defended trench full of, say, ISIS fighters for consideration. But sadly, such trenches have been increasingly hard to find as ISIS fighters are killed off by drone strikes conducted by “pilots” who received the “distinguished warfare medal.”While many company-grade officers want decorations, enlisted troops are hoping to get the combat pay that will finally pay for expensive modified trucks and muscle cars to manage their three-mile commutes from base housing to work.

All Americans Have Blood On Their Hands -- Robert Scheer - Shortly after Truthdig columnist Danny Sjursen left the Army, where he spent 18 years on active duty and rose to the rank of major, he sat down with Editor in Chief Robert Scheer for an interview about life after the military and a discussion about the conclusions he drew throughout his military career. Sjursen, who attended West Point and did several tours in the Middle East, including Iraq and Afghanistan, opened up to Scheer about how leaving the institution where he spent most of his adult life has allowed him to finally be completely frank about his experiences, in his columns as well as in his recent book, “Ghost Riders of Baghdad: Soldiers, Civilians, and the Myth of the Surge.” Now, as Sjursen pursues a Ph.D and a career as a writer while adapting to his new life and grappling with post-traumatic stress disorder, the former soldier is still profoundly troubled by his experiences at war, not only as he led soldiers to their deaths, but also as he watched U.S. forces devastate Iraq and Afghanistan. Although he went to Iraq thinking the trouble with the war was the way it was being fought, he left with a very different impression of the conflict.“What I saw happen to the Iraqi people [haunted me more] than what happened to my soldiers,” Sjursen says.“Not only the bodies in the street, not only the civil war that was being waged, but I found that more than 90% of the very friendly Iraqis... Sunni and Shia, they all told me that life was better under Saddam. ... That was a big turning point, when I started to say, ‘Wait a second. You know, forget about fighting the war poorly; we shouldn’t be fighting this war at all.’ ” Recounting the many ways the U.S. created worse conditions for Iraqis after the death of Saddam, Sjursen explains that the nearly half a million Iraqis who have died since the early 2000s were not killed directly by American soldiers, but by the unleashing of a “Pandora’s box of sectarian civil war in what was once a secular society.” The war in Afghanistan, while fought under different pretenses, was no less brutal or foolish than the Iraq War, in Sjursen’s eyes.“The reality is, any chance of victory in Afghanistan was over the minute - and this only took weeks - the minute after we switched from a counterterrorism strategy, a surgical, law enforcement-type attack on the al-Qaida system - the minute we switched from that to nation-building, counterinsurgency and occupation, the war was already lost.”But the blood on Sjursen’s hands, which he remains conscious of long after his last deployment, is on all Americans’ hands, as the Truthdig columnist points out. And with no end in sight to what have been dubbed our “forever wars,” it’s unlikely we’ll be able to wash our hands clean of these ongoing tragedies any time soon.

Under Trump arms deal, high-tech U.S. bombs to be built in Saudi Arabia  — A controversial arms deal for Arab allies approved by the Trump administration will allow U.S. hi-tech bomb parts to be manufactured in Saudi Arabia, giving Riyadh unprecedented access to a sensitive weapons technology. The production arrangement is part of a larger $8.1 billion arms package for Saudi Arabia, the United Arab Emirates and Jordan announced two weeks ago. The Trump administration pressed ahead with the sale without congressional approval, declaring an "emergency" based on what it said was a heightened threat from Iran.The deal came as a surprise to lawmakers, who were outraged that the administration chose to bypass Congress. But most members of Congress only learned days after the deal was announced May 24 that it opens the door for Saudi Arabia to host the production of electronic guidance and control systems for Paveway precision-guided bombs, congressional aides said.The New York Times first reported on the co-production arrangement.  Lawmakers are expected to grill a senior State Department official — R. Clarke Cooper, assistant secretary of state for political-military affairs — about the arms deal and the bomb production plan at a House Foreign Affairs Committee hearing Wednesday. The U.S. government tends to closely guard technology linked tosophisticated weapons, and limits how much of that technology is shared through co-production projects with other countries.   Lawmakers opposed to the deal said the production scheme sent the wrong signal to Saudi Arabia given its human rights record and its air war in Yemen, raised security concerns about sharing so-called "smart bomb" technology with Riyadh and undercut one of President Donald Trump's arguments for selling weapons to the Saudis — to generate jobs in the United States. "The concerns over this sale are only one more reason showing the importance of congressional review and why it is deeply disturbing that the Trump administration is trying to circumvent the law and Congress to give the Saudis not only American jobs but also American weapons technology,"

US Congress Moves to Challenge Trump Over Weapons Sale to Saudi Arabia - — A bipartisan move to block US President Donald Trump from circumventing a long-standing precedent that allows lawmakers to review major weapons sales is underway. Two senators – Republican Todd Young and Democrat Chris Murphy – both of whom sit on the Foreign Relations Committee, are planning to introduce a bill today designed to force a vote on current and future US arms sales and other military support to Saudi Arabia. The Bill appears to be the first in a series of proposed resolutions announced last week that would require votes on each of the arms sales that make up the $8.1 billion weapons package to Saudi Arabia, the United Arab Emirates and Jordan, which was announced by the Trump admiration in May.Trump circumvented Congress by declaring a national emergency on the grounds of a security threat from Iran. He swept aside objections from US lawmakers to complete the sale of arms to his Gulf allies and instigated a tug of war over who has the final say in such matters. Members of Congress, angry about the huge civilian toll from Saudi’s air campaign in Yemen, as well as human rights abuses such as the murder of Saudi journalist Jamal Khashoggi at a Saudi consulate in Turkey, had been blocking sales of offensive military equipment to the kingdom and the UAE for months. The decision is reported to have angered members of both parties, who worried that Trump’s laissez-faire attitude would eliminate Congress’ ability to prevent not just Trump but future presidents from selling weapons where they liked. “The process we are setting in motion will allow Congress to weigh in on the totality of our security relationship with Saudi Arabia, not just one arms sale, and restore Congress’ role in foreign policy-making,” Murphy said in a statement reported by NBC News.  Young said that “this bipartisan resolution simply asks the Secretary of State to report on some basic questions before moving forward with them. The ongoing humanitarian crisis and complicated security environment in Yemen requires our sustained attention and we cannot permit US military equipment to worsen the situation on the ground.”

Senators Switched Key Votes On Gulf Arms Ban Hours After Tanker Attacks - A brief report from AntiWar.com's Eric Garris suggests Thursday's tanker attack incident in the Gulf of Oman which the United States promptly blamed on Iran has directly impacted bills placed before the Senate which would ban US arms sales to Saudi Arabia, Bahrain, and Qatar.  Garris wrote of the vote which came hours after the Gulf tankers incident: "Both votes were considered highly likely to pass up until they were rushed to the floor today. The timing appears almost certainly to have been related to Thursday tanker bombings in the Gulf of Oman, and shifted a number of Senators’ votes in favor of continuing the arms sales." He noted that "some senators switched sides to kill the bills" following news of the tanker attacks.The vote, according to Defense News, indeed came very close: The U.S. Senate on Thursday rejected Sen. Rand Paul’s measures to block sales of munitions to Bahrain and Boeing AH–64E Apache helicopters to Qatar. The vote on Bahrain was 43-56 and Qatar 42-57, after Senate Majority Leader Mitch McConnell, R-Ky., and Senate Armed Services Committee Chairman Jim Inhofe, R-Okla., announced their opposition Thursday. The White House earlier this week threatened to veto the measures.The Kentucky Republican and prominent Libertarian argued passionately that the US should not be supporting authoritarian governments who are known backers of extremists and who are conducting mass atrocities in Yemen. Sen. Paul has repeatedly called on Congress and the White House to "stop arming radical jihadism".“Dumping more weapons into the Middle East won’t get us any closer to peace,” Paul said. “A ‘yes’ vote today is a vote for sanity. A ‘yes’ vote is a vote to quit sending arms to people who abuse human rights.”

 Tulsi Gabbard Pushes No War Agenda... And The Media Is Out To Kill Her Chances - Voters looking ahead to 2020 are being bombarded with soundbites from the twenty plus Democratic would-be candidates. The most interesting candidate is undoubtedly Congresswoman Tulsi Gabbard, who is a fourth term Congresswoman from Hawaii, where she was born and raised. She is also the real deal on national security, having been-there and done-it through service as an officer with the Hawaiian National Guard on a combat deployment in Iraq. Though in Congress full time, she still performs her Guard duty. Tulsi’s own military experience notwithstanding, she gives every indication of being honestly anti-war. In the speech announcing her candidacy she pledged “focus on the issue of war and peace” to “end the regime-change wars that have taken far too many lives and undermined our security by strengthening terrorist groups like Al-Qaeda.” She referred to the danger posed by blundering into a possible nuclear war and indicated her dismay over what appears to be a re-emergence of the Cold War. In a recent interview with Fox News’s Tucker Carlson, Gabbard doubled down on her anti-war credentials, telling the host that war with Iran would be “devastating,” adding that: “I know where this path leads us and I’m concerned because the American people don’t seem to be prepared for how devastating and costly such a war would be... So, what we are facing is, essentially, a war that has no frontlines, total chaos, engulfs the whole region, is not contained within Iran or Iraq but would extend to Syria and Lebanon and Israel across the region, setting us up in a situation where, in Iraq, we lost over 4,000 of my brothers and sisters in uniform. A war with Iran would take far more American lives, it would cost more civilian lives across the region...  Tulsi Gabbard could well be the only genuine antiwar candidate that might truly be electable in the past fifty years, and that is why the war party is out to get her. Two weeks ago, the Daily Beast displayed a headline: “Tulsi Gabbard’s Campaign Is Being Boosted by Putin Apologists.” The article also had a sub-headline: “The Hawaii congresswoman is quickly becoming the top candidate for Democrats who think the Russian leader is misunderstood.” The obvious smear job was picked by ABC’s George Stephanopoulos, television’s best known Hillary Clinton clone, who brought it up in an interview with Gabbard shortly thereafter. He asked whether Gabbard was “softer” on Putin than were some of the other candidates. Gabbard answered: “It’s unfortunate that you’re citing that article, George, because it’s a whole lot of fake news.” Politico the reported the exchange and wrote: “’Fake news’ is a favorite phrase of President Donald Trump…,” putting the ball back in Tulsi’s court rather than criticizing Stephanopoulos’s pointless question. Soon thereafter CNN produced its own version of Tulsi the Russophile, observing that Gabbard was using a Trump expression to “attack the credibility of negative coverage.”

U.S. failed in its policy against Venezuela: senior gov't official - (Xinhua) -- The U.S. government has failed in its destabilization plan against Venezuela and the local opposition is experiencing its "worst moment," said president of the Venezuelan National Constituent Assembly (ANC) on Friday. Diosdado Cabello said the opposition led by self-proclaimed leader Juan Guaido is "divided" and "without leadership" in a press conference in Havana shortly before returning to Caracas after a two-day visit to the island. "The United States is now understanding that it was wrong in choosing its leadership in Venezuela," said Cabello, referring to Guaido and recent statements by U.S. Secretary of State Mike Pompeo. According to a report by the Washington Post earlier this week, Pompeo admitted that keeping the Venezuelan opposition together "has proven devilishly difficult," since more than 40 leaders believe they are "legitimate successors" to President Nicolas Maduro. Cabello said Caracas is open to dialogue with the Lima Group, Canada or any other country but with respect to Venezuela's sovereignty and legitimate authorities. "We believe the Lima Group won't do anything to help solve the crisis in Venezuela, they would put all their efforts to see Maduro go, that is the only task they want to fulfill," said Cabello, also first vice president of the ruling United Socialist Party of Venezuela (PSUV). The Lima Group, comprising 13 Latin American countries and Canada, was formed in Lima, Peru in 2017 with a proclaimed aim to settle Venezuela's domestic crisis.

What Exactly Did Pompeo Mean When He Vowed To Push Back Against Corbyn? - Caitlin Johnstone -- An audio recording from a private meeting that was leaked to The Washington Post reportedly features US Secretary of State Mike Pompeo vowing to “push back” against surging British Labour leader Jeremy Corbyn, and many are concerned that what he said sounds an awful lot like a top US official promising to interfere in the UK’s democratic process. At a closed-door meeting with Jewish leaders earlier this month, one of the attendees asked Pompeo if Corbyn becomes Prime Minister, “would you be willing to work with us to take on actions if life becomes very difficult for Jews in the UK?”  Before I get to Pompeo’s response, I should interrupt myself to note that nobody actually believes that Corbyn would make life difficult for Jews in the UK. Anyone who claims to believe this is lying.  The idea that a man with a lifelong history of opposing bigotry is a secret antisemite who will facilitate the persecution of Jews if given the opportunity is a completely baseless smear campaign, and everyone knows it, including those who advance it.   So anyway, Pompeo is asked by some ridiculous twat what he’s going to do in the event of a Corbyn-led Kristallnacht, and WaPo reports on his response as follows: Pompeo said, “It could be that Mr. Corbyn manages to run the gauntlet and get elected. It’s possible. You should know, we won’t wait for him to do those things to begin to push back. We will do our level best,” he said to fervent applause from attendees.“It’s too risky and too important and too hard once it’s already happened,” he said.This revelation, understandably, has kicked up a fair bit of chatter in merry old England.“President Trump and his officials’ attempts to decide who will be Britain’s next prime minister are an entirely unacceptable interference in the UK’s democracy,” The Guardian quotes a Labour spokesperson as saying in response to the revelation.“STOP: The Secretary of State Mike Pompeo just promised ‘Jewish leaders’ in the United States that he would stop Jeremy Corbyn coming to power here,” tweeted former British MP George Galloway. “Is this normal now? Is this what we’ve been led to? Is this good for Jews? For Britain? Really?” “They did it in Latin America, Africa and Asia. Now the US government wants to overthrow democracy in Britain,” tweeted The Guardian’s George Monbiot. “Still waiting for a UK government spokesperson to express their outrage. Hello???” So many questions need to be answered. Was Pompeo in fact saying that the US is intending to prevent Corbyn from becoming Prime Minister? And if so, how? What exactly does “push back” entail? Are we talking psyops and smear campaigns? Or something more? And whatever they intend to do, have they started doing it already?

The Tree Symbolizing Friendship Between Trump And Macron Has Died - Last April, at the peak of their since-fizzled bromance, Emmanuel Macron gave a present to Donald Trump: an oak tree which was ceremoniously planted in the manicured lawns of the White House by both leaders. The photo of the two presidents digging away dirt promptly went viral and symbolized the friendship shown by the two leaders. It was a symbolic gesture: the tree came from Belleau Wood, north-east of Paris, the location of a pivotal battle in which 1,811 Americans died in June 1918 during the first world war. Since then, Trump's relations with Europe have soured and his friendship with Macron has since frayed – over issues ranging from Iran to trade – and the tree did not survive. Which is ironic because during Macron's April 2018 state visit he tweeted that the sapling would be “a reminder … of these ties that bind us” and the “tenacity of the friendship” of the two nations. From little acorns, great transatlantic ties would take root and grow, was the message. Well, maybe not. Once the cameras had departed, the tree was uprooted and disappeared in quarantine to avoid the spread of non-native diseases and invasive insects. “It is a quarantine which is mandatory for any living organism imported into the US,” Gerard Araud, then the French ambassador to America, wrote on Twitter, adding that it would be replanted later. Images showed only a yellow patch of grass in the spot on the White House south lawn where the tree had been planted. But it was never replanted: the tree died during its quarantine. Its death was confirmed by a diplomatic source to Agence France-Presse. Just like the Macron-Trump love-in, it is no more.

Markets can cheer: China appears to finally be addressing its US trade surplus -China will not allow the U.S. to interfere in its legislative process and economic policies, but it seems to be showing a readiness to keep its sales in American markets on a steep and steady downward path. According to data released June 6 by the U.S. Department of Commerce, Chinese goods exports to the U.S. in the first four months of this year declined 12.8% from the same period of 2018, driving the trade surplus down 10%. Although Chinese data released Monday morning point to a widening Chinese surplus on U.S. trade in the course of May, that wasn’t directly comparable to U.S. figures because of differing methodologies. Regardless, the trend of more balanced trade will — and must — continue if Beijing wants to return to normal trade relations with Washington. Indeed, the signal is clear that China has decided to operate a radical change in its U.S. trade. Taken at an annual rate, China’s trade surplus with the U.S. in the January-April interval would be 23.5% below China’s surplus for all of last year.   By appearing to ignore Washington’s trade warnings, China just made things difficult for itself. Beijing is now doing, under duress, what it should have done three years ago under much more favorable conditions, if it genuinely wanted to promote its policy of harmonious “great power relations.” It is, therefore, pleasing to read the reported comments, made last Friday, by Chinese President Xi Jinping at an international economic forum in Russia: “It’s hard to imagine a complete break of the United States from China or of China from the United States. We are not interested in this, and our American partners are not interested in this. President Trump is my friend and I am convinced he is also not interested in this.”  China has definitely decided, at the highest levels of state, that a balanced trade relationship with the United States is in the best interest of its economy, its tenuous security ties in Asia and the major role it wishes to play on the world stage.

Trump: If President Xi does not attend G-20, more China tariffs will go into effect immediately - President Donald Trump confirmed on Monday that additional tariffs on Chinese goods will be levied if Chinese President Xi Jinping does not attend this month’s G-20 meeting. When asked during a telephone interview if that means the new tariffs would go into effect immediately, Trump told CNBC’s Becky Quick, “Yes, it would.” The president previously threatened to put levies on another $300 billion in Chinese goods if a trade agreement is not reached soon. The Trump administration increased tariffs last month on $200 billion worth of goods the U.S. imports from China. Trump is supposed to meet with Xi at the G-20 summit, which is scheduled for June 28-29 in Osaka, Japan. The leaders of 19 nations and the European Union are expected to attend. In the telephone interview on “Squawk Box, ” the president said he’d be surprised if Xi did not attend. Trump said he has “a great relationship” with Xi, adding that “he’s actually an incredible guy.” As the trade war between the U.S. and China continues, Trump has said he will continue raising tariffs on Chinese goods. He said his administration is currently taxing “35% to 40%” of the Chinese goods the U.S. imports. If an agreement isn’t reached, there are “another 60% and that’ll be taxed,” Trump said.

Chinese Exporters Dodge Tariffs With Fake Made-in-Vietnam Labels Some Chinese exporters are going to extreme lengths to avoid the hit from Donald Trump’s tariffs. Vietnam said on Sunday that it found dozens of fake product-origin certificates and illegal transfers by companies trying to sidestep U.S. tariffs on everything from agriculture to textiles and steel. It was one of the first times an Asian government has publicly alleged such misbehavior since trade tensions between the world’s two biggest economies escalated this year. The statement from Vietnam, which pledged to increase penalties on trade-related fraud, adds to concerns that some Chinese exporters are illegally rerouting orders after Trump imposed tariffs on $250 billion of Chinese goods and threatened to target an additional $300 billion. U.S. trading partners including Vietnam face growing pressure to stop on illicit exports as they seek to avoid being hit by tariffs themselves. “It’s always a cat-and-mouse game,” said Fred Burke, managing partner at law firm Baker & McKenzie (Vietnam) Ltd. “As long as people are willing to take risks in search of those arbitrages of say 25 percent duties, it’s very difficult to enforce.” Vietnam is concerned it may be punished by the U.S. for allowing mislabeled Chinese products to flow to America, Do Van Sinh, a standing member of the National Assembly’s economic committee, was quoted as saying in the government’s statement.

Why you should never start a trade war with an autocracy - Economist - America’s government seems unfazed by the damage its tariffs do to the economy. One study by scholars at the Federal Reserve and Princeton and Columbia Universities found that the new levies have raised costs for consumers by $1.4bn per month. However, Donald Trump is devoted to his voters. And his trading rivals have retaliated where it hurts. A paper by Joseph Parilla and Max Bouchet of the Brookings Institution, a think-tank, estimated that 61% of jobs affected by retaliatory tariffs are in counties that voted for Mr Trump. Is this a coincidence? If a country’s imports from America already come from mostly Republican areas, those regions will bear the brunt of a trade war. However, a new paper by Thiemo Fetzer and Carlo Schwarz of the University of Warwick finds that America’s rivals probably did consider politics when crafting their policies. To test if recent tariffs were politically motivated, the authors needed to compare them with alternatives that were not. They devised this benchmark by creating at random 1,000 hypothetical bundles of targeted goods for each trading partner, all worth the same as the actual trade facing tariffs. The authors then compared real-world policies with these alternatives. First, they assessed the political impact of each plan, by measuring how closely its targeted areas matched Republican gains when Mr Trump was elected. Next, they estimated how much each policy would harm a retaliating bloc’s own economy, by counting the share of its imports of the chosen goods that come from America. The more a country relies on one supplier, the more switching to a less efficient source is likely to hurt. The study found that the eu prioritised minimising such damage. Its tariffs deftly protected domestic consumers, causing less disruption than 99% of alternatives. The bloc targeted Trump voters as well—its tariffs matched the election of 2016 more closely than in 87% of simulations—but not at the cost of upsetting its own citizens. In contrast, China focused on punishing Trump voters. Its tariffs tracked the election better than 99% of alternatives. They also disrupted China’s own economy more than in 99% of simulations. Even among plans including soyabeans—one of China’s main imports, grown mostly in Republican areas—China’s policy was just slightly more politically targeted than similar options, but far worse for its economy. China’s choice of tariffs seems designed to deter escalation at any cost. Only regimes with no voters to satisfy can run that risk. The lesson is clear: if you start a trade war, fight a democracy, not an autocracy.

President Trump to CNBC: China is going to make a deal because ‘they’re going to have to’ - President Donald Trump told CNBC on Monday he believes China will make a deal with the U.S. “because they’re going to have to.” In a wide-ranging telephone interview broadcast on “Squawk Box,” Trump defended his threats to slap tariffs on Mexico and China, which he said are putting the U.S. “at a tremendous competitive advantage.” “The China deal is going to work out. You know why? Because of tariffs,” Trump told co-host Joe Kernen. “Right now, China is getting absolutely decimated by companies that are leaving China, going to other countries, including our own, because they don’t want to pay the tariffs.” It’s unclear to what extent China is being hurt by U.S. tariffs. Data released by Chinese President Xi Jinping’s government Monday morning show a widening Chinese surplus on U.S. in May. But the president said that China is “going to make a deal because they’re going to have to make a deal.” Trump also responded directly to the Chamber of Commerce’s executive vice president and head of international affairs, Myron Brilliant, who had criticized the president’s use of tariffs earlier on the program. “The weaponization of tariffs, the increase of threats on our economy, on our farmers, on our manufacturers, our consumers, is going to hurt our country. It also creates uncertainty with our trading partners,” Brilliant said.“He’s not protecting our country,” Trump said of Brilliant. “He’s protecting companies who are members” of the Chamber.

The End of the World As We Know It -After three decades of moving toward a single global market governed by the rules of the World Trade Organization, the international order has undergone a fundamental change. The United States and China are locked in a tariff war that at first seemed to be about the bilateral trade balance, but has turned out to be about much more. Until recently, one could find hope in the fact that, despite frequent exchanges of threats, the two countries were negotiating. Not anymore. Last month, under pressure from US President Donald Trump’s administration, Google terminated its cooperation with Huawei, thereby depriving the Chinese smartphone maker of the license to use Google’s Android software and related services. The move poses an existential threat to Huawei. But, more than that, it marks both a new pinnacle in the Sino-American conflict and the end of US-led globalization. The message from the US is clear: technology and software exports are no longer just a matter of business; they are about power. From now on, the US will put might over market. Now that the conflict has assumed the form of a hegemonic struggle, China may have to pull out all the stops to protect its national champions. That means withdrawing as quickly as possible from all supply chains that rely on US-made high-tech inputs, particularly semiconductors. China would have to start sourcing all the necessary components domestically, or from safe partners within its orbit. In the medium term, this adjustment would effectively divide the world into two spheres of economic competition. Sooner or later, all smaller powers dependent on global markets would have to choose a side, unless they are somehow strong enough to withstand both American and Chinese pressure. With China and the US both demanding clarity, even economic giants like the European Union, India, and Japan would be faced with an intractable economic dilemma. Assuming that an open, unified global market does indeed become a thing of the past, the question, then, will be how China plays its cards. As America’s largest creditor, would it see a currency war as its ace up the sleeve? If so, an already dangerous struggle for global technological preeminence would become a broader and more immediately perilous conflict. The danger is not just that economic rivalry, protectionism, and trade restrictions would threaten global prosperity; it is that these developments also would raise the risk of a serious political confrontation. Technological sovereignty would take the place of trade and exchange, and the nationality of corporations – even major multinationals – would become just as important as their business model.

What to Do About China? - Brad DeLong -  In a recent issue of The New York Review of Books, the historian Adam Tooze notes that, “across the American political spectrum, if there is agreement on anything, it is on the need for a firmer line against China.” He’s right: On this singular issue, the war hawks, liberal internationalists, and blame-somebody-else crowd all tend to agree. They have concluded that because the United States needs to protect its relative position on the world stage, China’s standing must be diminished. But that is the wrong way to approach the challenge. In the near term (1-4 years), the US certainly could inflict a lot of damage on China through tariffs, bans on technology purchases, and other trade-war policies. But it would also inflict a lot of damage on itself; and in the end, the Chinese would suffer less. Whereas the Chinese government can buy up Chinese-made products that previously would have been sold to the US, thereby preventing mass unemployment and social turmoil, the US government could scarcely do the same for American workers displaced by the loss of the Chinese market.1 In the medium run (5-10 years), the US would face even larger problems, because China would have begun to replace US customers and suppliers with those of Europe and Japan. At the same time, an America that has just blown up its relationship with China will have a hard time convincing anybody else to fill China’s shoes as a trade partner and source of investment. Becoming the world’s irrational doofus comes with costs, after all. That is why it is entirely foreseeable that America’s attempt to “get tough” with China could accelerate its own relative decline, effectively handing China the semi-hegemony it is already approaching. As for America’s geopolitical or even military options, there are few left. After more than two years of chaotic unilateral behavior, the Trump administration has squandered any chance it might have had to work with other countries to contain China.

Forget the trade war — a bigger conflict between the US and China is playing out right under our noses - The world has its eye on the trade war between the US and China, but a more dangerous confrontation between the two nations is playing out in the background — the worsening disagreement over the One China policy. Last week, Reuters reported that Washington is on its way to approving $2 billion worth of arms sales to Taiwan. The move shows that the Trump administration isn't trying to create an atmosphere for trade negotiations, and suggests that disputes between the US and China are more likely headed toward escalation than resolution. "Taiwan is the thing the Chinese care most about hands down," said Susan Thornton, former Assistant US Secretary of State for East Asian and Pacific Affairs. "Anything where the US is interfering with Taiwan hits a national third rail." The One China policy — which asserts that Taiwan is not an independent nation but rather part of China — was developed during the Nixon administration to improve US-China relations. The idea is central to China's identity as a modern world power, and since Trump took office the US has challenged that notion repeatedly. Despite protests from Beijing, Trump signed the Taiwan Travel Act, legislation permitting high-level talks between US and Taiwanese officials, last year. In May, US national security adviser John Bolton met with David Lee, one of Taiwan's top security officials. This meeting came just after Taiwan renamed its unofficial embassy in Washington "the Taiwan Council for US Affairs." The old name, the "Coordination Council for North American Affairs" neglected to mention Taiwan or the US. The Trump administration has also sold arms to Taiwan before, as have previous administrations, but this $2 billion arms sale digs at a delicate wound during a delicate time. It's a big sale, even in a world where weapons are becoming more and more expensive. And though it does not include the US's top fighter jets, it is sure to antagonize Beijing before US and Chinese heads of state travel to a G20 meeting in Osaka, Japan at the end of this month. On Thursday Chinese Foreign Ministry spokesperson Geng Shuang responded to the news of the arms sale with a warning, according to Chinese state media outlet Xinhua.."We urge the US side to stop arms sales to Taiwan and sever their military ties, prudently and properly handle Taiwan-related issues, to avoid serious damage to China-US relations as well as to the peace and stability of the Taiwan Strait," said Geng.

 Trade War Nightmare Causes Logistical Hell For Los Angeles Ports -- President Trump's trade war has produced a logistical nightmare for American importers at Southern California ports.  Marisa Bedrosian Kosters, an executive at an Anaheim, Calif.-based ceramic tile and stone retailer, like any other retailer when they heard trade war last year, pulled demand forward by ordering additional product to get ahead of the tariffs and other duties, reported The Gazette. But when her new tiles, packed into 40-foot containers, from central Guangdong Province, China, reached the Port of Long Beach, she said her containers encountered a logistical difficulty. The trade war forced American importers to pull forward all at once; this created a massive influx of containers at the Port of Long Beach. Massive bottlenecks at the port formed in 2H19, which Kosters was slapped with thousands of dollars in extra costs charged by the terminals.The Gazette said her 389,000-square-foot tile distribution center is "overflowing" with tiles because she had to order more product to get ahead the tariffs. Now she is faced with record high inventory. Kosters said her troubled situation was all sparked by the trade war: "We're having to bring in more because there's so much uncertainty about what country is being hit next." Tariffs are having the most significant impact on Los Angeles and Long Beach ports, the nation's busiest container ports, which both handle about 47.5% of US containerized trade with China. But it's not just the ports that are feeling the pressure from the trade war, trucking, railroads, warehousing, construction, manufacturing, and farming, have also been impacted. About one million jobs related to international trade in a five-county region are also in question as the trade war continues to deepen. Trade chaos has "really gummed up the operations of the supply chain," said Eugene Seroka, executive director of the Port of Los Angeles. "We've got a lot of cargo coming in that just sits.""Containers are stacked high. Truck lines are long. And warehouses are bursting at the seams." There is so much inventory piling up at Southern California's warehousing and distribution complex, the largest in the world, that it has less than a 1% vacancy, down from the average of 5-7%, he added.The trade war has left corporate America uncertain about the future by pulling back investments, Seroka said."A lot of money is sitting on the sidelines," he said. "Do you buy more trucks? Do you hire more people? Do you build another warehouse? Do you invest in digital technology?" "Few companies want to invest at this point in time in the supply chain, not knowing where it is going in the future."

From rare earths to soy, the trade war will force the US and China to diversify supply -- Even if Beijing and Washington eventually find a way to paper over their differences, there’s no going back to the way things were. Vulnerabilities have been exposed. In the commodity space, US dependency on China’s rare earth metals and China’s reliance on American farmers for vast volumes of agricultural imports are no longer tenable options. That reality will have global implications in the commodity sector, just as occurred in the 1970s when, even though Tokyo and Washington were close allies, Japan’s relationship with the United States hit a bump in the road after the Nixon administration briefly banned US soy exports to Japan. As for China and the United States, writing for Project Syndicate last week, Joschka Fischer, Germany’s foreign minister and vice-chancellor from 1998-2005, argued that the China-US trade war “has assumed the form of a hegemonic struggle”.If Fischer is right, then going forward, neither Beijing nor Washington will want to be too dependent on each other in any areas of strategic importance.

 Apple’s US iPhones Can All Be Made Outside of China - Apple Inc. has a backup plan if the U.S.-China trade war gets out of hand. The Cupertino, Calif.-based company’s primary manufacturing partner has enough capacity to make all iPhones bound for the U.S. outside of China if necessary, according to a senior executive at Hon Hai Precision Industry Co. The Taiwanese contract manufacturer now makes most of the smartphones in the Chinese mainland. China is a crucial cog in Apple’s business, the origin of most of its iPhones and iPads as well as its largest international market. But President Donald Trump has threatened Beijing with new tariffs on about $300 billion worth of Chinese goods, an act that would escalate tensions dramatically while levying a punitive tax on Apple’s most profitable product. Hon Hai, known also as Foxconn, is the American giant’s most important manufacturing partner. It will fully support Apple if it needs to adjust its production as the U.S.-Chinese trade spat gets grimmer and more unpredictable, board nominee and semiconductor division chief Young Liu told an investor briefing in Taipei on Tuesday. “Twenty-five percent of our production capacity is outside of China and we can help Apple respond to its needs in the U.S. market,” said Liu, adding that investments are now being made in India for Apple. “We have enough capacity to meet Apple’s demand.” Apple has not given Hon Hai instructions to move production out of China, but it is capable of moving lines elsewhere according to customers’ needs, Liu added. The company will respond swiftly and rely on localized manufacturing in response to the trade war, just as it foresaw the need to build a base in the U.S. state of Wisconsin two years ago, he said.k

Trump Says He Is Holding Up Trade Deal With China, Putting Xi In A Tough Spot - In a sharp escalation in the war of words between the US and China, on Tuesday President Trump said he’s personally holding up a trade deal with China, adding that that he won’t complete the agreement unless Beijing returns to terms negotiated earlier in the year. “It’s me right now that’s holding up the deal,” Trump said, quoted by Bloomberg, adding that "we’re going to either do a great deal with China or we’re not going to do a deal at all.” Earlier in the day, the SCMP reported that the U.S. was accused of demanding “enormous, even hundreds” of changes to Chinese laws to protect intellectual property, which was the key factor in the collapse of the two nations’ trade talks, according to an interview with Chinese government adviser Shi Yinhong on the sidelines of a conference in Hong Kong. Shi, an adviser to China’s State Council and also a scholar at Renmin University, said U.S. insistence on strong IP protections is asking too much of Beijing and Chinese officials started to think “no deal is better than a bad deal” from early May.  Shi also said the gap between the two nations on technical aspects of the agreement widened as negotiations advanced, and hit an insurmountable hurdle once the U.S. presented the Chinese with list of hundreds of IP infringements that it wanted to be addressed. "The trade war is not about the trade surplus. It’s a U.S. effort to change how the Communist Party runs the nation’s economic activities at home and abroad," Shi said.   Trump’s comments came a day after he threatened to raise tariffs on China if President Xi Jinping doesn’t meet with him at the upcoming Group of 20 summit in Japan. Trump told reporters that he could impose tariffs of 25% or “much higher than 25%” on $300 billion in Chinese goods. The ultimatum puts Xi, whom Bloomberg dubbed China’s strongest leader in decades, in "the toughest spot of his six-year presidency." If Xi caves to Trump’s threats, he risks looking weak at home. If he declines the meeting, he must accept the economic costs that come with Trump possibly extending the trade conflict through the 2020 presidential elections.

Trump Says It Doesn't Matter If Xi Agrees To Meet At G-20 - Perhaps President Trump wanted to distract from Joe Biden, or maybe Trump wanted to distract us from the possibility that we might soon be at war with Iran. But in a blitz of interviews with ABC and Fox, the president offered his latest update on the possibility of a meeting with President Xi,  during which he sounded like he was leaning back toward the meeting likely not happening. Recently, Trump has repeatedly suggested that plans are nearly in place for a meeting, while the Chinese have repeatedly denied this.According to Trump, now "it doesn’t matter" whether President Xi and he meet later this month in Osaka; a trade deal with Beijing will soon be reached anyway, as Trump has been saying for weeks now.In the mean time, the US can just sit back and enjoy the billions in tax revenue that's not being paid, ultimately, by consumers."If he shows up, good," Trump told Fox News on Friday. “If he doesn’t - in the meantime, we’re taking in billions of dollars a month." He added: “Eventually, they’re going to make a deal, because they’re going to have to. Look, they’re paying hundreds of billions of dollars.”Trump accused the Chinese government of subsidizing Chinese industry... "They subsidize their industry, so our people are not paying," Trump said on Fox. "There’s this big thing about tariffs, ‘Oh, our people pay.’ It’s a lot of nonsense. You know what happens, really? Companies move back."...and he again accused China of manipulating its currency to deaden the impact of US tariffs on Chinese goods, even after the US again opted not to officially label any country a manipulator. Ironically, the yuan has strengthened over the past week, largely because the PBOC decided to nudge it higher."They’re paying hundreds of billions in dollars. I have 25% on $250 billion...they’re manipulating their currency in order to pay for it," he said. Earlier, the WTO said the two countries had dropped their official dispute over intellectual property rights, but didn't give a reason or offer any details. Whether or not that's a sign that a deal is more likely is up for debate.

Trump's Feud With China Is A Carbon Copy Of Reagan's Trade War With Japan: Is A New Plaza Accord Imminent? -- As Goldman's Michael Cahill writes today, there is never anything really new under the sun, and trade negotiations between the US and China "have so far followed a strikingly similar pattern to the bilateral US-Japan trade dispute" in the early 1980s: in both cases, talks were precipitated by a large bilateral trade imbalance and a perception of an “unfair” advantage, which were exacerbated by new US administrations that pursued tax cuts even as the Federal Reserve was in tightening mode. In another parallel, what began as trade negotiations ultimately sprawled into other areas including market access, government subsidies and currency policy. However, there are also important structural differences, first and foremost among them is that the US and Japan have been strategic allies for decades (and Japan depends heavily on the US for its national security), and this likely explains why Japan ultimately acquiesced to a number of US demands—including the “Plaza Accord” to dramatically strengthen its exchange rate. These differences help explain why so far the Yuan’s behavior has been very different from the Yen’s dramatic appreciation in the late 1980s, and prompt the question if Trump isn't making a huge gamble in assuming that China will fold, just like Japan did three and a half decades ago.  For those who were too young, or too stoned, to remember, here is a brief recap of the US-Japan trade conflict.

Michael Hudson: Trump’s Trade Threats are really Cold War 2.0 - President Trump has threatened China’s President Xi that if they don’t meet and talk at the upcoming G20 meetings in Japan, June 29-30, the United States will not soften its tariff war and economic sanctions against Chinese exports and technology. Some meeting between Chinese and U.S. leaders will indeed take place, but it cannot be anything like a real negotiation. Such meetings normally are planned in advance, by specialized officials working together to prepare an agreement to be announced by their heads of state. No such preparation has taken place, or can take place. Mr. Trump doesn’t delegate authority. He opens negotiations with a threat. That costs nothing, and you never know (or at least, he never knows) whether he can get a freebee. His threat is that the U.S. can hurt its adversary unless that country agrees to abide by America’s wish-list. But in this case the list is so unrealistic that the media are embarrassed to talk about it. The US is making impossible demands for economic surrender – that no country could accept. What appears on the surface to be only a trade war is really a full-fledged Cold War 2.0. At stake is whether China will agree to do what Russia did in the 1990s: put a Yeltsin-like puppet of neoliberal planners in place to shift control of its economy from its government to the U.S. financial sector and its planners. So the fight really is over what kind of planning China and the rest of the world should have: by governments to raise prosperity, or by the financial sector to extract revenue and impose austerity. U.S. diplomacy aims to make other countries dependent on its agricultural exports, its oil (or oil in countries that U.S. majors and allies control), information and military technology. This trade dependency will enable U.S. strategists to impose sanctions that would deprive economies of basic food, energy, communications and replacement parts if they resist U.S. demands. The objective is to gain financial control of global resources and make trade “partners” pay interest, licensing fees and high prices for products in which the United States enjoys monopoly pricing “rights” for intellectual property. A trade war thus aims to make other countries dependent on U.S.-controlled food, oil, banking and finance, or high-technology goods whose disruption will cause austerity and suffering until the trade “partner” surrenders.

US-China Trade War Damage May Be Irreversible -With the trade war between the US and China on the brink of re-escalating once more, a journalist told ABS-CBN News Philippines that damage to global supply chains from the trade war might be "irreversible."President Trump threatened to slap tariffs Monday on the remaining $300 billion of Chinese exports to the US if China's President Xi Jinping didn't meet with him at the 2019 G20 Osaka summit on 28–29 June 2019.Simon Rabinovitch Asia editor for The Economist told the ABS-CBN host that economic warfare had interrupted complex global supply chains, which took several decades to construct, are now "less efficient.""Even if the tariffs are reversed, the damage itself is irreversible. This is like a massive oil tanker and since it's begun to shift direction, begun to shift course, it can't go back to the way it used to be,"The global economy has experienced an "extremely long recovery" from the dark days of the 2008 financial crisis, and the business cycle tends to revert into the contraction phase every decade, he said.  However, there's hope; he said domestically-driven economies like the Philippines and India are "a little bit sheltered" from the global synchronized slowdown driven by the trade war. The best way to visualize just how serious Rabinovitch's claim of the "irreversible" damage from the trade war is to monitor the global flow of trade. Below is a chart on YoY changes in global trade as measured by the IMF's Direction of Trade Statistics, courtesy of BMO's Ian Lyngern. It shows the absolutely collapse in global exports as broken down into three categories:

  • Exports to the world (weakest since 2009),
  • Exports to advances economies (also lowest since 2009), and
  • Exports to the European Union (challenging 2009 lows).

Huawei Demands Verizon Pay $1 Billion For Using 230 Patents -- Huawei has hit upon a new strategy for fighting back against the US: leveraging its massive suite of technology patents to try and force American competitors to fork over billions of dollars. And its first target is Verizon, one of its biggest American competitors in the race to become a global leader in 5G. As Reuters reports, Huawei has told Verizon that it should pay licensing fees amounting to more than $1 billion for the more than 230 patents held by the Chinese telecoms giant. The plan has been percolating since before the White House blacklisted Huawei: Verizon should pay to "solve the patent licensing issue," a Huawei intellectual property licensing executive reportedly wrote in February. The patents cover networking equipment for more than 20 of Verizon's vendors, and those vendors would, in theory, indemnify Verizon. Some of these firms have been approached directly by Verizon. They range from core networking equipment and wireline infrastructure to IoT technology, according to sources cited by WSJ. For nearly a year now, Washington has been lobbying its allies to block Huawei equipment from being used in their 5G networks. That feud intensified in December, when Canadian authorities arrested Huawei's CFO, Meng Wanzhou, at the behest of the DoJ. The DoJ is now seeking to extradite the Huawei executive over allegations she lied to banks about Huawei's relationship with certain affiliates in order to help the company circumvent American sanctions on Iran. Washington's biggest complaint to its allies is that Huawei is bound by Chinese law to help state intelligence spy on foreign governments and civilians, if asked. Beijing and Huawei have denied this, but evidence of 'back doors' in Huawei equipment has been uncovered in the US and in Europe. Verizon and the other companies have reportedly notified the US government about Huawei's demands, which they suspect are motivated by the ongoing feud between Huawei and Washington.

India Readies for Delicate Trade Talks with US, as Shadow of Section 301 Probe Looms - India is gearing up for sensitive trade talks with the US government amidst increasing buzz that the Trump administration is contemplating an extensive trade probe across multiple sectors. Well-informed sources have confirmed to The Wire that there is a “very high possibility” that after China, the office of the US Trade Representative (USTR) will be turning to aggressively recalibrate its trade ties with more partners, including India. Rumours around more action on the trade front were triggered after Politico reported earlier this week that the US was considering launching a “full-blown investigation” against India as the next target after China. Sources stated that the possibility of a ‘Section 301 probe’ had been conveyed to India over the last couple of months from “various quarters” in the US government, although it remains unclear at this point as to whether it will actually happen. The sources added that USTR Robert Lighthizer had repeatedly mentioned at several closed-door fora that after the Trump administration’s focus on China, it will be turning the spotlight towards a few Asian partners, including India. It is learned that any action that would be taken under Section 301 of US Trade Act of 1974 will be an “omnibus” investigation looking into a slew of steps like taxes and “discriminatory treatment” of US companies. “This could open up everything, including the trade package…dairy, medical devices, agricultural products, boric acid and CRO (compulsory registration order) requirements,” said another high-placed source. Any possible action may also open the door to concerns about India’s proposed data localisation and e-commerce policies, on which there has been much heartburn among US tech companies. “Once you start an omnibus investigation, there is no stopping it,” he stated. US-India political ties remain close, with Modi and Trump scheduled to meet soon at G-20 Summit in Japan. The Indian PM is also likely travelling to US in September 2019 for the annual plenary of the United Nations General Assembly. However, the signal to play hardball with India on trade has come from the top in Washington. Trump has repeatedly criticised India for “very high” tariffs and even referred to it as a “tariff king” at a political rally in April 2019.

Mexico Doesn't Back Up Trump's Twitter Claims of Big Farm Deal - President Donald Trump hinted at additional measures between the U.S. and Mexico, a day after he vowed that Mexico would soon make “large” agricultural purchases from the U.S. as part of a deal on border security and illegal immigration that allowed Mexico to avoid U.S. tariffs. “Some things not mentioned in yesterday’s press release, one in particular, were agreed on. That will be announced at the appropriate time,” Trump said Sunday in a series of four tweets about Mexico, the media and other matters. Three Mexican officials said Saturday they were not aware of any side accord in the works, and that agricultural trade hadn’t been discussed during three days of negotiations in Washington that culminated in a joint communique late Friday. Mexico’s ambassador to the U.S. predicted on Sunday that trade in agricultural goods “could increase dramatically” now that tariffs aren’t going ahead and if the USMCA, the trilateral trade pact with the U.S., Mexico and Canada designed to replace NAFTA, is ratified -- but didn’t cite a specific deal with Washington on farm purchases. On Saturday Trump told his 61 million Twitter followers in an all-caps message that Mexico had agreed to “immediately begin buying large quantities of agricultural product from our great patriot farmers” following the border security deal. He retweeted the message overnight. The State Department communique issued late Friday -- entitled the U.S.-Mexico Joint Declaration -- also made no mention of agricultural trade as part of the agreement. The State Department didn’t respond to an inquiry made through its press department. The White House declined to comment or offer proof to back up Trump’s tweet. The Mexican foreign ministry’s press office declined to comment. President Andres Manuel Lopez Obrador said at a rally in Tijuana near the U.S. border that Mexico should celebrate the “important deal” with the U.S. that removed the threat of tariffs as it was preparing to retaliate. He also didn’t mention agriculture in a speech attended by leading political figures in the country.

Mexican Deal Confusion- Trump Doubles Down On Farm Purchase Claim, Mexico Denies - Hours after President Trump announced that a deal had been struck with Mexico to avert a round of tariffs that had been planned to take effect on Monday, the New York Times published a story claiming that the 'agreement' that the White House had touted had actually been laid out during discussions over the past several months, implying that Trump's latest border spat with Mexico was little more than a publicity stunt. The deal to avert tariffs that President Trump announced with great fanfare on Friday night consists largely of actions that Mexico had already promised to take in prior discussions with the United States over the past several months, according to officials from both countries who are familiar with the negotiations. Friday’s joint declaration says Mexico agreed to the “deployment of its National Guard throughout Mexico, giving priority to its southern border.” But the Mexican government had already pledged to do that in March during secret talks in Miami between Kirstjen Nielsen, then the secretary of homeland security, and Olga Sanchez, the Mexican secretary of the interior, the officials said. Slamming the story as "another false report" from the NYT, Trump insisted that the latest agreement with Mexico over the border involved concessions that the US has been trying to secure for months. Without Trump's tariff threats, these concessions likely never would have been achieved. And going forward, there will now likely be "great cooperation" between both sides - and if not, Trump can always bring back his tariff threats. Another false report in the Failing @nytimes. We have been trying to get some of these Border Actions for a long time, as have other administrations, but were not able to get them, or get them in full, until our signed agreement with Mexico. Additionally, and for many years,...  ..Mexico was not being cooperative on the Border in things we had, or didn’t have, and now I have full confidence, especially after speaking to their President yesterday, that they will be very cooperative and want to get the job properly done. — Donald J. Trump (@realDonaldTrump) June 9, 2019   In a separate report that Trump will likely also find frustrating, Bloomberg reported that Trump had doubled down on boasts of "large" agricultural sales to Mexico as a key win for the White House that had helped avert the tariffs. However, no such pledges were included as part of the deal according to a handful of Mexican officials.

 Trump Says Another Very Important Part Of Mexico Deal Is Now Finished -  --Markets are back in rally mode now that President Trump has managed to strike a deal with Mexico (which the New York Times and other members of the liberal press have dismissed as a fraud). But without getting into to many of the details, Trump revealed via Twitter on Monday that the two sides had "signed and documented another very important part of the immigration and security deal with Mexico." The details of the plan will be revealed in the "not too distant future".Now with our new deal, Mexico is doing more for the USA on Illegal Immigration than the Democrats. In fact, the Democrats are doing NOTHING, they want Open Borders, which means Illigal Immigration, Drugs and Crime.  We have fully signed and documented another very important part of the Immigration and Security deal with Mexico, one that the U.S. has been asking about getting for many years. It will be revealed in the not too distant future and will need a vote by Mexico’s Legislative body!.. ....We do not anticipate a problem with the vote but, if for any reason the approval is not forthcoming, Tariffs will be reinstated! — Donald J. Trump (@realDonaldTrump) June 10, 2019 According to a team of analysts at Goldman Sachs, while the new agreement is better than tariffs, it is not a free lunch for Mexico, which is perhaps why the peso has not held on to the pre-Trump-tariff warning levels...

Trump Teaser- Biggest Part Of Mexico Deal Has Not Yet Been Revealed - One day after Mexico's Foreign Minister Marcelo Ebrard denied the existence of a secret immigration deal when describing the nature of the 'understanding' reached between the US and Mexico, President Trump again touted on Tuesday the existence of such a deal, saying the "biggest part of deal with Mexico has not yet been revealed!" during a series of tweets.After blasting Maria Bartiromo (with whom Trump has sat for several exclusive interviews) and several other Fox Business hosts for the network's criticisms of his tariff strategy (Trump called into CNBC Monday morning to attack a Chamber of Commerce official who had the temerity to criticize Trump's protectionist trade strategy), the president added that the true efficacy of his tariff threats can't yet be assessed by the public.That's because the "biggest part" of his deal with Mexico has yet to be revealed. He also accused China of intentionally weaken the yuan to offset the impact of the US tariffs, which is why there hasn't been as much of an impact on the consumer. Maria, Dagan, Steve, Stuart V - When you are the big “piggy bank” that other countries have been ripping off for years (to a level that is not to be believed), Tariffs are a great negotiating tool, a great revenue producers and, most importantly, a powerful way to get......Companies to come to the U.S.A and to get companies that have left us for other lands to come back home. We stupidly lost 30% of our auto business to Mexico. If the Tariffs went on at the higher level, they would all come back, and pass. But very happy with the deal I made,......If Mexico produces (which I think they will). Biggest part of deal with Mexico has not yet been revealed! China is similar, except they devalue currency and subsidize companies to lessen effect of 25% Tariff. So far, little effect to consumer. Companies will relocate to U.S. — Donald J. Trump (@realDonaldTrump) June 11, 2019

Trump Says Secret Deal With Mexico Takes Effect When He Wants - President Donald Trump told reporters that he reached a secret pact with Mexico that will take effect when he wants it to -- despite the country’s insistence that there are no secret components of an immigration deal struck last week. “That’s the agreement that everybody says I don’t have,” Trump said at the White House on Tuesday, holding one page of what he described as a lengthy deal but refusing to explain the details. “If they bring the numbers way down, we won’t have to use it. OK?” Acting White House Chief of Staff Mick Mulvaney said separately at a conference in Washington the deal relates to asylum and would be put in place if the immigration agreement doesn’t stem the flow of undocumented migrants to the U.S. Trump on Friday said he was dropping plans for tariffs on Mexico that he’d been threatening to impose for the previous week after the country promised new steps to stem an influx of illegal migration into the U.S. Under the immigration deal, Mexico will expand deployment of its national guard throughout the country, “giving priority to its southern border,” according to a joint statement from the two countries. Asylum seekers who cross into the U.S. will be quickly returned to Mexico where they’ll wait for their claims to be resolved; the U.S. agreed to accelerate adjudication. Mexican Foreign Minister Marcelo Ebrard said Tuesday that if illegal immigration into the U.S. isn’t reduced, the U.S. is proposing that Mexico accept asylum applications from migrants from Central America instead of allowing them to apply in the U.S. Mexican officials have said that there’s an agreement to evaluate the success of current measures after 45 days and see if they’re working or if more needs to be done. But it wasn’t clear whether Trump could trigger an agreement as he asserted. Trump said the agreement he was referring to would need to be ratified by the Mexican Congress.

 Top White House official Mick Mulvaney says public may never see Trump’s ‘secret deal’ with Mexico - President Donald Trump has said the biggest part of his new border deal with Mexico has not yet been revealed. It may never be, according to his acting chief of staff Mick Mulvaney, who declined to discuss details of the arrangement in an interview with CNBC’s Eamon Javers on Tuesday. “If I told you, it wouldn’t be the secret part of the deal, right?” Mulvaney said at the Peter G. Peterson Foundation’s Fiscal Summit. Asked when the public would see the secret deal, Mulvaney responded: “Maybe never.” “Because if it works, it doesn’t make any difference,” Mulvaney said. He added: “The purpose here is not to satisfy your journalistic sort of, you know, inquiries as to what the deal is. The goal is to reduce the number of people crossing the border.” Javers pressed Mulvaney on whether the U.S. had agreed to “whatever the terms are in this secret deal? We’ve signed up for something as a country?” “Yeah,” Mulvaney said. “Again, it’s something that will kick in if the other things don’t work.” In that case, Mulvaney said, the public would find out about the deal. On Friday, the U.S. and Mexico issued a joint declaration that resolved Trump’s threats to impose tariffs on Mexican imports if the country did not take action to reduce the flow of migrants across its northern border. As part of the deal, Mexico agreed to deploy its national guard to its southern border with Guatemala. That declaration made no mention of other agreements. Mexico has flatly denied any secret deal.

Trump flaunts 'secret' migration deal already revealed by Mexico - (Reuters) - U.S. President Donald Trump brandished a document on Tuesday confirming details of a regional asylum project agreed with Mexico to stave off threatened tariffs, saying the plan was “secret” even though Mexican officials had revealed much of it. Trump, who has made containing illegal immigration a priority issue and has blamed Mexico for the problem since running for office in 2016, did not show the text of any document or give any details. However, a Reuters photograph of the sheet of paper allowed reporters to read parts of it. Under duress because of Trump’s threat to impose tariffs unless Mexico stemmed a surge in migrants that has overwhelmed U.S. detention facilities and immigration courts, Mexico signed a pact last week agreeing to control the flow of people from Central America, including deploying 6,000 members of a new national guard along its border with Guatemala. Mexico’s foreign minister, Marcelo Ebrard, said Mexico also agreed to a 45-day timeline to show increased enforcement efforts were effective in reducing the people flows. If that fails, Mexico has agreed to consider a longstanding U.S. demand that Central American asylum seekers crossing through Mexico apply for refuge there, not the United States, making Mexico a “safe third country,” a demand that Mexico has long rejected.

Mexico Refuses To Name International Figures Bankrolling Migrant Caravans -- After freezing the bank accounts of 26 individuals and entities amid a probe into human trafficking, Mexico has refused to name the account owners - some of which appear to have originated in the US, UK, African nations and Central America, according to Breitbart.  Mexico's Finance and Tax Secretariat (SHCP) on Thursday announced that the 26 accounts had been seized. Diplomatic sources told Breitbart News that the probe is being personally overseen by UIF Director Santiago Nieto Castillo, who briefs Mexican President Andres Manuel Lopez Obrador directly.  The SHCP’s Financial Intelligence Unit (UIF) tracked suspicious transactions beginning in October 2018 to determine the sources of funding for the caravans. The results reportedly pointed to some monies coming from the U.S., U.K., African nations, and throughout Central America. Diplomatic sources revealed the investigation is still developing since the case was prioritized Monday as tensions over tariffs escalated. –Breitbart  As part of Mexico's crackdown to avoid US tariffs, Mexican authorities also arrested two caravan organizers reportedly tied to the US-based group Pueblo Sin Fronteras, which helps migrants illegally cross into America. According to officials, the groups would demand money from some of the migrants.  What's more, law enforcement sources revealed to Breitbart that the UIF investigation found four sanctioned accounts linked to human smuggling groups that are loyal to Mexican drug cartels in border towns. Two of the accounts were linked to Piedras Negras, which is tied to the Cartel Del Noreste faction of the Los Zetas, as well as an independent smuggler in the area. The two other accounts are believed to be tied to Gulf Cartel operators based in Reynosa, Tamaulipas.

Trump expands network of immigrant concentration camps - The mounting scale of the US government’s attack on immigrants is a warning that the Trump administration, without opposition from the Democratic Party, is adopting an official state policy of physical violence and mass, indefinite detention. The US government arrested 144,000 immigrants in the month of May and is detaining 400,000 people per year, including 41,000 unaccompanied children, enough to fill Chicago’s Wrigley Field. On any given night, there are now 48,000 immigrants and an additional 13,000 unaccompanied children sleeping in detention beds. Another 10,000 people are currently living under tarps in makeshift camps on the Mexican side of the border, where, in flagrant violation of international law, they are being held as they await adjudication of their asylum applications in the US. There are 4,000 US soldiers deployed on the border, and on Friday the Pentagon announced it is building three sprawling compounds on isolated military bases to hold between 3,000 and 4,000 immigrant children who will be housed in tents encircled by razor wire. Particularly sinister is the fact that the government has allowed 31 immigrants to die in captivity since 2017, including seven children. In addition, the administration will no longer provide education, legal assistance or outdoor recreation for detained children. Virtually abandoned is the pretense that immigrant children are being held for processing. Now these children, some of whom are infants, are being openly held for punishment. In Saturday’s Los Angeles Times, writer Jonathan Katz referred to a “growing system of concentration camps,” calling them “places where people are being tortured and left to die.” The article, titled, “Call immigration detention centers what they really are: concentration camps,” warned: “Even the Nazis’ camps started out small, housing criminals, Communists and opponents of the regime. It took five years to begin the mass detention of Jews. It took eight, and the outbreak of a world war, for the first extermination camps to open.”

Obama Admin Purged 12 Years Of ICE Speeches On Immigration Crisis Hours Before Trump Inauguration - Hours before President Trump took office, the Obama administration scrambled to purge 12 years worth of transcripts spanning hundreds of speeches from the Immigrations and Customs Enforcement (ICE) website, according to the Daily Caller's Jason Hopkins.  A collection of 190 transcripts of speeches on ICE’s website was deleted on Jan. 18 and late in the evening on Jan. 19, 2017, according to research conducted by the Sunlight Foundation, a nonpartisan organization that advocates for government transparency. Statements made by high-ranking ICE officials regarding controversial immigration topics such as sanctuary cities, E-Verify, treatment of detainees, and other issues were included in the reported deletions. -Daily Caller"With a couple of clicks of a mouse, access to a federal government web resource containing 12 years of primary source materials on ICE’s history was lost," wrote the Sunlight Foundation, adding that speeches dating back to 2004 were included in the purge. The Caller notes that speeches from former acting ICE Director Thomas Homan were "prominently included in the deletion list," including a February 2016 speech in front of the Senate Judiciary Committee in which Homan discussed that "Unaccompanied Minor Crisis," which the Obama administration was grappling to manage at the southern border.  Another example cited by the Caller was a transcript from May 2016 in which Homan explained why sanctuary cities (and counties, and states) put "the public at risk," according to the report.

Senate Democrats Demand Amnesty For Foreign Nationals - A group of Senate Democrats spearheaded by Dianne Feinstein (D-CA) have demanded that the United States grant amnesty to foreign nationals living in the country on Temporary Protected Status (TPS).   Feinstein, along with Chris Van Hollen (D-MD), Tim Kaine (D-VA) and Ben Cardin (D-MD) have called on the GOP-controlled Senate to pass their amnesty plan which would give almost a half-million foreign nationals American citizenship and all the votes that come with it. House Democrats and seven House Republicans passed a similar measure granting amnesty to any illegal alien claiming to have arrived in the US as a child, according to Breitbart's John Binder.   According to Feinstein's website:   Currently, there are approximately 437,000 people with TPS in the United States from ten designated countries: El Salvador, Haiti, Honduras, Nepal, Nicaragua, Somalia, Sudan, South Sudan, Syria, and Yemen. Liberians, originally granted TPS in 1999, are currently the only country protected by DED – that status is set to terminate on March 31, 2019. The SECURE Act will provide stability for these individuals and their communities by giving them the ability to apply for legal permanent residency. Under the bill, all TPS and DED recipients who qualified under the most recent designation and who have been continuously present in the United States for at least three years would be eligible to apply for legal permanent residency. In a Wednesday statement, Cardin said "The Senate must act and the president must sign into law protection for Dreamers, who mostly have known no other country but America," adding "These individuals have lawfully lived and worked in the U.S. as our neighbors, as they sought refuge in the U.S. We have an obligation to take action and give needed predictability and safety to people who are in an uncertain status."

US to jail 1,400 immigrant children at WWII Japanese internment site - The Pentagon announced yesterday that the Trump administration will detain 1,400 immigrant children at the site of a World War II-era Japanese internment camp, Fort Sill Army Base in Lawton, Oklahoma. The decision, announced Tuesday as Trump denounced immigrants and socialism at a rally in Iowa, is a calculated political maneuver. “Immigration really is the defining issue of 2020,” Trump said in Des Moines shortly after the Pentagon announcement. “When it comes to immigration, Democrats no longer represent American citizens. … The Democratic Party is really now the socialist party.” The decision to re-open the internment camp at Fort Sill is a further milestone in the breakdown of democratic forms of rule and a sign that the government is reviving the worst crimes in American history as official state policy. It is a signal to Trump’s extreme right-wing supporters that the government is prepared to enact more openly dictatorial forms of rule. “Those who were incarcerated under Japanese internment often return to the camps on pilgrimages to demand that such places be recognized for the egregious wrongs that took place there. Now, further injustices will be happening at these same locations. The trauma inflicted on these immigrant children will last for generations.” Fort Sill housed some 700 Japanese-Americans, including US citizens and first-generation immigrants, known as issei, during World War II.  Between 1942 and 1946, the US government jailed 120,000 people at internment camps across the country without trial.

 In El Paso, Border Patrol Is Detaining Migrants in ‘a Human Dog Pound’- After New Mexico State University professor Neal Rosendorf read a government report exposing dangerous overcrowding of detained migrants at the Paso del Norte International Bridge in El Paso, he headed to the port of entry to see if he could find anyone protesting conditions there. When he reached the west side of the bridge, he encountered an unmarked open gate, which he walked through in the hopes of asking Border Patrol agents whether they had seen any protesters. Continuing underneath and then past the bridge about 100 yards or so, he was stunned by what he saw—migrants who said they’d been held outdoors for weeks as temperatures rose to nearly 100 degrees. Rosendorf described it as “a human dog pound”—one hundred to 150 men behind a chain-link fence, huddled beneath makeshift shelters made from mylar blankets and whatever other scraps they could find to shield themselves from the heat of the sun. “I was able to speak with detainees and take photos of them with their permission,” Rosendorf said in an email. “They told me they’ve been incarcerated outside for a month, that they haven’t washed or been able to change the clothes they were detained in the entire time, and that they’re being poorly fed and treated in general.” U.S. Customs and Border Protection took eight days to respond to Texas Monthly’s questions about Rosendorf’s discovery. In a statement this week, a CBP official acknowledged that the agency was detaining migrants outdoors for extended periods.

Photos Of Travelers Coming In And Out Of The US Have Been Hacked And Stolen - A US Customs and Border Protection subcontractor suffered a data breach that exposed the photos of tens of thousands of travelers coming in and out of the United States, the agency revealed Monday, in what it described as a "malicious cyber-attack."The database of identifying traveler photos and license plate images had been transferred to a CBP subcontractor's network without the federal agency's authorization or knowledge, CBP explained. The subcontractor's network was then hacked, though CBP said its own systems had not been compromised.The compromised photos were taken of travelers in vehicles coming in and out of the US through specific lanes at a single Port of Entry over a one and a half months period. Fewer than 100,000 people had their information compromised by the attack, according to a law enforcement official.No other identifying information was included with the photos and no passport or other travel document photos were compromised, the official said. Images of airline passengers from the air entry and exit process were also not involved. The cyberattack comes amid the ongoing rollout of CBP's “biometric entry-exit system,” the government initiative to biometrically verify the identities of all travelers crossing US borders. As BuzzFeed News reported earlier this year, CBP is scrambling to implement the initiative with the goal of using facial recognition technology on “100 percent of all international passengers,” including American citizens, in the top 20 US airports by 2021. And it is doing so in the absence of proper vetting, regulatory safeguards, and what privacy advocates say is in defiance of the law, BuzzFeed News found.

Medicare for All Goes to the Hill -- Remarkably, the real legislative fight to win Medicare for All is just beginning. With a hearing today, the Ways and Means Committee of the US House is the first congressional committee to consider Medicare for All that has primary policy and funding jurisdiction.  The hearing is the first step, setting the table for how Medicare for All will be debated in the House: how the hearing gets conducted, who testifies, matters. But here’s the thing: this powerful committee is not actually exercising its power on Wednesday. The Ways and Means committee has the power to pass the funding and policies to establish improved Medicare for All, in what’s called a “mark up” of the HR 1384 — the single-payer bill — to prepare it for consideration by the full US House. This hearing on “universal coverage” is not a mark-up. It may instead be the final act of this year’s mini-drama, “The Left and Progressives versus Nancy Pelosi.” This winter, at closed-door meetings, top Democratic staff assured health insurers that Medicare For All isn’t going anywhere, and public statements by Speaker Pelosi and by other leaders of the Democrats’ congressional campaign operation repeated industry talking pointson costs and the impact on current Medicare. But within the last two weeks the snide is gone and key congressional leaders, including the chair of Ways and Means, Richard Neal, has co-sponsored HR 1384.  When 85 percent of your party favors a reform, as they do with Medicare for All, it should create a problem for leaders if they are not leading on the issue.  But despite these Democrats’ giving in on the hearing, they continue clinging to rhetoric about Americans being able to “keep your private insurance.” This directly follows the health care industry’s campaign developed by the Partnership for America’s Health Care Future to scare Americans about losing their existing private health care coverage and having it replaced by Medicare for All.

Why Some CEOs Figure ‘Medicare For All’ Is Good For Business -— Walk into a big-box retailer such as Walmart or Michaels and you’re likely to see MCS Industries’ picture frames, decorative mirrors or kitschy wall décor. Adjacent to a dairy farm a few miles west of downtown Easton, MCS is the nation’s largest maker of such household products. But MCS doesn’t actually make anything here anymore. It has moved its manufacturing operations to Mexico and China, with the last manufacturing jobs departing this city along the Delaware River in 2005. MCS now has about 175 U.S. employees and 600 people overseas. “We were going to lose the business because we were no longer competitive,” CEO Richard Master explained. And one of the biggest impediments to keeping labor costs in line, he said, has been the increasing expense of health coverage in the United States. Today, he’s at the vanguard of a small but growing group of business executives who are lining up to support a “Medicare for All” national health program. He argues not that health care is a human right, but that covering everyone with a government plan and decoupling health care coverage from the workplace would benefit entrepreneurship. In February, Master stood with Rep. Pramila Jayapal (D-Wash.) outside the Capitol after she introduced her Medicare for All bill. “This bill removes an albatross from the neck of American business, puts more money in consumer products and will boost our economy,” he said. As health costs continue to grow, straining employer budgets and slowing wage growth, others in the business community are beginning to take the option more seriously.

Trump wants to start charging stores to accept food stamps - The White House proposal to overhaul the U.S. food stamp program — and the deep cuts it would make to benefits for the poorest households — has sparked public outrage on both sides of the aisle. But there’s another change tucked into the proposal that businesses say caught them off guard — and could wind up costing them more than $2 billion. That provision is a new fee that the White House wants to charge retailers that accept food stamps, which is now known as the Supplemental Nutrition Assistance Program. The Office of Management and Budget said the fee would be assessed when stores sign up and would require renewal after five years. The budget office said the amount would depend on the size and type of retailer, but the president’s budget estimates that the fee would generate $2.4 billion in revenue over the next decade. An OMB official described the fee as “modest” and “reasonable,” emphasizing that some large retailers redeem a billion dollars or more in food stamp benefits each year. “Although a small number of stores may choose to leave the program rather than pay the fee, we do not expect that this will affect access to authorized stores,” the official said. The proposal surprised the grocery industry, which is already fighting to block the controversial border adjustment tax on Capitol Hill. That measure would lower the cost of exports but raise the price of imports and has been widely opposed by chain retailers. Trump’s food stamp fee, however, would fall squarely on supermarkets.

9-11 Victims Fund Bill Unanimously Passes After Jon Stewart Publicly Shames House Panel - The House Judiciary Committee unanimously passed a bill on Wednesday which would permanently reauthorize the 9/11 Victim Compensation Fund, one day after comedian and activist Jon Stewart tore the committee a new one on Tuesday - calling them "shameful" over the number of empty seats on the panel. "I can't help but think what an incredible metaphor this room is ... a filled room of 9/11 first responders and in front of me, a nearly empty Congress. Sick and dying, they brought themselves down here to speak to no one ... shameful," Stewart began. The first responders sitting behind Stewart included retired NYPD detective Luis Alvarez, who was about to start his 69th round of chemotherapy for liver cancer. "It’s an embarrassment to the country and a stain on the institution and you should be ashamed of yourselves, for those who aren’t here, but you won’t be because accountability doesn’t appear to be something that occurs in this chamber," said Stewart. On Wednesday, chairman Jerrold Nadler (D-NY) dismissed calls to require a full committee vote after a handful of lawmakers were once again absent. 

GOP leader, Ocasio-Cortez give boost to lawmaker pay hike - Lawmakers say that any effort to give members of Congress a raise won’t pass unless both parties agree not to use the issue as a campaign weapon. While no such agreement has been ironed out, there is a chance that there will be a bipartisan deal struck at some point this year. Proponents of the pay hike acknowledge it’s not popular but argue that it is long overdue. The effort got a significant boost Tuesday when House Minority Leader Kevin McCarthy (R-Calif.) offered support for a pay bump, saying he doesn’t want Congress to be a place where only the wealthy can afford to serve. Freshman progressive Rep. Alexandria Ocasio-Cortez (D-N.Y.), meanwhile, forcefully made a case to her nearly 4.5 million Twitter followers, defending giving members of Congress the cost-of-living adjustment. That came after House Democratic leaders pulled a spending bill from the floor on Monday that would allow lawmakers to get a pay raise for the first time in a decade. At a press conference, McCarthy acknowledged the political sensitivity of a congressional raise but said it’s something legislators should consider. “I know when you talk this subject about a COLA, a cost-of-living increase, it does an invoke an emotion — kind of an impulsive emotion. I think it’s one we should pause and look at,” McCarthy said. House Majority Leader Steny Hoyer (D-Md.), who has long advocated for giving lawmakers a cost-of-living adjustment, has been in talks with McCarthy on the matter. Hoyer said Tuesday that he still intends to schedule a vote on giving lawmakers a cost-of-living adjustment this year. “I hope we pass it so that members can have the ability to not live in their offices,” Hoyer said, referring to the lawmakers who sleep in their offices to save money on expensive Washington rent. “We don’t want to have only rich people here. You know, we want this to be the People’s House, and representative of the people.”

Space Tourism- A Round Trip Ticket To The Space Station Costs $50 Million - NASA has announced it will open the International Space Station (ISS) for commercial business, permitting anyone who pays an estimated $50 million for a round trip ticket plus $35,000 per night, to stay in space, reported USA Today"We are announcing the ability for private astronauts to visit the space station on U.S. vehicles and for companies to engage in commercial profit-making activities," said Jeff DeWit, NASA's chief financial advisor, at a press conference last Friday at NASDAQ headquarters in New York. Since the Space Transportation System (STS) ended in 2011, NASA has partnered with Boeing and SpaceX to transport cargo to ISS. Private citizens who want to go to space will have to make arrangements with those companies to get into Low Earth orbit (LEO).  "If a private astronaut is on station, they will have to pay us while they're there for the life support, the food, the water, things of that nature," DeWit added. Private astronauts will need to meet the same physical requirements as any other astronaut. NASA will allow two private astronauts per year on the ISS with an expected price tag of $50 million per trip, and the first launch could be in the next several years.

 DOJ Issues Legal Opinion Backing Treasury's Refusal To Release Trump Taxes - In a move that was expected yet will lead to fresh howls of outrage by Democrats demanding William Barr be drawn and quartered, late on Friday the Department of Justice released a 33-page legal opinion backing up Steven Mnuchin's and the Treasury Department's decision to reject a request by congressional Democrats for six years of President Trump's tax returns."While the Executive Branch should accord due deference and respect to congressional requests, Treasury was not obliged to accept the Committee’s stated purpose without question, and based on all the facts and circumstances, we agreed that the Committee lacked a legitimate legislative purpose for its request," wrote Steven Engel, an assistant attorney general in DOJ's Office of Legal Counsel.The document follows Steven Mnuchin's rejection of a subpoena from House Ways and Means Committee Chairman Richard Neal (D-Mass.) last month, demanding Trump's personal and business tax returns from 2013 through 2018.When the Treasury Secretary rejected Neal's request, he said that he did so upon the advice of DOJ, and that the Justice Department would publish a legal opinion with its advice. Back in April, Trump, who has agreed to "absolutely" release his returns once they are no longer under IRS audit, told reporters "Hey, I’m under audit. But that’s up to whoever it is. From what I understand the law is 100 percent on my side." Fast forward to today when we know the answer: Mnuchin simply did what the DOJ advised. And while democrats will be furious, demanding Barr's scalp, several republicans will be happy with the DOJ opinion, especially Rep. Kevin Brady who two months ago said that "weaponizing our nation’s tax code by targeting political foes sets a dangerous precedent and weakens Americans’ privacy rights," adding "As you know, by law all Americans have a fundamental right to the privacy of the personal information found in their tax returns."

The end of political cartoons at The New York Times - Chappatte - All my professional life, I have been driven by the conviction that the unique freedom of political cartooning entails a great sense of responsibility. In 20-plus years of delivering a twice-weekly cartoon for the International Herald Tribune first, and then The New York Times, and after receiving three OPC awards in that category, I thought the case for political cartoons had been made (in a newspaper that was notoriously reluctant to the form in past history.) But something happened. In April 2019, a Netanyahu caricature from syndication reprinted in the international editions triggered widespread outrage, a Times apology and the termination of syndicated cartoons. Last week, my employers told me they'll be ending in-house political cartoons as well by July. I’m putting down my pen, with a sigh: that’s a lot of years of work undone by a single cartoon - not even mine - that should never have run in the best newspaper of the world. I’m afraid this is not just about cartoons, but about journalism and opinion in general. We are in a world where moralistic mobs gather on social media and rise like a storm, falling upon newsrooms in an overwhelming blow. This requires immediate counter-measures by publishers, leaving no room for ponderation or meaningful discussions. Twitter is a place for furor, not debate. The most outraged voices tend to define the conversation, and the angry crowd follows in.

United States added to list of most dangerous countries for journalists for first time  — The murder of the Saudi columnist Jamal Khashoggi — in a year when more than half of all journalists who were killed around the world were targeted deliberately — reflects a hatred of the media in many areas of society, a free-press advocacy group said Tuesday.At least 63 professional journalists were killed doing their jobs in 2018, a 15 percent increase over last year, said the group, Reporters Without Borders. The number of deaths rises to 80 when all media workers and people classified as citizen journalists are included, it said in its annual report.The world's five deadliest countries for journalists include three — India, Mexico and, for the first time, the United States — where journalists were killed in cold blood, even though those countries weren't at war or in conflict, the group said."The hatred of journalists that is voiced ... by unscrupulous politicians, religious leaders and businessmen has tragic consequences on the ground, and has been reflected in this disturbing increase in violations against journalists," Secretary-General Christophe Deloire said in a statement.Khashoggi, a royal insider who became a critic of Crown Prince Mohammed bin Salman and began writing for The Washington Post after moving to the United States last year, was killed inside the Saudi consulate in Istanbul, Turkey, in October. His death sparked worldwide outrage. Saudi officials have rejected accusations that the crown prince ordered his death. Reporters Without Borders said the three most dangerous countries for journalists to work in were Afghanistan, Syria and Mexico. Meanwhile, the shooting deaths of five employees of the Capital Gazette newspaper in Annapolis, Maryland, in June propelled the United States into the ranks of the most dangerous countries for the first time.

Exposé in “The Hill” challenges Mueller, media - Matt Taibbi -  - John Solomon of The Hill just came out with what could be a narrative-changing story. If news organizations that heavily covered Russiagate don’t at least check out this report – confirm it or refute it – few explanations other than bias will make sense.    In “Key figure that Mueller report linked to Russia was a State Department intel source,” Solomon asserts that Konstantin Kilimnik, the mysterious Ukrainian cohort of former Trump campaign manager Paul Manafort, has been a “sensitive” source for the U.S. State department dating back to at least 2013, including “while he was still working for Manafort.”  Solomon describes Kilimnik meeting “several times a week” with the chief political officer of the U.S. Embassy in Kiev. Kilimnik “relayed messages back to Ukraine’s leaders and delivered written reports to U.S. officials via emails that stretched on for thousands of words,” according to memos Solomon reviewed.  Solomon’s report, which raises significant questions about an episode frequently described as the “heart” of the Mueller investigation (and which was the subject of thousands of news stories), came out on June 6th. As of June 8th, here’s the list of major news organizations that have followed up on his report:

That’s it. Nobody else has touched it.

Mueller Used GPS Cellphone Exploit To Surveil Trump Associates -- Buried in his massive Trump-Russia report, special counsel Robert Mueller admits that he was able to pinpoint Blackwater founder Erik Prince's precise location in January, 2017 by matching his cell phone signal to a cell site near Trump Tower in New York City, according to Rowan Scarborough of the Washington Times.   The special counsel’s report discloses the use of this investigative technique, by which police determine a suspect’s location via a cellphone’s GPS signal. The Prince narrative is one instance in unredacted sections of the report in which Mr. Mueller’s team explicitly discloses cellphone tracking. It raises the question of whether the FBI applied the process to other investigative subjects — a phone’s GPS signal can disclose its exact location within a few feet. One of the first requests the FBI makes when confronting subjects is to ask for their electronic devices.   The fact Mr. Mueller could pinpoint Mr. Prince’s exact whereabouts suggest he used GPS readouts, which prosecutors can subpoena from cellular service providers. -Washington Times "I got the distinct impression that they had all my electronic communications and they operated with a confidence borne of a complete complement of the communications of everyone else," former Trump campaign adviser Michael Caputo - a harsh critic of the Mueller investigation - told the Times.

John Dean’s compelling case for parallels between Trump and Watergate – WaPo - The star witness of Watergate took a turn as the star witness for House Democrats’ inquiries into President Trump on Monday. And in doing so, he laid out a compelling series of parallels between the two situations.Former White House counsel John Dean acknowledged at the start of Monday’s House Judiciary Committee hearing that he wasn’t there as a “fact witness.” Instead, he noted in his opening statement several ways in which he sees the report of former special counsel Robert S. Mueller III echoing Watergate.Dean didn’t run through each of those verbally during his testimony, but his written statement lays his case out in detail.The most obvious parallel Dean noted involved himself: It concerns the role of the White House counsel. Just as he was the most significant witness against Richard M. Nixon, former White House counsel Donald McGahn has emerged as the most significant witness in the Mueller investigation. McGahn didn’t technically flip on Trump, as Dean did when he pleaded guilty in Watergate, but as Dean pointed out, “McGahn is the only witness that the special counsel expressly labels as reliable, calling McGahn ‘a credible witness with no motive to lie or exaggerate given the position he held in the White House.' "Dean noted that the Mueller report was spurred by Russian hacks targeting the Democratic National Committee and Hillary Clinton’s campaign, just as Watergate began with a botched burglary of the DNC. The burglars also had similar plans, he pointed out, for the campaign of Nixon’s 1972 Democratic opponent, George McGovern.Dean noted that the Mueller report didn’t find that Trump participated in that underlying crime, just as there is no evidence that he knows of “that Nixon was involved with or had advance knowledge of the Watergate break-in and bugging.” Dean also lent his endorsement to one of the most popular parallels of the entire investigation: between the “Saturday Night Massacre” and Comey’s firing in May 2017. “In short, the firing of FBI Director Comey, like Nixon’s effort to curtail the Watergate investigation,” Dean said, “resulted in the appointment of Special Counsel Mueller.”

Full text: Watergate’s John Dean gives statement on potential Trump obstruction John Dean's statement to the House Judiciary Committee on June 10, 2019, as prepared for delivery.

Trump looks to squash Amash - Donald Trump and his top allies are moving to make Justin Amash pay for becoming the sole Republican congressman to call for the president’s impeachment. Trump and his top advisers have discussed the prospect of backing a primary challenge to the Michigan lawmaker — a highly unusual move for a president against a member of his own party that would effectively amount to a warning shot to other Republicans thinking of crossing him. The conversations come as the billionaire DeVos family, which has deep ties to the administration and remains one of Michigan’s most powerful families, has announced it will cut off the congressman. That move could send a signal to other conservative donors deciding whether to invest in Amash. Trump has raised the primary challenge idea with Vice President Mike Pence and North Carolina Rep. Mark Meadows, a close Trump ally who co-founded the conservative House Freedom Caucus with Amash. Trump has also addressed the subject with Republican National Committee Chairwoman Ronna McDaniel, a former Michigan GOP leader who remains influential in the state. Those who’ve spoken with the president say he’s made no firm decision about taking on Amash, who’s accused the president of engaging in “impeachable conduct” and left the door open to a third-party campaign for president. Trump, they point out, is mostly focused on his own reelection and often cools down after he has time to process a slight. There are also potential risks: Trying to unseat Amash could elevate him or turn him into a martyr.

‘I think I’d take it’: In exclusive interview, Trump says he would listen if foreigners offered dirt on opponents President Donald Trump may not alert the FBI if foreign governments offered damaging information against his 2020 rivals during the upcoming presidential race, he said, despite the deluge of investigations stemming from his campaign's interactions with Russians during the 2016 campaign. Asked by ABC News Chief Anchor George Stephanopoulos in the Oval Office on Wednesday whether his campaign would accept such information from foreigners -- such as China or Russia -- or hand it over the FBI, Trump said, "I think maybe you do both." "I think you might want to listen, there isn't anything wrong with listening," Trump continued. "If somebody called from a country, Norway, [and said] ‘we have information on your opponent' -- oh, I think I'd want to hear it." President Trump made the remark during an exclusive interview with ABC News over the course of two days, wherein Stephanopoulos joined the president on a visit to Iowa and back to Washington for a day inside the White House.

Justice gives Congress new details on ‘spying’ probe - In a letter to the House and Senate Judiciary committees, Assistant Attorney General Stephen Boyd said that the inquiry is being primarily conducted by U.S. attorney John Durham out of Justice Department offices in Washington, D.C. Boyd wrote that Durham, the U.S. attorney from Connecticut, is receiving assistance from a “number of U.S. Attorney’s Office personnel and other Department employees.” “The Department has made existing office space in Washington available for this work,” Boyd wrote in a letter to House Judiciary Chairman Jerrold Nadler (D-N.Y.). “Mr. Durham’s Review will be funded out of the U.S. Attorney’s Salaries and Expenses appropriation.” Barr said earlier this year that he intended to review the origins of the counterintelligence investigation into Russia's election interference and intelligence collection directed at members and associates of the Trump campaign. It later became known that he tapped Durham to lead the review. Barr has said he believes the campaign was spied on and that he’s interested in ensuring that the investigative steps were adequately predicated. Barr has faced blowback for his use of the word “spying” from Democrats and other Trump administration critics who argued he was amplifying a conspiracy theory. In the letter Monday, Boyd described Barr’s review as “broad in scope and multifaceted" and said it is "intended to illuminate open questions regarding the activities of U.S. and foreign intelligence services as well as non-governmental organizations and individuals.” “As the Attorney General has stated publicly at congressional hearings and elsewhere, there remain open questions relating to the origins of this counter-intelligence investigation and the U.S. and foreign intelligence activities that took place prior to and during that investigation,” Boyd wrote.“The purpose of the Review is to more fully understand the efficacy and propriety of those steps and to answer, to the satisfaction of the Attorney General, those open questions. Among other things, the Review will seek to determine whether the investigation complied with applicable policies and laws,” he wrote.

House Democrats make deal to see Mueller files on Trump (AP) — The House expects to receive the first files of underlying evidence from Robert Mueller’s report soon, after a sudden shift by the Justice Department as Democrats weigh impeachment proceedings against President Donald Trump. It’s unclear if the deal, announced just moments before the start of a Judiciary Committee hearing with Watergate star witness John Dean, will ultimately be enough for Democrats who have called for the full, unredacted report and underlying documentation from the special counsel’s work. But it signaled the first real breakthrough in the standoff over the report and came at the start of a week of ramped-up action by the House in the Trump-Russia probe. Rep. Jerrold Nadler, D-N.Y., the chairman of the committee, said the Justice Department will provide some of Mueller’s “most important files” and all members of the committee will be able to view them. He said the files will include those used to assess whether Trump obstructed justice. In response to the agreement, Nadler said the panel will not vote to hold Attorney General William Barr in criminal contempt, for now. But the House will still vote on a resolution Tuesday that would empower the committee to file a civil lawsuit for the materials, if Democrats decide to do so. That was the expected outcome even before the deal, as Democrats have shifted their strategy toward lawsuits and away from criminal contempt. Criminal contempt would be referred to the Justice Department, where it would certainly be rejected. And Democrats have been encouraged by some early wins in court as Trump has broadly fought congressional oversight. Nadler said in his statement that he would give the Justice Department some time to comply. “If the Department proceeds in good faith and we are able to obtain everything that we need, then there will be no need to take further steps,” Nadler said in a statement. “If important information is held back, then we will have no choice but to enforce our subpoena in court and consider other remedies.”

Barr Contempt Vote On Hold After DOJ Cuts Deal For Unredacted Mueller Documents - The Democrat-controlled House Judiciary Committee has postponed its contempt vote for Attorney General William Barr after the Justice Department agreed to turn over unredacted portions of the Mueller report as well as the special counsel's "most important files" sought by the committee.  "I am pleased to announce that the Department of Justice has agreed to begin complying with out committee's subpoena by opening Robert Mueller's most important files to us," reads a statement by Chairman Jerrold Nadler (D-NY). The document production will provide "key evidence that the Special Counsel used to assess whether the President and others obstructed justice or were engaged in other misconduct," the statement continues. "Given our conversations with the Department, I will hold the criminal contempt process in abeyance for now," added Nadler. House Judiciary Dems announced they've reached a deal with DOJ to get info related to the Mueller report. This means, per Chair Nadler, that the contempt proceedings against AG Barr (see: https://t.co/J7AfEl6a8q) will be put on hold pic.twitter.com/oZ5OIirCD9 — Zoe Tillman (@ZoeTillman) June 10, 2019

House Authorizes Lawsuits Against Barr, McGahn; Nadler Vows To Pursue -- The House voted along party lines on Tuesday to allow lawsuits filed in federal court against Attorney General William Barr and former White House Counsel Don McGahn, amid an effort to enforce subpoenas for documents and testimony related to the Trump administration, according to Bloomberg.   The 229-191 resolution stops short of holding Barr and McGahn in contempt of Congress. Instead, a five-member panel House leadership will be required to sign off on litigation instead of the entire chamber, according to Bloomberg.   Legal experts told The Hill that the measure up for a vote on Tuesday doesn’t reach the threshold for contempt, though it does have the same goal of obtaining documents and testimony currently being withheld from Congress. "We're calling it contempt for short, because the courts obviously would have to find the executive branch in contempt in order to sort of render the orders to comply,” said Rep. Jamie Raskin (D-Md.), a member of the House Oversight and Judiciary Committees. “So it's, generally speaking, not contempt." -The Hill   The Tuesday resolution allows House Judiciary Committee Chairman Jerrold Nadler (D-NY) to go immediately to the House counsel to seek a court order against Barr and McGahn. That said, Nadler is unlikely to do so now that his committee struck a deal with the DOJ to provide unredacted portions of the Mueller report as well as the special counsel's "most important files" sought by the committee.  That said, Nadler announced after the House vote that he would move against anyone who hasn't complied with subpoenas, including McGahn.

 DOJ Investigating CIA Role In Russiagate -- The Department of Justice will interview senior CIA personnel as part of a sweeping investigation into the origins of 'Russiagate,' according to the New York Times, citing anonymous sources briefed on the matter.   The interview plans are the latest sign the Justice Department will take a critical look at the C.I.A.’s work on Russia’s election interference. Investigators want to talk with at least one senior counterintelligence official and a senior C.I.A. analyst, the people said. Both officials were involved in the agency’s work on understanding the Russian campaign to sabotage the election in 2016. -New York Times  The Times notes that while the DOJ probe is not a criminal inquiry, CIA employees are nervous, according to former officials, while senior agency officials have questioned why the CIA's analytical work should be within the purview of John H. Durham - the US Attorney for Connecticut appointed by Attorney General William Barr to oversee the review.  Justice Department officials have given only broad clues about the review but did note that it is focused on the period leading up to the 2016 vote. Mr. Barr has been interested in how the C.I.A. drew its conclusions about Russia’s election sabotage, particularly the judgment that Mr. Putin ordered that operatives help Mr. Trump by discrediting his opponent, Hillary Clinton, according to current and former American officials.  Mr. Barr wants to know more about the C.I.A. sources who helped inform its understanding of the details of the Russian interference campaign, an official has said. He also wants to better understand the intelligence that flowed from the C.I.A. to the F.B.I. in the summer of 2016. -New York Times And why should the CIA be nervous? Fox News commentator Monica Crowley laid it out in an April Op-Ed in the Washington TimesThe Obama Department of Justice and FBI targeting of two low-level Trump aides, George Papadopoulos and Carter Page, was carried out in the spring of 2016 because they wanted to spy on the Trump campaign but needed a way in. They enlisted an American academic and shadowy FBI informant named Stefan Halper to repeatedly sidle up to both Mr. Papadopoulos and Mr. Page. But complementing his work for the FBI, Mr. Halper had a side gig as an intelligence operative with longstanding ties to the CIA and British intelligence MI6..

Propaganda Is The Root Of All Our Problems -- Caitlin Johnstone -- A new article by Forbes reports that the CEO of Crowdstrike, the extremely shady cybersecurity corporation which was foundational in the construction of the official CIA/CNN Russian hacking narrative, is now a billionaire.George Kurtz ascended to the billionaire rankings on the back of soaring stocks immediately after the company went public, carried no doubt on the winds of the international fame it gained from its central protagonistic role in the most well-known hacking news story of all time. A loyal servant of empire well-rewarded.Never mind that US government insiders like Hillary Clinton had been prepping for escalations against Russia well in advance of the 2016 elections, and that their preexisting agendas to shove a geostrategic obstacle off the world stage benefitted from the hacking narrative as much as George Kurtz did.Never mind that Crowdstrike is tied to the NATO narrative management firm known as the Atlantic Council, which receives funding from the US government, the EU, NATO, Gulf states and powerful international oligarchs. Never mind either that Crowdstrike was financed with a whopping $100 million from Google, which has had a cozy relationship with US intelligence agencies since its very inception. Never mind that to this day the DNC servers have not been examined by the FBI, nor indeed were they examined by the Special Counsel of Robert “Iraq has WMD” Mueller, preferring instead to go with the analyses of this extremely shady outfit with extensive and well-documented ties with the oligarchic leaders of the US-centralized empire. Also never mind that the Crowdstrike analyst who led forensics on those DNC servers had in fact worked for and was promoted by Robert Mueller while the two were in the FBI. As I never tire of saying, the real underlying currency in our world is not gold, nor bureaucratic fiat, nor even raw military might. The real underlying currency of our world is narrative, and the ability to control it.

Saudi funded company partly owned by Trump, Kushner – Cadre, a real estate company partly owned by Donald Trump and his adviser Jared Kushner, has received ambiguous foreign funding of $90 million since Kushner’s appointment as Trump’s adviser, reported the Guardian. According to the newspaper, the funds flowed from Saudi Arabia and other investors through a branch attached to Goldman Sachs in the Cayman Islands, a tax haven known for prioritising corporate secrecy. Kushner had retained a stake in the company after joining the White House, with an estimated value of about $ 50 million, according to Kushner’s financial disclosure documents. The Guardian believed that this external funding could lead to conflicts of interest for Kushner due to the position he holds in the US administration, according to some ethics experts, who raised concerns about the lack of transparency regarding the investments. Read: The race to fail Palestine: the two-state compromise and Trump’s ‘deal of the century’ Jessica Tillipman, a Professorial Lecturer in Law at the George Washington University Law School, who teaches government’s anti–corruption ethics stated that the Saudi investments in Cadre “will cause people to wonder whether these funds have an impact on the nature of Kushner’s work.” The company was not included in the first ethics disclosure presented by Kushner, indicating later that this was not deliberate but rather was an unintentional omission, while stressing that he is not taking part in any activity related to the company anymore.

 'Corruption in Plain Sight': Jared Kushner Firm Took in $90 Million From Unnamed Foreign Entities Since 2017 - The latest scandal from the President Donald Trump administration involves secretive foreign investments in a company in which the president's son-in-law and advisor Jared Kushner has a stake.As The Guardian reported Monday, real estate speculation corporation Cadre, which was co-founded by Kushner, has received at least $90 million in overseas capital since 2017. "Corruption in plain sight!" tweeted journalist Rula Jebreal. The money came through financial services conglomerate Goldman Sachs via the Cayman Islands, making the original sources impossible to track. Neither Cadre nor Goldman are required to make the investors public and neither company has expressed any interest in doing so. Though Kushner reduced his share in Cadre to a minority stake of under 25 percent after joining the administration, he did not list his interest in the company in an early disclosure form. "It was one of the only assets that Kushner retained and it continues to collect foreign investors without transparency," Citizens for Responsibility and Ethics in Washington chief ethics counsel Virginia Canter said in comments to The Guardian. Cadre allows investors to play the real estate market like the stock market, buying and selling properties like investments and using combined purchasing power to obtain large pieces of real estate with less risk. The company partnered with Goldman in January 2018 to allow a total investment of up to $250 million from Goldman's clients; Goldman began collecting funds for Cadre in August 2017, reported The Guardian.  The news was just the latest "regular Monday morning outrage," tweeted journalist Rob Garver.

Facebook gets dumped from an S&P index that tracks socially responsible companies - Amid ongoing controversy over its use of its users private information, Facebook has been kicked out of an index tracking companies that abide behind socially responsible practices. S&P Dow Jones Indices announced that the social network no longer will be part of the S&P 500 ESG Index. The gauge follows companies that S&P says engage in responsible environmental, social and governance practices, a growing part of the market as investors seek out more ethical ways to put their money to work. Companies grouped as ESG-compliant have total assets of $11.6 trillion, according to an estimate from the Forum for Sustainable and Responsible Investment. For Facebook, the decision is part of an ongoing saga that has seen it come under fire for weak oversight of how its user data is sold to advertisers. Investors and political leaders have called for the company to break up, an insistence its founder, Mark Zuckerberg, has rejected. In making the move, S&P cited the privacy concerns that lowered Facebook’s total score used in deciding which companies will be included in the ESG Index. While Facebook received a high score in environmental issues — 82 out of a possible 100, not unusual for a tech company — its social and governance scores were much lower at 22 and 6 respectively. S&P weights the latter two categories more heavily when it comes to tech firms. “The specific issues resulting in these scores had to do with various privacy concerns, including a lack of transparency as to why Facebook collects and shares certain user information,” Reid Steadman, global head of ESG at S&P, said in a blog post on the company site published this week that explained the move. “These events have created uncertainty about Facebook’s diligence regarding privacy protection, and the effectiveness of the company risk management processes and how the company enforces them. These issues caused the company to lag behind its peers in terms of ESG performance.” The company’s score has dropped consistently over the past several years.

 Facebook's Secret "Hate Agent" Formula Leaked by Insider — An internal Facebook document reveals that the social media giant monitors its users’ offline behavior as part of how the company determines whether a person should be classified as a “Hate Agent,” according to Breitbarts Allum Bokhari who has reviewed the document. Titled “Hate Agent Policy Review,” the document reveals that Facebook employs a series of “signals” which include a person’s behavior both on and off the platform. Once determined to be a “hate agent,” a person is banned from the platform. If you praise the wrong individual, interview them, or appear at events alongside them, Facebook may categorize you as a “hate agent.” Facebook may also categorize you as a hate agent if you self-identify with or advocate for a “Designated Hateful Ideology,” if you associate with a “Designated Hate Entity” (one of the examples cited by Facebook as a “hate entity” includes Islam critic Tommy Robinson), or if you have “tattoos of hate symbols or hate slogans.” (The document cites no examples of these, but the media and “anti-racism” advocacy groups increasingly label innocuous items as “hate symbols,” including a cartoon frog and the “OK” hand sign.) Facebook will also categorize you as a hate agent for possession of “hate paraphernalia,” although the document provides no examples of what falls into this category. –Breitbart Facebook may even brand someone a hate agent for “statements made in private but later made public,” according to the report.

New York Times Reporters Perpetuate Popular Corporate Governance Myths - Two recent stories in the New York Times had all the best intentions. Nelson Schwartz’s December 6 piece, “How Wall Street Bent Steel: Timken Bows to Activist Investors, and Splits in Two” describes the crying shame in Ohio of “activist investors” that demand the breakup of a 112-year old company run by the 47-year old fifth generation Mr. Timken of Canton. Schwartz finds a villain in corporate law for his tear-stained portrayal of the betrayal of a “community-minded version of corporate capitalism that is fading in the United States”.  “As in all publicly traded companies, TimkenSteel’s board and top executives have a fiduciary duty to shareholders to maximize both profits and investor returns.” Later in the month, Pulitzer Prize winning reporter Gretchen Morgenson opened up her sad story of investors shut out of an active role in running corporations with a seemingly clear-cut, reasonable argument for more shareholder influence: “Shareholders own the companies they invest in, but they have long been largely shut out of any role in naming the people who are supposed to represent them: corporate directors.”  As the original saying goes, “L’enfer est plein de bonnes volontés et désirs” (hell is full of good wishes and desires). These journalists aim to tell a sympathetic story of corporate greed and indifference but throw in the myth of shareholder primacy and a value maximization mandate to make the result seem inevitable. The shareholder value maximization slogans show up when journalists need a rationale, or a bogeyman, for corporate activities that ignore other stakeholders and legitimate alternative corporate purposes. That’s despite the fact these myths have been decisively debunked over the last twenty years by numerous experts and in various forums. Professor Lynn Stout of Cornell University School of Law, in her book The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations, and the Public,” explains the origins of the shareholder primacy ideology. This ideology — and the latest canard of a legal duty for corporate officers to minimize taxes — lacks any solid foundation in corporate law, corporate economics, or the empirical evidence. Stout summarized the central thesis of her book in a post in 2012 at the Harvard Law School corporate governance forum blog: Contrary to what many believe, U.S. corporate law does not impose any enforceable legal duty on corporate directors or executives of public corporations to maximize profits or share price. The economic case for shareholder-value maximization similarly rests on incorrect factual claims about the structure of corporations, including the mistaken claims that shareholders “own” corporations, that they have the only residual claim on the firm’s profits, and that they are principals who hire and control directors to act as their agents.

 State AGs sue to block T-Mobile-Sprint merger  - A group of 10 state attorneys general led by New York's Tish James and California's Xavier Becerra is suing to block the $26 billion merger between T-Mobile and Sprint, putting pressure on President Donald Trump's Justice Department, which is still reviewing the deal.The deal would kill jobs and harm consumers, the AGs said in a statement Tuesday. Joining James and Becerra are the top state prosecutors from Colorado, Connecticut, the District of Columbia, Maryland, Michigan, Mississippi, Virginia, and Wisconsin. The suit was filed under seal in the U.S. District Court for the Southern District of New York.“When it comes to corporate power, bigger isn’t always better,” James said. “The T-Mobile and Sprint merger would not only cause irreparable harm to mobile subscribers nationwide by cutting access to affordable, reliable wireless service for millions of Americans, but would particularly affect lower-income and minority communities here in New York and in urban areas across the country."The lawsuit was quickly cheered by merger opponents, who called on DOJ antitrust chief Makan Delrahim to join the states in attempting to block the deal in court. A number of states filed supporting briefs when DOJ unsuccessfully sought to block AT&T's acquisition of Time Warner. DOJ antitrust officials aren't satisfied with the T-Mobile-Sprint transaction as structured and have been negotiating with the companies on divesting assets, with the goal of forging a pathway for a fourth competitor in the wireless market, a person familiar with the discussions told POLITICO.

Agencies are close to finishing Volcker Rule changes: FDIC's McWilliams — Regulators are closing in on a final plan to simplify how banks comply with the Volcker Rule, said Federal Deposit Insurance Corp. Chairman Jelena McWilliams. The federal banking agencies proposed changes last year to ease complexity for banks subject to the proprietary trading ban, but large institutions criticized the plan for unintended consequences that they said could make the rule more burdensome. In March, McWilliams and Comptroller of the Currency Joseph Otting said the regulators were looking at numerous options on how to proceed, including finalizing just the least controversial portions of the plan. “We hope to be able to finalize changes to the rule’s proprietary trading restrictions sometime this summer,” McWilliams said at a Cato Institute event Wednesday. The rule was mandated by the 2010 Dodd-Frank Act and was named for former Federal Reserve Chairman Paul Volcker. He criticized the ability of FDIC-insured banks to tap cash resources to keep their own trading books. The regulators have been sympathetic to concerns that the rule is overly complex, but bankers have particularly objected to the proposed introduction of a new accounting standard to determine which trades are subject to the ban. McWilliams previously said one option is for the regulators is to advance straightforward elements of the 2018 proposal and then consider a broader reproposal of more substantive changes.

Could JPMorgan Chase Be Hit with a Fourth Felony Count for Rigging Precious Metals Markets?-  By Pam Martens On September 25, 2013, after spending five years and 7,000 hours using taxpayers’ money investigating the potential rigging of the silver market, the Commodity Futures Trading Commission (CFTC) concluded that “there is not a viable basis to bring an enforcement action with respect to any firm or its employees related to our investigation of silver markets.” The investigation was provoked by multiple complaints asserting the market was rigged.The CFTC is a Federal regulator that oversees the U.S. commodities markets. The U.S. Department of Justice (DOJ) is also a Federal agency and the only one that can bring a criminal case against firms and individuals who commit conspiracy and fraud in commodity and securities markets. (The Securities and Exchange Commission can bring only civil, not criminal, cases.)On October 9 of last year, the DOJ used its criminal powers and charged John Edmonds, a former long-time employee of JPMorgan Chase, with one count of commodities fraud and one count of conspiracy to commit wire fraud, commodities fraud, commodities price manipulation and spoofing.The charges covered the period in which the CFTC had found no “viable basis to bring an enforcement action” for silver market manipulation. Edmonds has pleaded guilty to the charges and admitted that “from approximately 2009 through 2015, he conspired with other precious metals traders at the Bank to manipulate the markets for gold, silver, platinum and palladium futures contracts traded on the New York Mercantile Exchange Inc. (NYMEX) and Commodity Exchange Inc. (COMEX)….”  Far from being a lone, rogue trader, Edmonds has now implicated other traders and supervisors within JPMorgan Chase. His plea agreement indicates the following:  “…the defendant and his fellow traders routinely placed bids and offers-in other words, orders-for precious metals futures contracts with the intent to cancel those bids and offers before execution (the ‘Spoof Orders’). This trading strategy was intended to, and did, transmit materially false and misleading liquidity and price information and otherwise deceive other market participants about the existence of supply and demand for the futures contracts at issue, and thus induce those other market participants to trade against orders that the defendant and his co-conspirators placed and did want to execute on the opposite side of the market from the Spoof Orders at prices, quantities, and times that the other market participants otherwise would not have traded. The Spoof Orders thus were designed to, and did, artificially move the price of precious metals futures contracts in a direction that was favorable to the defendant and his co-conspirators at the Bank, to the detriment of other market participants, including other market participants in Connecticut..”

Equifax breach still poses fraud risk at four government agencies: GAO — Recent data breaches like that at Equifax have heightened online fraud risk for four government agencies, according to lawmakers and the Government Accountability Office. A GAO report faults the Department of Veterans Affairs, Centers for Medicare and Medicaid Services, Social Security Administration, and U.S. Postal Service, for relying on “knowledge-based verification” to grant access to online portals that users use to track benefits or other purposes. Such identity methods involve using personal data about a user that is typically in a credit file held by a consumer reporting agency. The GAO warned that a hacker could gain access to such data through a cyber intrusion like the 2017 Equifax breach, which compromised the information of millions of individuals. "It is troubling that almost two years after the massive 2017 Equifax data breach federal government agencies continue to use outdated identity-proofing methods that put citizens at increased risk of identity theft,” said Sen. Elizabeth Warren, D-Mass., Sen. Ron Wyden, D-Ore., and Rep. Elijah Cummings, D-Md., in a letter Thursday to the four agencies. The three lawmakers, who had requested the GAO audit, released the report on Friday. Until the agencies eliminate knowledge-based verification, the individuals they serve will remain at increased risk for identity fraud, the report said. "Although commonly used by federal agencies for remote identity proofing, knowledge-based verification techniques pose security risks because an attacker could obtain and use an individual’s personal information to answer knowledge-based verification questions and successfully impersonate that individual," the report said. The GAO noted that the Internal Revenue Service and the General Services Administration have improved their practices and no longer use the method. According to the lawmakers' letter, the VA, USPS and Social Security Administration have said they plan to eliminate knowledge-based verification. The Department of Health and Human Services said it felt there were not suitable existing alternatives for certain populations served by the Centers for Medicare and Medicaid Services. The lawmakers are asking the agencies what steps they have taken to protect consumer privacy following the Equifax data breach, and what policies are in place to ensure third-party contractors have appropriate data security practices.

Brown blasts data brokers' refusal to testify to Senate banking panel — The top Democrat on the Senate Banking Committee on Tuesday strongly criticized consumer data brokers for refusing to appear before the panel as lawmakers consider steps to strengthen data privacy. “These companies expect to be trusted with the most personal and private information you could imagine about millions and millions of Americans,” Sen. Sherrod Brown, D-Ohio, said at a hearing to discuss data security and privacy legislation, referring to companies that collect and sell data on consumers. “They are not even willing to show up and explain how their industry works. Some define this as cowardice. It’s hard to disagree with that.” Brown’s comments were targeted at companies that have access to information on where consumers use their credit cards, the products they buy, their life insurance policies and even personal information such as whether they are divorced. Senate Banking Committee Chairman Mike Crapo, R-Idaho, said he and Brown were committed to compelling members of the data broker industry to testify at a future hearing. “Private companies are collecting, processing, analyzing and sharing considerable data on individuals for all kinds of purposes. Even more troubling is that the vast majority of Americans do not even know what data is being collected, by whom and for what purpose," Crapo said in an opening statement. “In particular, data brokers and technology companies, including large social media platforms and search engines, play a central role in gathering vast amounts of personal information, and often without interacting with individuals, specifically in the case of data brokers." In February, Brown and Crapo called on stakeholders to weigh in on data privacy, protection and collection issues as they consider legislative responses to recent data breaches. They also wrote to Facebook last month, asking about its data collection and how it shares the information with financial firms to market products to consumers.

GOP, Dem senators join forces on new AML reform bill — A bipartisan group of senators have unveiled draft legislation to reform anti-money-laundering requirements, in another attempt to modernize a regime that bankers deem outdated. The bill sponsored by Sens. Mark Warner, D-Va., Doug Jones, D-Ala., Tom Cotton, R-Ark., and Mike Rounds, R-S.D., would require companies to disclose to the Financial Crimes Enforcement Network their beneficial owners and create a comprehensive federal database for beneficial ownership information. The reform legislation would also require the Department of Justice to provide metrics on the utility of AML reporting submitted by banks and other financial institutions. It would also bolster coordination between financial regulators and law enforcement to combat AML threats. Yet the bill omits changes to the thresholds that require financial firms to report suspicious transactions. The new bill means lawmakers in both the House and the Senate are zeroing in on a beneficial owner requirement as part of an AML reform bill. The draft legislation’s release comes a day before the House Financial Services Committee is set to mark up a bill led by Rep. Carolyn Maloney, D-N.Y., to require companies to report their true owners at incorporation. The Senate Banking Committee will also hold a hearing on beneficial ownership June 20. “As a former U.S. Attorney, I am all too familiar with criminals hiding behind shell corporations to enable their illegal behavior,” Jones said in a press release. “At the same time, our anti-money-laundering laws have not kept pace with the increasingly sophisticated means by which criminals and terrorist organizations use our financial system to move their money around the world. This bipartisan legislation addresses both challenges and gives law enforcement the tools they need to protect Americans and prosecute criminals.”

Warren, Jones press regulators on fintech lending discrimination — Sens. Elizabeth Warren, D-Mass., and Doug Jones, D-Ala., are calling on regulators to ensure that algorithms used by financial technology platforms don’t result in discriminatory lending. In a letter to the heads of the Federal Reserve Board, Office of the Comptroller of the Currency, Federal Deposit Insurance Corp. and the Consumer Financial Protection Bureau, the senators highlighted research from the University of California, Berkeley that found algorithmic lending can make it easier to apply for mortgages but can also lead to higher interest rates for African-American and Hispanic borrowers. The research found that algorithmic lending, by increasing competition, “appeared to reduce the likelihood that the loan applications of borrowers of color are rejected — thus reducing discrimination in lenders’ ‘accept/reject’ decision-making process,” Warren and Jones wrote. However, the research also found that African-American and Hispanic borrowers were charged interest rates 6 to 9 basis points higher than comparable white and Asian borrowers. “In other words, the algorithms used by fintech lenders are as discriminatory as loan officers,” the senators wrote. Specifically, the senators are asking the regulators what they are doing to identify and combat discrimination by lenders that use algorithms, to what extent the regulators’ responsibility to oversee fair lending laws extends to the fintech industry, and whether they have identified unique challenges to oversight of those laws by the fintech industry. They are asking if the agencies have conducted analysis of the impact of fintech algorithms on minority borrowers, including differences in credit availability and pricing and whether they have identified increased cases of lending discrimination in fintech. And they are asking if there are any additional statutory authorities that would help regulators better enforce fair lending laws or protect minority borrowers from discrimination in their interactions with the fintech industry.

I Will Bury You! - Bitcoin Bull John McAfee Warns-Off US Government Pursuers - A Bitcoin millionaire, who is currently on the run from the United States government for refusing to be stolen from, has warned the government to leave him alone. As SHTFplan.com's Mac Slavo details, infamous Bitcoin bull, John McAfee taunted the U.S. government on Twitter warning them to leave him alone or he will “f***ing bury” them.For my followers: my recent tweets are less for you than they are fir my pursuers. They are shots across the bow - leave me the fuck alone, or go down with the corruption you have embraced, because I will fucking bury you if you continue. Doubt me at your own fucking risk. — John McAfee (@officialmcafee) June 9, 2019As mainstream media paints him as a “fugitive” for the “crime” of wanting to keep the money he earned, the Bitcoin bull isn’t giving up on his rights to the fruits of his labor or his bold fight for liberty. After all, taxation set up the American Revolution. All I wanted was to be left alone. I paid tens of millions of dollars in taxes ane received only the condescension of Federal employees, when i needed services, in return. I chose to pay no more. This is my crime. You should have left me alone. — John McAfee (@officialmcafee) June 10, 2019 In his Twitter rant, McAfee claimed that the Department of Justice is compiling a bogus case against him for money-laundering, racketeering, and murder. And we all know the DoJ is full of just outstanding people who would never ever invent a crime to try to attack a political opponent (sarcasm)... The mainstream media is incredibly upset that McAfee hasn’t bowed to the government and paid his required theft money. Most articles out there tend to focus on the man’s simple quest for the freedom to not be stolen from. But, as we know, the media is in the back pockets of the government and cannot tell you the truth (that taxation is theft), let alone side with a rebel like McAfee. In another Tweet, which is currently pinned to the top of McAfee’s Twitter account, he comes right out and says he is not implying the entire government is corrupt, rather, he’s pointing it out as a fact.

Climate Change Poses Major Risks to Financial Markets, Regulator Warns - NYT— A top financial regulator is opening a public effort to highlight the risk that climate change poses to the nation’s financial markets, setting up a clash with a president who has mocked global warming and whose administration has sought to suppress climate science.Rostin Behnam, who sits on the federal government’s five-memberCommodity Futures Trading Commission, a powerful agency overseeing major financial markets including grain futures, oil trading and complex derivatives, said in an interview on Monday that the financial risks from climate change were comparable to those posed by the mortgage meltdown that triggered the 2008 financial crisis.“If climate change causes more volatile frequent and extreme weather events, you’re going to have a scenario where these large providers of financial products — mortgages, home insurance, pensions — cannot shift risk away from their portfolios,” he said. “It’s abundantly clear that climate change poses financial risk to the stability of the financial system.” Mr. Behnam was appointed by President Trump to a seat on the commission that, by law, must be filled by a Democrat. He said that unusual status gave him a measure of political protection that other appointees within the administration might not benefit from. Experts in government affairs said Mr. Behnam’s initiative was unusual. Historically, presidential appointees on panels like the trading commission, the Federal Election Commission or the Securities and Exchange Commission have sometimes quietly pushed back at the presidential policies with which they disagreed, but “rarely do you see a commissioner go rogue and public,” James A. Thurber, director of the Center for Congressional and Presidential Studies at American University, said in an email.

Recession or not, there will be pain - If the current economic expansion which began in June 2009 makes it to this July, it will set a record for the longest period of U.S. economic growth—beating the 1991 to 2001 boom. Economic expansions don’t die of old age, however, so what might bring this one to an end?  With memories of 2008-2009 still fresh, some observers have focused on corporate debt as the likely culprit. It’s true that corporate debt has risen rapidly during the expansion, both in absolute terms and in relation to corporate profits. But low interest rates mean that debt service—interest payments on this debt relative to after-tax profit—is about 25 percent, where it usually is during periods of expansion and not a cause for worry. Bank regulators are concerned about the rapid growth of leveraged loans and weaker lender protections. But they appear to be correct in their assessment that leveraged lending, despite a 20 percent growth since last year to almost $1.2 trillion, “isn’t a current threat to the financial system.”  Still, recession or no recession, there will be pain.  A large and growing share of corporate debt is “speculative debt”—either leveraged loans used to acquire target companies and burden them with high debt levels or high risk junk bonds. Many companies with high levels of speculative debt on their books were acquired by private equity in a leveraged buyout, meaning the PE firm used high amounts of debt to buy them. This is debt the target companies, not their private equity owners, are obligated to repay. Often, these PE-owned companies are required to issue junk bonds and further increase their indebtedness in order to pay dividends to their owners. A 100-day plan imposed on company managers at the time of the buyout lays out the steps that the company will need to take to service this mountain of debt. Reducing labor costs is a big part of these plans, whether by closing less profitable stores and establishments, laying off workers at those it continues to operate, or cutting pay and benefits. After it takes these steps to manage its debt, the company is on a knife-edge.  If all the assumptions made by the private equity firm when it persuaded creditors to lend it boatloads of money hold up, the company will avoid defaulting on its loans and going bankrupt. But if these assumptions are upended—say, by a slowdown in the economy, defaults and bankruptcies will spike. Creditors who have loaned billions of dollars to finance private equity-sponsored leverage buyouts will experience losses. Establishments will be shuttered, some companies will be liquidated, workers will lose their jobs, and communities will lose businesses that have played a key role in the local economy.

‘Epic’ flooding forces ag banks to lean on farm agency -- In soggy corn country, rural banks are turning more farmers toward a government program that provides a taxpayer backstop to new loans. The reason? To get those customers through a year where many may not even put seeds in the ground. A question remains whether lawmakers will need to do more to meet the demand. The Farm Service Agency, which under the U.S. Department of Agriculture guarantees bank loans made to farmers and makes direct loans as well, is authorized to back or lend out a little more than $6.7 billion in fiscal year 2019, which ends Sept. 30. As of last week, the agency has used up nearly $4 billion of this authority. Farm Service Agency loan demand Policymakers and industry officials are watching closely to see if the current program can handle the anticipated burden. A bill that passed in the House early this year would raise the agency’s combined loan and guarantee authority above $7 billion, but Juli Obudzinski, interim policy director at the National Sustainable Agriculture Coalition, said lawmakers may be forced to revisit the issue as farmers are increasingly unable to get loans from the private sector. "We need to make sure if there is an increase in demand that appropriators are responsive," says Obudzinski, whose group represents midsize family farms that fear more congressional funding will be necessary. "In the very least, in the short term, making sure those loan programs have whatever money they need to service farms is absolutely important."

Fed publishes report on what bankers want from CRA reform -- The Federal Reserve Board published feedback Thursday from more than 400 bankers and community groups that will influence how regulators make changes to the Community Reinvestment Act. The Fed’s 24-page summary delves into the major concerns about reforming CRA, including updating assessment boundaries, evaluating how banks are tested, and clarifying which activities are eligible for CRA credit. The Fed, Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. have struggled to develop a joint CRA reform plan. The report is based on feedback the Fed received from 29 roundtable discussions held between October and January on potential revisions to CRA regulation. Generally, bankers and community groups want the CRA expanded to apply to credit unions, insurance companies, financial technology companies, mortgage brokers, and other non-regulated or nondepository institutions. Participants in the roundtables said such an expansion would be more “fair” to the banks that are currently subject to the CRA and would increase the overall resources available to low- and moderate-income communities. Many participants in the Fed's roundtable discussions think that current CRA assessment areas should be expanded to include a bank's lending activities and market share rather than relying primarily on deposits. Some bankers expressed concerns about the difficulty in defining a bank’s digital presence. Others appeared reluctant to expand the geographic scope of assessment areas because doing so could impact which markets would be reviewed for fair-lending risk. “Several bankers noted that the CRA can be a deterrent to growth because banks are hesitant to add branches or enter new markets due to all the CRA-related requirements associated with a new assessment area,” the report stated. Bankers were somewhat critical of the current CRA framework, saying it creates confusion and results in banks restricting community development activities outside their assessment area. To that end, many bankers want the definition of CRA assessment areas changed so institutions can receive credit for a range of activities outside their current boundaries.

First Merchants settles with Justice Department over mortgage practices - First Merchants in Muncie, Ind., has reached a settlement with the Department of Justice over the company's lending practices. The $10.2 billion-asset company said in a press release Thursday that the agreement ends an investigation that began in June 2017 and focused on issues tied to the Equal Credit Opportunity Act and the Fair Housing Act. First Merchants said there was no actual finding or adjudication tied to any matter alleged by the Justice Department. First Merchants agreed to invest more than $1 million over four years in a loan subsidy fund that will offer improved access to mortgages and home improvement loans to residents in majority black census tracts in Indianapolis and Marion County. The company will also open a full-service branch in a majority-black census tract in that market, along with a loan production office. “The settlement provides an opportunity for the bank to devote additional resources in serving the communities in which it operates, including helping meet the credit needs of all borrowers in those communities," Michael Rechin, the company's president and CEO, said in the release. The investigation focused on the bank's lending practices in Indianapolis and Marion County between 2011 and 2016. In mid-2017, the company completed a comprehensive fair lending assessment for 2016, concluding that it needed to enhance its mortgage lending strategy in neighborhoods with mostly minority residents. First Merchants said it then began making improvements. First Merchants and the Fair Housing Center of Central Indiana announced new initiatives designed to increase mortgage lending to residents in Marion County’s majority-black neighborhoods. With the issue resolved, First Merchants can proceed with its proposed acquisition of MBT Financial, which was announced in October.

GSE overhaul needs FHFA and Congress to succeed: Calabria — Federal Housing Finance Agency Director Mark Calabria on Thursday reiterated his view that an optimal reform framework for Fannie Mae and Freddie Mac would include both congressional action and administrative steps by the agency. “There are two major avenues for reform — administrative action and congressional action. To truly fix what is broken in our housing finance system, we need both,” he said during remarks at a Ginnie Mae summit. “It is not the case that either Congress acts or else I will.” The Federal Housing Finance Agency has appeared willing to move on its own to reform the government-sponsored enterprises. But legislation would be necessary, for example, to make explicit what is now an implicit government guarantee of the mortgage system. Calabria sounded open to such a reform, but said explicit government backing should have restrictions. “If Congress does create an explicit guarantee, it should be limited, clearly defined and paid for,” he said. His latest comment came just days after a June 8 interview Treasury Secretary Steven Mnuchin gave to Bloomberg, in which Mnuchin said he would prefer an explicit government guarantee in a future housing finance system. Calabria also echoed findings in the agency's most recent Report to Congress, issued earlier this week, that lawmakers should give the FHFA the same powers as other banking regulators, such as the ability to grant charters. Such authority would increase competition in the market. “Competition lowers prices, improves quality and drives innovation. Competition would also increase the stability of our housing system and ensure no institution is too big to fail,”

FHFA asks Congress for power to charter Fannie, Freddie competitors — The Federal Housing Finance Agency has officially asked Congress to provide it with certain powers granted to other banking regulators, including the ability to charter additional competitors to mortgage giants Fannie Mae and Freddie Mac. In the FHFA’s most recent report to Congress, Director Mark Calabria urged the Senate Banking Committee and House Financial Services Committee to take action on housing finance reform, encouraging lawmakers “to act alongside the administration and FHFA” in order to strengthen the ability of the government-sponsored enterprises to withstand an economic downturn. “FHFA will set an ambitious agenda that ensures that the mortgage market and FHFA’s regulated entities do not return to pre-financial crisis business models,” Calabria wrote in an opening letter, which was released Wednesday along with the full report. Calabria said that Congress should provide the FHFA with chartering authority, similar to that exercised by the Office of the Comptroller of the Currency, to approve competitors to Fannie and Freddie. He argued more competition would boost market stability and limit reliance on the GSEs. “FHFA should have the same powers today, with the same flexibility, as other federal financial safety and soundness regulators,” he said. Calabria has endorsed this idea previously in speeches since he took the helm of the agency in April. He told a Mortgage Bankers Association conference in May that chartering powers would put the FHFA on a level playing field with the other banking regulators. Calabria said the FHFA's underlying statute also requires the agency to use capital definitions that are outmoded and restrict the regulator’s capabilities, which he said “requires undesirable work-arounds.” “Amending or eliminating statutory capital definitions that apply only to the Enterprises, thereby providing FHFA the same flexibility as other financial regulators, would permit FHFA to develop more tailored and appropriate capital and leverage standards, for consideration by Congress, the Administration, and market participants when working toward housing finance reform,”

 March foreclosure rates haven't been this low in 20 years -  Foreclosure rates in March hit their lowest reading for the month in at least 20 years, while overall and serious delinquency rates also achieved 13-year lows for the same period, according to CoreLogic. The foreclosure inventory rate, which accounts for mortgages in any stage of foreclosure, ticked down 0.2 percentage points to 0.4% in March from a year ago. This is the fifth consecutive month the rate has held at 0.4%, and marks the lowest it has been for any March since 1999. Overall, 4% of mortgage loans were in some stage of delinquency in March, down from 4.3% a year ago. A healthier economy is a likely contributor to better behavior from borrowers. The share of consumers reporting their household income was significantly higher in March from the prior year grew 3% annually to 20%, according to Fannie Mae. And 80% claimed they were confident in not losing their job over the next 12 months, which is up 9% from the previous year. "Delinquency rates and foreclosures continue to drop through March and should decline further in the months ahead barring any serious dislocations from recent flooding in the Midwest or a severe Atlantic hurricane and/or wildfire season on the coasts," Frank Martell, CoreLogic's president and CEO, said in a press release. Certain regions did post increases in their delinquency rates, with the greatest gains being in those that had more recently suffered from natural disasters. Among states posting stronger growth in delinquency rates were hurricane-affected areas in the Southeast (Florida, Georgia and North Carolina) and in the Chico, Calif., metro area, which was devastated by last year's Camp Fire. While the national delinquency rate was down overall, 21 states did see some sort of increase, though their development should be limited going forward. "The increase in the overall delinquency rate in 42% of states most likely indicates many Americans were caught off guard by their expenses in early 2019. A strong economy, labor market and record levels of home equity should limit delinquencies from progressing to later stages,"

CoreLogic: 2.2 Million Homes with Negative Equity in Q1 2019 -- From CoreLogic: Homeowner Equity Insights, 1st Quarter 2019 In the first quarter 2019, the total number of mortgaged residential properties with negative equity decreased 1% percent from the fourth quarter 2018 to 2.2 million homes, or 4.1% of all mortgaged properties. On a year-over-year basis, negative equity fell 11% from 2.5 million homes, or 4.7% of all mortgaged properties, in the first quarter of 2018.The national aggregate value of negative equity was approximately $304.4 billion at the end of the first quarter of 2019. This is up quarter over quarter by approximately $2.5 billion, from $301.9 billion in the fourth quarter of 2018.Negative equity peaked at 26 percent of mortgaged residential properties in the fourth quarter of 2009, based on the CoreLogic equity data analysis which began in the third quarter of 2009.This graph from CoreLogic shows the percent negative equity by states. On a year-over-year basis, the number of homeowners with negative equity has declined from 2.5 million to 2.2 million.

MBA: Mortgage Applications Increased Sharply in Latest Weekly Survey -- From the MBA: Mortgage Applications Increase in Latest MBA Weekly Survey: Mortgage applications increased 26.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 7, 2019. The results for the week ending May 31, 2019 included an adjustment for the Memorial Day holiday. .. The Refinance Index increased 47 percent from the previous week. The seasonally adjusted Purchase Index increased 10 percent from one week earlier. The unadjusted Purchase Index increased 20 percent compared with the previous week and was 10 percent higher than the same week one year ago. ... “Mortgage rates for all loan types fell by a sizeable margin for the second straight week, pulled down by trade tensions with China and Mexico, the financial markets reacting to more bearish communication from several Fed officials, and weaker than expected hiring in May,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Despite the less positive outlook, both purchase and refinance applications surged, driven mainly by these lower rates. The refinance index jumped 47 percent to its highest level since 2016.” Added Kan, “With the 30-year fixed-rate mortgage at its lowest level since September 2017, purchase activity was more than 10 percent higher than a year ago. Demand is still relatively strong, but there is likely some restraint from prospective buyers, driven by some economic uncertainty. Furthermore, housing supply is still very tight for first-time buyers.”  .. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.12 percent from 4.23 percent, with points remaining unchanged at 0.33 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.

Credit Scores Could Soon Get Even Creepier and More Biased - Credit scores are often presented as objective and neutral, but they have a long history of prejudice. Most changes in how credit scores are calculated over the years—including the shift from human assessment to computer calculations, and most recently to artificial intelligence—have come out of a desire to make the scores more equitable, but credit companies have failed to remove bias, on the basis of race or gender, for example, from their system. More recently, credit companies have started to use machine learning and offer "alternative credit" as a way to reduce bias in credit scores. The idea is to use data that isn't normally included in a credit score to try and get a sense for how trustworthy someone might be. All data is potential credit data, these companies argue, which could include everything from your sexual orientation to your political beliefs, and even what high school you went to. But introducing this "non-traditional" information to credit scores runs the risk of making them even more biased than they already are, eroding nearly 150 years of effort to eliminate unfairness in the system. Though it's unclear exactly what sorts of algorithms credit companies use, the latest in machine learning is "deep learning." Deep-learning programs are trained on huge amounts of data in order to "learn" patterns and generate an output, such as a credit score. Machine learning depends on a quality training dataset for accuracy, meaning that AI programs can absorb the prejudices of their creators. For example, Amazon ditched an AI-driven hiring tool trained on resumes after it realized that the program was biased against women.The algorithms likely wouldn't be told the race or gender of an applicant, but that doesn't prevent the system from making guesses and reflecting existing biases. A 2018 study found that both "face-to-face and FinTech lenders charge Latinx/African-American borrowers 6-9 basis points higher interest rates." Researchers have previously raised the alarm that AI programs could effectively reinstate redlining and similar practices by churning through deeply biased or incomplete data to produce a seemingly objective number. In 2017, Stanford University researchers found that even an ostensibly "fair" algorithm in a pretrial setting can be injected with bias in favour of a particular group, depending on the composition of the training data.

Mortgage applications soar as refinances surge on a big rate drop - Consumers saw an opportunity last week and took it — in a big way. Mortgage rates dropped to their lowest level in nearly two years, so total mortgage applications surged 26.8% in just one week, according to the Mortgage Bankers Association’s seasonally adjusted index. Volume was 41% higher than a year ago. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.12% from 4.23%, with points remaining unchanged at 0.33 (including the origination fee) for loans with a 20% down payment. That rate was 4.83% a year ago, 71 basis points higher. “Mortgage rates for all loan types fell by a sizable margin for the second straight week, pulled down by trade tensions with China and Mexico, the financial markets reacting to more bearish communication from several Fed officials, and weaker than expected hiring in May,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. Refinances, which are most rate-sensitive, led the surge, jumping a remarkable 47% week to week and 97% annually. That pushed the refinance share of total mortgage application volume to 49.8% from 42.2%. It is nothing short of a refinancing boom, with applications now up 63% in the four weeks as rates have fallen 28 basis points over that time. Mortgage applications to purchase a home, which hadn’t gained much traction on falling rates, finally jumped 10% weekly and annually. Buyers don’t usually react immediately to weekly rate drops, but since rates have been falling for a few weeks now, it may have pushed more potential buyers off the fence. “Demand is still relatively strong, but there is likely some restraint from prospective buyers, driven by some economic uncertainty. Furthermore, housing supply is still very tight for first-time buyers,” Kan said. Supply is rising in most metropolitan markets, but only in the move-up and luxury range. Starter homes continue to be scarce, and builders are still mostly building more expensive homes. Housing starts overall have been falling, as builders saw very weak demand at the end of last year and are only now seeing that demand pick up.

 Profits Plunge As Home-Flipping Hits 9-Year-High - Luxury homes aren't the only section of the American housing market that's showing troubling signs of weakness. Increasingly, entrepreneurs who once saw the opportunity to make quick gains by investing in gentrifying markets before offloading their homes at a premium - a practice called 'home flipping' - are also heading for the exits.Homes that were resold within 12 months after being purchased made up 7.2% of all transactions in the first quarter, the biggest share since the start of 2010. But while activity surged to new cycle highs, the average return on investment, not including renovations and other expenses, dropped to 39%, an almost eight-year low. All told, profits slumped to their lowest level in eight years. Anybody who remembers the heady years ahead of the housing market crash will recall the role that unchecked speculation allowed unqualified investors, hairdressers, strippers and others, to secure adjustable rate 'liar loans' that helped them enter the speculation frenzy.Speculators are on the housing market’s front lines, where softening price growth, waning demand and longer times to sell can turn quickly into shrinking profits, or even losses. Purchases of previously owned homes fell 4.4% in April, the 14th straight year-over-year decline, according to the National Association of Realtors."Investors may be getting out while the getting is good," Todd Teta, chief product officer at Attom Data Solutions, said in the report. "If investors are seeing profit margins drop, they may be acting now and selling before price increases drop even more." The average gross flipping profit of $60,000 in Q1 2019 translated into an average 38.7% return on investment compared to the original acquisition price, down from a 42.5% average gross flipping ROI in Q4 2018 and down from an average gross flipping ROI of 48.6% in Q1 2018 to the lowest level since Q3 2011, a nearly eight-year low.

 Most millennial renters expect to buy a home in the next five years -Approximately two-thirds of millennial and Generation-Z renters expect to purchase a home in the next five years, although their aspirations for homeownership slipped from a year ago, a Pulsenomics survey found. "Moderating home price growth, falling mortgage rates and solid wage gains in the first quarter have stoked housing expectations and homeownership aspirations" for all groups, said Pulsenomics founder Terry Loebs in a press release. However, the purchase market has not grown as some had forecast because of affordability concerns. "Although our research confirms significant variation in housing confidence and transaction sentiments by market and household category, overall, these latest index data point to an improving balance of power between real estate buyers and sellers," Loebs said. The Housing Confidence Survey index for all generations was 69.8 in the first quarter, but for millennials it was 71. The overall score one year ago was 68.6, which dropped to 67.2 in the third quarter. When it came to millennials, the index was 69.7 for the first quarter last year and 70.1 for the third quarter. Millennials have a higher homeownership aspirations index than the general population, 72.4 versus 62.7, respectively. But the index is down from 72.9 for the first quarter one year ago and 73.1 from the third quarter. For the general population, the index rose from 61.3 in the first quarter of 2018 and 61.9 in the third quarter. Housing confidence among prospective first-time homebuyers has been resilient even as many deal with potential roadblocks like student loan debt. "Contrary to some popular narratives, the majority of Gen-Z and millennial renters are looking forward to homeownership, are confident they'll be able to afford it, and say that when the time comes to buy, they will favor living in suburbia,"

Leading Index for Commercial Real Estate Declines in May -- From Dodge Data Analytics: Dodge Momentum Index Falls in May The Dodge Momentum Index fell 1.0% in May to 141.0 (2000=100) from the revised April reading of 142.4. The Momentum Index, issued by Dodge Data & Analytics, is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The May decline for the Momentum Index was due entirely to a 6.9% drop by its commercial component, as its institutional component rose 8.1%.  The Momentum Index continues to settle back from the most recent highs achieved last summer.On a year-over-year basis, the Momentum Index in May was 9.2% lower than a year ago, with a 16.0% drop by its commercial component outweighing a 1.8% gain by its institutional component. Although the trend for the overall Momentum Index is downward, so far the pullback has been measured, suggesting that there remains enough nonresidential building projects in the pipeline to support near term stability for construction activity. This graph shows the Dodge Momentum Index since 2002. The index was at 141.0 in May, down from 142.4 in April. According to Dodge, this index leads "construction spending for nonresidential buildings by a full year".  This suggests a slowdown in CRE later this year.

Half of Americans say their financial situation hasn’t improved since the Great Recession - The Great Recession has officially been over for a decade. For many Americans, there’s little reason to celebrate. Many people’s finances haven’t recovered from the recession’s blows, according to a new survey by personal finance website Bankrate.com. “There are still tens of millions who are struggling to even get back to where they were before the economy took a turn for the worse,” said Mark Hamrick, senior economic analyst at Bankrate.com. More than half of Americans who were adults amid the Great Recession said they endured some type of negative financial impact, Bankrate found. And half of those people say they’re doing worse now than before the crisis. Fewer than half (46%) of those who were adults at the time of the recession say they’ve seen their paychecks grow since before it began. More than a third of those who say they, or their partner, lost a job during the recession say their pay has actually dropped from before the recession. More than 2,700 adults were interviewed online in May. The median family income, after accounting for inflation, was $59,039 in 2016, little different than it was in 2000 ($58,544). During the same time, medical, childcare and college costs have ballooned.

Retail Sales increased 0.5% in May - On a monthly basis, retail sales increased 0.5 percent from April to May (seasonally adjusted), and sales were up 3.2 percent from May 2018. From the Census Bureau report: Advance estimates of U.S. retail and food services sales for May 2019, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $519.0 billion,an increase of 0.5 percent from the previous month, and 3.2 percent above May 2018. ... The March 2019 to April 2019 percent change was revised from down 0.2 percent to up 0.3 percent.This graph shows retail sales since 1992. This is monthly retail sales and food service, seasonally adjusted (total and ex-gasoline).Retail sales ex-gasoline were up 0.6% in May. The second graph shows the year-over-year change in retail sales and food service (ex-gasoline) since 1993.  Retail and Food service sales, ex-gasoline, increased by 3.0% on a YoY basis. The increase in May was below expectations, however sales in March and April were revised up.  Overall a solid report.

Retail Sales: Up 0.55% in May, at 3.2% YoY --The Census Bureau's Advance Retail Sales Report for May was released this morning. Headline sales came in at 0.55% month-over-month to one decimal and was worse than the Investing.com forecast of 0.7%. Core sales (ex Autos) came in at 0.50% MoM (to two decimals). Here is the introduction from today's report:Advance estimates of U.S. retail and food services sales for May 2019, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $519.0 billion, an increase of 0.5 percent (±0.5 percent)* from the previous month, and 3.2 percent (±0.7 percent) above May 2018. Total sales for the March 2019 through May 2019 period were up 3.6 percent (±0.5 percent) from the same period a year ago. The March 2019 to April 2019 percent change was revised from down 0.2 percent (±0.5 percent)* to up 0.3 percent (±0.1 percent).Retail trade sales were up 0.5 percent (±0.5 percent)* from April 2019, and 3.1 percent (±0.7 percent) above last year. Nonstore retailers were up 11.4 percent (±1.4 percent) from May 2018, while sporting goods, hobby, musical instrument, and book stores were down 4.2 percent (±2.5 percent) from last year. [view full report]The chart below is a log-scale snapshot of retail sales since the early 1990s. The two exponential regressions through the data help us to evaluate the long-term trend of this key economic indicator.

Michigan Consumer Sentiment: Reverses in June - The June Preliminary came in at 97.9, down 2.1 from the May Final reading. Investing.com had forecast 98.1.Surveys of Consumers chief economist, Richard Curtin, makes the following comments: In early June, consumer sentiment reversed the May gain due to tariffs as well as slowing gains in employment. Some of the decline was due to expected tariffs on Mexican imports, which may be reversed in late June, but most of the concern was with the 25% tariffs on nearly half of all Chinese imports. Consumers responded by lowering growth prospects for the national economy, and as a consequence, reduced the expected gains in employment. Consumers anticipated an average long-term inflation rate of just 2.2%, the lowest rate the surveys have recorded since the question was introduced forty years ago. The sole component of the Sentiment Index that improved in early June was buying plans for large household durables. That improvement, however, was due to consumers favoring tariff induced buy-in-advance price rationales. In the past year, spontaneously unfavorable references to tariffs moved in tandem with unaided mentions of buy-in-advance rationales for household durables. Negative mentions of tariffs were spontaneously made by 40% of all consumers in early June, up from 21% in May and the prior high of 35% in July 2018; unaided references to buy-in-advance price rationales were mentioned in early June by 19%, up from 12% in May, and just below the 21% in March 2018 (when Trump first announced tariffs on home appliances). Overall, the data indicate that real personal consumption expenditures will advance by 2.5% in the year ahead. [More...] See the chart below for a long-term perspective on this widely watched indicator. Recessions and real GDP are included to help us evaluate the correlation between the Michigan Consumer Sentiment Index and the broader economy.

BLS: CPI increased 0.1% in May, Core CPI increased 0.1% --From the BLS:The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1 percent in May on a seasonally adjusted basis after rising 0.3 percent in April, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 1.8 percent before seasonal adjustment...The index for all items less food and energy increased 0.1 percent for the fourth consecutive month.... The all items index increased 1.8 percent for the 12 months ending May. The index for all items less food and energy rose 2.0 percent over the last 12 months, and the food index also rose 2.0 percent. The energy index decreased 0.5 percent over the past year. I'll post a graph later today after the Cleveland Fed releases the median and trimmed-mean CPI.

Consumer Price Index: May Headline at 1.79% - The Bureau of Labor Statistics released the May Consumer Price Index data this morning. The year-over-year non-seasonally adjusted Headline CPI came in at 1.79%, down from 2.00% the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 1.99%, fractionally down from the previous month's 2.06% and below the Fed's 2% PCE target.Here is the introduction from the BLS summary, which leads with the seasonally adjusted monthly data:The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1 percent in May on a seasonally adjusted basis after rising 0.3 percent in April, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 1.8 percent before seasonal adjustment.The food index rose 0.3 percent in May after declining in April, with the food index accounting for nearly half of the May seasonally adjusted all items monthly increase. The energy index fell 0.6 percent in May, with the gasoline index falling 0.5 percent and the indexes for electricity and natural gas also declining in May.The index for all items less food and energy increased 0.1 percent for the fourth consecutive month. The indexes for shelter, medical care, airline fares, education, household furnishings and operations, and new vehicles all rose in May. The indexes for used cars and trucks, recreation, and motor vehicle insurance were among those that declined over the month.The all items index increased 1.8 percent for the 12 months ending May. The index for all items less food and energy rose 2.0 percent over the last 12 months, and the food index also rose 2.0 percent. The energy index decreased 0.5 percent over the past year. [More…]Investing.com was looking for a 0.1% MoM change in seasonally adjusted Headline CPI and 0.2% in Core CPI. Year-over-year forecasts were 1.9% for Headline and 2.1% for Core. The first chart is an overlay of Headline CPI and Core CPI (the latter excludes Food and Energy) since the turn of the century. The highlighted two percent level is the Federal Reserve's Core inflation target for the CPI's cousin index, the BEA's Personal Consumption Expenditures (PCE) price index.

Consumer Price Inflation Slows In May - Core Weakest Since Feb 2017Consumer Prices rose less than expected in May, slowing to +1.8% YoY (the same as headline PPI), both back below the Fed's 'mandated' level of 2.0% for the first time since June 2017. Both Goods and Services CPI slowed in May. The index for used cars and trucks fell 1.4 percent in May, its fourth consecutive monthly decrease. The index for motor vehicle insurance declined 0.4 percent in May, the largest monthly decrease in that index since May 2007. The index for recreation decreased 0.3 percent for the month. Lower gasoline prices played a role in keeping broader inflation tame. Energy prices fell 0.6% from the prior month and 0.5% from a year earlier as all major components in the category fell on an annual basis. The index for owners’ equivalent rent rose 0.3 percent, while the index for rent increased 0.2 percent over the month. The index for lodging away from home fell 0.1 percent in May, breaking a string of 5 consecutive monthly increases. Both rent and shelter inflation YoY slowed modestly in May. The index for prescription drugs fell 0.2 percent, but the index for hospital services rose 0.5 percent and the index for physicians’ services advanced 0.1 percent. The more watched Core CPI data also slowed to just 2.0% YoY (below forecasts) bolster investor expectations for Fed rate cuts this year (alongside slowing economic growth indications)

Cleveland Fed: Key Measures Show Inflation Close to 2% YoY in May, Core PCE below 2% --The Cleveland Fed released the median CPI and the trimmed-mean CPI this morning:According to the Federal Reserve Bank of Cleveland, the median Consumer Price Index rose 0.2% (2.3% annualized rate) in May. The 16% trimmed-mean Consumer Price Index also rose 0.1% (1.3% annualized rate) during the month. The median CPI and 16% trimmed-mean CPI are measures of core inflation calculated by the Federal Reserve Bank of Cleveland based on data released in the Bureau of Labor Statistics’ (BLS) monthly CPI report. Earlier today, the BLS reported that the seasonally adjusted CPI for all urban consumers rose 0.1% (0.9% annualized rate) in May. The CPI less food and energy rose 0.1% (1.4% annualized rate) on a seasonally adjusted basis. Note: The Cleveland Fed released the median CPI details for May here.

May Producer Price Index: Core Final Demand Up 0.2 MoM - Today's release of the May Producer Price Index (PPI) for Final Demand came in at 0.1% month-over-month seasonally adjusted, down from 0.2% last month. It is at 1.8% year-over-year, down from 2.2% last month, on a non-seasonally adjusted basis. Core Final Demand (less food and energy) came in at 0.2% MoM, up from 0.1% the previous month and is unchanged YoY NSA. Investing.com MoM consensus forecasts were for 0.1% headline and 0.2% core.Here is the summary of the news release on Final Demand:The Producer Price Index for final demand rose 0.1 percent in May, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices advanced 0.2 percent in April and 0.6 percent in March. (See table A.) On an unadjusted basis, the final demand index increased 1.8 percent for the 12 months ended in May.In May, the rise in final demand prices is attributable to a 0.3-percent increase in the index for final demand services. In contrast, prices for final demand goods declined 0.2 percent. More…  The BLS shifted its focus to its new "Final Demand" series in 2014, a shift we support. However, the data for these series are only constructed back to November 2009 for Headline and April 2010 for Core. Since our focus is on longer-term trends, we continue to track the legacy Producer Price Index for Finished Goods, which the BLS also includes in their monthly updates.As this (older) overlay illustrates, the Final Demand and Finished Goods indexes are highly correlated.

Producer Price Growth Slumps To Weakest Since Jan 2017 -- Core Producer Price inflation has slowed for six straight months to +2.3% YoY but the headline (NSA) data slowed to just 1.8% YoY (notably below the +2.0% expectation). This is the weakest headline Producer Price inflation print since Jan 2017 Final Demand Goods prices shrank 0.2% in May as Services prices rose 0.3%... Notably, nearly 80 percent of the May advance in the index for final demand services is attributable to prices for guestroom rental, which jumped 10.1 percent. This is a rec0ord surge in guestroom rental prices on a non-seasonally-adjusted basis... The indexes for fuels and lubricants retailing, outpatient care (partial), inpatient care, portfolio management, and transportation of passengers (partial) also moved higher. In contrast, margins for apparel, footwear, and accessories retailing declined 5.2 percent. The indexes for machinery, equipment, parts, and supplies wholesaling and for loan services (partial) also decreased . This headline print below the 2.0% Maginot Line, surely gives The Fed more ammo for its pre-crime "insurance cut"? However, the PPI (ex Food, Energy, and Trade Services) rose to +2.3% YoY.

Industrial Production Increased 0.4% in May From the Fed: Industrial Production and Capacity Utilization - Industrial production rose 0.4 percent in May after falling 0.4 percent in April. The indexes for manufacturing and mining gained 0.2 percent and 0.1 percent, respectively, in May; the index for utilities climbed 2.1 percent. At 109.6 percent of its 2012 average, total industrial production was 2.0 percent higher in May than it was a year earlier. Capacity utilization for the industrial sector moved up 0.2 percentage point in May to 78.1 percent, a rate that is 1.7 percentage points below its long-run (1972–2018) average.This graph shows Capacity Utilization. This series is up 11.4 percentage points from the record low set in June 2009 (the series starts in 1967).Capacity utilization at 78.1% is 1.7% below the average from 1972 to 2017 and below the pre-recession level of 80.8% in December 2007. The second graph shows industrial production since 1967.Industrial production increased in May to 109.2. This is 26% above the recession low, and 4.0% above the pre-recession peak. The increase in industrial production and increase in capacity utilization were above consensus.

US Industrial Production Rebounds From Its Weakest Since Feb 2017 - After a huge disappointment ( and biggest decline in a year) in April, May's US Industrial Production was expected to rebound modestly but it beat expectations of a 0.2% gain, rising 0.4% MoM. It has been an ugly few months for industrial production but this rebound is the biggest MoM jump since Nov 2018. Factory production rose 0.2% in May after falling 0.5% in April but the biggest driver of IP gains in May was a 2.1% spike in Utilities... not exactly a reflection of a humming economy, and we would not rely on this being sustainable... U.S. May Oil and Gas Drilling Fell 4% MoM and May consumer energy products posted a rise of 1.5% MoM after falling 4.4% in April. On a year-over-year basis, industrial production growth rebounded from its weakest since Feb 2017 This is not the rebound in economic data that markets are hoping for as, like retail sales, it weakens The Fed's case for an "insurance" cut. We await the proclamation that, like inflation's dip, this rebound in production is transitory too... 

May real retail sales positive, but industrial production remains in a shallow recession --Retail sales are one of my favorite indicators, because in real terms they can tell us so much about the present, near term forecast, and longer term forecast for the economy.This morning retail sales for May were reported up +0.5%, and April was revised upward by a net +0.5% as well. Since consumer inflation increased by +0.4% over that two month period, real retail sales have risen +0.6% in the past two months.  For the past two months I have noted that sales were still slightly below their peak last November, and YoY real sales remained in a downshift. This morning’s report helps those comparisons substantially, as YoY real retail sales are now up +1.4%.  Here is what the last five years look like:

U.S. import prices - May 2019: US import prices post the largest drop in 5 months - U.S. import prices fell by the most in five months in May amid a broad decline in the cost of goods, the latest indication of muted inflation that strengthens the case for the Federal Reserve to cut interest rates this year. The Labor Department said on Thursday import prices dropped 0.3% last month, the biggest decline since last December. Data for April was revised down to show import prices rising 0.1% instead of climbing 0.2% as previously reported. Economists polled by Reuters had forecast import prices slipping 0.2% in May. In the 12 months through May, import prices fell 1.5% after decreasing 0.3% in April. The report came on the heels of data on Wednesday showing consumer prices remained tame in May, supporting financial market expectations that the Fed would cut rates this year. Import prices exclude duties. In May, prices for imported fuels and lubricants declined 1.0% after rising 1.7% percent in the prior month. Imported food prices dropped 0.8% last month after surging 2.7% in April. Excluding fuels and food, import prices slipped 0.2% in May after falling 0.3% in the prior month. So-called core import prices decreased 1.5% in the 12 months through May. Though the dollar has weakened a bit this year, its gains last year against the currencies of the United States’ main trading partners continue to depress core import prices. The cost of imported capital goods declined 0.1% last month. Prices for imported consumer goods excluding automobiles was unchanged. The cost of goods imported from China edged down 0.1% last month after falling 0.2% in April. Prices fell 1.4% in the 12 months through May, the largest drop since February 2017. The report also showed export prices fell 0.2% in May after nudging up 0.1% in April. Export prices fell 0.7% on a year-on-year basis in May after gaining 0.2% in April. Soybean prices tumbled 20.6% year-on-year.

LA area Port Traffic Down Year-over-year in May - Special note: The expansion to the Panama Canal was completed in 2016 (As I noted a few years ago), and some of the traffic that used the ports of Los Angeles and Long Beach is probably going through the canal. This might be impacting TEUs on the West Coast.On the impact of the trade war, from Port of Long Beach Executive Director Mario Cordero: “One year into the trade war, escalating tariffs have pushed retailers to order goods early, warehouses are brimming with inventory as a result, and in response, ocean carriers are managing their vessels to deal with reduced demand,” Cordero said. “We are hopeful Washington and Beijing can resolve their differences before we see long-term changes to the supply chain that impact jobs in both nations.” emphasis addedContainer traffic gives us an idea about the volume of goods being exported and imported - and usually some hints about the trade report since LA area ports handle about 40% of the nation's container port traffic. The following graphs are for inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container). To remove the strong seasonal component for inbound traffic, the first graph shows the rolling 12 month average. On a rolling 12 month basis, inbound traffic was down 0.5% in May compared to the rolling 12 months ending in April. Outbound traffic was down 0.7% compared to the rolling 12 months ending the previous month. The 2nd graph is the monthly data (with a strong seasonal pattern for imports). LA Area Port TrafficUsually imports peak in the July to October period as retailers import goods for the Christmas holiday, and then decline sharply and bottom in February or March depending on the timing of the Chinese New Year (February 5th in 2019). In general imports have been increasing, and exports have mostly moved sideways over the last 8 years

Imports at Southern California Ports Fell Sharply Last Month – WSJ - Trans-Pacific trade tensions weighed on volumes at Southern California ports in May, prompting warnings that the yearlong tariff spat between the U.S. and China is rattling supply chains. Combined inbound loaded containers at the ports of Los Angeles and Long Beach, the neighboring ports that comprise the largest U.S. gateway for seaborne trade, fell 6.3% last month from a year ago. The ports handled 48,256 fewer loaded import containers than they did in the same month last year. Combined exports at the two ports also fell 7.4%. The decline, in a month when maritime operators usually are gearing up for the year’s peak seasonal shipping volumes, suggested that importers are pausing orders for goods after accelerating imports for several months to get ahead of rising tariffs launched by Washington and Beijing. “Escalating tariffs pushed retailers to order early, warehouses are brimming with inventory and carriers are managing their vessels to deal with reduced demand,” said Mario Cordero, executive director of the Port of Long Beach, where loaded import container volume fell 19.5% last month from same month a year ago.  Last month, the Trump administration raised tariffs on $200 billion of Chinese goods, including furniture and automotive parts, to 25%. China responded with tariffs on $60 billion in U.S. goods. Washington has also threatened to impose levies on all remaining Chinese exports worth around $300 billion. The Global Port Tracker report by the National Retail Federation and Hackett Associates released this week estimated that container imports into major U.S. ports overall rose 3% in May. The retail group also scaled back its projection for imports in the coming months, saying U.S. ports would see a combined 900,000 fewer inbound containers in June, July and August than had been forecast in May. Peter Sand, chief shipping analyst at Bimco, an organization representing shipowners, said in a report Wednesday that container shipping demand world-wide has been softening this year and grew by 0.5% in the first quarter from a year ago, sharply below average growth rates over recent years. Volumes for intra-Asia trade also declined 0.2% in the first three months of the year, which Mr. Sand is a troubling signal for broader trade demand later this year. “The drop is a sign of weakening volumes in the supply chains and, ultimately, the result of fewer new export orders received by Asian manufactures in recent months,” Mr. Sand said, “something that will impact outbound volumes in the coming months.”

AAR: May Rail Carloads down 2.1% YoY, Intermodal Down 5.9% YoY -- From the Association of American Railroads (AAR) Rail Time Indicators. Graphs and excerpts reprinted with permission. You have to look pretty hard to find good news in May’s rail traffic data, but disappointing news is easy to find. Total U.S. rail carloads were down 2.1% in May 2019 from May 2018, their fourth straight monthly decline. ... Carloads are taking hits from several sides. Flooding in the Midwest has been hindering the operations of railroads and many of their customers for a couple of months. More importantly, heightened economic uncertainty is being made worse by increased trade-related tensions; higher tariffs leading to reductions or disruptions of international trade; and lower industrial and manufacturing output. ... Ongoing trade disputes aren’t helping intermodal. In May, intermodal volume was down 5.9%, thanks in part to the trade disputes and tariffs that have been applied to imports in recent months. This graph from the Rail Time Indicators report shows U.S. average weekly rail carloads (NSA).  Red is 2019. Rail carloads have been weak over the last decade due to the decline in coal shipments. It’s not like the sky is falling (not yet, anyway), but U.S. rail traffic has certainly seen better days. Total U.S. rail carloads in May 2019 were 1.29 million, down 2.1%, or 28,065 carloads, from May 2018. That’s the fourth straight year-over-year monthly decline, something that last happened in late 2017In 2019 through May, total U.S. carloads were down 2.4%, or 137,995 carloads, from 2018 through May. Since 1988, when our data begin, only 2016 had fewer total carloads for the first five months of the year. The second graph is for intermodal traffic (using intermodal or shipping containers): May was a disappointing month for intermodal. U.S. intermodal originations were down 5.9%, or 82,521 containers and trailers, in May 2019 from May 2018. The 5.9% decline was the largest percentage decline for any month since July 2016 and was the fourth-straight monthly decline for intermodal … The silver lining is that May 2018 was by far the highest-volume May in history for U.S. intermodal, so May 2019 faced a very tough comp and compared to years other than 2018, May 2019 wasn’t so bad.

Hundreds Of U.S. Flights Canceled As GPS-Based Aircraft Navigation System Fails - "Does anyone know what happened to GPS/ADS-B last night?" one aviation commentator asked Twitter on June 9, a Sunday. "The issue seemed to be quite wide-spread, with a lot of aircraft grounded... Had this happened on a weekday, it would have been leading headlines on national news⁠—some sort of GPS fault grounded a chunk of the U.S. commercial fleet and hardly anybody noticed." But at the time of publishing that issue remains unresolved and the weekend is all but over. According to the FAA, "certain aircraft equipped with the Rockwell Collins GPS 4000-100 and select ADS-B out GPS receivers are indicating 'ADS-B fail, unavailable, TCAS fail or transponder fail' messages." Aircraft without working transponders were directed to coordinate with the FAA before departure, a prior directive had instructed those planes not to fly above 28,000 feet.  Rockwell Collins, acquired by United Technologies last year, provides avionics and information technology systems and services. The issue appears to center on some of the company's ADS-B (Automatic Dependent Surveillance-Broadcast) systems that send flight data to be picked up by ground stations. "The ADS-B system depends on GPS data to function properly," explained Hackaday, "but a problem with the quality of the GPS data has disrupted normal ADS-B features on some planes."  Whether the issue was caused by poor GPS data or a software upgrade to affected systems remains speculation, nothing has yet been confirmed. But, whatever the cause, the issue has led to a significant number of flight cancellations. According to CNBC, regional carriers in the U.S. "canceled about 400 flights scheduled for Sunday." A Delta spokeswoman said "about 80 of its regional flights were canceled," and American and United regional carriers were hit by the same issue.

Why Boeing May Never Recover From Its 737 Debacle - -- Most of us are familiar with the acronym “FUBAR.” A recent New York Times article on the Boeing 737 fiasco provides a perfect illustration of the concept. We’re now learning that the company “built deadly assumptions” into its newly designed 737 Max aircraft and, specifically, its computer software system—the Maneuvering Characteristics Augmentation System (MCAS). Even worse, the New York Times account concludes that the recent air crashes that have resulted in a worldwide grounding of the Boeing Max plane “might have been avoided, if employees and regulators had a better understanding of MCAS” and if the Federal Aviation Authority (FAA) itself was not operating with outdated data on the software changes (which Boeing failed to provide). The analysis is excellent as far as it goes. But the most damning fact only briefly hinted at in the article is that the problems were evident as early as 2012, some five years before the newest 737 version was marketed and sold across the globe. At its core, this was a hardware problem, not a software issue. Even when Boeing was using a relatively “safer” version of the early MCAS software (that was later changed to a more dangerous version), the new 737 still had an engine too large to be accommodated in its traditional spot on the plane, which ultimately distorted “the relationship between the engine’s ‘thrust’ and its center of gravity,” as I’ve written before. The resultant aerodynamic problems could not be solved with a software “solution,” no matter how “safe” the original MCAS version (that was ultimately changed to an even more dangerous version) was purported to be.

 Small Business Optimism Index increased in May - Note: Most of this survey is noise, but there is some information, especially on the labor market and the "Single Most Important Problem". From the National Federation of Independent Business (NFIB): May 2019 Report: Small Business Optimism IndexSmall business optimism eclipsed pre-shutdown levels, increasing 1.5 points to 105.0 in May.  [S]mall business owners added a net addition of 0.32 workers per firm, with 25 percent citing the difficulty of finding qualified workers as their Single Most Important Business Problem, matching the record high. Sixty-two percent of owners reported hiring or trying to hire employees, up five points from last month, but 54 percent reported few or no qualified applicants for the positions they were trying to fill (up five points).

Weekly Initial Unemployment Claims increased to 222,000 --  The DOL reportedIn the week ending June 8, the advance figure for seasonally adjusted initial claims was 222,000, an increase of 3,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 218,000 to 219,000. The 4-week moving average was 217,750, an increase of 2,500 from the previous week's revised average. The previous week's average was revised up by 250 from 215,000 to 215,250.  The previous week was revised up.  The following graph shows the 4-week moving average of weekly claims since 1971.

BLS: Job Openings "Mostly Unchanged" at 7.4 Million in April -  In April there were 7.449 million job openings, and, according to the April Employment report, there were 5.824 million unemployed. So, for the fourteenth consecutive month, there were more job openings than people unemployed. Also note that the number of job openings has exceeded the number of hires since January 2015 (over 4 years).  From the BLS: Job Openings and Labor Turnover Summary:  The number of job openings was little changed at 7.4 million on the last business day of April, the U.S. Bureau of Labor Statistics reported today. Over the month, hires edged up to 5.9 million, and separations were little changed at 5.6 million. Within separations, the quits rate was unchanged at 2.3 percent and the layoffs and discharges rate was little changed at 1.2 percent. ...  The number of quits was little changed in April at 3.5 million. The quits rate was 2.3 percent. The quits level was little changed for total private and for government.  The following graph shows job openings (yellow line), hires (dark blue), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS. This series started in December 2000. Note: The difference between JOLTS hires and separations is similar to the CES (payroll survey) net jobs headline numbers. This report is for April, the most recent employment report was for May.  Note that hires (dark blue) and total separations (red and light blue columns stacked) are pretty close each month. This is a measure of labor market turnover.  When the blue line is above the two stacked columns, the economy is adding net jobs - when it is below the columns, the economy is losing jobs.  Jobs openings decreased in April to 7.449 million from 7.474 million in March. The number of job openings (yellow) are up 5% year-over-year. Quits are up 4% year-over-year. These are voluntary separations. (see light blue columns at bottom of graph for trend for "quits"). Job openings remain at a high level, and quits are still increasing year-over-year. This was a solid report.

April JOLTS report: a mixed bag consistent with the strong jobs report one month ago --The jobs report one month ago was a blowout to the upside, so I expected the JOLTS report for April, reported yesterday with a one month lag, to follow suit. And generally it did. Because this series is only 20 years old, we only have one full business cycle to compare. During the 2000s expansion:

  • Hires peaked first, from December 2004 through September 2005
  • Quits peaked next, in September 2005
  • Layoffs and Discharges peaked next, from October 2005 through September 2006
  • Openings peaked last, in April 2007

In yesterday’s report:

  • Hires made a new expansion high
  • Quits were only 1000 off their expansion high
  • Layoffs and discharges backed off from interim lows in January and March
  • Openings continued to fade from their expansion high last November:

Here’s the composite graph (with layoffs and discharges inverted, since fewer is better):  And here are the YoY% changes, better to show the underlying trend (minus hires, which I’ll break out separately below:

Forget Lower Jobs Growth, The Number of People Who’ve Stopped Looking for Work Is Much More Worrisome - The latest jobs report showed a lackluster gain in jobs in May that was worse than economists had predicted. While the sudden slowdown in jobs growth after many months of strong numbers is worrying and signals a weakening economy, a more long-term concern is the persistently low labor force participation rate that has not recovered in the decade since the onset of the Great Recession. I’ve been studying labor market issues for over much of my 30 year career as an economist. Let me explain why you should be paying more attention to the participation rate. Strong employment growth is important because getting a job is one of the best ways to improve a person’s economic standing. For this reason, slowing employment growth and rising unemployment are worrisome.But while the unemployment rate is currently near a 50-year low of 3.6%, that statistic doesn’t tell the full story and can mask a deterioration in the labor market.The participation rate measures all active workers divided by the working-age population. More importantly, it reflects people’s attachment to the job market – including their economic engagement and also, because a job is such an important part of a person’s identity, their overall well-being.When people who are unemployed grow too discouraged and stop looking for work, it causes the participation rate to go down. But as a result, the unemployment rate goes down as well because it doesn’t include people who have given up. This makes the picture look better than it is.From about the late 1980s until 2008, the participation rate fluctuated around 66% to 67%. But after the Great Recession, the rate dropped more 3 percentage points over the next seven years and has barely budged since. The latest jobs report shows it’s at 62.8%. The 3 percentage points decline in participation translates to over 6 million people no longer in the labor force.

How Americans Make And Spend Their Money, By Education Level - Months ago, we showed you a set of data visualizations that highlighted how people make and spend their money based on income groups.Today’s post follows a similar theme, and it visualizes differences based on education levels.Below, we’ll tackle the breakdowns of several educational groupings, ranging from high school dropouts to those in the highest education bracket, which is defined as having achieved a master’s, professional, or doctorate degree. The data visualizations in today’s post come to us from Engaging Data and they use Sankey diagrams to display data from the Bureau of Labor Statistics (BLS) that shows income and expenditure differences between varying levels of education in America. The four charts below will show data from the following categories:

  1. Less than high school graduate
  2. High school graduate
  3. Bachelor’s degree
  4. Master’s, professional, or doctorate degree

It should be noted that the educational level listed pertains to the person the BLS defines as the primary household member. Further, people in households can be at different ages and at different stages in their career – for example, someone with a Master’s degree could be 72 years old and collecting pension payments, and this impacts the data.

The Poor Who Are Not With Us - Yves Smith - America has a bad case of poverty denialism.  Being poor is stigmatized. In neo-Calvanist America, if you aren’t doing well, it must be the result of bad choices (like choosing the wrong parents) or not working hard enough. So many people in dire straits often feel compelled to underplay how bad things are for the sake of their dignity. But as the gap between rich and poor has turned into a yawning chasm, the well off are even better able than before to distance themselves from the desperate. One of the ways that seems to happen more and more is to underscore how alien they are compared to urban elites. Two articles that superficially don’t seem that closely connected but are different facets of this phenomenon are a Medium article (hat tip UserFriendly), Half of Americans Are Effectively Poor Now by Unair Haque and a Wall Street Journal story, The South’s Economy Is Falling Behind (hat tip Scott). The Medium piece explains that poverty is widespread in America, once you define it correctly, as in not being able to afford necessities:  43% of American households can’t afford a budget that includes housing, food, childcare, healthcare, transportation, and a cellphone. Translation: nearly half of Americans can’t afford the basics of life anymore.  You might know it intimately. The statistics say there’s an even chance you’re…living it. What a grim and bizarre reality. Half of people are effectively poor in the world’s richest country…  The folks that did the study above call this new class of people ALICE, for “asset limited, income constrained, employed.” It’s a sharp way to think about American collapse. Let me translate this term, too: the people formerly known as the American middle class.  Let’s take each of those terms one by one. “Asset limited” means that these households don’t have the resources — the hard financial assets — to drawn down on anymore. In short, “asset limited” is a polite way of saying: indebted for life, with no real way of ever not getting out of the trap. It’s a nice way of saying: broke.  There are two basic kinds of financial poverty, after all. Not having much of an income, and not having any wealth saved up. Americans are poor in both ways now. That’s because their incomes haven’t risen to allow them to save, and their debts keep mounting, which eats up their meagre incomes. Hence (another shocking stat) most Americans now die…in debt…  What do we call a population that live and debt “in debt”? We certainly don’t call them free in any real sense. They’re the modern equivalent of serfs or peasants — who are born owing, and who will die owing, a fictional, unplayable amount.

California's Staggering Homeless Count -- With 28 of 40 regions within the state having reported the preliminary estimates of their 2019 Point-In-Time (PIT) counts of the homeless population within the state, California officials are struggling to grasp that the number of homeless already exceeds the official count of 129,972 for the entire state in 2018, and will almost certainly surpass 150,000 when those counts are finalized in December 2019.  We base this observation on our analysis of the preliminary data that individual "Continuums of Care", which consist of one or more counties in the state of California, have reported through 7 June 2019. With those regions reporting an average 17.1% increase over their 2018 figures, if we apply this percentage to the 12 regions that have yet to report data, we project the number of people who will be counted as homeless in California for 2019 will be 152,332.  If those remaining 12 regions report no year-over-year change in their homeless counts, the size of California's homeless population will rise above 149,000 at a minimum, which would mark the lower end of a reasonable range for the state's 2019 homeless count. Meanwhile, if our estimate of 152,332 represents a midpoint for such a range, the high end would be more than 155,000.  No wonder elected officials are "stunned" by the staggering homeless counts being reported in across the state, where the below average 12% increase in Los Angeles County and 16% increase within the city of Los Angeles, stands out.The stunning increase in homelessness announced in Los Angeles this week — up 16% over last year citywide — was an almost incomprehensible conundrum given the nation's booming economy and the hundreds of millions of dollars that city, county and state officials have directed toward the problem.... "It is the height of contradiction that in the midst of great prosperity across the Golden State, we are also seeing unprecedented increases in homelessness,"

Black Drivers in Missouri 91% More Likely to Be Pulled Over by Police - — Black drivers in Missouri are nearly twice as likely to be pulled over than white drivers, according to a new report by the state’s attorney general.The report, released Monday by the office of Attorney General Eric Schmitt, found that black drivers had a 91 percent higher chance of being pulled over than their white counterparts. That was one of a number of disturbing statistics that add to the perception of Missouri as one of the most dangerous places in the U.S. for black people.The trend reflected in this year’s report, while troubling, is nothing new. In 2017, the NAACP issued a travel advisory for black people driving in Missouri based in part on data from the 2016 attorney general’s report.Black drivers in the state are 91 percent more likely to be pulled over by police than white drivers, a report from Missouri Attorney General Eric Schmitt’s office found.  This year, Schmitt’s office found that when the data was isolated to certain cities and neighborhoods, the racial disparity of traffic stops jumped even higher. According to reporting from the Associated Press: In the Kansas City-area city of Blue Springs, which is 87 percent white based on 2010 census data and close to Interstate 70, black drivers in general were 275 percent more likely to be stopped. When isolating stops to residents, data show black drivers were nearly three times as likely to be stopped compared to white resident drivers.

Special report: Profiting from prison  - A handful of American businesses have their fingers in almost every aspect of prison life, raking in billions of dollars every year for products and services — often with little oversight.  Taxpayers, incarcerated people and their families spend around $85 billion a year on public and private correction facilities, bail and prison services, according to the Prison Policy Initiative.

  • For-profit prison companies arose in response to the government's incapacity to handle the skyrocketing incarcerated population.
  • Now entrenched, they've become "one more hurdle" to changing the American system of mass incarceration, Lauren-Brooke Eisen of the Brennan Center for Justice told Axios.
  • These companies also have been known to cut corners — sometimes endangering people — in order to profit off of a system that disproportionately impacts the impoverished and marginalized.

Here's how they make money:

  • Phone calls.  About 80% of inmate calls go through Secarus or GTL, both owned by private equity and known for sometimes charging outrageous fees ($8.20 for the first minute, in one case cited in a lawsuit).
  • Medical services. The largest private provider of medical services to prisons is believed to be Corizon Health, operating in 220 facilities in 17 states and owned by a New York City hedge fund. Pricing: Corizon was paid $15.16 per incarcerated person per day for medical staffing in Arizona's prisons, before being accused of cheating state monitors and losing the account to another private company.
  • Food services. Two companies — Aramark and Trinity Services — provide meals in around 800 state and local facilities.
    • The Michigan Department of Corrections awarded a $145 million contract to Aramark, then fired the company for everything from "meal shortages to maggots in the kitchen," and replaced the company with Trinity at an annual cost of $158 million.
    • Problems persisted under Trinity, causing Michigan to abandon privatized food services in its kitchens.
  • Transportation services. Tennessee-based Prisoner Transportation Services is the largest provider of transportation for jails and prisons.
    • In 2016, PTS priced its services to Nevada at $1.05 per adult per mile, with higher rates for minors or those with mental disabilities. The minimum trip fee was $350.
    • In the past several years, 14 women claimed to have been sexually assaulted by transportation guards and at least 4 people have died while being transported in PTS vehicles, per the Marshall Project.
  • Clothes, toiletries, etc.  Incarcerated people and their families spend an estimated $1.6 billion every year on commissary items such as toiletries, clothes and games.

9-year-old boy pays off entire school lunch debt for his class after saving his allowance - A 9-year-old boy in California used his allowance money to pay off school lunch debts for his entire third-grade class, KGO-TV/ABC7 News reported.When Ryan Kirkpatrick, a student at West Park Elementary School, learned that some kids cannot afford lunch at school and have to take on debt, he wanted to make a difference, according to his mom, Kylie Kirkpatrick.Ryan asked his mom to find out how much his peers at his own school owed for lunches, and his mom discovered it was about $74.50. The price of school lunches range from 30 cents to $3.25 each.“What do you want to do?” Kirkpatrick asked her son, according to KGO-TV/ABC7 News. “He said, 'I guess I can pay for it.' I said, 'are you sure?' And he said, 'yes.' "Ryan would usually use his allowance money to buy sports gear, like autographed baseballs, but he gave it to the school anonymously.“I want them just to realize people actually think about them instead of just telling them what they did because you're just bragging about stuff,” Ryan said. “I want them to feel happy that someone cares about them."

Charter Schools Are a Major Dividing Line for the 2020 Democratic Candidates—Education Fights in Pennsylvania Point the Way - Charter schools have finally broken into the national political dialogue, with presidential candidates in the Democratic Party proclaiming their stances on these schools. But a national debate about charters and “school choice” will be an exercise in empty rhetoric unless the candidates’ views are grounded in the real consequences of how charter schools and school choice affect communities. Although much of the debate is stuck to a bumper sticker message about the need for families to have a choice to attend charter schools, few if any candidates seem willing to acknowledge providing families with an option to choose charters can come with considerable costs to everyone else in the community.  To understand those costs, consider Pennsylvania, where the costs of charter schools are most blatantly apparent but nevertheless representative of the cost of charters everywhere. Across the state, charter schools are part of what Dan Doubet tells me is “a perfect storm of economic factors crushing down on middle- and working-class families.”  Pennsylvania passed its charter school law in 1997 and now has 179 charter schools enrolling 135,100 students, the sixth highest charter school enrollment in the nation.  Although charter schools are promoted to Pennsylvania families as a free option to look outside their neighborhood public schools, the costs of charters are borne by local school districts—and all the taxpayers who support them. Charter schools now cost Pennsylvania taxpayers over $1.8 billion annually and account for over 25 percent of the state’s basic education funding. Pennsylvania’s surging charter school costs are direct causes of rapidly rising property taxes across the state. When public school students transfer to charters, and per-pupil costs “follow the child,” Doubet explains, the bill for that cost comes due at the end of each budget year when local public schools have to make “tuition payments” to compensate charters for students who transferred. These mostly unplanned, unforeseen costs are often enough to tip district budgets into the red.

Better Public Schools Won’t Fix America  --Long ago, i was captivated by a seductively intuitive idea, one many of my wealthy friends still subscribe to: that both poverty and rising inequality are largely consequences of America’s failing education system. Fix that, I believed, and we could cure much of what ails America. This belief system, which I have come to think of as “educationism,” is grounded in a familiar story about cause and effect: Once upon a time, America created a public-education system that was the envy of the modern world. No nation produced more or better-educated high-school and college graduates, and thus the great American middle class was built. But then, sometime around the 1970s, America lost its way. We allowed our schools to crumble, and our test scores and graduation rates to fall.  Taken with this story line, I embraced education as both a philanthropic cause and a civic mission. I co-founded the League of Education Voters, a nonprofit dedicated to improving public education. I joined Bill Gates, Alice Walton, and Paul Allen in giving more than $1 million each to an effort to pass a ballot measure that established Washington State’s first charter schools. All told, I have devoted countless hours and millions of dollars to the simple idea that if we improved our schools—if we modernized our curricula and our teaching methods, substantially increased school funding, rooted out bad teachers, and opened enough charter schools—American children, especially those in low-income and working-class communities, would start learning again. Graduation rates and wages would increase, poverty and inequality would decrease, and public commitment to democracy would be restored. But after decades of organizing and giving, I have come to the uncomfortable conclusion that I was wrong.  What I’ve realized, decades late, is that educationism is tragically misguided. American workers are struggling in large part because they are underpaid—and they are underpaid because 40 years of trickle-down policies have rigged the economy in favor of wealthy people like me. Americans are more highly educated than ever before, but despite that, and despite nearly record-low unemployment, most American workers—at all levels of educational attainment—have seen little if any wage growth since 2000.

Teachers are always there to help, but now we’re the ones who need a boost - The teacher shortage is real and it exists for many reasons. The question is why do we lose so many young educators? What causes them to not enter teaching? Why do many leave their chosen field after just a few years? And how can we make teaching as financially rewarding as other fields when the reality is many localities do not have the funds to raise salaries? Many colleges and universities now require educators to have a Bachelor’s degree prior to entering an education program. After getting a Bachelor’s degree future teachers have one more year to get teaching credentials or in many cases they can spend two more years getting a Master’s degree. In other words: teachers face the unenviable choice of incurring greater debt prior to entering the workforce or changing majors and entering the workforce after only four years with less debt but also less credentials. This is a significant problem since students average $30,000 in college debt. Some of my colleagues owe something closer to $60,000 in debt. It is the passion, the call of teaching, the desire to make a difference that leads people into education not the paychecks. When you consider teacher’s salaries you have to ponder how someone with this much debt can afford to take a starting position with the national average starting salary less than $40,000 in 2017! Why would anyone become a teacher? Many teachers who enter the field quickly leave. The number of teachers leaving the field with less than five years of experience keeps growing. Why? Everyone has their own reasons but some of the reasons cut across schools, school divisions, states, and our nation. Teachers do not feel supported and the role and responsibilities of teachers just keep increasing. When I was growing up in the 70s and 80s my teachers taught us, supported us, disciplined us, attended a few meetings and our testing was a nationally normed standardized test that was given a few times throughout my K-12 education.  Today, teachers teach, discipline, support, remediate, attend countless trainings, prepare students for dozens of evaluations at the local and state level and are told to do more with less. This mantra grew louder during the recession and continues today. During the recession our responsibilities and accountability grew while our support and financial assistance shrunk. It is time that those making laws and regulations that impact educators and students start having conversations with those teachers and students.

Graduation gone bad: Salutatorians rip their Detroit charter school -- Two top students at a Detroit charter school used their graduation ceremony speeches to blast their new alma mater for what they said was an inferior education and a culture of secrecy.The pair accused Universal Academy on Detroit's west side of churning substitute teachers through their classrooms, backing out of promised benefits, firing teachers who advocated for kids and silencing students and parents who speak out.  CEO Nawal Hamadeh ordered the microphone silenced during the second speech but by then, the point had been made, said Tuhfa Kasem, 17, whose speech was cut short."She asked for me to be escorted out but the parents had my back," Kasem said. "The cops came in. The parents were like 'you're not going to touch her.' "The school called the criticisms unfounded and said the girls had been used by adults with an ax to grind against the school. "A few disgruntled adults have attempted to sully the academy’s honorable achievements and the graduation celebration to cause controversy to serve their own agendas, which have nothing to do with the students’ best interests," the school said in a statement. "The student speech ... was merely the result of the work of those adults to accomplish their goals. We are so sad to see that some of our students were misled and used to serve agendas that have nothing to do with what really serves their interests."  A YouTube video of the scene took the speech to a much larger crowd than the one that was packed into the school gymnasium earlier this month. Kasem's speech followed a shorter speech by Zainab Altalaqani, a co-salutatorian and friend. The girls accuse the school of using long-term substitute teachers and other means to save money at the expense of the education of the children.

Valedictorian Thanks 'Alcoholic Teacher' And Negligent Counselor For Teaching To 'Fend For Herself - A California valedictorian went off script during her commencement address, slamming an alcoholic teacher who was 'escorted out of school' and a guidance counselor who she thanked for 'letting me fend for myself' due to being 'always unavailable to my parents and I despite appointments.' San Ysidro High School senior Nataly Buhr opened her June 6 speech in typical fashion - thanking her parents for their "endless love," acknowledging the memories shared with her friends, and mentioning a handful of teachers for being 'invested in the students.' Then, Buhr went scorched earth. Buhr began by unloading on her counselor, to whom she said: "Thanks for teaching me to fend for myself: You were always unavailable to my parents and I, despite appointments. ... You expressed to me your joy in knowing that one of your students was valedictorian, when you had absolutely no role in my achievements. She then slammed the office staff, saying "Thank you for teaching me how to be resourceful. Your negligence to inform me of several scholarships until the day before they were due potentially caused me to miss out on thousands of dollars. When applying for a work permit, you repeatedly turned me away, despite confirming with my employer and my parents that all of my paperwork was filled out correctly. I’ve had to escalate issues with staff to an assistant principal various times to reach any sort of solution." And finally - "To the teacher that was regularly intoxicated during class this year, thank you for using yourself to teach these students about the dangers of alcoholism. Being escorted out of school left a lasting impression," said Buhr, receiving applause from the audience. "I hope that future students and staff learn from these examples," she said in conclusion. 

Union halts New Jersey teachers’ strike after one day - Union officials in Franklin Lakes, New Jersey, shut down a strike by nearly 300 teachers and support staff Tuesday, less than 24 hours after the walkout began. With a mediator from the state Public Employment Relations Commission (PERC) in attendance, the Franklin Lakes Education Association (FLEA) reached a tentative agreement with local school authorities at 2 a.m. Tuesday and sent teachers and staff back to work without giving educators the opportunity to review or vote on the deal.The agreement covers the next four years and addresses “all outstanding issues,” according to a statement from the board. But the New Jersey Education Association (NJEA), of which FLEA is a member, has not made the details of the agreement public. This is because the union anticipates opposition to a deal, which no doubt ignores teachers’ most pressing concerns including crushing health care expenses. Teachers and the board must ratify the agreement before it can take effect. The teachers’ previous contract expired in July 2017, and negotiations had dragged on since March 2017. Teachers’ main objection was that their contributions to their health care premiums were extraordinarily high. These contributions have increased thanks to Chapter 78, a law passed by the Democratic-controlled state legislature and signed by former Republican Governor Chris Christie. Contributions are calculated based on salaries, and some of the Franklin Lakes teachers pay as much as 35 percent of their salaries toward health care.

College admissions scandal shows ‘sacrifice matters less than money,’ prosecutors say The college admissions scandal has shaken the country’s trust in higher education and corroborated a “national fear” that the process can be rigged to favor the rich, prosecutors wrote in arguing why a coach mired in the scandal should go to prison.In a sentencing memorandum filed Friday, prosecutors from the U.S. attorney’s office in Massachusetts described the effect of a scandal they uncovered in March — an incendiary case that has indicted not just wealthy parents from Silicon Valley, Hollywood and the Newport Coast, but the belief that there is some meritocratic calculus behind college admissions.Thirty-three parents have been charged. Some are accused of paying to doctor their children’s entrance exams, others to disguise their kids as recruited athletes, which ensured their admittance to prestigious schools as Yale, Stanford and Georgetown. A handful are suspected of paying for both.The case has no less than “shaken the nation,” prosecutors wrote in a sentencing memo for former Stanford sailing coach John Vandemoer, describing “thousands of newspaper articles” published in its wake that articulated disgust, cynicism and anger that seats at some of the country’s most venerable schools could be bought so easily as described in court papers.  The scandal, prosecutors said, "confirms, for many, the worst of what they had long suspected: that hard work and sacrifice matters less than money and the access it buys.”  Vandemoer has admitted to accepting $610,000 in bribes from Newport Beach college consultant William “Rick” Singer, the scheme’s admitted mastermind. Vandemoer pleaded guilty to racketeering conspiracy in March.P rosecutors requested that Vandemoer be sentenced next week to 13 months in prison — considerably less than in his plea deal, in which they said they’d recommend a sentencing range of 33 to 41 months. Vandemoer will be sentenced in Boston on June 12. Friday’s court filing shed new light on his arrangement with Singer, which produced the most eye-popping sum in the scandal so far: a $6.5-million payment Singer received from a Chinese family after their daughter was admitted to Stanford.

 Local Bakery Wins $11 Million After Oberlin College Students Labeled It 'Racist' - Ohio's Oberlin College has been a bastion of liberal activism virtually since its founding in 1833. It was the first interracial and first coeducational college in the US, and was once even home to a stop on the Underground Railroad. But in the heady modern political climate, Oberlin is known less for helping ferry runaway slaves to freedom in Canada, and more for an activist community that has condemned cafeteria food offerings as racist (because they're not authentic), questioned the value of teaching the western canon and pushed the necessity of safe spaces. One black female professor provoked a controversy in 2016 after she was fired for making incendiary statements like blaming Israel for 9/11. Soon, the school's black student union was condemning the school as an "unethical institution" and demanding that the professor be given tenure. But while these incidents may have tarnished the school's reputation, reinforcing its reputation as a bastion of over-privileged trust-funders, the college will now face a very real cost after losing a legal battle with a local bakery that has been a pillar of the downtown business community since it opened more than 100 years ago, according to the Washington Post. Gibson's, a bakery known for its wheat donuts and apple fritters, has for decades held a standing contract to supply baked goods for university functions. But the school cut ties with Gibson's after an incident where a young black student was caught trying to shoplift a few bottles of wine. A scuffle ensued, and ended with the student's arrest and arraignment on a robbery charge.  Soon, the school's students, led by the Black Student Union, had branded Gibson's a "RACIST" establishment. Students encouraged a boycott of the establishment, which is owned by Gibson’s father, David R. Gibson, and his grandfather, also named Allyn. "A member of our community was assaulted by the owner of this establishment yesterday," read a flier distributed outside the bakery, calling Gibson’s a "RACIST establishment with a LONG ACCOUNT of RACIAL PROFILING and DISCRIMINATION." The school followed up by suspending its Gibson's order (though it was later quietly reinstated). But for Gibson's, the damage had already been done, and small business decided to pursue a civil complaint against the school and a senior administrator.   Gibson's ended up winning an $11 million judgment.

Underpaid Adjunct Professors Sleep in Cars and Rely on Public Aid - Adjunct professors are the minimum-wage temp workers of academia. Underpaid, overworked, with no benefits and no job security, their numbers have ballooned in recent decades. They are part of what Herb Childress calls “hope labor,” in his new book, The Adjunct Underclass. Childress quotes researchers who define hope labor as “un- or under-compensated work carried out in the present, often for experience or exposure, in the hope that future employment opportunities may follow.” For most adjuncts, that hope comes to nothing.Childress compares the catastrophe of gig economy college teaching to gig-based employment in other industries like medicine or taxis. He argues that adjunct teachers are the Uber drivers of academia. “College teaching has become primarily a pickup job … like running chores for TaskRabbit,” he writes, reporting that 25 percent of adjuncts depend on some form of public assistance. His book brings to mind the nearly starving, peripatetic scholars, wandering from one university to another, teaching and begging, in medieval Europe.The Adjunct Underclass summarizes The Pittsburgh Post Gazette’s account of the death of Margaret Mary Vojtko, who died at the age of eighty-three from cancer she could not afford to treat. She died at her home, for which she could not afford electricity. She had taught French at Duquesne University for twenty-five years, never making more than twenty-thousand dollars a year for her six or more courses and never receiving health benefits or retirement contributions. Childress discusses homeless adjunct professors who sleep in their cars. He cites the San Francisco Chronicle and the example of English professor Ellen Tara James Penny. While teaching four courses per semester at San Jose University in Fall 2017, Penny “often drives to a parking lot to grade papers. When it’s dark, she’ll use a headlamp from Home Depot, so she can continue her work. At night she’ll re-park in a residential neighborhood and sleep in her 2004 Volvo. She keeps the car neat to avoid suspicion.”Some adjunct professors turn to sex work to augment their income. Childress refers to a Guardian story about a “middle-aged” adjunct whose income dwindled dramatically when her course load was cut in half. About to be evicted, she told The Guardian, “In my mind I was like, I’ve had one-night stands, how bad can it be?… And it wasn’t that bad.”

Why Trump’s clampdown on academia is forcing many Chinese researchers into a difficult corner Science knows no borders. But if it does, the United States has a lot to thank China for in helping to build its global tech supremacy. More than 10 per cent of US inventions today are made by scientists of ethnic Chinese origin, according to research in a recent book by Harvard professor William R. Kerr. And most of the artificial intelligence scientists in the US who are immigrants came from China, according to research by think tank MacroPolo. Collectively known as scientists “with Chinese origin”, they are a core building block of the US technology ecosystem and a group that is facing increased scrutiny in the US due to concerns over possible espionage. “The policies of the Trump administration to weaken Chinese talent for America are foolish,” said Kerr, a professor of business administration at Harvard Business School and the author of the The Gift of Global Talent. “The United States needs to ensure good intellectual property protection, but efforts to isolate and diminish the Chinese talent component can have long-term negative consequences for our country,” he said. How to protect intellectual property without scaring away some of the world’s top talent is a major challenge for the Trump administration as many of China’s best and brightest currently contribute a great deal to US innovation, and they are now caught in the middle of the raging US-China tech war. Chinese talent, especially those who study and work in sensitive technology fields, have had to deal with shorter visa times, delays and even denials of visa requests in the US. China’s Education Ministry issued a warning on Monday about the risks of studying in the US, urging students and academics to “raise their risk assessment” after visa denial rates soared. Some Chinese researchers have been denied access to certain research facilities. In mid May, Georgia-based Emory University abruptly dismissed two Chinese-American professors due to alleged undisclosed funding ties with China.

Democrats push for tougher oversight on student loan market - Democratic lawmakers at a House hearing on Tuesday pushed for tougher oversight of companies handling student loans. The hearing before the House Financial Services Subcommittee on Oversight and Investigations addressed what critics say is predatory behavior within the $1.5 trillion student loan servicing market. Democrats pushed for Congress to impose responsibilities so that loan servicers must provide better advice to student borrowers. Under current Department of Education rules, federal student loan servicers are not legally obligated to inform borrowers which loan repayment plans are most beneficial for them. “You want your degree at the end, and that’s really the focus when young people get in there,” said Rep. Rashida Tlaib (D­Mich.). “Then afterwards they expect the government and the quasi-­governmental relationship they might have with private companies to do what’s in the best interest of their future.” But Republicans balked at new regulations. Rep. Warren Davidson (R­-Ohio) raised concerns about Congress imposing new responsibilities on servicers without saveguards to protect them from defaults. “As a history major I don’t know that I favor the idea that the government picks what your major is," Davidson said. "But certainly we shouldn’t be indifferent to the default risk, particularly if we’re going to hold someone to the fiduciary responsibility for the performance of the borrower in repaying that loan." Lawmakers also addressed the obstacles women or minority student borrowers face that lead to higher default and late repayment rates. GOP lawmakers, including Reps. Barry Loudermilk (Ga.) and Bryan Steil (Wis.), though, said many of the problems with student loans stemmed from the high costs of higher education not the practices of loan servicers.

CU consortium to forgive student loans under CFPB order -- The Consumer Financial Protection Bureau, 44 states and the District of Columbia announced a $168 million settlement with a credit union consortium over high-risk loans to students at the now-bankrupt ITT Technical Institute. The CFPB alleged that Student CU Connect CUSO, made up of seven credit unions, engaged in unfair acts and practices that resulted in roughly 8,600 students taking out student loans "that they could not afford, did not want, did not understand, or did not even know they had.” From 2009 to 2011, the consortium's loan program originated $189 million in loans for ITT students, the CFPB said. ITT filed for bankruptcy in 2016 after the federal government restricted the for-profit college from accessing federal student aid. The CFPB described a typical 10-year loan from consortium as having interest rates from 10.5% to 16.25%, plus origination fees of 10%, “with few options to reduce monthly payments.” The complaint and settlement were filed in U.S. District Court for the Southern District of Indiana. After ITT filed for bankruptcy, the consortium — known as a credit union service organization — projected a cumulative default rate of 94%, the CFPB said. Deborah J. Caruso, the trustee of ITT, sued the consortium of credit unions — including Eli Lilly Federal Credit Union, Bellco Credit Union, Credit Union of America, Directions Credit Union, Veridian Credit Union, Workers Credit Union and Community America Credit Union — as well as the Rochdale Group, a consulting firm, in 2017.  The credit unions are expected to provide a total of $168 million in loan forgiveness. The CFPB said the CUSO must stop collecting loan payments and must write off outstanding loans. The order also requires the CUSO to provide notice to all consumers with outstanding loans that their debt has been discharged.

Elizabeth Warren will introduce legislation to cancel student loan debt for most borrowers - Democratic presidential candidate Elizabeth Warren isn’t waiting for the election to push forward her proposal to erase the majority of the country’s outstanding student debt.  The Massachusetts senator and Rep. James E. Clyburn (D-S.C.) announced on Wednesday their plan to introduce legislation in the Senate and House to eliminate up to $50,000 in student loan debt for 42 million Americans. “It’s time to decide: Are we going to be a country that only helps the rich and powerful get richer and more powerful, or are we going to be a country that invests in its future?” Warren said, in a statement. Outstanding education debt in the U.S. is projected to swell to $2 trillion by 2022, surpassing credit card or auto debt levels. Today, the average college graduate leaves school $30,000 in the red, up from $10,000 in the 1990s. Nearly one-quarter of borrowers are in delinquency or default.  In a post on Medium in April, Warren introduced her campaign proposal to eliminate student debt. The details of the bill are likely to be similar.  Borrowers with household incomes under $100,000 would be eligible to have $50,000 of their student debt scrubbed. People who earn between $100,000 and $250,000 would be eligible for less forgiveness. For example, Warren writes, “a person with household income of $130,000 gets $40,000 in cancellation, while a person with household income of $160,000 gets $30,000 in cancellation.”

Punishing Kids With Years of Debt — When Sophie McMullan was 17, her older boyfriend burglarized a string of upscale houses on the Maine coast, giving her a fancy purse, designer sunglasses and other loot. She joined him only once: The couple broke into a lakeside home and stayed overnight, consuming snacks, Pepsi and alcohol, according to police records..McMullan went along with the crimes, she said, because after a grim childhood marked by violence and periods of homelessness, she’d never felt wanted before. And she paid a steep price, serving nearly three years in juvenile prison, where she was the victim of severe assault, according to prosecutors.  Months after getting out, she was rearrested for failing to appear in court to pay restitution to the families who lost laptops, credit cards and other valuables. McMullan’s boyfriend admitted to police that she hadn’t joined him in those burglaries. But under accomplice liability law, she was ordered to pay the full value of the stolen items—$2,831.69—the same amount as him.  Across the nation, children and teens who commit crimes are routinely ordered to pay their victims restitution for damaged property, lost wages and medical bills, leaving many saddled with a financial burden that can follow them long into adulthood. Just a half-dozen states cap these payments, which often reach into the tens of thousands of dollars, according to a Marshall Project review of five years of cases in 10 states that collect data on juvenile restitution.As a result, young people like McMullan can find themselves homeless and in debt, paying off victims many years after they’ve served their sentences. 

Walgreens cuts longtime health benefit for retired employees - Walgreens said in a September letter reviewed by CNBC that it would no longer subsidize medical benefits for its former employees who hadn’t turned 64 by March 31, citing “rising and unpredictable healthcare costs.”    Some 550 retirees receive the subsidies from Walgreens before they turn 65 and are eligible for Medicare. Under the age restrictions laid out in the September letter, they won’t receive the payments, which vary in amount based on employees’ years of service.Neither will employees who were eligible for the benefit upon retirement under the old rules, which made it available to employees who had turned 50 by May 2017 and had worked at the company 20 years. (Employees still needed to be at least 55 with at least 25 years of service at the time of retirement to receive the benefit).Walgreens tightened the requirements for the subsidies in the past, eliminating eligibility for new hires and younger employees, but until last fall, the company had stopped short of touching the payments of retirees who were already receiving them.“Pre-65, I do think it’s unusual to take people who already have a subsidy right now and eliminate that subsidy,” said Derek Guyton, a partner in the health and benefits business at Mercer, owned by Marsh & McLennan. “What’s more common is you tell people way ahead of time you’re not going to have this subsidy when you get to 55 or what have you. That obviously has happened a lot and continues to happen, but taking it away from people, some employers consider that almost an employment contract.”

Michigan Prosecutors Drop Criminal Charges Against Officials Involved in Flint Water Crisis -- Michigan prosecutors dropped all criminal charges against government officials involved in the Flint water crisis Thursday, citing concerns about the investigation they had inherited from the Office of Special Counsel (OSC) appointed by former Attorney General Bill Schuette, CNN reported."We cannot provide the citizens of Flint the investigation they rightly deserve by continuing to build on a flawed foundation," Solicitor General Fadwa Hammoud and Wayne County Prosecutor Kym L. Worthy said in a statement. "Dismissing these cases allows us to move forward according to the non-negotiable requirements of a thorough, methodical and ethical investigation." The news comes a little more than three years after the first criminal charges were filed and a little more than five years since an emergency manager switched Flint's water supply from the Detroit water system to the Flint River as a cost-saving measure. The highly corrosive water leached lead from the pipes, contaminating the drinking water with unsafe levels of the heavy metal. The new water was also linked to an outbreak of Legionnaires' disease that killed at least 12, The New York Times reported.For Flint residents, the news of the dropped charges was the latest in a long line of betrayals from government officials. Flint activist Melissa Mays, who founded the advocacy group Water You Fighting For, wrote in a Facebook post that she first heard the news of the dropped charges from a New York Times reporter."This is not justice," Mays told The New York Times. "It just seems like a political ploy. The only thing it tells me is our lives don't matter."

Alabama Passes Bill Requiring Certain Child Molesters To Be Chemically Castrated - HB 379 in Alabama is a bill that requires certain child sex offenders to undergo chemical castration and, according to Fox News, it is now just awaiting the governor's signature before becoming law. Unlike physical/surgical castration, chemical castration uses drugs to suppress sexual urges. The bill was introduced by Republican state Rep. Steve Hurst and specifically targets sex offenders whose crimes involve anyone under the age of 13. Hurst says that his aim is to reduce the number of sex crimes committed against children by making offenders "think twice" before they act.  "If we do something of this nature it would deter something like this happening again in Alabama and maybe reduce the numbers," Hurst continued. Hurst said: “They have marked this child for life and the punishment should fit the crime.” To add insult to injury, the offender would also have to pay for the procedure. Refusing the procedure would result in a violation of parole, according to the bill.  Hurst concluded: "I had people call me in the past when I introduced it and said, 'Don't you think this is inhumane?' I asked them what's more inhumane than when you take a little infant child, and you sexually molest that infant child when the child cannot defend themselves or get away, and they have to go through all the things they have to go through. If you want to talk about inhumane -- that's inhumane.”

Trump ends federal funding of fetal tissue research - The Trump administration on Wednesday cut off federal funding for medical research using fetal tissue. The Department of Health and Human Services (HHS) announced the new policy in a six-paragraph statement, but White House spokesman Judd Deere stressed that “This was the president’s decision.” The order prohibits the National Institutes of Health from using fetal tissue in its studies and ends a $2 million-a-year grant to the University of California, San Francisco, to research HIV treatments that has existed since 2013. Other universities using the tissue in medical studies will be allowed to continue until their grants run out. They will then have to apply for renewal of their grants to new medical ethics boards created by Health and Human Services Secretary Alex Azar. The move was praised by anti-abortion zealots and denounced by scientists. Larry Goldstein, distinguished professor in the University of California at San Diego’s department of cellular and molecular medicine, who has advised researchers that use fetal tissue, said, “I think it’s ultimately a terrible, nonsensical policy. Valuable research that is directed at helping to develop therapies for terrible diseases will be stopped. And tissue that would be used will be thrown out instead.” The elimination of funding for these projects, which use tissue from aborted fetuses, will imperil research into cures for a wide range of diseases, including HIV/AIDS, Parkinson’s, Alzheimer’s, and ALS (also known as Lou Gehrig’s Disease). It will also halt the development of new vaccines. In the past, fetal tissue has been used to help develop vaccines for polio, rubella, chicken pox, adenovirus, Ebola, rabies and shingles. Currently, research is being performed using fetal tissue to develop a vaccine for the Zika virus.

Young Blood to Reverse Aging? It's Quackery Now But Has Potential - This month, scientists published a demonstration that two proteins isolated from young blood changed the behavior of human neurons in culture – stimulating them to grow new connections. The paper, published in the Proceedings of the National Academy of Sciences – doesn’t show it will work in people, but leaves the possibility open.In medicine, that’s enough to attract lots of entrepreneurs. One startup, called Ambrosia, has already begun transfusing customers for $8,000 a liter, according to a piece in Business Insider. In February, in response to such practice, the FDA issued an official warning that transfusions of young blood offered “no proven clinical benefit” for either normal aging or Alzheimer’s disease.But the principle isn’t crazy. One of the authors on the PNAS paper, Stanford biochemist Thomas Sudhof, won the 2013 Nobel Prize for elucidating the way cells communicate. He said that he was intrigued by some of the studies in mice that showed blood from younger individuals rejuvenated the brains of older ones – improving their abilities to learn and remember.What struck him as particularly intriguing was that this work challenged the current paradigm of brain aging, which posits that degeneration originates in the brain tissue. The young blood experiments suggest that brain aging might start in the blood. And if that’s the case, it might indeed be possible to preserve the brain by altering blood chemistry. Sudhof’s experiment relied on cultured human neurons, exposed to blood plasma (the liquid part of the blood without the white and red cells) from 15-day-old mice or from 15-month-olds (that’s old for a mouse). He found two proteins, called thrombospondin 4 (THBS4) and SPARC-like protein 1 (SPARCL1), which were more concentrated in the young plasma, and which, in isolation, stimulated the neurons to increase their connectivity.

U.S. measles outbreak spreads to Idaho and Virginia, hits 1,022 cases (Reuters) - The United States’ worst measles outbreak in a quarter-century spread to Idaho and Virginia last week as public health authorities on Monday reported 41 new cases of the highly contagious and sometimes deadly disease. The U.S. has recorded 1,022 cases of the diseases this year as of June 6, in an outbreak blamed on misinformation about vaccines, the U.S. Centers for Disease Control and Prevention said. The 2019 outbreak, which has reached 28 states, is the worst since 1992, when 2,126 cases were recorded. Federal health officials attribute this year’s outbreak to U.S. parents who refuse to vaccinate their children. These parents believe, contrary to scientific evidence, that ingredients in the vaccine can cause autism. Measles was declared eliminated in the United States in 2000, meaning there was no continuous transmission of the disease for a year. Still, cases of the virus occur and spread via travelers coming from countries where measles is common. CDC officials have warned that the country risks losing its measles elimination status if the ongoing outbreak, which began in October 2018 in New York, continues until October 2019.

The Los Angeles Disease Renaissance- Typhoid & Typhus Make A Comeback - As the homeless population in Los Angeles grows, so does the unfortunate revival of many third world diseases... Despite hundreds of millions of dollars flowing through Los Angeles to stem the rising tide of homelessness, a resurgence of medieval diseases has the city – and neighboring states – on edge. Typhoid fever and typhus, borne by fleas, body lice, and feces, are turning the once glitzy and glamorous city into a third-world worthy environment. Yes, Typhoid Mary is back, in a sense, living on the streets and wreaking havoc on unsuspecting people in the Golden State. These diseases, along with an uptick in tuberculosis, hepatitis A, and staph, are easily and rapidly spread and have wide-reaching consequences. They’re highly contagious and can infect anyone through casual contact.  An LAPD officer was recently diagnosed with typhoid, and several other city employees are exhibiting the classic symptoms of high fever, muscle pain, and weakness.  Left untreated, the disease can be fatal – and let’s face it: The malady wiped out entire populations during the Dark Ages and took a heavy toll on American Civil War soldiers and early American settlers.  Some historians blame the malaise for obliterating the Jamestown settlement. Los Angeles Homeless Services Authority recently released a report showing 59,000 people living on the streets in Los Angeles County – a 12% increase since 2018 – with 36,300 of them within the city limits of Los Angeles.  The U.S. Department of Housing and Urban Development (HUD), reports that “California accounted for 30% of all people experiencing homelessness as individuals” throughout the United States. Los Angeles Mayor Gil Garcetti (D), who many believed would be a 2020 presidential contender, calls the crisis, “the biggest heartbreak for me and my city.”  Garcetti campaigned extensively for the initiative known as Proposition HHH, which designated $1.2 billion over the next ten years to build homeless housing.  But now residents are howling about the pricey plan’s abject failure.

Climate Crisis Could Spread Dengue Fever Through Most of Southeast U.S. - If greenhouse gas emissions continue to rise until 2080, dengue fever could spread through much of the southeastern U.S. by 2050. That's one of the findings in a study published in Nature Microbiology Monday on the potential spread of the mosquito-borne disease, which currently kills around 10,000 people per year and sickens 100 million. The study also predicted the disease would expand to higher altitudes in central Mexico, to northern Argentina, to inland Australia, to large coastal cities in eastern China and Japan, to southern Africa and to the West African Sahel.The study incorporated data on mosquito behavior, urbanization and different climate change scenarios to predict how dengue fever would spread in 2020, 2050 and 2080, The New York Times explained. In the most extreme climate scenario, emissions continue to rise. In another, emissions rise through 2080 and stabilize by 2100 and, in the third, they peak in 2040. In all scenarios the spread of dengue increased, but it decreased slightly between 2050 and 2080 in the lowest-emission scenario."This suggests that curbs in emissions and more sustainable socioeconomic growth targets offer hope of limiting the future impact of dengue," the researchers wrote.The study was unique from previous research in that it did not only focus on how climate change would impact the spread of dengue. It also focused on urbanization. That is because dengue is a disease that thrives and spreads in cities."When people hear mosquito-borne disease they think about forest areas. But dengue is very much the disease of the 21st century – it happens in big cities. In big cities you have lots of people moving around very quickly," lead study author and assistant professor at the London School of Hygiene and Tropical Medicine Oliver Brady told The Telegraph. The study found that 2.25 billion more people would be at risk from dengue by 2080, or 60 percent of the world's population. But most of that increased risk would be driven by population growth in areas where the disease is already endemic, not by an expansion in its geographic range.

Massive Ebola outbreak spreads across DRC border, infected 5-year-old in Uganda - Health officials in Uganda have confirmed the country’s first case of Ebola stemming from amassive outbreak that has been raging across the border in the Democratic Republic of the Congo since August of 2018.  The World Health Organization reported Tuesday, June 11, that the case is in a 5-year-old boy from the DRC who traveled with his family into Uganda on June 9. The boy’s case was confirmed by the Uganda Virus Institute (UVRI), and he’s receiving care in the Ebola Treatment Unit in the western Ugandan town of Bwera, which sits at the border with DRC. Health officials have feared the spread of the virus, which has festered in DRC’s North Kivu and Ituri provinces for nearly a year. The provinces sit on the eastern side of the country, bordering South Sudan, Uganda, and Rwanda. As of June 9, the WHO reports 2,062 cases(1,968 confirmed and 94 probable), including 1,390 deaths (1,296 confirmed and 94 probable) in the outbreak. It is the second largest Ebola outbreak on record, surpassed only by the 2014 West African outbreak, which involved more than 28,000 cases and 11,000 deaths. Violent attacks and community distrust have severely hampered outbreak responses in the volatile region. Militants have injured health responders and, in one case, killed a police officer. In February, Doctors Without Borders/Médecins Sans Frontières (MSF) suspended medical responses after two attacks that left treatment facilities partially burnt down. With the potential for the outbreak to spread, Uganda has already vaccinated 4,700 health workers in 165 health facilities and has intensified monitoring. The experimental vaccine being used in the outbreak is 97.5% effective at preventing the viral disease, preliminary data suggests. Ebola treatment centers, like the one in Bwera, are already set up. Further, the WHO has dispatched a Rapid Response team to monitor those who had contact with the boy and help with the response.

Uganda confirms first Ebola case outside outbreak in Democratic Republic of Congo - Uganda on Tuesday confirmed a child there has been diagnosed with Ebola, the first cross-border case from the Democratic Republic of the Congo, where a large outbreak has raged for the last 10 months. Five family members traveling with the child, a 5-year-old, are also ill and have been tested for Ebola, Ugandan Health Minister Dr. Jane Ruth Aceng said. Those test results are pending. The news will likely increase pressure on the World Health Organization to declare the outbreak a public health emergency of international concern. The agency’s director-general, Tedros Adhanom Ghebreyesus, told STAT he will convene an advisory body — called an emergency committee — as quickly as possible to review the situation and decide whether the outbreak now poses a global health threat. Dr. Mike Ryan, who heads the WHO’s emergencies program, said the meeting will likely occur within the next day or two, after the agency consults with the governments of Uganda and DRC. Ryan said Uganda and partners have been working for months to protect the border area against just this type of event. “It’s never good news to have Ebola,” he said, but suggested the preparatory work should help contain the threat. The infected child crossed into Uganda with his family in Bwera, near the Congolese city of Butembo. The Congolese Health Ministry said the family was traveling from Mabalako. Both Mabalako and Butembo have experienced intense Ebola transmission of late. The family had traveled to DRC to see the woman’s father. He died from Ebola in late May. A group of 14 family members set off to return to Uganda, arriving at a village called Kasindi near the border on June 10. Of the group, seven are children, ranging in age from 7 months to 12 years of age. When they arrived at Kasindi, 12 members of the group were experiencing symptoms, and they stopped there at a health facility. They were directed to an isolation center, but then six members of the family fled the facility, crossing into Uganda, said the Congolese Health Ministry, which alerted Ugandan authorities of the family’s movements.

Boy who crossed into Uganda with Ebola has died – With confirmation that the long-running outbreak in the Democratic Republic of the Congo had spilled across the country’s eastern border to enmesh Uganda in the epidemic, partners in the Ebola containment effort moved Wednesday to ramp up their responses. The World Health Organization announced Director-General Tedros Adhanom Ghebreyesus has convened a panel of outside experts to advise him on whether the outbreak should be declared a public health emergency of international concern. The so-called emergency committee will meet on Friday. In the U.S., the Centers for Disease Control and Prevention announced it was activating its emergency operations center to better coordinate its contribution to the containment effort. The move allows the agency to dedicate staff full time to the response, and to shift people from other jobs if additional expertise is needed. But the move does not signify that the risk to the United States has risen in any way, said CDC Director Dr. Robert Redfield. Redfield noted the CDC, the WHO, and other partners in the Ebola response have been preparing DRC’s neighbors for months to be ready in case the virus spread across their borders.Those preparations were put to the test Monday when a family returning to Uganda after attending the funeral of a man who died from Ebola in DRC went to a hospital in Kagando looking for care for a 5-year-old boy. With the boy were his mother and father, his grandmother, two younger siblings, and another member of the party. A number of them were ill.Staff at the hospital suspected Ebola and sent the group to an Ebola treatment center at Bwera that the health ministry had established in anticipation of cases coming across the border. The 5-year-old was the first in the group to test positive; he died later Tuesday night. His grandmother, 50, and 3-year-old brother also tested positive. The rest of the group is under observation.

 A deadly deer disease is spreading. Could it strike people, too? - WaPo - Jeannine Fleegle, a wildlife biologist for the Pennsylvania Game Commission, was with a half-dozen other state scientists in a garage in the small town of Bolivar. Covered in head-to-toe white Tyvek suits, they were surgically extracting hundreds of brain stem samples from deer killed by hunters during the state’s rifle season. The samples would be analyzed for signs of a deadly pathogen. The formal name of the ailment is chronic wasting disease, or CWD. But its effects on deer, elk and other cervids — weight loss, stumbling, listlessness and certain death — have inspired a creepier colloquial name: zombie deer disease. More than half a century after it was first detected, the disease is now spreading rapidly. Last winter, Tennessee became the latest of 24 states to report CWD infections, which have also been found in two Canadian provinces, Norway, Finland and South Korea. Now, as it strikes animals across a widening territory, concern is growing among scientists and public health officials that the disease might leap to humans. CWD is a transmissible spongiform encephalopathy, another of which did jump species: mad cow disease. In humans, mad cow disease is known as variant Creutzfeldt-Jakob disease, and it has killed more than 220 people worldwide since the 1990s. Some experts say that in a nation with an estimated 10 million deer hunters harvesting 6 million deer a year and eating many of them, it may be just a matter of time before chronic wasting makes its way to us.Both CWD and mad cow are thought to be caused by proteins that malfunction and misfold, called prions. There is no known cure or treatment for prion diseases.“Last year, we estimate that as many as 15,000 carcasses may have been served to people that were CWD-positive,” said Michael Osterholm, director of the Center for Infectious Disease Research and Policy at the University of Minnesota. “And what people don’t understand with prion-related conditions like this is that time changes the risk.” There are thought to be eight strains of CWD, and every time one goes through an animal, Osterholm said, there’s a chance it might adapt in a way that allows it to pass into humans.

'Dangerous Proposal': USDA Seeking to Replace Government Inspectors at Beef Slaughter Plants With Private Employees -- In an apparent effort to boost profits for meat manufacturers despite potential harms to food safety, the U.S. Department of Agriculture is reportedly planning to privatize inspections of beef slaughter plants. Food and Water Watch reported Monday that the USDA is pursuing deregulation of the food inspection system that has been used for years at beef slaughterhouses. The information came from documents obtained through the Freedom of Information Act. The group released an application from beef, pork, and poultry manufacturer Tyson Foods, in which the company requested a waiver to allow Tyson employees to conduct more inspections at its beef plant in Holcolm, Kansas, instead of relying on USDA food safety inspectors. "This dangerous proposal could rid beef slaughter plants of most government inspectors," Food and Water Watch said in a statement. The documents were uncovered after many recent denials by USDA's Food Safety and Inspection Service (FSIS) that it plans to privatize inspections of mass-produced beef, Food and Water Watch stated.Tyson's proposal comes 21 years after FSIS first launched a pilot program in more than two dozen poultry and pork plants in which government food safety inspectors were replaced by the manufacturers' own inspectors, allowing the companies to regulate themselves.In 2013, the USDA's inspector general found that the agency "did not critically assess whether the new inspection process had measurably improved food safety at each plant" that produced pork. The following year, FSIS expanded the program to the entire poultry industry. The agency will not conduct an assessment of the new system's effects on food safety until 2022."The previous attempts at privatized inspection have led to weaker food safety performance and are a ploy by the industry to increase line speeds," said Tony Corbo, a senior lobbyist with Food and Water Watch. Despite a lack of evidence that the privatized food safety inspection system is making food safer — and CDC data showing that foodborne illnesses from foods including chicken have been on the rise since 2015 — FSIS is weakening standards in order to increase the speed with which meat is processed, allowing for greater manufacturing profits.

‘Peak pig’ in Iowa leads to a ‘staggering’ amount of sh*t in the state   It’s probably not an accomplishment state officials will want to boast about, but Iowa out-performs the rest of the country when it comes to producing shit. Not “shit” in any metaphorical sense, but literal fecal waste. Chris Jones, a research engineer and an adjunct associate professor at the University of Iowa, IIHR (UI’s hydroscience and engineering center), has done the math, and published the results on his blog about water quality. Iowa, with a population of 3.2 million, produces more than twice the amount of fecal waste per square mile than California, which has almost 40 million people. But what’s propelled Iowa to the top of the shit list isn’t people, it’s pigs.  Last year, Iowa hit “peak pig,” with 23.6 million pigs, the most ever recorded in any state. When Iowa set that record in August, North Carolina, the state that ranks second in swine, only had 9.4 million. And pigs, Jones explained on his blog, produce much more waste than humans. “A feeder pig is about the same size as a human being, but it excretes 3 times as much nitrogen (N), 5 times as much phosphorus (P), and 3.5 times as much solid matter (TS-total solids),” Jones wrote, comparing the fecal output of pigs and people. Jones used the “reference values for the amount of nitrogen, phosphorus, and total solids generated” by pigs and as well as the other animals that make up most of Iowa’s livestock population, “and converted that to a human equivalent.” “When I apply the N, P and TS values of the waste from these animals, what would be the equivalent-sized human population that would generate such waste is staggering,”  he wrote.

    • • Iowa hogs: equivalent to 83.7 million people
    • • Dairy cattle: 8.6 million people
    • • Beef cattle: 25 million people
    • • Laying chickens: 15 million people
    • • Turkeys: 900,000 people

“In total, these five species generate the waste equivalent to that produced by about 134 million people,” Jones estimated. That was March. Since then the USDA has released updated the data in its Census of Agriculture, and Jones published a new post on Thursday updating his assessment of Iowa’s fecal output. “With the updated USDA data, it’s now 168 million,”

Toxic PFAS Chemicals Found in Maine Farms Fertilized with Sewage Sludge  -- ALL SEWAGE SLUDGE recently tested by the Maine Department of Environmental Protection was contaminated with PFAS chemicals, according to documents obtained by The Intercept. The state tested the sludge, solid waste that remains after the treatment of domestic and industrial water, for the presence of three “forever chemicals”: PFOA, PFOS, and PFBS. Of 44 samples taken from Maine farms and other facilities that distribute compost made from the sludge, all contained at least one of the PFAS chemicals.  In March, the state announced that it would temporarily halt the land application of sludge and begin the testing, after milk from a dairy farm in Arundel, Maine, was found to be contaminated with PFAS that had likely come from sludge that the farmers had spread on their land as fertilizer. While Maine is leading the nation by setting limits for the chemicals and testing sludge to see if it meets them, local environmentalists fear that the state’s levels — 2.5 parts per billion for PFOA, 5.2 ppb for PFOS, and 1,900 ppb for PFBS — may not be stringent enough.  “Even low parts-per-billion levels of PFAS in sludge can threaten the health of the food supply.”The evidence of widespread sludge contamination comes just days after a Food and Drug Administration study revealed that PFAS chemicals were also found in food. The investigation, which was conducted by FDA chemists but made public by the Environmental Defense Fund and theEnvironmental Working Group, detected 16 PFAS chemicals in food samples collected from grocery stores in the mid-Atlantic region. Among them were PFOS, which was in almost half of the meat and seafood products (ground turkey, tilapia, and shrimp had particularly high levels); PFBA, which was found in pineapple; and PFHxS in sweet potato. A slice of chocolate cake with icing was found to have extremely high levels of a chemical called PFPeA.

New Round of Tests Find Breakfast Cereals Still Full of Roundup, Says EWG - Many best sellers in the cereal aisle continue to have trace amounts of the weed killer glyphosate, according to a new report published Wednesday by the Environmental Working Group (EWG).The herbicide was detected in all 21 oat-based products. All but four of them contained levels of glyphosate higher than what EWG scientists deem safe for children.This is the third round of glyphosate tests by EWG, which receives funding from organic food companies, according to its own disclosures. The new round confirms the findings from the first two tests in August and October last year. Tests of 94 samples of oat-based foods found glyphosate in all but two samples, with 74 samples at levels of glyphosate above EWG's health benchmark. In this latest analysis, the highest levels of the weedkiller were detected in General Mills' Honey Nut Cheerios Medley Crunch at 833 parts per billion, or ppb, and Cheerios, with 729 ppb. EWG's health benchmark for children is 160 ppb. EWG says a child would only need to eat a single 60-gram serving of food with a glyphosate level of 160 ppb to reach the maximum dose it considers safe, according to a press release. "As these latest tests show, a box of Cheerios or other oat-based foods on store shelves today almost certainly comes with a dose of a cancer-causing weedkiller," said Olga Naidenko, Ph.D., vice president for science investigations at EWG, said in an EWG press release. The manufacturers insist their products are safe and that EWG's findings are unprecedented, according toCNN. And, before cutting your kid's carbs, it's worth noting that no case of cancer has ever been linked to eating breakfast cereal. EWG's study was never submitted to peer review nor were they published in a scientific journal. And, EWG created its own standard of toxicity, as it explains on its website. Its standard of toxicity for glyphosate exposure is about 1/100th of the California threshold, which is about 1/100th of the U.S. Environmental Protection Agency's (EPA) standard. In other words, EWG's limit for consuming glyphosate hovers around 1/10,000th of what the EPA deems as safe, according to Slate.

 Roundup’s Risks Could Go Well Beyond Cancer  - Glyphosate manufacturers — which now include many companies around the world; Monsanto's patent expired in 2000 — have long argued that glyphosate is completely safe for humans, animals and indeed all non-plant life.  In 2015, the International Agency for Research on Cancer, part of the World Health Organization, concluded that glyphosate is likely carcinogenic. But both the U.S. Environmental Protection Agency and the European Food Safety Authority have declined to do the same. Both the EPA and the EFSA relied on information provided by researchers linked to the industry and considered studies provided by the industry that were not peer-reviewed or made public.  An independent group of biologists in 2016 tried to clarify what we really know about the chemical. Their paper makes for grim reading. It noted that studies in the previous decade found significant traces of glyphosate-based herbicides in drinking water and groundwater, probably routinely exposing millions of people across the planet to the chemical. Toxicity studies in rodents have found that glyphosate can damage the liver and kidneys, even for doses in the range generally considered safe for humans. Young pigs fed soybeans contaminated with glyphosate herbicide residues have exhibited congenital malformations, not unlike birth defects observed for people living in and near farming regions with intensive glyphosate use.The study points to many other troubling findings, from the disruptive impact of glyphosate on hormone signaling in mammals to how the chemical binds to metals such as zinc, cobalt and manganese, reducing the supplies of these crucial micronutrients for people, crops and other plants, and wildlife.  In April, a different study found another worrying effect: Glyphosate might disrupt biological functions for generations.  In experiments with rats fed glyphosate, Michael Skinner of Washington State University and colleagues found that malign effects of treatment did not show up in the organism eating glyphosate, or even in its offspring, but in the next two generations of offspring. These rats, without ever being exposed to glyphosate, nevertheless showed a prominent tendency toward prostate disease, obesity, kidney disease, ovarian disease and birth abnormalities. Glyphosate is clearly not a benign herbicide warranting no concern, its link to cancer aside. It may be causing many other serious disruptions to human biology, and to organisms and plants in the environment, currently invisible to today's outdated regulatory systems. It's about time our regulators updated their science.

U.S. Annually Uses 388 Million Pounds of Potentially Fatal Pesticides Banned in the EU, China and Brazil -  When it comes to banning harmful pesticides, the U.S. lags behind the European Union (E.U.), China and Brazil, according to a study published in the journal Environmental Health. Eighty-five pesticides currently in use across the country have been banned or are in the process of being phased out in the three nations, in large part due to their harmful impact on human health or the environment. In all, that means that about one-in-ten American-used pesticides contain ingredients that are either banned, not approved or have an otherwise unknown status in the E.U., China and Brazil. Many of these pesticides have been linked to acute poisoning in the U.S., some of which are considered highly poisonous in high dosages and have been connected to lung damage, convulsions, respiratory failure, coma and even death. "It's appalling the U.S. lags so far behind these major agricultural powers in banning harmful pesticides," said study author Nathan Donley, who is affiliated with the Center for Biological Diversity. "The fact that we're still using hundreds of millions of pounds of poisons other nations have wisely rejected as too risky spotlights our dangerously lax approach to phasing out hazardous pesticides."  The study focused on 13 pesticides that are currently approved in the U.S. but banned in at least two of the three other leading agricultural economics, though the researchers compared the approval status of a total of more than 500 pesticides used in outdoor applications. Of the 1.2 billion pounds of pesticides used across the nation in 2016, 322 million pounds had been banned or were being phased out in the E.U., compared with 40 million pounds in China and 26 million in Brazil.  "The USA is generally regarded as being highly regulated and having protective pesticide safeguards in place. This study contradicts that narrative and finds that in the last couple of decades, nearly all pesticide cancellations in the USA have been done voluntarily by the pesticide industry," said Donley. "Without a change in the U.S. Environmental Protection Agency's (EPA's) current reliance on voluntary mechanisms for cancellations, the USA will likely continue to lag behind its peers in banning harmful pesticides."

Maharashtra Farmers to Protest Ban on GM Crops, Plant Bt Cotton and Brinjal  A farmers’ body has announced that it will be sowing genetically modified seeds of brinjal and cotton in Maharashtra on June 10, even though the varieties are banned in the state. Around 5,000, under the aegis of the Shetkari Sanghatana, are expected to gather in Akola to plant the transgenic varieties as a mark of protest against the government’s ban.“It will be a peaceful protest. We will only plant the varieties in the fields. But there is the possibility that the police could arrest us because the cultivation of these varieties of these crops is banned,” said Anil Ghanwat, state president of Shetkari Sanghatana.The farmers’ body is opposed to a ban on GM crops as they claim that these are beneficial to farmers. “Genetically modified seeds are being used all over the world and we have seen that the costs are less, pest attacks are fewer and the yields are higher. They are definitely much better for the farmer,” Ghanwat said.The protest comes a month after the Haryana government began a crackdown on illegal cultivation of genetically modified brinjal in the state. Officials visited fields and uprooted the crop, which was found to be grown illegally, and buried it in trenches.Herbicide-tolerant Bt cotton and Bt brinjal are the genetically modified varieties of the two crops that the farmers want to be able to sow. The sowing of Bt cotton seeds was banned in Maharashtra in 2012. The ban was lifted, momentarily, in 2013, only to be banned again in 2015.The use of Bt brinjal for cultivation has been prohibited since 2010 when Jairam Ramesh, the then environment minister, imposed a moratorium arguing that stakeholders and scientists have been unable to reach a consensus on whether Bt brinjal should be cultivated. Ghanwat argues that farmers should be allowed to use genetically modified varieties particularly since India allows the import of certain edibles of the genetically modified variety. “We are importing canola oil from Canada that is being made using genetically modified genes. If that can be consumed, why not Bt brinjal? Why can farmers not grow Bt cotton?”

In India, insects are slowly disappearing – and that is a cause for worry - There are approximately 5.5 million insect species buzzing, creeping and crawling across our planet. However, a scientific review of records recently published in the journal Biological Conservation revealed that up to 40% of insect species worldwide are likely to become extinct in the coming years. And that, entomologists say, is bad news. Our knowledge of the services that insects provide to the ecosystem is limited. In fact, nearly 89% of the global insect population has not even been named, said former director of the Zoological Society of India, PT Cherian, who is among the many scientists who believe that India is also part of the decline of insects being witnessed globally. CA Virakthamath, the 76-year-old doyen of contemporary Indian entomology and professor emeritus at Gandhi Krishi Vignana Kendra, Bengaluru, is an authority on leafhoppers. “In the early ’70s, I visited Coonoor several times in search of this interesting leafhopper of the genus Gunhilda that had earlier been recorded from that place,” he said. “But neither my students nor I nor anyone else looking for it, has found it ever since.” A complete genera of leafhoppers has disappeared in India.  “You don’t hear insects as you would before,” said Rohini Balakrishnan, chairman, Centre for Ecological Studies at the Indian Institute of Science in Bengaluru. Balakrishnan specialises in insect acoustics, particularly crickets and tettigonids. “Their numbers are diminishing, and that should be a cause for worry,” she added, pointing to growing urbanisation as one of the reasons.  Other Indian entomologists have similar tales. According to Prathapan Divakaran, an entomologist from College of Agriculture in Vellayani, Thiruvananthapuram, in Kerala, two species of flea beetles that he had collected from the botanical garden at the Gandhi Krishi Vignana Kendra campus in Bengaluru in the ’90s, are now missing. An expert on flea beetles, who has described 80 new species and seven new genera, Divakaran said, “I have also not been able to locate several genera described in the records on fauna from British India.”

Plant Extinction Is Happening 500x Faster Than Before the Industrial Revolution --Researchers have found that nearly 600 plant extinctions have taken place over the last two and a half centuries, according to a new paper published in Nature Ecology and Evolution.  The 571 proven plant extinctions lost since 1753 is twice the number of animal species lost in the same time frame and nearly four times as many plants lost as botanists recently estimated. The researchers with the Royal Botanic Gardens in the UK and Stockholm University also noted that many plant species disappeared without anyone ever knowing about them, pushing the true number of extinctions much higher. The extinction rate — 500 times greater now than before the Industrial Revolution — is also quite alarming, according to The Guardian. This number, too, is likely an underestimate."This study is the first time we have an overview of what plants have already become extinct, where they have disappeared from and how quickly this is happening," said Aelys Humphreys, Ph.D., of Stockholm University, the BBC reported.The paper documented all known plant extinctions in the world, finding that most lost plants were in the tropics and on islands. The researchers created a map that showed South Africa, Australia, Brazil, India, Madagascar and Hawaii as particular hotspots for plant extinction, according to The Guardian.So what's causing the rapid rate of plant extinction? The main culprit is human activity like clear cutting forestsfor timber and converting land into fields for agriculture.The researchers note that their paper also shows what lessons can be learned to stop future extinctions. "Plants underpin all life on Earth," said Eimear Nic Lughadha, Ph.D., at the Royal Botanic Gardens, Kew, who was part of the research team, as The Guardian reported. "They provide the oxygen we breathe and the food we eat, as well as making up the backbone of the world's ecosystems – so plant extinction is bad news for all species."

Twice as many plants have gone extinct than birds, mammals, and amphibians combined - When scientists talk about recent extinctions, birds and mammals get most of the attention. But the first global analysis of its kind finds that twice as many plants have disappeared than birds, mammals, and amphibians combined. Researchers reviewed published research, international databases, and museum specimens such as grasses from Madagascar (pictured), tallying up 571 plants species that have gone extinct in the past 250 years. One reason the total exceeds that of well-studied animals is that there are simply more kinds of plants. Looking at percentages, the situation is worse for mammals and birds; an estimated 5% of those species have gone extinct, compared with 0.2% of plants.  The losses include the Chile sandalwood tree in the South Pacific, exploited for its fragrant timber. It was last seen on Robinson Crusoe Island in 1908. (The extinction rates among plants have been highest for trees and shrubs on islands—which often have species that occur nowhere else—and in regions with rich diversity, especially the tropics and in Mediterranean climates.)Just a few years later, the world lost the banded trinity (Thismia americana), a leafless plant that grew entirely underground except for its flowers. Most species of this kind of plant grow in rainforests, but T. americana was first described in 1912 in a sandy wetland in Chicago, Illinois, and was wiped out by development. The total of 571 extinct plant species is four times higher than the official listing kept by the International Union for the Conservation of Nature in Gland, Switzerland, the team reports today inNature Ecology & Evolution. Even so, it is probably still an underestimate, as less is known about the status of plants in Africa and South America than on other continents. Many of these species may vanish, too; a major review of the status of global biodiversity recently estimated than more than a million species (including 14% of plant and animal diversity) are threatened with extinction.

 "Biggest Animal Disease Outbreak Ever" Has Already Killed Millions...And There's "No Way To Stop It"  -- We have never seen an animal disease outbreak like this before, and it is rapidly getting worse.  African Swine Fever, also referred to as “pig Ebola”, has already wiped out millions upon millions of pigs and it continues to spread to even more countries.  There is no vaccine and there is no cure, and so essentially we don’t have any way to stop this disease.  At this point, the only solution is to kill all the pigs wherever the virus is found and desperately hope that it doesn’t spread anywhere else.  But that approach clearly hasn’t been working, and according to a recent Fox News report this epidemic has now become the “biggest animal disease outbreak we’ve ever had on the planet”“This is the biggest animal disease outbreak we’ve ever had on the planet,” Dirk Pfeiffer, a veterinary epidemiologist at City University of Hong Kong and swine fever expert, said. “It makes the foot and mouth disease and [mad cow disease] outbreaks pale in comparison to the damage that is being done. And we have no way to stop it from spreading.”China is the epicenter for this outbreak, and it is also home to half of all the pigs in the world.Actually, to be more accurate, I should say that it used to be home to half of all the pigs in the world.In a normal year, China slaughters approximately 700 million pigs.  But according to Rabobank, that number will be down 30 percent this year due to this outbreak Researchers at Rabobank are estimating that this year China will suffer a 30% loss in pork production as a result of ASF. To put that into perspective, that 30% loss in production is equivalent to Europe’s entire annual pork supply, and almost 30% larger than U.S. annual pork production.

Food Security: Largest Animal Epidemic in History Is Due to Industrial Farming - (video & transcript) Jerri-Lynn here. This Real News Network interview with Rob Wallace of the Agroecology and Rural Economics Research Corps discusses what’s caused the current outbreak of African swine flu – the largest animal epidemic in history –  which is currently rampaging throughout China and other parts of Asia. Pork prices have shot up 40% globally. This epidemic is just one pressure on food prices; others include India’s drought and the US midwest floods (which Lambert has posted about here and here).

Forest Service Wants to Fast-Track Logging Without Environmental Review - The U.S Forest Service unveiled a new plan to skirt a major environmental law that requires extensive review for new logging, road building, and mining projects on its nearly 200 million acres of public land. The proposal set off alarm bells for environmental groups, according to Reuters. The proposed changes, released by the US Department of Agriculture (USDA), affect how new projects comply with the National Environmental Policy Act (NEPA), a decades-old law that requires detailed analysis prior to approval for any project that could significantly affect an ecosystem. One of the revisions, for example, would eliminate the requirement for a thorough environmental study before permitting mining on blocks of land up to one square mile in size, according to the Los Angeles Times.  The USDA says that eliminating some impact studies and reducing the number of redundant environmental reviews will allow it to repair roads, trails and campgrounds quickly. It also claims that shedding the red tape will allow the agency to take proactive steps to mitigate the threat of wildfires, according to the USDA's press release.   "With millions of acres in need of treatment, years of costly analysis and delays are not an acceptable solution — especially when data and experience show us we can get this work done with strong environmental protection standards as well as protect communities, livelihoods and resources,” said Sonny Perdue, secretary of the USDA, in the agency's statement. Environmental groups, however, quickly refuted Perdue's statement and criticized the plan, pointing out that the proposal will cut the public out of the decision-making process and damage public lands."This is clearly consistent with the Trump administration's desire to reduce government and to cut the public out of the process of managing a public asset," said Susan Jane Brown, an attorney for advocacy group Western Environmental Law Center, as The Washington Post reported. "To try to draw a line between climate change-induced wildfire and the need to cut the public out of the process of wildland management is disingenuous." Environmental groups quickly spotted a new loophole in the law for commercial logging that would permit up to 4,200 acres of clearcutting, or 6.6 square miles, without any public involvement.

US flight attendants speak out over uniforms that cause illness - Body rashes. Burning throat and eyes. Coughing and headaches. These are just some of the medical symptoms American Airlines flight attendants have been dealing with since the rollout of new uniforms for more than 70,000 airline employees in September 2016. Many Delta Air Lines workers are reporting similar health issues with their work uniforms, which were produced by a different manufacturer. “They rolled out three years ago, and when I opened the box, this awful fishy, chemical smell hit me,”. “I washed everything several times. My house stunk. I tried to wear it, and it gave me rashes, headaches, chest tightening, dry cough,” she continued. “I figured out it was the uniform. I quit wearing it and was better, but if I was around others wearing the uniform, I got the symptoms. I would get rashes on my chest, neck and arms. I wore the skirt that was lined. My arms would get a rash because they would brush against the skirt. It’s been going on three years.” After discussing her symptoms with co-workers, she realized that her physical ailments were widespread and that their uniforms were likely the cause. “We just sort of figured it out. That was the only common denominator, and you felt better when you took it off within an hour,” she said. Over 5,000 American Airlines employees have filed complaints that their uniforms have made them ill. The company is preparing to replace the uniforms with those provided by a different supplier. However, this change will not be completed until 2022. In the meantime, American Airlines is allowing workers who experienced illness to choose alternative clothing until the new line of uniforms is completed sometime in 2022. However, uniforms from the new manufacturer, Lands’ End, have been the source of almost identical complaints from flight attendants at Delta. American Airlines and the company that supplied the uniforms—Twin Hill, a subsidiary of the company Tailored Brands, which also owns clothing outlets Men’s Wearhouse and Jos. A. Bank—have stated, “The uniforms are safe and designed with the appropriate levels of chemicals used to sustain the quality of the work uniforms.” American Airlines insists that its uniforms are safe to wear and have spent millions on tests to prove that the uniforms are safe.

You May Be Swallowing a Credit Card’s Weight in Plastic Weekly, Says New Study -- Want a drink to wash down that credit card?  It may not sound appetizing, but a new study found that the global average of microplastic ingestion could be five grams every week. That's about the same weight as a credit card. Put another way, it's a teaspoonful of plastic, 2,000 tiny bits of plastic; you are inadvertently swallowing every single week, according to CNN.  The research was commissioned by the World Wildlife Fund (WWF) for its report No Plastic in Nature: Assessing Plastic Ingestion from Nature to People and executed by the microplastics research team at the University of Newcastle, Australia.  The largest source of plastic ingestion comes from water — both bottled and tap. The average person consumes as many as 1,769 tiny plastic bits per week just by drinking water, as CNN reported.  "In water it's mostly fibers which could come from industrial activities," said Thava Palanisami, Ph.D., a University of Newcastle researcher and one of the study's co-authors, as reported by the Australian Broadcasting Corporation. "It's released with other gases and chemicals and this can then ultimately sink into the freshwater bodies and that gets into the drinking water."  Shellfish came in as the second most common source of plastic in a person's diet. Beer and salt also ranked high as significant sources of plastic, the study showed, according to the New York Post.  The findings, collated from analyzing 52 peer-reviewed studies, are the first to estimate the weight of plastics consumed by individual humans. "For the first time, this study offers precise estimations on the amounts of plastic ingested by humans," said Palanisami, as reported by The Brussels Times. That weight is five grams every week, or 250 grams over the course of a year.

Canada to Announce Ban on Single Use Plastics - Canada's Prime Minister Justin Trudeau will announce a plan to ban single use plastics by 2021 at a press conference in Montreal Monday, the Associated Press reports. An announcement on specific prohibited items will wait until the government surveys a science-based review, but plastic straws, cotton swabs, drink stirrers, plates, cutlery and balloon sticks are just some of the single-use plastics that will be banned, according to an official government source who spoke to the CBC.The official said the government will establish achievable targets and metrics to work with the private sector for a gradual reduction in plastic pollution over the next few years, Canada's National Post reported.The full list of banned products will mirror the comprehensive list of banned products the European Union agreed to in March, which included oxo-degradable plastic and polystyrene fast food containers, which are similar to white styrofoam, the CBC reports.The EU's aggressive move to curb plastic usage not only placed a ban on single use items, but also took aim at plastic producers, holding them responsible for the cost of waste management and clean up. The member states will have to clean up 90 percent of plastic bottles by 2025. Items like balloons and sanitary wipes will have clear labeling instructing the user on how to dispose it, according to Deutsche Welle. The Trudeau government is no stranger to partnering with EU members states on matters of environmental stewardship. Last year, his government created the Ocean Plastics Charter at the G7 summit in Quebec. The European Union and 63 companies immediately signed on, agreeing to find ways to reduce marine plastics litter, the National Post reported. The issue of plastic waste has recently been a scourge for Canada and a public relations nightmare. Early this year, a report by the consulting firms Deloitte and ChemInfo Services commissioned by Environment and Climate Change Canada found that only nine percent of Canada's plastic waste is recycled and 87 percent ended up in landfills, the CBC reported. Environment and Climate Change Canada also found that Canadians throw away more than 34 million plastic bags everyday.

Despite Outcry, ORSANCO Commissioners Vote To Make Ohio River Pollution Standards Voluntary - The multi-state organization which sets pollution standards for the Ohio River is making a major change after 60 years. Commissioners of the Cincinnati-based Ohio River Valley Water Sanitation Commission voted Thursday to relinquish its role setting pollution standards to protect human health and aquatic life. ORSANCO will instead issue non-binding guidelines for eight states along the river – including Indiana, Ohio and Kentucky – going forward. Environmental watchdogs are concerned that allowing states to withdraw from ORSANCO’s regional standards removes safeguards for ensuring individual states cannot cause harm to states downstream. A previous effort to revise regional adherence to ORSANCO’s pollution control standards was halted in 2018 thanks to similar public outcry. That was only a delay as it turns out. This past March and April, ORSANCO held a series of public hearings and welcomed public comment on the topic of revising its pollution control standards. Thursday’s vote by 18 of the 20 commissioners appointed by governors from each state came despite just nine of more than 4,000 people filing public comments supporting the change.   A representative of the National Wildlife Federation called it a “gut punch” to the five million people who depend on the Ohio River for drinking water. “With many of our cities and towns living with unsafe drinking water, now is not the time to pull back from the regional pollution control standards that have provided the framework for regional cooperation and agreement on pollution limits. This can only lead to a race to the bottom that threatens our environment, economy, and public health,” said Gail Hesse, the NWF Great Lakes Regional Center’s water program director. The foundation says the 981-mile Ohio River continues to face serious threats from sewage, toxic pollution, and farm runoff. The quality of the river water has already led to drinking water restrictions, fish consumption advisories, and recreation restrictions.

Ohio River water quality standards diluted by multi-state agency - The multi-state agency that for the last 60 years has set water quality standards protecting the Ohio River Thursday approved industry-backed changes to make those rules voluntary. The Ohio River Sanitation Commission, known by the acronym ORSANCO, voted 19-2 with one abstention to make the changes at its meeting in Covington, Ky., even though public comments on the policy proposal totaled 4,150 opposed and nine in support. Jordan Lubetkin, a regional spokesman for the National Wildlife Federation, said the commission presented no analysis, justification or data supporting the decision to make the standards voluntary. “This is a monumental step backwards that will jeopardize the health of the Ohio River,” Mr. Lubetkin said. “The commissioners should be ashamed.” Mr. Lubetkin said the Ohio River continues to face serious threats from sewage contamination, toxic pollutants from industry and farm runoff, resulting in drinking water problems, fish consumption advisories and restrictions on swimming and boating. Pennsylvania is represented on the commission by Davitt Woodwell, president of the Pennsylvania Environmental Council, Charles “Chuck” Duritsa, retired southwest regional director at the Pennsylvania Department of Environmental Protection, and Patrick McDonnell, DEP secretary. Jennifer Orr-Greene, from the DEP’s office of water resources planning, attended representing Mr. McDonnell. All three Pennsylvania representatives voted in favor of the revision. The new policy is effective immediately. The only two votes against adopting the new policy were from George Elmaraghy, one of the two federal representatives, and Douglas Conroe, executive director of the Chautauqua Lake Association Inc., representing New York. Other states represented on the commission are Ohio, West Virginia, Indiana, Illinois, Kentucky and Virginia.

The Great Lakes are overflowing with record amounts of water -Lake Erie and Lake Superior broke records for average water levels in May, as did Lake St. Clair on Detroit’s eastern edge, according to the U.S. Army Corps of Engineers. In May, Lake Erie also reached its highest level on record for any month.Record- or near-record-high water levels are forecast to continue in the summer before making the usual downturn into fall.The effects of these high waters have been wide-reaching. Recreational beaches have shrunk, and water has inundated docks and destroyed roads.Damage to lakeshore property was reported again this week along Lake Ontario in Upstate New York in the town of Henderson.“There’s houses surrounded by water, water going into houses and lake water in the roads,” Eric Anderson, an operations coordinator for the Henderson Fire District, told the Watertown Daily Times. “Carp are feeding in people’s front lawns.”This kind of flooding has occurred along the shores of the Great Lakes for months, in some places repeatedly, and intensifies during high-wind events and storms. Major winter snowfalls and excessive rainfall are primary drivers for high water this year.  Normal water levels in the Great Lakes are largely modulated by precipitation, natural springs and rivers. Great Lakes water levels typically rise during the spring into summer, but this year it has been extreme. Year-to-date precipitation in much of the Great Lakes region is running 150- to 200-plus percent of normal. Only the Lake Ontario region has seen somewhat lesser amounts, though it has still endured flooding. Winter saw record snowfall. Last year was also fairly wet. During the month of May, the water level of Lake Superior rose 5 inches, and the water level of Lakes Michigan-Huron rose 9 inches. The water levels on these Great Lakes are around 1 foot higher than one year ago. pic.twitter.com/GzW5c6Brnu

 Rising Great Lakes water levels fuel worries about damage to shoreline structures - Rising Great Lakes water levels are causing damage to some structures on Michigan shorelines. The Holland Sentinel reports a section of seawall at Kollen Park in Holland sustained damage during a storm.Keith Kompoltowicz, chief of watershed hydrology at the U.S. Army Corps of Engineers in Detroit, said lake levels are expected to topple record highs this summer.“For the month of May, a new record high for the month was set and additional record highs for the months of June, July, August and September are expected,” he said.Federal officials say they're hearing concerns from lakeside businesses, cities and towns.“It suffices to say that we built infrastructure that really can't withstand some of these major events that are rolling through at these really severe and high frequency occurrences,” said Heather Stirratt, the Great Lakes lead for the National Oceanic and Atmospheric Administration. She says we can expect continued shoreline erosion, flooding and accelerated damage caused by storms.

Midwest Flooding, the Corn and Soy Crops, and Knock-On Effects - Lambert Strether - Here’s a map of the flooding from the United States Geological Service (USGS) as of today, June 9, 2019:  The black triangles, as you can see, show flooding, and there are rather a lot of them. As best I can determine, the aqua (“95-98”) and blue (“>=99”) show the streamflow value compared to 30 years of average streamflow conditions, where streamflow is “the amount of water flowing in a river.” So, add 1% plus a smidge to a blue (99) triangle, and you have a flood. And here — because it’s hard to plant when your field is mud, even if your field isn’t flooded — is a map of soil moisture from the National Oceanic and Atmospheric Administration (NOAA) as of yesterday, June 8, 2019:  Calculated soil moisture anomaly is “is intended to reflect the degree of dryness or saturation of the soil compared with normal conditions,” in this case by measuring departure from a 1971-2000 dataset, measured in millimeters. From NOAA: [S]oil moisture is the water that is held in the spaces between soil particles. Surface soil moisture is the water that is in the upper 10 cm of soil, whereas root zone soil moisture is the water that is available to plants, which is generally considered to be in the upper 200 cm of soil. 10cm is 3.9 inches, and (from the map) those dark green areas are saturated to depth of 160m = 6.29 inches, and even the light green areas to a depth of 100mm = 3.9 inches, so for vast areas of the Midwest, the surface soil is waterlogged, and for lesser but still vast areas, the root zone is waterlogged too.  With flooded fields and waterlogged soil all across the Midwest, we would expect planting to be bad, and so it is. From the Washington PostPlanting in June is so absurd that Midwest universities typically do not even test dates that late when determining optimal growing seasons, [University of Illinois economist Scott Irwin] said. But if fears of a bad crop spread and corn prices rise enough — they are already up about 20 percent since their mid-May low — some farmers will plant late crops, even if they are likely to harvest far less per acre. Even under the most generous definitions, much of the Corn Belt has only one hail-Mary planting window left. The planting window for corn is about to close; the window for soy closes a little later. Here is a handy map from the Federal Reserve Bank of St Louis showing the difference between last year’s corn planting and this year’s, in percentage terms:  This year’s planting will be low. Very low. From Accuweather, “AccuWeather predicts another historic low for corn planting as ‘billion-dollar disaster’ looms

Some Ohio farmers won’t plant crops at all because of rain (AP) — The constant rains this spring are forcing some Ohio farmers to give up hopes of planting any corn this spring and wonder if they'll have any crops at all this year. Just one-third of Ohio's corn crop had been planted as of a week ago. In a typical year, farmers in the state would have nearly all of their corn fields planted. Soybean planting is also behind because of the wet weather. Only Indiana is further off pace than Ohio when it comes to delays in planting, according to U.S. Department of Agriculture statistics. The Ohio Farm Bureau Federation said this is the worst planting season since it started tracking planting progress in the 1970s. It's been especially bad in northwest Ohio, which is home to some of the most productive agriculture counties in the state. "There are going to be a bunch of fields filled with weeds," Ty Higgins, a farm bureau spokesman, told The Blade. "It's going to change the entire landscape of the countryside of northwest Ohio." Cooler temperatures have made it harder for fields to dry out. "There have been years we've had wet spells, but this has lingered on," said 63-year-old Mark Bushman, who has a farm near Pemberville. "This is the worst I've experienced." Kris Swartz, another northwest Ohio farmer, said many farmers won't be able afford another year like this one. "I've been farming 36 years and this is the first year I may not have an acre of corn," Swartz said. Joe Logan, who leads the Ohio Farmers Union, said many farmers have decided not to plant corn and will now have to see if they can even get soybeans into the fields. "They're exchanging seed as we speak," Logan said.

USDA Slashes Corn Yield Estimates, Leaves Soybeans Unchanged - In their June World Agriculture Supply and Demand Estimates report, USDA slashed corn output, but left soybeans unchanged. In the WASDE report narrative, USDA economists wrote: “Unprecedented planting delays observed through early June are expected to prevent some plantings and reduce yield prospects. USDA will release its Acreage report on June 28, which will provide survey-based indications of planted and harvested area.” While analysts were looking for a yield reduction, nobody expected the agency to reduce yield to 166 bu. per acre. According to a Reuters survey, the trade expected a 172.4 bu. yield for corn. Additionally, USDA removed 3 million harvested acres from the balance sheet. A move INTL FCSTone chief economist Arlan Suderman says indicates more cuts are coming. Sharply lower supplies pushed use down 425 million bushels to 14.3 billion, based on reductions to feed and residual use and exports. Carryout is expected to decline 810 million bushels to 1.7 billion, which if realized would be the lowest since 2013/14. Corn markets surged higher following the report’s release, including nearby contracts indicating the weather market is far from over. Despite reporting just 60% of the soybean crop is planted in their June 10 Crop Progress Report, USDA left soybean output alone in the June WASDE report. Agency economists wrote: “Although adverse weather has significantly slowed soybean planting progress this year, area and production forecasts are unchanged with several weeks remaining in the planting season.”

Paralysis on America’s Rivers: There’s Too Much Water - NYT - Nineteen barges bound for nowhere were tied up along the swollen riverbank. Dark warehouses full of flooded fertilizer reeked with a sulfuric stench that made it painful to inhale. The river system, which for decades provided Mr. Shell a livelihood, now spreads only gelatinous mud and pungent debris and uncomfortable questions about the future.  The devastating flooding that has submerged large parts of the Midwest and South this spring has also brought barge traffic on many of the regions’ rivers to a near standstill. The water is too high and too fast to navigate. Shipments of grains, fertilizers and construction supplies are stranded. And riverfront ports, including the ones Mr. Shell oversees in Van Buren and Fort Smith, Ark., have been overtaken by the floods and severely damaged. As Mr. Shell surveyed the wreckage last week, anything approaching normalcy remained months, or even a year, away. To start, he would be happy just to get the power restored. Across the country’s flood-battered midsection, the farms, townsand homes consumed by the bloated waters have drawn much of the attention. But flooding has had another, less intuitive effect — crippling the nation’s essential river commerce. Water, the very thing that makes barge shipping possible in normal times, has been present in such alarming overabundance this spring that it has rendered river transportation impossible in much of the United States.The Arkansas River has been closed to commercial traffic. So has the Illinois River, a key connection to Chicago and the Great Lakes. And so has part of the Mississippi River near St. Louis, where it crested on Sunday at its second-highest point on record, cutting off the river’s northern section from shippers to the south.As a result, farmers already grappling with flooded fields and worries about the trade war with China have struggled to obtain fertilizer for their crops. Customers have seen their deliveries of construction materials and road salt get stuck midway to their destinations. And shippers have made drastic cuts to their operations with work at a standstill.“It’s like when you’re driving on an interstate and there’s an accident in front of you and there’s nowhere to go,” said  Jeff Webb, president of Cargill Marine and Terminal, which operates more than 1,400 barges, hundreds of which are now stuck in the Gulf of Mexico or lower Mississippi River because of closures to the north.

Photos: Severe flooding prompts states of emergency, leaves 3 dead in North Carolina - Severe flooding persists as waters continue to rise in the southeastern United States. The flooding forced hundreds from their homes, caused travel disruptions and damaged property early this week. Western North Carolina is among the regions hit the hardest by the storms. North Carolina Governor Roy Cooper held a press conference to address the flooding across the state Monday afternoon. “Over the weekend, we saw rains that had a serious impact on our state that we will feel for several days,” Cooper said. “Several counties received as much as 12 inches of rain.” According to Cooper, over 80 swift water rescues have been performed so far. He urged residents to use caution when traveling and never to drive around a barricade or through floodwaters. North Carolina State Highway Patrol (NCSHP) has responded to around 4,000 calls for service since the start of the storm, according to NCSHP Colonel Glenn McNeill. Three people were killed amid the heavy rain near Lincolnton, North Carolina, on Saturday evening. The vehicle they were traveling in slid off the road, hit a tree and overturned into rising creek waters, troopers told WBTV. On Sunday, Mayor Lee E. Moritz, Jr., declared a state of emergency for the city of Conover, North Carolina, along with Catawba County, due to the heavy rain and flooding in the area. The city ofHickory, North Carolina, made a similar declaration. A few locations in western North Carolina have recorded more than a foot of rain in the past three days. This includes 13.64 inches near Brookford and 13.57 inches east of Boone, North Carolina.

Near Record ‘Dead Zone’ Predicted for Gulf of Mexico - Every year the Gulf of Mexico hosts a human caused "dead zone." This year, it will approach record levels scientists from the National Oceanic and Atmospheric Administration — or NOAA — estimate, in a statementreleased Monday.The researchers predict the hypoxic zone — an area with little to no oxygen that can kill marine life — to be nearly 8,000 square miles or roughly the size of Massachusetts. NOAA wasn't the only organization to estimate a near record dead zone this summer. Researchers from Louisiana State University (LSU) released a statement on Monday predicting this year's dead zone to be 8,717 square miles, making it the second largest on record."We think this will be the second-largest, but it could very well go over that," said Nancy Rabalais, a marine ecologist who studies dead zones co-authored the LSU report, as CNN reported.The Gulf of Mexico's dead zone is a result of nutrient pollution, including nitrogen and phosphorus from urban environments and farms, traveling through the Mississippi River watershed and into the gulf, according to NOAA's press release.NOAA pointed to the overwhelming spring rains along the Mississippi River, which led to record high river flows and flooding, as a major contributing factor to this year's sizeable dead zone.The record flooding brought a substantial amount of pollutants into the water. "This past May, discharge in the Mississippi and Atchafalaya rivers was about 67 percent above the long-term average between 1980 and 2018. USGS estimates that this larger-than average river discharge carried 156,000 metric tons of nitrate and 25,300 metric tons of phosphorus into the Gulf of Mexico in May alone. These nitrate loads were about 18 percent above the long-term average, and phosphorus loads were about 49 percent above the long-term average," NOAA said in its press release.What happens is the nitrogen and phosphorus stimulate the growth o f phytoplankton, which fall to the bottom of the water and decompose with the bacteria that uses up the oxygen, creating an area with not enough oxygen to sustain life.

NOAA forecasts very large ‘dead zone’ for Gulf of Mexico - NOAA -- NOAA scientists are forecasting this summer’s Gulf of Mexico hypoxic zone or ‘dead zone’ – an area of low to no oxygen that can kill fish and other marine life – to be approximately 7,829 square miles, or roughly the size of Massachusetts. The annual prediction is based on U.S. Geological Survey river flow and nutrient data. The 2019 forecast is close to the record size of 8,776 square miles set in 2017 and larger than the 5-year average measured size of 5,770 square miles. The annually recurring Gulf of Mexico hypoxic zone is primarily caused by excess nutrient pollution from human activities, such as urbanization and agriculture, occurring throughout the Mississippi River watershed. Once the excess nutrients reach the Gulf they stimulate an overgrowth of algae, which eventually die, then sink and decompose in the water. The resulting low oxygen levels near the bottom are insufficient to support most marine life and have long-term impacts to living marine resources that are unable to leave the area. Considered one of the world’s largest, the Gulf of Mexico dead zone occurs every summer.  A major factor contributing to the large dead zone this year is the abnormally high amount of spring rainfall in many parts of the Mississippi River watershed, which led to record high river flows and much larger nutrient loading to the Gulf of Mexico. This past May, discharge in the Mississippi and Atchafalaya rivers was about 67% above the long-term average between 1980 and 2018. USGS estimates that this larger-than average river discharge carried 156,000 metric tons of nitrate and 25,300 metric tons of phosphorus into the Gulf of Mexico in May alone. These nitrate loads were about 18% above the long-term average, and phosphorus loads were about 49% above the long-term average. NOAA issues a dead zone forecast each year, and refines the modelsoffsite link used by the Hypoxia Task Force to set nutrient reduction targets and better understand the link between hypoxia and nutrients. The forecast assumes typical coastal weather conditions, but the measured dead zone size could be disrupted and its size could change by major wind events, hurricanes and tropical storms which mix ocean waters, as occurred in 2018. USGS operates more than 3,000 real-time stream gauges, 50 real-time nitrate sensors, and 35 long-term monitoring sites throughout the Mississippi-Atchafalaya watershed, which drains all rivers and streams in parts or all of 31 states and 2 Canadian provinces into the Gulf of Mexico.

Europe′s seas to lose almost a third of life due to climate change: report  - Europe's waters are expected to lose 30% of their already vulnerable ocean life to further warming, says a new study. Combined with overfishing, that loss can threaten livelihood and food security in coastal nations. The Earth's oceans will lose 5% of marine animals globally for every degree of warming, even without taking into account the broader impacts of fishing, according to the most comprehensive global study of its kind published in the Proceedings of the National Academy of Sciences (PNAS) on June 11. With warmer oceans pushing fish toward the cooler poles and larger species suffering the biggest decline, the new report, "Global ensemble projections reveal trophic amplification of ocean biomass declines with climate change," aims to provide the clearest picture yet of how climate breakdown risks the structure and function of our oceans' ecosystems. While warmer global temperatures have already caused a significant loss and redistribution of the world's sea life, the impacts in Europe will be the most keenly felt, according to one of the report's 35 authors, Boris Worm from Dalhousie University in Halifax, Canada. DW spoke with Worm about the impact of climate change in the oceans and how we can reverse the trend.

Deforestation of Brazilian Amazon surges to record high - Deforestation of the Brazilian Amazon surged last month to the highest May level since the current monitoring method began, prompting concerns that president Jair Bolsonaro is giving a free pass to illegal logging, farming and mining. The world’s greatest rainforest – which is a vital provider of oxygen and carbon sequestration – lost 739sq km during the 31 days, equivalent to two football pitches every minute, according to data from the government’s satellite monitoring agency. Although a single month is too short to confirm long-term trends, May is considered an important guide because it marks the start of the dry season, which is when most burning and other forms of forest clearance are carried out. Unless the government sends a clear signal it will not tolerate a further acceleration, environmentalists fear there will be an increase in the coming months that could make 2019 one of the worst years for deforestation in recent memory. “The government can’t deny these numbers from their own agency. The question now is what they’ll do about it,” said Carlos Souza, of the independent monitoring group Imazon. “By the end of July. we’ll have a clear idea of the impact of recent moves to dismantle environmental policies.” Since the far-right Bolsonaro came to power in January, he has weakened the environment ministry, loosened controls on economic exploitation of the Amazon, halted demarcation of indigenous land and encouraged mining and farming interests to expand in the region. Since the president criticised the government’s main monitoring agency as a “fines industry”, it has issued a fewer penalties than at any time in 11 years and the number of inspection operations is down 70% from last year. His environment minister, Ricardo Salles, who was convicted for environmental fraud and had never visited the Amazon region before this year, has further undermined morale by failing to appoint regional chiefs and by firing veteran inspectors. Earlier this week, Folha reported he was moving to privatise the satellite monitoring of the forest. 

Narendra Modi and rain god not going well together, India stares at another drought - rendra Modi had begun his first regime in 2014 on a drought note. It was followed by another drought in 2015. This was said to be the first instance in a hundred years when India faced back-to-back drought years. Narendra Modi won a bigger mandate in 2019 and India is staring at another spell of drought if the current trend of rainfall shortage continues. The India Meteorological Department (IMD) data fuels this fear. In the pre-monsoon season or between March 1 and May 31, the rainfall deficiency was 25 per cent. It has been increasing since then. Between May 30 and June 6, the IMD data says, the rainfall deficiency increased to 40 per cent. According to the Drought Early Warning System, 43 per cent of India is currently under the spell of drought. Situation in Maharashtra, Karnataka and Tamil Nadu is grim. It is not much better in Gujarat, Rajasthan and Andhra Pradesh. About half of Maharashtra - including the districts of Latur, Beed and Osmanabad in Marathwada region - comprising nearly three-fourth of 36 districts of the state are facing severe drought situation. In Karnataka, two dozen of its 30 districts - nearly 80 per cent - are reeling under drought. News reports suggest that over 80 lakh farmers in the two states are affected by drought.Monsoon is weak and delayed. It reached Kerala on Saturday after a delay of a week. In its forecast, the IMD said monsoon is likely to be below normal - 96 per cent of the long period average (LPA) with 41 per cent possibility of a normal monsoon. The long period average for India from 1951-2000 is 89 centimetres. Anything between 96-104 per cent of the LPA is normal, and below normal if it is 90-96 per cent. .

Indian villages lie empty as drought forces thousands to flee - Hundreds of Indian villages have been evacuated as a historic drought forces families to abandon their homes in search of water.The country has seen extremely high temperatures in recent weeks. On Monday the capital, Delhi, saw its highest ever June temperature of 48C. In Rajasthan, the city of Churu recently experienced highs of 50.8C, making it the hottest place on the planet. Further south, less than 250 miles from the country’s commercial capital, Mumbai, village after village lies deserted. Estimates suggest up to 90% of the area’s population has fled, leaving the sick and elderly to fend for themselves in the face of a water crisis that shows no sign of abating.The village of Hatkarwadi, about 20 miles from Beed in Maharashtra state, is almost completely deserted.  Wells and handpumps have run dry in the 45C heatwave. The drought, which officials say is worse than the 1972 famine that affected 25 million people across the state, began early in December. By the end of May, Hatkarwadi had been deserted with only 10-15 families remaining out of a population of more than 2,000.With 80% of districts in neighbouring Karnataka and 72% in Maharashtra hit by drought and crop failure, the 8 million farmers in these two states are struggling to survive. More than 6,000 tankers supply water to villages and hamlets in Maharashtra daily, as conflict brews between the two states over common water resources. The acute water shortage has devastated villagers’ agriculture-based livelihood. Crops have withered and died, leaving livestock starving and with little to drink. Major crops, including maize, soya, cotton, sweet lime, pulses and groundnuts – drivers of the local economy – have suffered. In Marathwada, by many estimates the Indian region most affected by drought, increasingly frequent droughts have led to more than 4,700 farmer suicides in the last five years, including 947 last year. That crisis has deepened. In the city of Beed, clean drinking water has run out and households do not have enough water to wash clothes, clean dishes or flush the toilet. Hospitals are filling up with people suffering from dehydration – and gastrointestinal disease from drinking contaminated water.

India heatwave kills ‘dozens’ of people as temperatures hit 50C - Dozens of people are reported to have died in a heatwave across India that has seen temperatures reaching more than 50C (122F). Scorching temperatures and water shortages have caused “heavy casualties, including dozens of deaths by sunstroke and other heat-related causes”, according to The Weather Channel.. Indian media said on Friday that 17 people had died in three weeks. Meteorological Department officials issued an extreme weather event warning as the “severe heatwave” continued in northern and central areas for a third day in a row. The thermometer hit 50.6C (123F) in the city of Churu in the northwestern state of Rajasthan on Saturday, the weather department said. Hospitals have issued emergency wards with extra air conditioners, coolers and medicines, said Ramratan Sonkariya, an additional district magistrate. Water is being poured on roads in Churu, known as “the gateway to the Thar ​Desert”, to keep the temperature down and prevent them from melting, he said. In the western-central state of Maharashtra, farmers struggled to find water for thirsty animals and crops. “We have to source water tankers from nearby villages as water reserves, lakes and rivers have dried up,” said Rajesh Chandrakant, from Beed, one of the worst-hit districts. “Farmers only get water every three days for their livestock.” Of the 15 hottest places in the world on Sunday-Monday, eight were in India and the others in neighbouring Pakistan, according to weather monitoring website El Dorado.

36 Die in India Heat Wave, Delhi Records Its Highest All-Time Temperature - Four elderly pilgrims died while riding in a non-air-conditioned train car as India's deadly heat wave continues,The Times of India reported Tuesday. The four, aged between 69 and 81, had been returning from the holy city of Varanasi to Kerala in the south,The Independent reported. Railway official Manoj Kumar said they collapsed in their carriage and were pronounced dead by doctors waiting at the Jhansi station. The deaths come as the total number of fatalities in one of India's most intense and longest-lasting heat waves has reached at least 36, The New York Times reported Wednesday. Temperatures have soared to 50.6 degrees Celsius (123 degrees Fahrenheit), and the high temperatures are expected to impact 23 states this year, up from nine in 2015 and 19 in 2018, India's National Disaster Management Authority expert Anup Kumar Srivastava said.  #Heatwave conditions in many parts with a severe heat wave in some parts very likely over West Rajasthan; Heat wave in many parts with severe heat wave in isolated pockets over East #Rajasthan & #MadhyaPradesh; #Heatwave to a severe heat wave in isolated pockets over UP.  IMD pic.twitter.com/fnsBgyukrg — NDMA India (@ndmaindia) June 11, 2019  "This year, the number of heat wave days [has] also increased — and it's not just day temperature, night temperatures have also been high," Srivastava told The New York Times.  India has increasingly suffered from extreme heat in recent years. 2018 was the country's sixth hottest year on record, and 11 of its 15 warmest years have occurred since 2004, The Independent reported. The capital of New Delhi broke its all-time record Monday with a high of 48 degrees Celsius, according to The Times of India.

 Tar Is Literally Oozing Up Through The Streets Of LA As 700 Quakes Hit Key Seismic Zone -- Scientists are quite “concerned” about the huge earthquake swarm that has been shaking southern California in recent weeks, and right at this moment bubbling tar is literally coming up through the streets in one section of Los Angeles.  None of this means that a major seismic event is imminent, but it is certainly not a good sign either.  We have been tracking quite a bit of unusual shaking along the Ring of Fire in recent months, and scientists assure us that it is just a matter of time before “the Big One” hits southern California.  And if you follow my work on a regular basis, then you already know that I am extremely concerned about the potential for major seismic activity along the west coast.  So when I came across a San Diego Union-Tribune article entitled “Southern California earthquake swarm takes an unexpected turn, and that’s reason to worry”, it definitely got my attention.  According to that article, there have been “more than 700 earthquakes” in the Fontana seismic zone over the past few weeks… There have been more than 700 earthquakes recorded in the Fontana area since May 25, ranging from magnitude 0.7 to magnitude 3.2, recorded Wednesday at 5:20 p.m., according to Caltech staff seismologist Jen Andrews. According to one scientist, this is the “most prolific swarm” to hit that area “in the past three decades”The likelihood of a larger seismic event, given so many quakes over such an extended period, is higher than normal, the scientist said. “People ought to be concerned,” said Hauksson. “This is probably the most prolific swarm in that area of the Fontana seismic zone that we’ve seen in the past three decades.”   According to one local news report, “bubbling tar” is actually coming up through the streets near the La Brea Tar Pits in Los Angeles… And on Saturday, more seepage. Enough to draw the interests of tourists and residents alike. CBS2’s Jake Reiner said tourists and residents alike have been coming to the area marveling at the bubbling tar.

PG&E proactively cuts power because of weather  - Pacific Gas & Electric cut power Saturday to about 1,600 customers in Northern California to reduce risk of wildfires amid windy, dry and warming weather conditions that raised the year's first red flag warnings.The utility said it began cutting power at 6 a.m. to portions of Napa, Solano and Yolo counties, an area northeast of the San Francisco Bay region. By 3:48 p.m., PG&E announced the event had concluded. The company also announced Saturday afternoon that it would cut power to 27,000 customers in Butte, Yuba, Nevada, El Dorado and Placer counties.Conditions ripe for fire - winds, low humidity, dry vegetation and heat - were expected to last into Sunday. The National Weather Service said a station north of Sonoma reported gusts to 50 mph Saturday.PG&E is under pressure to prevent fire starts after downed power lines and other equipment have been blamed for conflagrations that began during so-called fire weather. But there has been opposition from customers who rely on electrically powered life-support equipment as well as businesses that have had to shut down for lack of power.

PG&E Shuts Power to California Resort Area to Prevent Wildfires - PG&E Corp. turned off power to about 22,000 customers in Northern California this weekend as part of the first wave of what the utility has said will likely be numerous pre-emptive shutdowns this year to help prevent deadly wildfires.  It came after the National Weather Service issued its first red-flag warning, which signals high fire danger, of 2019 for a region that has until now been mostly cool and moist.  About 1,600 businesses and homes in parts of Napa, Yolo and Solano counties, located about 75 miles northeast of San Francisco lost power from 6 a.m. Saturday morning until late that night.

 Glacier National Park Quietly Removes Its Gone By 2020 Signs - Officials at Glacier National Park (GNP) have begun quietly removing and altering signs and government literature which told visitors that the Park’s glaciers were all expected to disappear by either 2020 or 2030.In recent years the National Park Service prominently featured brochures, signs and films which boldly proclaimed that all glaciers at GNP were melting away rapidly. But now officials at GNP seem to be scrambling to hide or replace their previous hysterical claims while avoiding any notice to the public that the claims were inaccurate. Teams from Lysander Spooner University visiting the Park each September have noted that GNP’s most famous glaciers such as the Grinnell Glacier and the Jackson Glacier appear to have been growing - not shrinking - since about 2010. (The Jackson Glacier—easily seen from the Going-To-The-Sun Highway—may have grown as much as 25% or more over the past decade.)The centerpiece of the visitor center at St. Mary near the east boundary is a large three-dimensional diorama showing lights going out as the glaciers disappear. Visitors press a button to see the diorama lit up like a Christmas tree in 1850, then showing fewer and fewer lights until the diorama goes completely dark. As recently as September 2018 the diorama displayed a sign saying GNP’s glaciers were expected to disappear completely by 2020.Video of the diorama two years ago.But at some point during this past winter (as the visitor center was closed to the public), workers replaced the diorama’s ‘gone by 2020’ engraving with a new sign indicating the glaciers will disappear in “future generations.”

Climate change is destroying a barrier that protects the U.S. East Coast from hurricanes - A new study suggests that climate change could soon eliminate an atmospheric barrier that protects much of the U.S. East Coast from powerful hurricanes.  There are two main factors that contribute to hurricane development and intensity: sea surface temperature and vertical wind shear. Vertical wind shear is the difference in wind speed or direction between the upper and lower troposphere. Warmer sea surface temperatures and low wind shear (meaning the wind speeds and directions are similar throughout the column of air) both raise the potential intensity of a hurricane. Scientists knew that ocean temperatures are heating up, but until now it has not been clear how climate change would impact wind shear. A new paper, published today in Scientific Reports, finds that climate change could alter wind shear in a way that could deliver more powerful hurricanes to the East Coast. The study is authored by scientists from Columbia University's Lamont-Doherty Earth Observatory and the National Oceanic and Atmospheric Administration.  The new paper builds off of a talk NOAA's James Kossin gave at an Extreme Weather and Climate Initiative meeting at Columbia University in 2017. Kossin spoke about how, as hurricanes move northwestward out of the tropical Atlantic, a strong vertical wind shear along the East Coast prevents the storm from gaining strength, thus providing a protective barrier to strong landfalling hurricanes. Lamont Research Professor Mingfang Ting and Kossin, along with Lamont researchers Suzana Camargo and Cuihua Li, used model simulations to examine the effects of climate change on hurricanes in the United States. The group found that these hurricanes will be affected in two different ways. As earlier studies have shown, rising sea surface temperatures will lead to an increase in hurricane intensity. But this study was the first to find that rising anthropogenic greenhouse gases in the atmosphere will weaken the vertical wind shear along the East Coast which will, in turn, enable further intensification of hurricanes that make landfall in this region.

PIOMAS June 2019 - Arctic Sea Ice by Neven - (graphics) Another month has passed and so here is the updated Arctic sea ice volume graph as calculated by the Pan-Arctic Ice Ocean Modeling and Assimilation System (PIOMAS) at the Polar Science Center:As you can see, 2019 has moved into second place on the PIOMAS volume graph. The drop of 3234 km3 for May was third highest on record (after 2010 and 2012 which dropped 3523 and 3508 km3 respectively) and well above the average May decrease of 2621 km3. Last month, 2019 was on a par with 2011, 2016 and 2018 for second place, but now there is no question who is second. And 2017's lead has been reduced further from 1665 to 1015 km3.Here's how the differences with previous years have evolved from last month: Wipneus' version of the PIOMAS graph also shows the minuscule lead over all the other years, except 2017, which is about to end its extraordinary excursion:The anomaly trend line on the PIOMAS volume anomaly graph has dropped like a rock, smashing through the linear trend line, ending up in negative standard deviation territory in one fell swoop: PIJAMAS is also highly interesting this month. Remember, PIJAMAS is a measure for average thickness of the ice pack, and is crudely calculated by dividing PIOMAS volume numbers with JAXA extent numbers. When extent drops faster than volume, average thickness will go up, as the volume is spread over a smaller ice pack. But what we see in the graph below, is the opposite. Extent dropped steadily during May, but volume went down somewhat faster, and thus average thickness has decreased. While the thickness of most years increased during May, or practically stayed the same, two years show a marked decline: 2012 and 2019. The Polar Science Centre average thickness graph shows it too:  One of the main reasons there was such a large volume drop during the past month had to do with air temperatures. Arctic-wide, May 2019 was the warmest on record, mainly because of record high temperatures on the Pacific side and especially the Canadian side of the Arctic (-2.855 vs -3.604 °C in 2006): Here's an image showing surface air temperature (SAT) anomaly and mean sea level pressure (SLP) maps from the NOAA ESRL Daily Mean Composites website. This gives an idea of what kind of weather and temps cause the biggest drops in volume (in km3, below the years):

Disappearing sea ice is changing the whole ecosystem of the Arctic Ocean -- I drafted this while looking north over the frozen Lincoln Sea, at the northernmost tip of Ellesmere Island in Canada. I was at Alert, a Canadian Forces Station which, at 82°N, is the most northerly permanently inhabited place on Earth. It was May, and the sea should have still been frozen, but this year the bridge of sea ice between Ellesmere and Greenland broke up early, and Arctic ice began flowing down the narrow Nares Channel and south into Baffin Bay.   The Arctic is warming at twice the rate of the rest of the planet, and images of polar bears on small ice floes capture the imagination. But those images represent (excusing the pun) only the tip of the iceberg – the consequences of ice loss are profound and start from the very bottom of the food chain, in the microbial processes that drive the biology of the ocean.  Sea ice forms when seawater temperature falls below -1.8℃. As the ice crystals form, salt is forced out and ice brines and other dissolved constituents become trapped in a honeycomb of small channels in the ice. As the air grows colder, the ice thickens downwards and, in the brine channels and across the ice bottom, specialised algae and bacteria grow. When sunlight returns to the Arctic in the spring and penetrates through the ice (which is rarely more than a few metres thick) these ice-algal communities start to photosynthesise, producing algal biomass and abundant dissolved organic matter.This feeds a wide range of microscopic creatures known as zooplankton, which graze across the bottom of the ice. These zooplankton in turn feed larger animals and drive the food chain throughout spring. When the ice melts more of this material flows out into the seas, providing more food resources at the bottom of food chains. In a recent study published in Nature Climate Change, colleagues and I showed how the different components of this organic matter derived from ice-algae are used by different species of bacteria and at different rates in underlying seawater, so that more melting ice will change the patterns of organic matter turnover in surface waters during spring.  Less ice cover in summer means more open ocean water, which – as it is darker – absorbs more sunlight and heat, making it harder to freeze in the autumn. Open water also means the wind can stir up the sea and slow the process of refreezing. More open water in summer will change the plankton communities, and then the animals that feed on them.

Why Is China Pouring Money Into The Arctic? - Some of China’s investments have been welcomed by regional actors, and include the China Iceland Joint Arctic Science Observatory. Its costs were covered fully by the Chinese government, according to Halldor Johannsson, vice-chair of the new research facility located in Northern Iceland. Originally meant to monitor the northern lights, both parties have already committed to expanding its activities. Despite earlier suspicions in 2011 regarding investments by a Chinese billionaire, Iceland’s attitude towards scientific cooperation with China remains neutral, and the Observatory was inaugurated in October 2018. In Greenland, melting glaciers provide new opportunities for the exploration of natural resources. Chinese companies are involved in six different projects, including a partnership with the Australian company to extract uranium and rare earth minerals, which may serve a growing demand for the latter in China. While environmental concernshave been raised, international cooperation on natural resource extraction could reduce Greenland’s current reliance on Danish subsidies.However, in other cases, Chinese investments have been met with wary eyes. A sparsely populated but vast island, Greenland relies on aviation for the transport of both goods and people. When in 2017 two Chinese construction companies applied for a government tender to build three airports, their bid to improve the infrastructure network of the island sparked fears of a Chinese takeover in the Danish Parliament. In order to prevent Greenland from falling into a potential ‘debt trap’, Denmark offered to finance the projects instead.In Sweden, a newly opened research facility in Kiruna has also been put under scrutiny after the Swedish Defense Research Agency, an entity of Sweden’s Ministry of Defense, argued that its monitoring capabilities could be abused by the Chinese military. China’s first wholly-owned satellite ground station opened in January 2019 and is meant to improve global satellite data reception. Yet the highly blurred lines between the civilian and military sphere in China’s space efforts mean that potential military applications of its new satellite base cannot be ruled out.  It is these concerns that fuel U.S. antagonism towards a growing Chinese presence on the North Pole.

Global Emissions Rose the Most in 7 Years, BP Review Shows Global carbon emissions jumped the most in seven years in 2018 as energy demand surged, according to BP’s annual review of world energy, indicating the world is falling behind in its efforts to rein in climate change. The report, one of the most closely watched surveys of global energy trends, found that primary demand rose at the fastest pace this decade in 2018 even though economic growth weakened. China, India and the U.S. were responsible for two thirds of the 2.9% increase in consumption. Urgency is building around the world to contain a global increase in the temperature, which has risen 1 degree Celsius since the start of the industrial revolution and is on track to at least double that increase by the end of the century. It marks the quickest change in the climate since the end of the last ice age some 10,000 years ago. “At a time when society is increasing concerns about climate change and the need for action, energy demand and carbon emissions are growing at their fastest rate for years,” BP Chief Economist Spencer Dale said at a briefing in London. Much of the gains were driven by more volatile weather patterns. An increase in the number of days that were either unusually hot or cold boosted energy use for heating and cooling, Dale said. As a result, global CO2 emissions rose for a third straight year, a trend likely to stick for the time being. Almost 200 nations pledged to take steps to limit warming to well below 2 degrees through the Paris Agreement on climate change in 2015. Their aim was to limit the superstorms, droughts and famine predicted to happen more frequently with runaway climate change.

The Pentagon emits more greenhouse gases than Portugal or Sweden, study says - The U.S. Department of Defense is the largest institutional consumer of fossil fuels in the world, new research shows, creating more planet-warming greenhouse gas emissions than industrialized countries such as Portugal or Sweden. The Pentagon, which oversees the U.S. military, released around 1.2 billion metric tons of greenhouse gases between 2001 and 2017, according to research by Brown University. The study, published Wednesday, is the first of its kind to compile such comprehensive data. The Pentagon’s emissions were “in any one year… greater than many smaller countries total greenhouse gas emissions,” researchers of the study said. The findings showed that if the Pentagon was listed as a country, its emissions would make it the world’s 55th largest contributor of greenhouse gases. The Pentagon was not immediately available to comment when contacted by CNBC on Thursday.

 Famine, economic collapse, a sun that cooks us: What climate change could wreak — sooner than you think. --It is, I promise, worse than you think. If your anxiety about global warming is dominated by fears of sea-level rise, you are barely scratching the surface of what terrors are possible, even within the lifetime of a teenager today. And yet the swelling seas — and the cities they will drown — have so dominated the picture of global warming, and so overwhelmed our capacity for climate panic, that they have occluded our perception of other threats, many much closer at hand. Rising oceans are bad, in fact very bad; but fleeing the coastline will not be enough. Indeed, absent a significant adjustment to how billions of humans conduct their lives, parts of the Earth will likely become close to uninhabitable, and other parts horrifically inhospitable, as soon as the end of this century. Even when we train our eyes on climate change, we are unable to comprehend its scope. This past winter, a string of days 60 and 70 degrees warmer than normal baked the North Pole, melting the permafrost that encased Norway’s Svalbard seed vault — a global food bank nicknamed “Doomsday,” designed to ensure that our agriculture survives any catastrophe, and which appeared to have been flooded by climate change less than ten years after being built. The Doomsday vault is fine, for now: The structure has been secured and the seeds are safe. But treating the episode as a parable of impending flooding missed the more important news. Until recently, permafrost was not a major concern of climate scientists, because, as the name suggests, it was soil that stayed permanently frozen. But Arctic permafrost contains 1.8 trillion tons of carbon, more than twice as much as is currently suspended in the Earth’s atmosphere. When it thaws and is released, that carbon may evaporate as methane, which is 34 times as powerful a greenhouse-gas warming blanket as carbon dioxide when judged on the timescale of a century; when judged on the timescale of two decades, it is 86 times as powerful. In other words, we have, trapped in Arctic permafrost, twice as much carbon as is currently wrecking the atmosphere of the planet, all of it scheduled to be released at a date that keeps getting moved up, partially in the form of a gas that multiplies its warming power 86 times over.

Pricing carbon: A solution whose time has finally come - Momentum is building in Congress behind legislation that places an effective price on carbon, the solution thousands of economists agree is the best first step to rein in the heat-trapping emissions causing climate change.Polling shows a significant increase in the number of Americans who areconcerned about climate change and want Congress to act. Also, asurvey from a Republican pollster shows 2-1 support among Republicans for a carbon-fee-and-dividend policy. Responding to the shift in public opinion, some congressional Republicans are changing their rhetoric on climate change and saying it's a problem that needs to be solved. The public conversation driven by the Green New Deal is also pressuring Republicans to come up with their own solutions to climate change.A strong carbon-pricing bill with bipartisan appeal — the Energy Innovation and Carbon Dividend Act — has been introduced in the House with a Republican cosponsor and is picking up more cosponsors every week. About 1,500 "citizen lobbyists" from every state in the nation swarmed Capitol Hill on Tuesday, employing their approach of respectful engagement to build more bipartisan support for this groundbreaking legislation. Republicans are back at the table on climate change, and their solution of choice is innovation, which translates into more funding for research and development or tax incentives to come up with technological breakthroughs. All well and good, but that doesn’t address the problem of deploying those innovations fast enough to reduce emissions in a short period of time, which scientists are telling us is roughly 12 years. In fact, we already have the tools necessary to wean ourselves off fossil fuels. The only thing lacking is a big incentive — like a robust price on carbon — to quickly deploy those tools.

US teen climate activist takes aim at textbooks - and presidential debates -- Alexandria Villasenor, a 14-year-old activist who has become one of the U.S. faces of the global youth climate movement, is outraged at how little U.S. students learn about climate change. Next Friday, she plans to launch a global non-profit called Earth Uprising, demanding schools and teachers around the globe dedicate more resources to teaching about climate change and threats it presents.Today, only about 37 of 50 U.S. states, plus Washington D.C., have adopted science education guidelines that include teaching that climate change is largely a result of human activity, according to the National Center for Science Education.Better education, Villasenor hopes, will fuel a growing global youth movement to demand rapid action on the threat."We have to get more people involved in climate activism," she said in an interview with the Thomson Reuters Foundation at her home.Action on climate threats will "grow once there's more climate education, because you can't argue with science and facts", she said.In particular, she hopes the Earth Uprising project, which will have ambassadors in more than 50 countries, will create and put into teachers' hands a combined curriculum on climate science - and how past civil movements have succeeded.The project can be "the gateway to bringing people who've never been involved in activism into the movement", she said. The New York City teenager gained national prominence after she began skipping school each Friday, starting last December, to sit on a bench in front of the United Nations headquarters and demand action on climate change. She was among the teens who helped organize an international youth rally on climate change in March that saw hundreds skipping school in Washington D.C. and thousands more in about 45 other states. With school now over for the year, Villasenor has spent just this week speaking at the United Nations, having breakfast with a state governor, and appearing before the influential Council on Foreign Relations think tank, amid a long list of commitments.

US schools accused of censoring climate crisis message in graduation - Schools and colleges across the US have been accused of censoring students who have attempted to use their graduation speeches to speak out on the unfolding climate crisis.A youth-led movement called Class of 0000 is encouraging students to read out a prepared text at their graduation ceremonies that warns of “catastrophic climate change” and tells elected leaders to “have plan to get to zero emissions, or get zero of our votes”. More than 350 students set to speak at ceremonies as valedictorians, or in other roles, have pledged to read the message, but many have complained that educational authorities have barred them from doing so as the global climate emergency is deemed too political to mention.In the US education system, a valedictorian is typically a student with the highest academic performance in the class. This student delivers a farewell speech for the class at its graduation.Emily Shal, an 18-year-old senior, was told by her school that the climate message was “too controversial” for her graduation speech as class president. Shal read the speech at a talent show before the graduation ceremony and said she still received backlash from school authorities.“The administration were very mad, they were pissed,” said Shal, who attends Whittier Tech high school in Haverhill, Massachusetts. “Everyone was telling me I was in trouble. They now consider me rogue and rebellious. I was really worried about repercussions.” Worried that she would be dragged off stage if she made the climate speech, Shal decided to apologize and comply with the demand not to mention climate change at the ceremony last week. She said a large majority of her classmates consider climate a “huge topic” that needs to be addressed.

Radiohead Makes Stolen Tracks Available to Help 'Extinction Rebellion' --The British rock band Radiohead announced on Tuesday that it would make public some 18 hours of previously unreleased music from the late 1990s, recorded around the time the band made the 1997 album "OK Computer."  The band was recently the victim of hackers who stole the music from singer Thom Yorke's private archive.   Those behind the hack had demanded $150,000 (€133,000) in return for not publishing the tracks, but Radiohead went on the offensive, announcing, "We're releasing all 18 hours on Bandcamp [a music-sharing site] in aid of Extinction Rebellion."   The band says it never intended to release the tracks, but that fans would now be able to purchase the music for 18 pounds ($23.00, €20.20) over the next 18 days, to "find out if we should have paid that ransom." Extinction Rebellion, which recently gained attention for days of climate-change protests it orchestrated in London, said, "We thank Radiohead for supporting us so that we can continue to build our already far-reaching and powerful movement of non-violent civil disobedience."

I SEIU Green New Deal Grist - The Service Employees International Union is one of the largest unions in the country with more than 2 million members in all kinds of work — home care, security, airlines, and much else. On Thursday, the powerful SEIU endorsed the Green New Deal resolution — an economy-wide proposal to green the economy and avert the worst effects of climate change.So much for the old union vs. environmentalists divide.“We’ve been inspired by the fearlessness and courage of the climate change activists whose direct action and bold demands for change have put this issue front and center in the national conversation,” Mary Kay Henry, the SEIU’s International President, said in a statement. The resolution in support of the Green New Deal promises to organize its members in the fight against climate change.That’s a major shift, not only because the SEIU is the first union to endorse the progressive proposal, but also because many unions have opposed green legislation in favor of fossil fuel infrastructure projects in the past. For example, the Laborers’ International Union of North America, which has been a strong supporter of the Dakota Access Pipeline, came out against the Green New Deal in February, arguing it would cause “economic and social devastation.”Now that the SEIU is on board with the Green New Deal, will other labor unions follow?

Adding to Planetary Alarm Bells, Top US Finance Official Warns Climate Crisis a Recipe for Global Economic Collapse - Demanding action from industries and government, a top federal regulator warned this week that the human-caused climate emergency poses a threat to the economy which rivals the subprime mortgage meltdown that led to the 2008 financial crisis.  Rostin Behnam is part of the five-member Commodities Futures Trading Commission, an independent federal agency. As the sponsor of CFTC’s Market Risk Advisory Committee, he convened a public meeting Wednesday to discuss climate-related financial threats and the formation of a panel to produce a report which reviews those threats and offers solutions. “As most of the world’s markets and market regulators are taking steps towards assessing and mitigating the current and potential threats of climate change, we in the U.S. must also demand action from all segments of the public and private sectors, including this agency,” Behnam said in his opening statement Wednesday. “The impacts of climate change affect every aspect of the American economy—from production agriculture to commercial manufacturing and the financing of every step in each process,” he continued. “Any solutions seeking to address and mitigate climate risk must be equally focused on ensuring the safety and continued prosperity of our urban cores and rural communities. Failing to address financial market risks associated with climate change will impede economic growth, and most likely hit rural communities the hardest.” Behnam pointed to extreme weather that scientists say is exacerbated by the climate crisis, from the heightened threat of wildfires in Northern California to catastrophic floods following heavy rainfall in the Midwest this spring, which could have a long-term negative impact on both farmers and food prices. “I believe it is time to examine the relationship of these terrible, and sadly, more frequent events, to financial market risk and more generally, market stability,” he said.

Is Geoengineering the Answer to the Climate Crisis? - Once seen as spooky sci-fi, geoengineering to halt runaway climate change is now being looked at with growing urgency. A spate of dire scientific warnings that the world community can no longer delay major cuts in carbon emissions, coupled with a recent surge in atmospheric concentrations of CO2, has left a growing number of scientists saying that it’s time to give the controversial technologies a serious look.  “Time is no longer on our side,” one geoengineering advocate, former British government chief scientist David King, told a conference last fall. “What we do over the next 10 years will determine the future of humanity for the next 10,000 years.” King helped secure the Paris Climate Agreement in 2015, but he no longer believes cutting planet-warming emissions is enough to stave off disaster. He is in the process of establishing a Center for Climate Repair at Cambridge University. It would be the world’s first major research center dedicated to a task that, he says, “is going to be necessary.” Technologies earmarked for the Cambridge center’s attention include a range of efforts to restrict solar radiation from reaching the lower atmosphere, including spraying aerosols of sulphate particles into the stratosphere, and refreezing rapidly warming parts of the polar regions by deploying tall ships to pump salt particles from the ocean into polar clouds to make them brighter.  U.S. scientists are on the case, too. The National Academies last October launched a study intosunlight reflection technologies, including their feasibility, impacts and risks, and governance requirements. Marcia McNutt, president of the National Academy of Sciences, said: “We are running out of time to mitigate catastrophic climate change. Some of these interventions … may need to be considered in future.”  The study’s prospective authors held their first meeting in Washington, D.C., at the end of April. Speakers included David Keith, a Harvard University physicist who has developed his own patented technology for using chemistry to remove CO2 directly from the atmosphere, and Kelly Wanser of the Marine Cloud Brightening Project, which is studying the efficacy of seeding clouds with sea salt and other materials to reflect more sunlight back into space. The project is preparing for future field trials.  China too has an active government-funded research program. It insists it has no current plans for deployment, but is looking, among other things, at how solar shading might slow the rapid melting of Himalayan glaciers.

Giant floating islands that turn atmospheric CO2 into fuel could prevent climate change, scientists say -  Millions of floating islands that convert atmospheric carbon dioxide to fuel could help protect our climate from the burning of fossil fuels, scientists have said. These proposed islands would be clustered together to create large-scale facilities that—if enough were built—could eventually offset the total global emissions from fossil fuels. A team of researchers from Norway and Switzerland has put forward a proposal for 'Solar Methanol Islands' in a paper published in PNAS. The article argues that most of the technology to build these facilities already exists, and that by creating them on a large scale in ocean regions where they would be safe from large waves and extreme weather, we could drastically reduce the need for fossil fuels, thereby limiting the extent of global warming over the coming decades. In the paper, the researchers suggest floating islands similar to large-scale floating fish farms. They would use photovoltaic cells that could convert solar energy into electricity. This would then power hydrogen production and CO2 extraction from seawater. The gasses produced would then be reacted to form methanol that can be reused as a fuel, "which is conveniently shipped to the end consumer," they wrote. The team says 70 of these artificial islands would make up a single facility that covers an area of around one kilometer squared (0.4 square miles). Facilities could be placed in areas where wave height reaches less than seven meters, where there is a low probability for hurricanes and the water depth is less than 600 meters, so the islands can be moored properly. Locations for facilities were found across the globe, with the coasts of South America, Australia and Southeast Asia particularly suitable. The team estimates that the output from 3.2 million floating islands would exceed the total global emissions from fossil fuels. Production is still some way off and the team acknowledges that the proposal is "ambitious." At the moment, they are working to develop prototypes of the floating islands. "[The] biggest challenge is the development of a large scale device to extract CO2 from seawater," Borgschulte said. "This process is the only one of the total system [that] has not yet been fully developed. All others exist already on an industrial scale."

Covering the Sahara Desert with Solar Panels to Fight Climate Disaster? -- Juan Cole at Informed Comment has a post up by Will de Freitas Should we cover the Sahara Desert with Solar Panels to Fight Climate Disaster? A map of North Africa is shown, with a surprisingly small box somewhere in Libya or Algeria shaded in. An area of the Sahara this size, the caption will say, could power the entire world through solar energy. Over the years various different schemes have been proposed for making this idea a reality. Though a company called Desertec caused a splash with some bold ideas a decade ago, it collapsed in 2014 and none of the other proposals to export serious amounts of electricity from the Sahara to Europe and beyond are anywhere close to being realized. An engineer at Nottingham Trent University has researched various options for Saharan solar,Amin Al-Habaibeh and discusses the sheer size of the Sahara desert and amount of sunshine it receives:

  • – It’s larger than Brazil, and slightly smaller than the US.
  • – If every ray of sunshine hitting s the Sahara was converted into energy, the desert would produce enough electricity over any given period to power Europe 7,000 times over.
  • – Concentrated solar power using lenses or mirrors to focus the sun’s energy in one spot, which becomes incredibly hot. This heat then generates electricity through a steam turbine.
  • – A tower in the middle of the mirror or lens is the “receiver” which then feeds heat to a generator.
  • – Some systems store the heat in the form of molten salt. This means they can release energy overnight, when the sun isn’t shining, providing a 24 hour per day supply of electricity.
  • – Concentrated solar power is very efficient in hot, dry environments, but the steam generators use large amounts of water.
  • – There are also the regular photovoltaic solar panels which are much more flexible and easier to set up, but less efficient in the very hottest weather.

Amin Al-Habaibeh: “Just a small portion of the Sahara could produce as much energy as the entire continent of Africa does at present. As solar technology improves, things will only get cheaper and more efficient. The Sahara may be inhospitable for most plants and animals, but it could bring sustainable energy to life across North Africa – and beyond.”

Governor vetoes bills that target CMP transmission project - --  Democratic Gov. Janet Mills on Wednesday vetoed two bills aimed at creating obstacles for Central Maine Power’s proposed 145-mile transmission project in western Maine. Mills called the proposals to give local governments the ability to block the project “poor public policy.” She said Wednesday that the bills would give towns disproportionate power over a project with statewide benefits and would discourage private investment by upsetting established regulatory and permitting procedures. The $1 billion New England Clean Energy Connect aims to bring Canadian hydropower to the New England power grid to help Massachusetts meet its clean energy goals. Massachusetts will fund the project. Sandi Howard, director of Say NO to NECEC, accused the governor of siding with “foreign corporations” over “the will of Maine people.” “As town, county, and state representatives learned more about the CMP corridor, they realized what a bad deal it is for Maine and rescinded support. Unfortunately, Governor Mills sided with foreign corporations that will make a huge profit,” she said. Supporters say the project will reduce carbon pollution and lower energy prices in Maine.

Big Oil and environmentalists alike are mad about the EPA’s new summer ethanol rules | Grist - One of the Trump administration’s latest environmental regulatory rollbacks has managed to piss off both Big Oil and environmentalists. The Environmental Protection Agency announced at the end of May that it would roll back a decade-long summertime ban on E15 fuel, a blend of 15 percent ethanol and 85 percent gasoline.Ethanol is a biofuel that can be made from an array of starchy plants — but is most commonly made by fermenting corn. Mixing gasoline with a greater percentage of ethanol increases the overall volatility of the fuel, resulting in more emissions that react with sunlight to create smog. In some regions, ethanol fuels can be cheaper per gallon at the pump, but they can result in reduced fuel economy, meaning they may not be a better deal for some consumers by the mile. In the mid-2000s, legislation aimed at reducing U.S. dependence on foreign oil and decreasing fossil fuel emissions established the Renewable Fuel Standard program. Since then, incorporating biofuels like ethanol into the U.S. energy mix has been federally mandated. But E15’s contribution to air pollution led to the EPA banning it during summer months in 2011.Proponents of abandoning the rule say there is little difference in smog contribution between E15 and E10, a blend of 10 percent ethanol and 90 percent gasoline that remained available year-round. They also claim the E15 ban unnecessarily hurt corn farmers, many of whom are still reeling from recent flooding throughout the Midwest. Scrolling through social posts with #NoPlant19 will quickly give a sense of how real the struggle has been for farmers this flood season: To avoid declining yields later in the growing season, the vast majority of corn crops should have been planted by the end of last week. But as of May 26, more than 40 percent of corn that should have been planted in the U.S. wasn’t yet in the ground.Oil lobbyists, meanwhile, worry that a shift towards the use of more biofuels like ethanol could cut into their profits. That’s created a strange sort of alignment with some major environmental groups worried about dangers E15 fuel could pose to public health, land use, and the climate. If E15 becomes the default fuel in America, it would result in a 50 percent jump in the nation’s ethanol production compared to E10. That massive expansion in the amount of corn produced to make ethanol, explained Jonathan Lewis, senior counsel at the Clean Air Task Force, “would be disastrous for water quality, habitat, and the climate.”

U.S. refiner group sues Trump EPA over high-ethanol gasoline – (Reuters) - The main U.S. refining industry association said on Monday it sued to block the Trump administration’s effort to expand sales of higher ethanol blends of gasoline, arguing the move exceeded the administration’s authority. The legal challenge from the American Fuel and Petrochemical Manufacturers (AFPM) association escalated a battle between the oil and corn industries over the nation’s biofuel policy, which requires refiners to blend biofuels like corn-based ethanol into their gasoline, often at great expense. President Donald Trump had directed the Environmental Protection Agency to lift a summertime ban on the sale of gasoline containing 15 percent ethanol, called E15, in an effort to help farmers suffering from the U.S. trade war with China. The EPA unveiled its rule doing so on May 31. The summertime E15 ban had been implemented during the Obama administration to reduce smog emissions, but Trump’s EPA said E15’s impact on air quality was similar to that of E10, which could already be sold year-round. The tension over the policy move reflects how Trump has struggled to please both Big Oil and Big Agriculture, two critical constituencies in the Republican president’s 2020 re-election bid. AFPM asked the U.S. Court of Appeals for the District of Columbia to review the EPA’s rule, in papers filed on Monday, said Diana Cronan, a spokeswoman for the group. AFPM has one month to provide the court with the outline of its case, she said.

California natural gas costs could spike as state decarbonizes: E3, UC Irvine -- A draft study presented to the California Energy Commission (CEC) on June 6 warns low-income customers could be hit hard by rising natural gas costs as the state's demand for the fuel is projected to decline dramatically.  Broad electrification of buildings could lead to a 60% decline in gas demand, according to the analysis from Energy+Environmental Economics and the University of California Irvine. "As gas demand falls, average costs for remaining customers increase," the report concludes.  The report calls for a "gas transition strategy" to protect consumers.  Responding to the report, the Natural Resources Defense Council said it wants to see all new heating equipment sales in the state be electric by 2040, along with a targeted phase out of gas infrastructure.  California will still be burning some natural gas in 2050, according to the E3 report, but all scenarios lead to significantly lower gas demand. That means, the report warns, the state needs policies in place to ensure an orderly transition. That strategy could include reducing gas system expenditures through targeted pipeline replacements, changes to gas rates and rate design, and recovery of gas system costs "from electric ratepayers or other funds," according to the report. The report builds on a 2018 study by E3 that evaluated scenarios to meet California's climate goals, including an 80% reduction in greenhouse gas emissions by 2050. That work concluded electrification of buildings is one of the lowest-cost strategies for GHG mitigation. The new research aims to consider the economy-wide costs of achieving the state's goals, and what strategies are available to reduce the impacts on consumers. "Replacing gas equipment with electric equipment upon burnout lowers the societal cost of achieving California's climate policy goals," E3 and UC Irvine concluded. According to NRDC, the report's findings are "starkly clear" — the state needs to develop a transition strategy "to shield Californians from sharply higher heating bills, protect workers, and meet the state's climate targets." NRDC said it wants to see the state cease connecting new buildings to the gas distribution system as soon as possible, and start shutting down portions of the gas system where possible, to reduce costs.

Renewable Energy Costs Take Another Tumble, Making Fossil Fuels Look More Expensive Than Ever - The cost of renewable energy has tumbled even further over the past year, to the point where almost every source of green energy can now compete on cost with oil, coal and gas-fired power plants, according to new data released today. Hydroelectric power is the cheapest source of renewable energy, at an average of $0.05 per kilowatt hour (kWh), but the average cost of developing new power plants based on onshore wind, solar photovoltaic (PV), biomass or geothermal energy is now usually below $0.10/kWh. Not far behind that is offshore wind, which costs close to $0.13/kWh. These figures are global averages and it is worth noting that the cost of individual projects can vary hugely – the cost of producing electricity from a biomass energy plant, for example, can range from as low as $0.05/kWh to a high of almost $0.25/kWh. However, all these fuel types are now able to compete with the cost of developing new power plants based on fossil fuels such as oil and gas, which typically range from $0.05/kWh to over $0.15/kWh. These figures are contained in the latest Renewable Power Generation Costs report, released today by the Abu Dhabi-based International Renewable Energy Agency (IRENA), an inter-governmental body with around 160 members.

 DOE providing $39 million for coal-fired power fleet research - The U.S. Department of Energy’s Office of Fossil Energy announced Monday it will allocate about $39 million toward 17 research projects focused on improving coal-fired power generation. DOE selected the projects as part of its Transformative Power Generation Program and Crosscutting Research program. These are cost-shared research projects developing advanced technologies for improving the reliability, performance and flexibility of the nation’s existing coal-fired power fleet. “Coal-fired power plants represent the second-largest energy source for electricity generation in the United States,” said Assistant Secretary for Fossil Energy Steven Winberg. “The Trump Administration remains committed to ensuring a coal-fueled power plant fleet that provides stable energy to the power grid.” Among the recipients include universities such as Clemson, Utah and Lehigh, as well as the Electric Power Research Institute, GE and Siemens, among others Here are the projects selected by DOE:

U.S. senators target $1 billion a year coal subsidy, ask IRS for test results – (Reuters) - Three U.S. senators on Monday urged the Internal Revenue Service to crack down on a $1 billion-a-year subsidy for burning chemically treated refined coal, after a new study showed some power plants using the fuel produced surging amounts of mercury and smog instead of cutting pollution. Scrutiny from Rhode Island’s Sheldon Whitehouse, as well as fellow U.S. Senate Democrats Elizabeth Warren of Massachusetts and Sherrod Brown of Ohio, comes after a Reuters special report in December revealed that many power plants burning refined coal pumped out more smog, not less. Companies can qualify for the subsidy by showing pollution cuts in lab tests. Pending legislation in the Senate would extend the coal subsidy program another decade, costing taxpayers at least $10 billion at current consumption levels. “We have evidence to show that Wall Street is raking in hundreds of millions in tax credits each year for pollution reductions they aren’t coming close to delivering in the real world,” Whitehouse said in a statement. “That’s a massive boondoggle for taxpayers, a blow to air quality and Americans’ health, and a setback for our climate.” The refined coal subsidy was adopted by Congress and signed into law by President George W. Bush as part of the American Jobs Creation Act of 2004, alongside credits for generating renewable energy from solar and wind. The legislation had broad bipartisan support and generated little public debate.

Perry says federal incentives to save coal, nukes up to US FERC - S&P Global Platts— US Secretary of Energy Rick Perry told reporters the Department of Energy is not developing any policy incentives to keep struggling coal-fired and nuclear power plants operating, insisting that doing so is the Federal Energy Regulatory Commission's job. The comments came after a speech this week at the Edison Electric Institute's annual convention in which he warned that regulation and clean power advocates are grave threats to the US economy, largely repeating the speech he offers at most public appearances, although perhaps more forcefully than usual. "I don't think the DOE has any regulatory or statutory authority" to provide subsidies for coal and nuclear power, Perry said. Perry added efforts to formulate subsidies do not appear to have made any headway in the past year or so. In January 2018, FERC rejected a proposed rule DOE developed that would have ensured full cost recovery for plants that stored at least 90 days of fuel onsite -- criteria that essentially only nuclear and some coal plants could have met. "I haven't seen any movement out of FERC or the White House ... and I have nothing to add," Perry said. However, he did say coal exports were up and that plenty of other efforts are ongoing to support coal. When asked if he thinks other states should follow Ohio's lead and try to provide subsidies to struggling coal and nuclear power plants, Perry said: "I'm a pretty big fan of states making their own decisions." During his earlier speech, however, Perry blasted state governments and officials for blocking energy infrastructure projects. Perry took particular aim at New York for thwarting the development of a pipeline to deliver natural gas to New England. He also assailed Washington Governor Jay Inslee, calling him a "global activist" for signing a bill banning hydraulic fracking for oil and natural gas in the state and supporting the exclusive use of zero emissions and renewable energy. "If this philosophy prevails, everyone in this room knows full well what the consequences will be," Perry warned. The energy secretary noted that 43% of the power generated in the US is produced by nuclear and coal-fired generating plants. And when a crisis strikes the grid, he said, those two fuels are the most reliable available. But "thanks to blatantly discriminatory rules and regulations, nuclear and coal plants are being retired at an alarming rate," Perry said. Equally alarming, according to Perry, is the existence of forces that want to ban both of those fuels.

Pentagon turns to coal ash to escape Chinese dominance of rare earth elements -- Coal ash could be the next source of elements the U.S. defense industry uses in everything from night vision goggles to gyroscopes for smart bombs. The Senate Committee on Armed Services included a provision in its recent markup of the 2020 defense budget authorizing an increase in funding for the Pentagon to develop capabilities to produce rare earth elements from coal ash, the remnants of burned coal, as China threatens to restrict supplies. "[Y]ou need to make sure you have either [a] stockpile or access to them," acting Deputy Secretary of Defense David Norquist told the Washington Examiner. "And so that's an area where, as you look across the system, and you look at your future production, [you] question: Do I have those? Do I have enough of them? Do I have access to them? Where are they produced? And I think that's a proper place for the Congress to have focused on."   A 2016 Department of Commerce survey found 66% of respondents, most of them Department of Defense vendors, imported rare earths. Rare earths like neodymium and dysprosium may not be household names, but they are found in everything from cellphones to F-35 fighter jets — and China is the world's premier supplier, producing 70% of the world's supply in 2018, according to the U.S. Geological Survey. The country has threatened to throttle supplies of rare earths as it battles the Trump administration over trade policies.  "The U.S. has control of not just the financial system, in large part, but also almost everything that's traded in the world is traded with dollars ... So they've got to find the places where they have an asymmetric edge, and this is one of the few, so I am not surprised that they are threatening to use it." The U.S. produces nearly 80 million tons of coal ash per year from which rare earths could be derived, according to Rochester Institute of Technology researchers. "[Rare earth elements] from coal ash is technically feasible, but [it's] not clear how much it will cost compared to other options,"  The government has already invested in some coal ash extraction methods, though none have proven to be commercially viable. But Williams and his fellow researchers believe a method using compressed carbon dioxide to extract rare earths, similar to how caffeine is removed from coffee beans, could be an affordable solution. They also argue it could be beneficial to the coal industry as the country moves away from coal power plants.

N.C. DEQ says recent Belews Creek contaminated groundwater filing is not troubling - State environmental officials say they are not surprised by Duke Energy’s recent reports of contaminated groundwater near coal ash pits at the Belews Creek Steam Station and three other coal-fired plants in North Carolina. Slight increases in chemicals such as mercury, arsenic and beryllium in groundwater drawn right beside utility waste ponds are not cause for alarm, a spokeswoman for the state Department of Environmental Quality said. “The exceedances reported are not unexpected, especially since these sample results are collected from wells located adjacent to the waste boundary of a coal ash impoundment, which is near the source material,” said Sarah Young of the DEQ’s Raleigh office. Young’s comment came in answer to the Greensboro News & Record’s request for the agency’s perspective on recent assertions by the Southern Environmental Law Center in Chapel Hill that the new disclosures showed that “more toxic substances are polluting the water at Duke Energy coal ash sites across North Carolina.” The environmental group made the statement after Duke Energy posted public acknowledgements that groundwater testing showed higher trace levels of certain chemicals around ash ponds at Belews Creek Steam Station and at plants near Roxboro, Lumberton and Lake Norman. At Belews Creek in Stokes County northwest of Greensboro, the company reported such an “exceedance” of federal groundwater standards for mercury. It had previously reported similar groundwater overages there for arsenic, beryllium, cobalt, lithium and two forms of radium.

TVA can investigate itself on coal ash under joint order with TDEC -- Anderson County residents worried about coal ash's impact on their health and the environment learned this week the Tennessee Valley Authority gets to investigate itself and won't have to reveal the results for nearly two years. By the time TVA files its investigative report, the nation’s largest electricity provider will have generated at least another 637,000 tons of coal ash waste at its Bull Run coal-fired power plant in Anderson County, according to data from the Tennessee Department of Environment and Conservation. TDEC and TVA together crafted an order in 2015 that allows TVA to investigate its coal ash dumps, reveal any contamination or structural weaknesses and draft a plan to fix problems, TDEC senior advisor Chuck Head told attendees at Monday’s meeting. “We will be in data collection mode for at least the next 18 months,” TDEC coal ash manager Robert Wilkinson told attendees packed by the dozens Monday night into a meeting of the Anderson County Commission’s Intergovernmental Committee. Head added, “Then we’ll make a decision at that point and time if enough information has been collected for us to determine what corrective action should be taken.”

TVA plans have arsenic-rich water pumped into Mississippi River - The Tennessee Valley Authority is ready to clean up and demolish the Allen Fossil plant in South Memphis. But plans to do so are drawing concern from environmental groups that say the cleanup process has not been publicly vetted and involves pumping dangerous amounts of arsenic solids into the Mississippi River. Inactive since March 2018, the once coal-powered Allen plant still contains an estimated 3 million cubic yards of coal ash waste and other combustible residuals. The water near and in these coal ash pits, and their stilling ponds, were recently ranked among the worst in the nation for contamination due to the high amount of arsenic present in the water. TVA has said its preferred option for cleaning up the coal ash ponds is removal, but doing so involves a process called "dewatering," and the Southern Environmental Law Center has criticized TVA's dewatering plan. In a letter submitted to the Tennessee Valley Authority and Tennessee Department of Environment and Conservation, the SELC lists several objections to the plans for cleaning up Allen. TVA spokesperson Scott Brooks said while the agency has not "officially" reviewed the SELC letter, the objections are "scare tactics without science." The water in question is referred to in the letter as pore water, which is "the water trapped within the void space between ash particles," according to a previous TVA report. "By TVA's own admission," the Southern Environmental Law Center letter said, "concentrations of arsenic in its pore water range up to 13,700 micrograms per liter (of water), with an average of 1,350 micrograms per liter, in other words, concentrations of arsenic over a thousand times the safe level for drinking water."

TVA agrees to dig up 12 million tons of coal ash at Gallatin plant - The Tennessee Valley Authority has agreed to dig up 12 million tons of coal ash stored in unlined pits at its Gallatin Fossil Plant in Middle Tennessee and clean up contamination from it, officials announced Thursday. The Tennessee Department of Environment and Conservation and Tennessee Attorney General Herbert Slatery II said in a joint news release Thursday that the state reached a lawsuit settlement with TVA over coal ash contamination at the Gallatin plant and nearby waterways. “We are pleased to bring this matter to a positive conclusion,” TDEC Commissioner David Salyers said. “This settlement will resolve environmental issues at the Gallatin Fossil Plant and we look forward to continuing our work with TVA and non-governmental organizations to further protect our environment and our citizens.” Prompted by two environmental groups, the state sued the TVA in 2015 over pollution from coal ash dumps at the Gallatin Fossil Plant, the closest coal-fired power plant to Nashville. Court documents show pollutants leach from the ash into the groundwater and then enter the Cumberland River, a source of drinking water for much of Middle Tennessee.

As Calls For Action On Black Lung Disease Grow, Regulators Show Little Indication Of Change - Sturgill shared his story at the West Virginia Black Lung Association conference the first week of June. It was the first such meeting since an NPR investigation and PBS Frontline film put the spotlight on central Appalachia’s growing epidemic of black lung disease and the failure of regulators to meaningfully address it. As many as one in five experienced coal miners in the region has some form of black lung, which is progressive, debilitating, deadly, and preventable. At the conference, researchers presented more evidence of the growing number of cases, and specific practices likely putting mine workers at risk, and the head of the mine workers’ union issued a rousing call for action. Congressional leaders have scheduled hearings later this month to investigate. But federal mine safety regulators show little indication of making any meaningful change to policies meant to protect miners from harmful dust exposure. An investigation by NPR and the Ohio Valley ReSource beginning in 2016 found that far more miners had progressive massive fibrosis, a more serious type of black lung disease, than had been recognized in government reports. More than 2,000 miners have PMF, and rates of the disease are significantly higher in central Appalachia than in other coal-producing regions.

W.Va. Black Lung Clinics to Receive $1.9 Million - Nearly $2 million in federal funds will be awarded to West Virginia to help support the state’s black lung clinics. West Virginia is expected to receive $1,954,576 through the U.S. Department of Health and Human Services. Sens. Shelley Moore Capito and Joe Manchin made the announcement in a Friday news release. The funding will support the West Virginia Black Lung Clinics Program, which aims to provide primary and specialized health care services for coal miners and their families. These clinics conduct outreach and education in the communities where they operate to provide holistic care to those suffering from black lung and other respiratory illnesses.

Justice slaps Bloomberg's 'Beyond Carbon' push against coal and gas - Gov. Jim Justice, whose family owns significant coal holdings, is taking umbrage to a pledge by former New York Mayor Michael Bloomberg.Bloomberg last week said he would donate $500 million to a new campaign to close every coal-fired power plant in the United States and stop the growth of natural gas.Justice, who is running for re-election in 2020, put out a statement in opposition to Bloomberg’s proposal and alsoannounced a gathering at the Capitol on Monday with representatives of the coal and gas industries.“Michael Bloomberg and the radical Sierra Club organization have declared war on the American worker. If this campaign is successful, massive numbers of West Virginians will lose their livelihoods and the U.S. economy will suffer greatly. And all of this for extremely minor global reductions of emissions,” Justice stated.“I stand with our State’s hundred of thousands energy, oil/gas, coal, pipeline, and utility workers and their families and challenge anyone anywhere who threatens to remove their livelihoods.”Justice plans to gather at 1 p.m. Monday at the Capitol with leaders from the West Virginia Coal Association, AEP, Dominion Power, the West Virginia Oil and Natural Gas Association, the West Virginia Independent Oil and Gas Association, and the West Virginia Business and Industry Council.Bloomberg’s Beyond Carbon proposal is described as spending most of the money over a three-year period, going toward lobbying groups in state and local governments and public utility commissions. Some funding will also support electing local officials with green energy platforms. “We’re in a race against time with climate change, and yet there is virtually no hope of bold federal action on this issue for at least another two years,” Bloomberg said last week. “Mother Nature is not waiting on our political calendar, and neither can we.”

West Virginia Governor Agrees to Pay Delinquent Kentucky Taxes -- Coal companies tied to West Virginia Gov. Jim Justice are promising to pay huge property tax debts owed to some eastern Kentucky counties. Knott, Pike, Harlan and Magoffin counties received checks last week totaling nearly $1.2 million from Justice companies. The Justice organization has also pledged to pay an equal amount over the next six months to resolve years of delinquent taxes in Kentucky, The Herald-Leader of Lexington reported. Kentucky’s Finance and Administration Cabinet led the negotiations with Justice. The cabinet announced the agreement Monday. Finance Secretary William M. Landrum III says the settlement “means the state and these counties no longer have to spend time, money and other resources on lawsuits that could take many years with no guarantee that the taxes would be paid.” The agreement did not cover Floyd County, where a Justice company owes a tax bill of $671,000. The delinquent taxes in the millions hit the Appalachian counties hard as the coal industry slumped and coal severance taxes dried up. Knott County has laid off 32 employees since the first of the year, sold 15 vehicles to reduce costs and cut the number of hot meals for senior citizens, Judge-Executive Jeff Dobson said. As part of the agreement, the state and some counties waived penalties and interest on debts the Justice companies owed.

Kentucky county to sue coal company tied to Gov. Jim Justice - A county attorney in Eastern Kentucky has provided notice of his intent to sue a coal company once controlled by West Virginia Gov. Jim Justice to collect $670,000 in delinquent taxes.The notice from Floyd County Attorney Keith Bartley was dated Wednesday.The law requires a 45-day notice before filing a lawsuit in an effort to collect delinquent taxes. That’s the notice Bartley sent to Kentucky Fuel Corporation.The company has delinquent taxes on property and unmined coal reserves dating to 2013, according to the letter. The amount of the original tax bills totaled $313,125.However, Kentucky Fuel now owes a total of $670,274 in Floyd County because of penalties and interest that have piled up as a result of the payments being late, according to Bartley’s notice.Justice, a billionaire who who was elected in 2016 as a Democrat but later announced a switch to Republican at a rally with President Donald Trump, controlled Kentucky Fuel during much of the time covered in the tax bills.Justice switched control of Kentucky Fuel and other coal companies to his son, Jay, and daughter Jill in 2017, according to federal records.Justice-family companies had owed millions in delinquent taxes to the state and five Eastern Kentucky counties until recently, when Jay Justice and the state worked out a payment agreement.

India's Adani wins green light for long awaited Australian coal mine -(Reuters) - India’s Adani Enterprises on Thursday received the go-ahead to start construction of a controversial coal mine in outback Australia, after a state government approved a final permit on ground water management. The Carmichael mine has been a lighting rod for climate change concerns in Australia, and was seen as a factor in the surprise return to power of the conservative Liberal/National coalition in a national election in May. First acquired by Adani in 2010, the project is slated to produce 8-10 million tonnes of thermal coal a year and cost up to $1.5 billion, but has been mired in court battles and opposition from green groups. “In two years’ time people should be expecting we have exported our first piece of coal,” Adani Mining Chief Executive Lucas Dow told reporters, adding that construction work would begin within weeks. The go-ahead comes after Queensland’s Department of Environment and Science said it had approved Adani’s Groundwater Dependent Ecosystem Management Plan following a rigorous assessment “based on the best available science.” The approval potentially paves the way for half a dozen new thermal coal mines to come on line in Australia by opening up Queensland’s remote Galilee basin with rail infrastructure to the coast 320 km (200 miles) away at Abbot Point.

Alarm bell on decline of nuclear power way too late -- Recently, the International Energy Agency (IEA) warned that neglect of the world's nuclear electric generating plants would lead to a precipitous decline in climate-friendly nuclear energy production around the world. The agency, a consortium of 30 countries which monitors energy developments worldwide, said 25 percent of nuclear capacity could be lost by 2025 and two-thirds by 2040. The cause is clear. Little new capacity is being built and much of the current fleet of reactors is nearing the end of its lifespan.  The IEA's warning comes about a decade too late. That's because the timeline for planning and building nuclear power plants can be that long.  More than 10 years ago I wrote a piece called "The Nuclear Future That Never Arrived." In it I explained why I believed the time for nuclear power development had come and gone.  Since then we've had the Fukushima disaster after which talk of a nuclear renaissance ceased. In fact, some countries, notably Germany, decided to retire its nuclear power stations. But Sweden and Japan have since reversed course on a similar decision. The schizophrenia on nuclear power has to do with two things according to the IEA. First, generating electricity from nuclear plants produces very little greenhouse gas compared to fossil fuel-fired plants. (Nuclear plants, of course, require service vehicles and delivery trucks. And, there is uranium mining and processing.) Nuclear's nearly carbon-free energy is important in the context of climate change. Second, the cost of building renewable energy generation considerably exceeds the marginal cost of keeping existing nuclear plants running longer.  And, that's what some nations are choosing to do. In the United States, several original 40-year licenses are being extended to 60 years.

The Department of Energy’s decision to reclassify some nuclear waste. Of all the things in the world to worry about, nuclear waste management is not at the top of most people’s lists. We trust (or hope, at least) that expert scientists and policymakers will make good decisions about how to make sure radioactive byproducts stay far, far away from us, by whatever means possible. But, many of those experts say, we’re going to need to figure out a new way to manage our country’s nuclear waste—and soon. To that end, the Department of Energy announced Wednesday that they are reclassifying the definition of “high-level,” or highly radioactive, waste stored in underground tanks at Hanford Nuclear Reservation in Washington state, the Savannah River Plant in South Carolina, and the Idaho National Laboratory in Idaho Falls. The DOE hopes that the redefinition will expedite cleanup of the waste. Currently, the high-level waste stored at these sites is waiting for the government to open a secure waste repository (like Yucca Mountain in Nevada, which has been in limbo for decades). But if some of the less radioactive waste qualifies under the new definition, it might instead be shipped off to other sites, like one in Texas, where it could be mixed with “concrete-like grout.” The cleanup at Hanford has already cost the country billions of dollars and is projected to cost billions more as we continue the search for the waste’s final home. (Adding some urgency to developing a new plan is the risk that containers could leak and contaminate the environment, especially if there’s an earthquake in Washington.) The DOE’s new plan could be cost-effective, sure, but the question is whether it’s safe. When the agency first announced reclassification plans in October 2018 and solicited public comment, the proposal received thousands of responses. And Washington state officials are not happy; Gov. Jay Inslee and Department of Ecology Director Maia Bellon have both sent letters of concern to the DOE. “I am gravely concerned with DOE forging ahead with a new interpretation of HLW that does not comport with federal law, despite objections from Washington state,” wrote Bellon.  Some countries tried storing barrels of waste in ice sheets, which turns out to be less than ideal given that ice both moves and melts. In addition to the waste we already have sitting around at Hanford and other old nuclear weapons facilities (charmingly called “legacy waste”), nearly 100 commercial nuclear reactors at 60 facilities around the U.S. are creating new waste every day.

Gov. slams planned nuclear waste storage site » Albuquerque Journal – Gov. Michelle Lujan Grisham came out swinging Friday against a planned facility to store spent nuclear fuel in southeast New Mexico, saying it would be “economic malpractice” to open such a site in an oil-rich region that’s also home to agricultural operations. In a letter sent to U.S. Energy Secretary Rick Perry and U.S. Nuclear Regulatory Commission Chairwoman Kristine Svinicki, Lujan Grisham said the interim storage of high-level radioactive waste – as proposed by Holtec International – poses significant risk to New Mexico’s environment and economy. “Any disruption of agricultural or oil and gas activities as a result of a perceived or actual incident would be catastrophic to New Mexico, and any steps toward siting such a project could cause a decrease in investment in two of our state’s biggest industries,” the first-term Democratic governor wrote in her letter. She also said several industry groups – including the New Mexico Cattle Growers’ Association and the New Mexico Farm and Livestock Bureau – had sent her letters opposing the project. However, it’s unclear whether Lujan Grisham’s opposition to the facility will ultimately halt the project, as the Nuclear Regulatory Commission is already reviewing Holtec’s application for a 40-year license and public hearings were held in Albuquerque earlier this year. The proposed site was backed by the administration of Lujan Grisham’s predecessor, Republican ex-Gov. Susana Martinez. It would be located between Hobbs and Carlsbad and would temporarily house the nation’s spent nuclear fuel until a permanent repository could be built.

Nuke plants seeking $150 million annual bailout not interested in verifying need — If a business told you it was not profitable and asked you for $150 annually so they could keep their business open and their workers employed; and then refused to prove to you they actually needed your money, because they didn’t have enough of their own, would you hand over the cash? That’s pretty much what is happening with one company that is asking the State of Ohio for a massive bailout, only instead of asking for $150 they are asking for $150,000,000. FirstEnergy Solutions (FES) is going through bankruptcy. For whatever reason their business decisions led them down a path of having too much debt and not enough money to cover it. So they are looking to get out from under that obligation. Right now, FES owns two nuclear power plants in northern Ohio, the Davis-Besse plant and the Perry plant. According to the people in the firm running the bankruptcy restructuring neither plant is profitable. No matter how efficient they make the plant, and they say the plants are already in the top tier of efficiency for nuclear plants in the country, they can’t make a buck. If the plants were somehow made to be profitable, through a bail out subsidy by the State Legislature, the owners of the debt attached to the plants would trade it in for equity shares in the power plants. If the legislature doesn’t prop up the plants with a bail out, the investors are ready to shut the plant down and walk away.  

ODNR Approves 11 Permits in Utica Shale – The Ohio Department of Natural Resources approved 11 new permits for horizontal wells in the Utica shale during the week ended June 8, according to the latest data provided by the agency. Rice Drilling LLC secured six new permits to drill in Belmont County, while Ascent Resources Utica LLC was awarded five new permits: two in Belmont and three in Guernsey counties. The number of rigs operating during the week stood at 19, according to ODNR. As of June 8, ODNR has issued 3,106 permits for horizontal wells across the Utica, the majority of which are in the southeastern part of the state. The agency reported that 2,613 of those wells are drilled and 2,222 are in production. There were no new permits issued for the northern Utica – which includes Columbiana, Mahoning and Trumbull counties. Also, no new permits were issued in neighboring Mercer and Lawrence counties in western Pennsylvania, according to the Pennsylvania Department of Environmental Protection.

Shale deposits drawing plastics attention to Ohio Valley - Plastics News -- The shale-rich Ohio Valley region continues to draw interest from materials firms because of its abundant supplies of natural gas.The region now produces 50 percent more oil and gas than it did during its previous peak in the 1970s, Greg Kozera said June 5 at Global Plastics Summit 2019 in Houston. Kozera is marketing director for Shale Crescent USA, a trade group that promotes the Ohio Valley region of Ohio, Pennsylvania and West Virginia to potential investors.Shell Chemical is making the region's potential a reality with a massive petrochemicals project near Pittsburgh that's set to open in the early 2020s. That project will include around 3.5 billion pounds of annual production capacity for polyethylene resin.Shell, which is based in Houston and London, chose the western Pennsylvania site because of the availability of natural gas via hydraulic fracturing (fracking) from the Marcellus and Utica shale deposits. Shell officials also have touted the proximity of the region to a large number of American consumers and end markets.A similar resin and feedstocks joint venture in Dilles Bottom, Ohio, is being analyzed by PTT Global Chemical of Thailand and Daelim Industrial Co. of South Korea. At GPS 2019, Shale Crescent USA business manager Nathan Lord said that 85 percent of U.S. natural gas production growth from 2008-18 took place in the Ohio Valley. The region "produces more natural gas than Texas with half of the land mass," he added.

Air pollution ‘alert’ presented at board of health meeting — Manufacturing in the planned Appalachian Storage and Trade Hub could impact Garrett County’s air quality, Ann Bristow said during the county commissioners’ recent board of health meeting in Oakland. “I’m alerting you to this,” she told the commissioners and Garrett County Health Planning Council members. A local resident and Frostburg State University professor emeritus, Bristow was a member of Gov. Martin O’Malley’s Marcellus shale advisory commission. She handed out a map showing existing and planned natural gas liquids infrastructure in the petrochemical “hub,” including refineries, processing facilities and pipelines. “It’s a small area of Kentucky, a large area of West Virginia, a little bit of Western Pennsylvania just over the Ohio River, and then Ohio,” Bristow said, pointing to various sites throughout the Ohio Valley region. Currently, the country’s petrochemical activity is mainly centered in Texas and Louisiana. “[But] the Houston area and the Gulf port area experience a lot of hurricanes and flooding events,” Bristow said. “And that’s one motivation for developing a natural gas liquids storage and trading hub in the Ohio Valley.”  In addition to natural gas, hydraulic fracturing also produces natural gas liquids, including ethane.  . “The first ethane cracker plant is being constructed in Beaver County, Pennsylvania,” Bristow said. “I think there are four or five others proposed. The other thing proposed is huge underground storage complexes for ethanes.” She noted Garrett County has “geological characteristics” for ethane storage, but none are planned for the ASTH project. “Here’s Garrett County,” Bristow said, pointing to the map, “and you can see how close we are to all of this proposed manufacturing, in terms of being down wind.” She handed out a graphic from a report titled “Plastic & Health: The Hidden Costs of a Plastic Planet,” illustrating direct and environmental exposure from plastics on humans. It notes that health impacts from refining and manufacturing plastics “can include cancers, neurotoxicity, reproductive toxicity, low-birth weight and eye and skin irritation.”

Fracking becomes personal suffering | National Catholic Reporter - Fracking seemed like just the medicine that Washington County residents needed to revive their ailing economy.  Drillers offered cash for mineral rights and the promise of a percentage of the profits from the gas taken from the land. It seemed like an economic godsend.The region's experience with coal provided lessons that less economically distressed communities might have taken more seriously. Coal mining companies practiced a ruthless efficiency that offloaded many costs onto local communities and left a legacy of environmental degradation. Local streams run orange today with sulfur and iron from abandoned mine drainage that render them inhospitable to fish and animals. That same drainage threatened drinking water sources for many in western Pennsylvania. Haney soon found this to be the case for her and her immediate neighbors, even as gas royalty payments enriched others in and around the two towns of Amity and Prosperity. Griswold chronicles Haney's dawning understanding that any short-term wealth that fracking generated for some landowners and corporate shareholders must be weighed against the human and environmental costs.That realization came only after much suffering. Haney's son, Harley, started to develop serious and mysterious health concerns that forced him to miss extensive stretches of school, lose weight and fall into depression. But staying home exposed Harley to the contamination even more intensely and exacerbated his illnesses, keeping him home from school still longer.It took Haney months to recognize the link between the fracking and her son's debilitation. Fracking turned the Earth's suffering into Harley's personal struggle. Just up the hill from Haney, her neighbors' prize horses began to fall ill as well. Some died. Later, after she finally connected the illnesses to contamination in her well water and moved out, another neighbor discovered that his water too had gone bad. The suffering spread. Poor design and inattentive monitoring allowed wastewater to escape and migrate into the wells from which Haney and her neighbors drew their drinking water. Some also contaminated ground water that animals consumed. The result was a surfeit of suffering.

2 companies cited for deadly fire at local plant - The U.S. Department of Labor is citing two companies after a deadly fire at a natural gas processing plant in Washington County. OSHA, or the Occupational Safety and Health Administration, has cited Energy Transportation LLC and MW Logistics Services LLC for serious safety violations after a deadly fire at MarkWest in Houston in December. Four employees were hospitalized and one of them, Jeffery Fisher, 61, of Salem, West Virginia who was badly burned in the explosion, died a few days later. The company is being cited for violations of the pricess safety management standard and exposing employees to flammable vapor and liquid while they offloaded waste material into a mobile tank. “Providing workers with a safe and healthful workplace is required of every employer,” said OSHA Area Director Christopher Robinson, in Pittsburgh, Pennsylvania. “This tragedy could have been prevented if the employer had followed safety processes to control the release of gases from highly hazardous chemicals.” Energy Transportation LLC faces penalties totaling $51,148 and MW Logistics Services LLC faces $47,360 in penalties.

Bill would provide tax credit for energy, fertilizer manufacturing -   The state House Finance Committee voted Tuesday to advance the Energy and Fertilizer Manufacturing Tax Credit, which seeks to encourage manufacturing companies to invest in Pennsylvania. The bill amends the Tax Reform Code of 1971 and mirrors the Pennsylvania Resource Manufacturing tax credit. The credit is attributed with the Shell Cracker Plant’s investment in western Pennsylvania. “This legislation would provide our region with ample investment, workforce, and economic growth opportunities,” Rep. Aaron Kaufer (R-Luzerne), who introduced the energy and fertilizer credit, said. “We are talking about over a billion-dollar investment and over a thousand permanent jobs along with thousands of construction jobs. This is truly a once in a generation investment and will be a game-changer for the economy in northeast Pennsylvania.” The energy and fertilizer credit focuses on manufacturers using methane to produce ammonia, urea, and methanol. Manufacturers must meet three requirements to qualify for the credit. They must purchase and use methane in the manufacture of petrochemicals or fertilizers at a facility in Pennsylvania, must make a capital investment of at least $1 billion in construction of the facility, must create at least 1,000 full-time jobs during the construction phase.

Philadelphia City Council approves PGW’s new LNG plant - In a 13-4 vote, Philadelphia City Council approved a plan to build a $60 million liquefied natural gas facility in Southwest Philadelphia. Passyunk Energy Center will be a public-private partnership between city-owned Philadelphia Gas Works and Conshohocken-based Liberty Energy Trust. PGW will approve design plans and run the facility, but Liberty Energy Trust will finance the construction.The plan is projected to bring in anywhere from $1.35 million to $4 million in revenue for PGW each year.City Councilman and Gas Commission Chair Derek Green said that extra revenue will prevent the utility from having to raise rates on customers.“This gives us an opportunity to bring in revenue that’s not tied to ratepayers that allows us to do some additional creative ideas,” Green said.The plan, first proposed last September, has drawn protests from environmentalists, who argue that it further tethers the city to fossil fuels, flying in the face of the city’s plan to reduce its emissions by 80 percent by 2050.“Philadelphia should not be expanding its fossil fuel infrastructure,” said Audra Wolfe, a member of POWER, an interfaith social justice organization. “It’s not right for the future, it’s not right for the people of Philadelphia, and it’s not right for the climate.”Councilwoman Helen Gym, one of the four “no” votes, echoed that sentiment, saying the project was the wrong direction for the city.“I think it’s clear the city needs to move away from fossil fuels,” Gym said, adding that council should be devoting its time to developing clean energy solutions. “We need to move, and we need to move quickly.”

Pipeline update: Where these 2 projects through the Lehigh Valley stand, amid continuing Pa. natural gas boom - Pennsylvania’s natural gas production in 2018 was nearly four times greater than that of 2011, when hydraulic fracturing operations began to ramp up in the state’s Marcellus Shale region.  To help get that gas to homes, schools, businesses and industries, two pipeline projects are continuing their march toward construction through the Lehigh Valley.  PennEast Pipeline is a roughly $1.2 billion new pipeline from the Pennsylvania’s Marcellus Shale region in Luzerne County to Mercer County in New Jersey. Its constituent companies say the new line, reviled by environmentalists, is vital to safely and affordably meeting the region’s natural gas and electricity needs.  Adelphia Gateway is an estimated $339 million retrofit of an existing line originally built in the 1970s to transport oil from Marcus Hook outside Philadelphia for electricity generation at Martins Creek in Lower Mount Bethel Township. The line will transport both Marcellus and Utica shale gas to the Philadelphia region.  The Utica geologic formation lies beneath portions of eight states, including Pennsylvania, from Tennessee through New York and into Canada. The Marcellus formation is more central to Pennsylvania’s natural gas boom, extending under 60% of the state, along with parts of West Virginia, New York, Ohio and Maryland, according to the U.S. Energy Information Administration; it has the largest estimated proved reserves of any natural gas field in the United States.  PennEast, which is a consortium of five energy companies, and Adelphia Gateway, a project of New Jersey Resources Corp., are far from the only companies looking to cash in on Pennsylvania's natural gas boom. The Tulsa, Oklahoma-based Williams Companies said Thursday it will reapply for key environmental permits, rejected Wednesday by New Jersey regulators, to to build a hotly contested $926 million pipeline that would carry natural gas from Pennsylvania through New Jersey, and under Raritan Bay and the Atlantic Ocean to New York. The New York City skyline is seen June 3, 2019, from Middletown, New Jersey, across Raritan Bay, where a natural gas pipeline is proposed from Pennsylvania to serve New York City and Long Island. On March 1, 2018, the Dominion Energy Cove Point liquefied natural gas facility exported its first LNG cargo. Cove Point is the only LNG export facility on the East Coast of the United States, and the second export facility operating in the Lower 48 states after Sabine Pass in Louisiana, which began commercial operations in 2016, according to the EIA.

Court Signals Approval for State Defying PennEast Pipeline - Critics of a natural-gas pipeline that would cut through nearly 150 private properties in Pennsylvania and New Jersey pushed the Third Circuit on Monday to reverse an order condemning the lands. Though the Federal Energy Regulatory Commission gave the PennEast Pipeline Co. permission to seize lands in Hunterdon County that are held in a public trust, construction of the $1 billion pipeline has been held up by the New Jersey’s refusal to issue a construction permit. New Jersey’s Assistant Attorney General Jeremy Feigenbaum argued before the Third Circuit this afternoon that nothing in the Natural Gas Act says allows a private company to take land by eminent domain. “This is about whether states maintain a certain right,” Feigenbaum said. Feigenbaum faced stern questioning, with U.S. Circuit Judge Kent Jordan saying his proposition would “allow states to aggressively claim land,” but the panel proved even tougher on PennEast’s attorney. U.S. Circuit Judge Stephanos Bibas pushed back specifically when James Graziano with Archer Law made the case that the Natural Gas Act gives PennEast the power to claim all properties necessary for the project. “It doesn’t say state property,” said Bibas, referring to the law. “It says nothing about state owners.” 

Restore PA requires 20 years of natural gas production. Some progressive legislators aren’t ready to sign on - A handful of state House progressives are standing strong against Gov. Tom Wolf’s signature infrastructure plan, seeing in the $4.5 billion investment spree an over-reliance on the state’s natural gas industry at a time when Pennsylvania should be moving away from fossil fuels.The administration’s proposal, known as Restore PA, “locks us into the extraction of natural gas for decades … and that, to me, is troubling,” first-year Rep. Elizabeth Fiedler, of Philadelphia, told the Capital-Star this week.Restore PA calls for the state to take out 20-year bonds, backed by the future revenue of a severance tax on natural gas production. Pennsylvania is the second-largest gas producing state in the U.S., according to federal data, and despite a decade of development, still has considerable gas reserves underneath its soil.That also leaves the state among the top carbon polluters in the country. In 2016, Pennsylvania ranked fourth in nation for carbon emissions with 218 million metric tons released into the atmosphere.   If the commonwealth was ranked among countries, its carbon output would be tied with Vietnam as the 27th largest emitter. Fiedler said her concerns with Wolf’s plan are made more acute by “the absence of a larger plan to transition into a larger renewable economy” including wind and solar. More broadly, the lawmaker said she is unwilling to “double down on fossil fuels.” The reticence from Fiedler and other primarily first-year progressive lawmakers comes after months of hard salesmanship from Wolf that saw the governor crisscross the state, touring struggling downtowns and flood ravaged communities to build support for his multi-billion dollar plan. The administration finally rolled out the fine print of the legislation Wednesday night, revealing at the same time that it had secured the support of bipartisan near majorities in the Republican-controlled House and Senate.  All but 10 of the House’s 93 Democrats are listed as sponsors of the bill.

Delco OKs resolution to seek moratorium on Mariner East 2 operation - Delaware County Council joined those in calling for a moratorium on the operation and transmission of all Sunoco current and proposed highly volatile liquid pipelines in light of issues arising surrounding the Mariner East projects and the lack of a emergency response plan for these liquids. On Wednesday, council voted 3-0 on a resolution calling for the moratorium. Council members Colleen Morrone, Michael Culp and Kevin Madden voted for the resolution. Council Chairman John McBlain abstained as the law firm where he works has done work for Sunoco although he himself has not. Councilman Brian Zidek was absent from the meeting. Part of the resolution reads, "Delaware County Council hereby calls on Gov. Wolf to institute an immediate moratorium on the operation and transmission of all Sunoco current and proposed HVL pipelines in Delaware County, continuing until there is a credible and practicable public response program and emergency response plan that accounts for the unique hazards of these HVL's and the density and immobility of vulnerable populations within the impact radius." This is not the first action council has taken in regards to the pipeline.

Enviros call for full fracking ban in the Delaware River watershed – A coalition of environmental groups is calling on the multistate agency that oversees the Delaware River watershed to ban fracking and related activities in the area.The activists hope it would codify a de facto moratorium that has been in place for nearly a decade that prohibits fracking, the treatment and disposal of fracking waste, and the transfer of water for fracking operations elsewhere.“The public has spoken over and over again that we do not want fracking within the Delaware River watershed,” said Tracy Carluccio, deputy director of the Delaware Riverkeeper Network.The groups rallied Wednesday outside a meeting of the Delaware River Basin Commission, the agency that oversees the watershed.Although the DRBC has a de facto ban on fracking in place, the commission is considering new rules that would ban fracking, but also authorize the storage, treatment, and disposal of fracking waste and the removal of water for fracking in other places. “There should not be any further delay to end the suspense, to clearly say that fracking and its activities deserve no place in the Delaware River watershed,” said Doug O’Malley, director of Environment New Jersey. “That’s why the DRBC needs to act, and they need to act now.”

Counting the Costs of Pipeline Projects for Delaware River Basin - A new study suggests the expansion of the natural gas infrastructure in the Delaware River Basin is resulting in significant disruption and stresses to the environment and communities within the region. The analysis, conducted by the New Jersey Conservation Foundation, which is focused on two contested pipeline projects in New Jersey and Pennsylvania, found the 120-mile PennEast pipeline and the Mariner East 2 pipeline across the width of the latter state will add to the environmental degradation, habitat fragmentation and pollution throughout the DRB. “The results of the study suggest that the present value of lifetime environmental and social costs associated with the proposed PennEast pipeline and existing Mariner East 2 pipelines in the DRB range from approximately $758 million to $2.4 billion,’’ according to the report. Those costs include losses associated with ecosystem disruptions, greenhouse-gas emissions and loss of preserved land. One-quarter of the land where the PennEast pipeline is proposed to pass through is protected land or under conservation easements, the analysis found. Other costs could not be quantified, but involve water quality degradation, loss of property value, and increased treatment of surface water due to additional sedimentation in streams and rivers. “Such costs should not be overlooked when making decisions about pipeline development in the region,’’ the report said. The DRB spans parts of four states — New Jersey, Pennsylvania, New York and Delaware — and provides drinking water to more than 15 million people. Since 2016, at least eight major pipelines have been proposed in the basin, encompassing 322 miles. Between 2011 and 2018, pipeline capacity in New Jersey increased 52 percent even as some studies concluded the added capacity is unnecessary.

Virtual Pipelines: A Dangerous New Way to Transport Fracked Gas by Truck - For several years a mysterious fleet of tractor trailers loaded with natural gas cylinders has been crisscrossing U.S. roads, and in the dark early morning hours on Sunday, March 3, one drove off a highway near Cobleskill, New York, careened down an embankment, and flipped over. The driver had fallen asleep, according to a New York State police accident report, the truck was demolished, and “several tanks ruptured and were leaking” natural gas. Five nearby homes were evacuated.For retired New York Department of Transportation commercial vehicle inspector Ron Barton, an alarm bell he had been ringing for months suddenly grew even more urgent. “This is a catastrophe waiting to happen,” says Barton.The trucks are part of a little-known system of moving natural gas called “virtual pipelines.” The practice involves loading cylinders filled with compressed natural gas (CNG) onto specially designed trucks and hauling the gas between existing pipelines or to areas not connected to a natural gas distribution system, such as rural towns, and remote factories, universities and hospitals.Many environmental groups appear unaware of the topic, virtual pipelines have received virtually no national media attention, and some regulatory agencies seem unsure how to handle them.“The concept,” wrote Pennsylvania energy expert John Siggins in a 2016 report, “was born out of the lack of pipeline infrastructure in the New England area,” and a natural gas boom in nearby Pennsylvania’s Marcellus shale play that lowered gas prices. “As the shale energy revolution took off,” wrote Siggins, “a system for off-pipeline natural gas deliveries became of interest.”

The ‘hidden’ plan to remake an old dynamite factory near Philly into a major gas export terminal -- A New York investment firm is quietly laying the groundwork to build a major storage terminal at a former explosives factory near Philadelphia for exporting liquid fuels from Pennsylvania’s rich natural gas fields in Marcellus Shale to foreign markets.The plan to revive DuPont’s former Repauno Works in Greenwich Township, a shuttered dynamite factory on the Delaware River that is still contaminated 20 years after it closed, has gathered support from South Jersey elected officials. But environmentalists are mobilizing opposition to the project, alleging it is a stealth effort to export liquefied natural gas (LNG). The Delaware Riverkeeper Network, in a May 28 letterto federal and state regulators, said the private port’s true purpose is to export LNG produced in northern Pennsylvania. “This looks to us like a deliberate cover-up,” Maya van Rossum, the head of the riverkeeper network, said in a statement. The emerging battle over an energy project on a largely industrial stretch of the Delaware River pits local officials who envision an economic development opportunity vs. climate activists who see a risky business that perpetuates the nation’s dependence on fossil fuels. The issue also has national political overtones: The Trump administration has championed LNG exports as a means to influence international policy. “LNG has always ignited the public imagination because it’s so explosive," said Jeff Tittel, director of the New Jersey Sierra Club, which has denounced the Repauno project as a “threat to the environment and public safety.” Efforts to build LNG import terminals along the Delaware stalled in 2006 after public opposition mounted over fears about dangers.

DRBC Confirms Plan to Build LNG Export Terminal at New South Jersey Port - - Agency says it only ‘recently’ learned of plan to load potentially explosive liquids onto tankers in Gloucester County. The Delaware River Basin Commission acknowledged on Tuesday that an energy company plans to ship liquefied natural gas (LNG) and other liquids through a new export terminal on the Delaware River in South Jersey, updating its earlier statement that LNG was not part of the company’s permit application. Environmental activists have accused the DRBC and other regulators of concealing plans by the developer, Delaware River Partners, to add an LNG terminal to a new port that it plans to build on a former DuPont site in Gibbstown, Gloucester County. The DRBC previously said the company did not seek a permit for the LNG terminal in its application but on Tuesday said it “recently” learned of the plan. David Kovach, the agency’s head of permitting, verbally included LNG in a list of proposed uses at a DRBC meeting on June 6, the agency said in a statement on Tuesday. “During his description of the draft docket, Mr. Kovach said that the applicant recently informed us that Dock 2 will support the transloading of a variety of bulk liquid products, including butane, isobutane, propane (collectively liquefied petroleum gas, or LPG), liquefied natural gas (LNG), and ethane,” the statement said. LNG would be shipped to the Gibbstown port via truck from a new liquefaction plant being built in Bradford County, Pennsylvania, amid the abundant natural gas supplies of the Marcellus Shale, according to a Securities and Exchange filing by the plant’s developer, New Fortress Energy. The plant, costing an estimated $750-$850 million, would have a capacity of 3.6 million gallons a day and could serve markets in the Northeast by truck, the company said in a statement.

Contentious plan to remake N.J. dynamite plant into shale-gas export terminal is approved - The Delaware River Basin Commission on Wednesday unanimously approved a plan to build a $96 million 1,600-foot-long pier to load tankers at the former DuPont Repauno Works in New Jersey, where an investment firm proposes to export large volumes of liquid fuels produced from fracking Pennsylvania shale gas wells.The commission rejected pleas from environmentalists to delay the project to study the impact of the terminal, which activists fear will be used primarily as an export terminal for liquefied natural gas (LNG) brought in by road and rail to the port in Greenwich Township. DuPont shut down its Repauno operations about 20 years ago. The commission said its review was confined to the impact of building the wharf and of dredging the Delaware River to 43 feet deep to connect with the main channel.  Locator map of former DuPont Repauno Works plant, site of a planned gas terminal on the Delaware RiverThe wharf would be the second new dock built on the site, where the property’s owners, Delaware River Partners LLC, say LNG is only one of several commodities that may be shipped, including other fuels, automobiles, and bulk cargo. An LNG shipper would be required to obtain a U.S. Energy Department permit to export LNG.A coalition of climate activists opposed to new fossil-fuel infrastructure projects raised alarms about the project after connecting the dots between the port expansion and a proposal by an affiliated company to produce LNG at a plant in northern Pennsylvania’s Marcellus Shale gaslands.Local elected officials support the terminal, saying it’s an economic development project that will revive a dormant industrial site with taxable improvements and new jobs. Opponents could challenge the commission’s approval, as well as try to block other permits Delaware River Partners will need to develop the site, including state environmental approvals, Coast Guard permits, and Energy Department permits if LNG is exported. Delaware River Partners LLC, in securities filings, has suggested that its initial interest is primary to develop the Repauno port to export propane and butane from Marcellus producers to European petrochemical manufacturers. The site has a 186,000-barrel underground storage tavern suitable for liquid fuel like propane, but not LNG.

Judge dismisses antitrust lawsuit against energy providers Eversource, Avangrid - A federal judge in Boston has dismissed a proposed antitrust class action accusing Eversource Energy and Avangrid, two of New England’s largest energy providers, of manipulating pipeline capacity to inflate prices of natural gas and electricity. Filed in 2018 by New Hampshire energy marketer PNE Energy, the antitrust lawsuit said the two companies tied up natural gas capacity on New England’s main pipeline, the Algonquin, in a deliberate bid to drive natural gas and wholesale electricity prices higher, hurting competitors. But in a decision on Friday, U.S. District Judge Denise Casper said the natural gas prices the defendants allegedly manipulated were federally regulated and could not be interfered with by the court. To read the full story on WestlawNext Practitioner Insights, click here: bit.ly/2XDxDdu

Fumes from the Petroleum Tanks in this Port City Never Seem to Go Away. Are They Dangerous? - In late March, the city of South Portland was blindsided when the EPA filed a consent decree with a company that operates industrial storage tanks here. Global Partners, a Massachusetts-based energy supply company that owns four of them, had been violating its emissions permit since at least 2013. The amount of volatile organic compounds (VOCs) being emitted was reportedly more than double what was permitted, and the problem had gone unabated for years. VOCs are a range of chemicals that can cause a range of problems, including a one-two punch of health and climate impacts. They can irritate the eyes, nose and throat, damage the nervous system and cause cancer. VOCs can also lead to the formation of ground-level ozone, a short-lived climate pollutant that exacerbates climate change and can trigger asthma and breathing problems—especially in the elderly and the young. A 2016 study found that ozone pollution from oil and gas production causes more than 750,000 summertime asthma attacks in children across the U.S. each year. When I found out about the consent decree, I hopped on Google Maps to see where the tanks were, and I felt the sudden urge to throw up. The tanks, which contain bunker fuel and asphalt, are less than a quarter mile from where my kids go to daycare. Just under a mile and a half from my home.  South Portland has the largest municipal solar array in the state, bans on plastic bags and pesticide use, and a progressive plan to reduce the city's contributions to climate change while preparing for the future. But how to reconcile that environmental consciousness with 120 giant fuel tanks?

W.Va. Supreme Court: Drilling Rights Are for Minerals Directly Below - The West Virginia Supreme Court has affirmed a lower court’s ruling in favor of landowners’ claims that a company had no right to drill on their property to access oil and gas on other lands. The court’s ruling released Wednesday, June 6, says a mineral owner has the right to access only what’s directly below the surface. The court says “it is trespassing to go on someone’s land without the right to do so.”  A Doddridge County Circuit Court jury in 2017 awarded $180,000 to David Wentz and $10,000 to his ex-wife, Margot Beth Crowder, in their lawsuit against EQT Production.  The company held a century-old lease allowing it to drill wells to extract oil and gas from beneath the plaintiffs’ land. The plaintiffs sued to challenge the company’s use of their land to drill horizontal wells extending to neighboring properties.

West Virginia Ruling Means Costs Could Increase for Producers Seeking Surface Rights - In a decision that could find producers paying more to develop the Marcellus and Utica shales in West Virginia, the state Supreme Court has finally ruled that operators need clear permission from surface rights owners to site well pads on their land to extract natural gas from nearby properties.  The state Supreme Court unanimously affirmed a lower court’s ruling that found EQT Corp. had trespassed by using Margot Beth Crowder and David Wentz’s property in Doddridge County to tap into shale reserves held by other owners nearby. The two filed a lawsuit against the company in 2014 and were eventually awarded $190,000 in damages by a jury. The company appealed the case to the high court.  While the farm owners held a lease that allowed EQT to drill wells to tap oil and gas from beneath their surface estate, they argued that the company was not allowed to disrupt their property in order to produce from neighboring properties with horizontal wells. EQT had argued it was not in the wrong because nearly 40% of the lateral was through shale beneath their land, and the lease in question had been unitized with others nearby years ago. Following the ruling, EQT said it would continue to cooperate with its customers, partners and residents in the state.David McMahon, an attorney for the plaintiffs, who is also co-founder of the West Virginia Surface Owners’ Rights Organization, said the court’s ruling was one of the most important for surface estates in decades. In West Virginia, mineral and surface rights are severed, meaning they can be under different ownership, which has created varying interests over the years as unconventional drilling has boomed in the state.  In the past, McMahon noted that surface owners often agreed to be paid only what the land was worth as a meadow or a wood lot, for example. After the state Supreme Court’s decision, they can now “insist on surface use protections,” and demand better payment from operators based on what the well pad is worth to development, he said.

How 2 West Virginia residents went up against a big, invasive fracking company — and won a major victory – Seven years ago this month, Beth Crowder and David Wentz told natural gas giant EQT Corp. that it did not have permission to come onto their West Virginia farm to drill for the natural gas beneath neighboring properties. EQT had a lease that entitled the company to the gas directly beneath their farm, but it also wanted to use a new, 20-acre well pad to gather gas from 3,000 acres of adjacent or nearby leases. The company ignored their warnings. It built roads and drilled a well, and it put in horizontal pipes stretching for miles in all directions. Crowder and Wentz sued — and they’ve been fighting EQT in court ever since. On Wednesday, the West Virginia Supreme Court ended the matter with a surprisingly straightforward and unanimous conclusion: Going onto someone else’s land without their permission is trespassing. Gas and other mineral companies must obtain permission from surface owners in order to use their land to reach reserves under other properties, Justice John Hutchison wrote for the court. “The right must be expressly obtained, addressed, or reserved in the parties’ deeds, leases, or other writings,” he wrote. Attorney Dave McMahon, who represented Crowder and Wentz, broke the news to them by phone. “The short answer is, we won. And we won big time,” he said. Kristina Whiteaker, another lawyer for Crowder and Wentz, told them, “You guys really made some good law for the whole state.” Officials from EQT have not responded to requests for comment on the Supreme Court ruling. Neither did officials from the West Virginia Oil and Natural Gas Association, an industry trade association.

Court rules with Antero, but doesn’t set new standards for gas drilling - The West Virginia Supreme Court on Monday sided with Antero Resources in a case brought by Harrison County landowners, but it did not fully close off the ability of residents to use the courts to limit the effects of West Virginia’s growing natural gas industry.Justices upheld a lower court ruling that threw out a collection of lawsuits that argued Antero’s operations in the Cherry Camp area had created a nuisance, but the 3-2 decision written by Justice Evan Jenkins did not include any new points of law setting precedent for future cases.The decision is the second one issued by the court this month on major disputes between surface landowners and natural gas companies.Last week, in a unanimous decision, the court ruled that gas companies no longer may drill on one person’s property to reach gas reserves underneath adjacent tracts without permission of the surface owner.Monday’s decision involved a different situation, in which the residents suing were surface landowners who did not have wells located on their property, but wells located nearby to reach gas under their surface property.Anthony Majestro, a lawyer for the Harrison County residents, said the ruling reflects the developing law over the kinds of conflicts that are occurring in parts of the state where the natural gas industry has dramatically expanded. “As the Marcellus Shale drilling has expanded, there have been conflicts between surface owners and the companies that are drilling,” Majestro said. “These cases are new cases, and we are seeing from the Supreme Court what theories work and what theories don’t. Trespass works, and the jury is still out over nuisance.”

Fracking Companies Lost on Trespassing, but a Court Just Gave Them a Different Win -- A week after the West Virginia Supreme Court unanimously upheld the property rights of landowners battling one natural gas giant, the same court tossed out a challenge filed by another group of landowners against a different natural gas company. In the latest case, decided Monday, the court upheld a lower court ruling that threw out a collection of lawsuits alleging dust, traffic and noise from gas operations were creating a nuisance for nearby landowners. Charlie Burd, executive director of the Independent Oil and Gas Association of West Virginia, said the latest ruling lets “Wall Street know capital investment in oil and natural gas is welcome in West Virginia” and increases the possibility of more such investments in drilling and in so-called “downstream” chemical and manufacturing plants related to the gas industry. In the property rights case last week, the justices set a clear legal standard that natural gas companies can’t trespass on a person’s land, without permission, to tap into gas reserves from neighboring tracts. In Monday’s case, the justices didn’t articulate a new legal precedent. The mixed messages of the two cases show that “this is new litigation and the theories are evolving,” said Anthony Majestro, a lawyer who represented residents who lost their nuisance action before the Supreme Court. “As the Marcellus shale drilling has expanded, there have been conflicts between surface owners and the companies that are drilling,” Majestro said. “Absent some legal requirement to require the industry to be good neighbors, I’m afraid we’ll continue to have these situations.”

Tyler County, WV, gas tank fire under investigation | WV News - Officials from Dominion Energy are conducting an investigation into a fire at one of the company’s storage tanks in the Ohio Valley during Memorial Day weekend with an eye toward preventing future incidents.The fire was reported at the site of a natural gas condensate tank in the unincorporated community of Ben’s Run near Friendly in the afternoon hours of May 25. Several Tyler County fire departments and even industrial fire fighting crews were called to the scene. Gov. Jim Justice also ordered state resources to the scene to assist upon being informed of the situation by Department of Environmental Protection Secretary Austin CapertonThe fire wasn’t extinguished until about 5 a.m. the following morning.Lora D. Lipscomb, public information officer for the West Virginia Division of Homeland Security and Emergency Management, said Dominion is investigating the fire, which was believed to have been caused by a lightning strike since thunderstorms were moving through the area at the time.“They don’t know for sure,” she said. “No one saw anything until the smoke started coming off and someone at a factory adjacent saw the smoke from the storage tank and called the fire departments.” Lipscomb said firefighters from Paden City and New Martinsville in Wetzel County also were called to the scene. She said the industrial fire suppression specialists brought in by Dominion were equipped with special chemical foams much more potent than water, but the flames proved too intense even for that, and it soon became a matter of letting the fire burn itself out while containing it.

Dominion confident it will win Atlantic Coast Pipeline legal challenges - Dominion Energy expects to win one of two legal challenges its Atlantic Coast Pipeline faces within the next four to six weeks and be able to resume construction on a portion of the 600-mile route after that, an executive said Tuesday. Donald Raikes, senior vice president for gas transmission operations in Dominion's Gas Infrastructure Group, added that he believes the US Supreme Court will agree to hear the second legal challenge, involving a permit to cross the Appalachian Trail, and ultimately rule in the operator's favor, allowing it to complete the project. The optimism comes as Dominion holds to its current timeline to begin partial service in late 2020 and full service in early 2021. The up-to-$7.5 billion project has been beset by delays and cost increases, largely because of opposition from environmental groups that has resulted in the legal challenges. Atlantic Coast Pipeline is among several Northeast gas infrastructure projects designed to boost takeaway capacity from the Appalachian Basin that have been delayed or stalled because of regulatory and legal hurdles. "This is not about Duke, or Dominion or Southern," Raikes said at the LDC Gas Forums conference in Boston. "This is about the industry. This is about all of us.".The federal government is expected to back with its own appeal Dominion's Supreme Court appeal of a 4th US Circuit Court of Appeals decision that invalidated US Forest Service authorizations for the project to cross the Appalachian Trail. While the government's support could bolster Dominion's case, success is not assured. Some analysts have questioned whether the high court will hear the case, and if it does whether it will make a favorable decision in a timely way to allow the operator to keep to its current in-service schedule. The 4th Circuit has become a very difficult venue for Dominion.

State denies Mountain Valley Pipeline application for now - The state has denied, for now, the Mountain Valley Pipeline Southgate’s applications for water quality certification and riparian buffer authorization. The Division of Water Resources learned from MVP that updated impact tables, final plan and profile views for proposed effects wouldn’t be available until after July, and decided to deny the application altogether. The N.C. Department of Environmental Quality informed MVP June 3 in a letter to Matthew Raffenberg of Mountain Valley LLC. The letter noted that any work done within the state waters or riparian buffers might violate state law. The division received the application for the certification and authorization Nov. 30, according to the state, and requested additional information Jan 10. On Feb. 12, it received a “partial response,” saying “Mountain Valley is currently completing route evaluations and will be providing updated impact tables at a later date. Mountain Valley will provide final plan and profile view for all proposed permanent fills of aquatic resources in North Carolina ... once all surveys have been completed and project design is finalized.” On March 25, the state returned the application as incomplete. “Once a draft [Environmental Impact Statement] has been issued and a preferred route is identified by [the Federal Energy Regulatory Commission], you may reapply to the division,” the state said in the June 3 letter.

 In pet coke fight, Marathon points fingers at dusty neighbors - The Marathon refinery in Detroit making a push against its neighbors as it works to change an ordinance on airborne particles.    Across Oakwood Boulevard from the refinery, front-end loaders scoop up and dump asphalt millings at neighbor Edward C. Levy Co.'s Cadillac Asphalt plant, kicking up dust that can be seen from atop of the glowing 200-foot tower at the Marathon plant that defines the skyline of industrial southwest Detroit.  "Look at all of the dust coming from the Levy asphalt plant," Marathon refinery general manager Dave Roland says pointing west from atop of the tower.  After years of being the brunt of criticism about its environmental track record, Findlay, Ohio-based Marathon Petroleum is pushing back in unusual ways — pointing fingers at its odor-emitting and dust-creating neighbors in a bid to win approval from the City of Detroit to continue operating its pet coke storage and disposal without a covered roof over the massive pit.  "No one ever complains about the (smell of the) waste water treatment plant — especially the city," Roland said during a recent tour with Crain's of the refinery's coker, where the pet coke is produced during the refining process.  The city's Buildings, Safety, Engineering and Environmental Department (BSEED) recently denied Marathon's variance request to continue outdoor storage under a 2017 ordinance that City Council passed in response to Detroit Bulk Storage's previous storage of 40-foot piles of pet coke along the Detroit River that created black dust storms that could be seen — and breathed — in Windsor.  "The goal is protect public health so that stuff is not blowing into people's homes," said City Councilwoman Raquel Castañeda-López, who represents southwest Detroit.  Marathon officials are questioning why Detroit's bulk materials storage ordinance applies to pet coke but not the petroleum-based asphalt millings piled up at the Cadillac Asphalt plant across the street from the refinery or the Detroit Salt Co.'s dusty salt piles that sit next to the refinery along I-75.

Aging Enbridge oil pipelines face setbacks over fears of Great Lakes spills - (Reuters) - Fears about oil spills into the Great Lakes from two aging U.S. pipelines have flared, raising doubts about their future and creating fresh headaches for operator Enbridge Inc and the Canadian energy sector. Canada has faced years of delay in getting new oil pipelines built because of environmental opposition, resulting in severe congestion in Alberta, the country’s main crude-producing province, that forced the provincial government to impose production cuts this year. Pipelines face increasing scrutiny from environmental groups worried about leaks, and U.S. Great Lakes states are taking a hard look at the risks. The Minnesota Court of Appeals ruled on June 3 that the environmental impact statement for Enbridge’s Line 3 failed to properly address the spill risk in Lake Superior, imposing a fresh challenge to the company’s construction schedule. Also last week, Michigan Governor Gretchen Whitmer repeated a threat to shut down Line 5 unless Enbridge accelerated its timeline to replace it. “That is a real-time problem because (Line 3) was the most imminent chance for Canadian production to see some pressure release on the system,” said Rafi Tahmazian, senior portfolio manager at Canoe Financial, which owns shares of Canadian Natural Resources and other oil producers. “It’s disappointing and concerning.” Line 3 carries oil from Alberta to U.S. refineries in Minnesota and Wisconsin. Line 5 takes oil from Wisconsin to refineries in Sarnia, Ontario, passing through the Straits of Mackinac channel connecting Lake Michigan and Lake Huron. Both were built in the 1960s. 

Whitmer task force to identify Line 5 propane alternatives - As a battle over the fate of Line 5 heads to court, Michigan Gov. Gretchen Whitmer on Friday created a new task force to study propane delivery alternatives for the Upper Peninsula. Enbridge on Thursday sued the state after talks with Whitmer over an accelerated tunnel plan broke down. The governor demanded for a two-year timeline to shut down the aging oil and gas pipeline, which helps transport propane many U.P. residents use to heat their homes. Whitmer’s new task force, created by executive order, is charged with identifying alternative propane delivery options in he event of a Line 5 shut down, along with ways to rein in other energy rates in high-cost regions of the U.P. “Our jobs, economy and public health depend on the preservation of the Great Lakes, which literally define us as a state,” the governor said in a statement. “Enbridge has a disappointing safety record in Michigan, and the dual pipelines that run through the Straits of Mackinac create an unacceptable risk of an oil spill by anchor strike or other means. Such an event would be catastrophic for The Great Lakes and our economy, and would send energy costs skyrocketing for UP families.” The Enbridge lawsuit filed Thursday seeks court validation of a tunnel agreement the Canadian energy firm had brokered late last year with former Gov. Rick Snyder. Whitmer halted state action on the plan in March after Attorney General Dana Nessel invalidated an underlying law that had allowed the deal. Whitmer said in April that she is open to a tunnel option but wanted a plan to get Line 5 out of the Great Lakes faster than the five-year to 10-year construction estimate. Her office claimed that Enbridge “walked away from the negotiating table” on Tuesday and chose litigation instead.

Propane likely to shift to rail if Michigan forces Enbridge to shut Line 5 | S&P Global Platts — The propane-by-rail market would likely have enough slack to replace pipeline flows into Michigan if the state carries through with a threat to force Enbridge to decommission the 540,000 b/d Line 5, according to S&P Global Platts Analytics. The future of Line 5 is in doubt after talks broke down last week between Enbridge and Michigan Governor Gretchen Whitmer's office. In March, Whitmer made good on a campaign promise to halt Enbridge's project to build a utility corridor under the Straits of Mackinac. The tunnel would address environmental safety concerns surrounding the 65-year-old pipeline and house a future replacement. The system remains a key route for light crude and NGLs to the US Midwest and Ontario, including up to 75% of Michigan's propane demand. "Ultimately, the question is more about logistics and connecting propane production, whether in Canada or in the US, to demand," Platts Analytics senior NGL analyst Andrew Neal said Monday. Enbridge spokesman Michael Barnes said Monday that the Line 5 tunnel project is "the best long-term opportunity to secure the energy needs of the state while making an already safe pipeline even safer." He said a 2017 analysis commissioned by the state found no viable alternative to moving the products carried by Line 5 on other pipelines, rail or truck. Platts Analytics estimates Line 5 carries 20,000-30,000 b/d of propane from Canada into the US Great Lakes, with roughly half the volume coming off the pipe at fractionators in Clearbrook, Minnesota; Superior, Wisconsin; and Rapid River, Michigan. The rest is re-exported to Canada, where it and moves into storage facilities spanning the border between eastern Michigan and southern Ontario. Neal said most of the product comes off the pipe in Minnesota or Wisconsin, before it reaches Michigan. Much of the volume bound for storage near Sarnia, Ontario, likely ends up back in Michigan for consumption, but refined product pipe networks in the Chicago area and around Detroit and Northwest Ohio can supply propane as well, he said.

 Meteor Timber Takes DNR To Court Seeking Wetland Fill For Frac Sand Facility - Atlanta based Meteor Timber is taking the state Department of Natural Resources to court as part of a four-year push to build a frac sand processing facility on 16 acres of high quality wetlands in Monroe County.Since 2015, Meteor Timber has sought approval to build a $75 million frac sand processing and rail loading facility on property that includes rare hardwood swamp. Environmental groups and the Ho-Chunk Nation have opposed the project.In 2017, the DNR issued a wetland fill permit despite objections — obtained by WPR through an open records request — that showed staff felt pressured to approve the permit despite what staff called a lack of basic information from the company about how it would mitigate the wetland destruction.The Ho-Chunk Nation, Midwest Environmental Advocates and Clean Wisconsin challenged the DNR’s permit through a contested case hearing and in May of 2018, an administrative law judgeoverturned the Meteor Timber permit saying the agency lacked important information and didn’t prove it could mitigate the loss of the rare wetlands.Meteor Timber disagreed and pointed to thousands of pages of documents submitted to the DNR throughout the permitting process. The company appealed the administrative law judge’s decision and asked the DNR to review and potentially overturn it through a little used state statute. Former DNR Secretary Dan Meyer, an appointee of former Gov. Scott Walker agreed to have a staff attorney review the matter but no decision was made before Gov. Tony Evers took office in January.

Lowest crude oil imports since 1986 indicate changes in U.S. Gulf Coast crude oil supply – EIA -- U.S. Gulf Coast crude oil imports averaged 1.8 million barrels per day (b/d) in March 2019, the lowest level since March 1986 and significantly lower than the peak of 6.6 million b/d in March 2007. Preliminary weekly data indicate that Gulf Coast crude oil imports have averaged about 1.9 million b/d through April and May (Figure 1). Falling crude oil imports into the U.S. Gulf Coast so far in 2019 are the result of both recent events and continuing longer-term trends. Recently, sanctions on Venezuelan imports and heavy refinery maintenance have reduced imports. At the same time, imports to the Gulf Coast have also decreased because of sharp declines in imports from the Organization of the Petroleum Exporting Countries (OPEC) following an agreement among members to reduce production and because imports are being replaced by increased production of domestic crude oil. Together, these trends have fundamentally changed how the Gulf Coast region is supplied with crude oil. In the past five consecutive months, the U.S. Gulf Coast hasexported more crude oil than it imported (net exports), and since 2015, it has consistently received more crude oil from other regions of the United States than it has sent to other regions (net receipts). Gulf Coast crude oil imports are typically lower in the early months of the year as refineries reduce runs as part of their seasonal maintenance. This year, planned maintenance activity was higher than usual. The four-week average of gross refinery inputs in the Gulf Coast fell from 9.6 million b/d for the week ending January 4, higher than the five-year (2014-18) maximum and 648,000 b/d higher than the five-year average, to a low of about 8.6 million b/d from mid-February until mid-April. Although 8.6 million b/d of gross refinery inputs is more than the Gulf Coast’s five-year average level for the period, eight consecutive weeks of relatively flat refinery runs is longer than normal during refinery maintenance at this time of year. This extended period of lower refinery runs for longer in the early months of 2019 reduced the need for crude oil imports, contributing to the more-than-three-decade-low crude oil imports during this period. Around the same time, the U.S. government announced additional sanctions on Venezuela that included limitations on crude oil imports from Venezuela. In 2018, 20% of all Gulf Coast crude oil imports were from Venezuela, an annual average of 498,000 b/d. The Gulf Coast was the destination for 98% of all U.S. imports of Venezuelan crude oil in 2018. Because of the imposition of sanctions, refiners in the Gulf Coast sharply reduced imports of Venezuelan crude oil. Between January and March 2019, Gulf Coast imports of crude oil from Venezuela fell by 498,000 b/d to 47,000 b/d in March. As a result of the Gulf Coast reductions, U.S. four-week average imports from Venezuela fell from 603,000 b/d for the week ending January 25 to 12,000 b/d for the week ending May 31 (Figure 2).

Port Arthur, Corpus Christi Terminals Get an Upgrade - Howard Energy Partners completes expansion of Port Arthur and Corpus Christi terminals This week, Howard Energy Partners (HEP) announced the completion of two expansion projects at its Port Arthur and Corpus Christi bulk liquid terminal facilities, increasing HEP’s Gulf Coast storage capacity to 2.6 million barrels. The expansion also upped the number of ship and barge docks by three each, the unit train loading capacity to two trains per day, and the direct pipeline connectivity through wholly-owned pipelines to seven refineries. “We currently have more than 470 acres for additional Gulf Coast expansion projects, including significant water frontage,” said HEP Co-Founder and President Brad Bynum.

New pipelines to connect Port of Corpus Christi to key U.S. oil producing regions — Two separate joint ventures announced by Phillips 66 Monday will connect the Port of Corpus Christi to key shale oil producing regions in the U.S. Phillips 66 is partnering with Bridger Pipeline LLC to build the Liberty Pipeline, which will provide crude oil transportation services from the Rockies and Backen production areas to Cushing, Oklahoma, the main thoroughfare for Central U.S. crude production. Phillips 66 is also partnering with Plains All American Pipeline to build the Red Oak Pipeline, which will transport multiple grades of crude oil from Cushing and the Permian Basin to the Port of Corpus Christi. Officials said pending permitting, service on both pipelines could begin as early as 2021. "These newly announced pipelines are pivotal developments in establishing the Port of Corpus Christi as the preferred gateway for U.S. crude exports. These lines will add new North American crude slates such as Bakken, Niobrara/DJ Basin, SCOOP & STACK to our already high-quality Permian and Eagle Ford barrels," said Sean Strawbridge, Chief Executive Officer for the Port of Corpus Christi. "The discerning Asian and European crude customer will certainly appreciate the expanded menu of options Corpus Christi provides when buying American crude oil." The Port of Corpus Christi forecasts exports of nearly $15 billion of crude oil in 2019.

Exxon, Saudis Bet on Plastics Growth in Giant Gulf Coast Plant - Exxon Mobil Corp. and Saudi Arabia’s state-controlled petrochemicals company formally approved construction of a new chemical complex in Texas that will process production from the Permian Basin’s booming oil and natural gas wells. The project near Corpus Christi will be the world’s largest steam cracker and create $50 billion of “economic output” in the first six years, Exxon and Saudi Basic Industries Corp., known as Sabic, said in a joint statement on Thursday. The facility will convert hydrocarbons such as ethane and propane to ethylene, a chemical used to make everything from plastics to antifreeze.It’s the latest in a slew of chemical and refining plants set for the Gulf Coast, gaining from ultra-cheap production from the Permian, the world’s largest shale basin. As explorers boost oil output, associated supplies of gas and liquid byproducts provide some of the cheapest chemical feedstocks in the world. Situated “on the doorstep of rapidly growing Permian production gives this project significant scale and feedstock advantages,” Exxon Chief Executive Officer Darren Woods, said in the statement. Industry executives have been lauding chemicals as an emerging driver of global oil and gas markets. Earlier this week, BP Plc Chief Economist Spencer Dale earlier predicted petrochemicals will dominate energy demand growth for the next two decades. Plastics and chemicals are seen as increasingly vital to Big Oil’s future given uncertainty over crude demand and the push toward electric vehicles and cleaner energy sources. But some of the world’s most-advanced economies are increasingly clamping down on single-use plastics such as shopping bags and straws. That hasn’t scared off Exxon. This year alone, the oil giant approved major expansions to its giant Baytown petrochemical complex and Beaumont refinery in Texas as well as a plastics unit in Louisiana. CEO Woods, former head of the company’s downstream division, sees the plants as essential to making money all the way from the wellhead to the final products. The business also acts as a natural hedge against commodity-price swings.

Sempra Energy ships first liquefied natural gas cargo from Cameron LNG export facility -- On May 31, 2019, Sempra Energy, the majority owner of the Cameron liquefied natural gas (LNG) export facility,announced that the company had shipped its first cargo of LNG, becoming the fourth such facility in the United States to enter service since 2016. Upon completion of Phase 1 of the Cameron LNG project, U.S. baseload operational LNG-export capacity increased to about 4.8 billion cubic feet per day (Bcf/d). Cameron LNG’s export facility is located in Hackberry, Louisiana, next to the company’s existing LNG-import terminal. Phase 1 of the project includes three liquefaction units—referred to as trains—that will export a projected 12 million tons per year of LNG exports, or about 1.7 Bcf/d. Train 1 is currently producing LNG, and the first LNG shipment departed the facility aboard the ship Marvel Crane. The facility will continue to ship commissioning cargos until it receives approval from the Federal Energy Regulatory Commission to begin commercial shipments. Commissioning cargos refer to pre-commercial cargo loaded while export facility operations are still undergoing final testing and inspection. Trains 2 and 3 are expected to come online in the first and second quarters of 2020, according to Sempra Energy’s first-quarter 2019 earnings call. Cameron LNG has regulatory approval to expand the facility through two additional phases, which involve the construction of two additional liquefaction units that would increase the facility’s LNG capacity to about 3.5 Bcf/d. These additional phases do not have final investment decisions.  Cameron LNG will be the fourth U.S. LNG-export facility placed into service since February 2016. LNG exports rose steadily in 2016 and 2017 as liquefaction trains at the Sabine Pass LNG-export facility entered service, with additional increases through 2018 as units entered service at Cove Point LNG and Corpus Christi LNG. Monthly exports of LNG exports reached more than 4.0 Bcf/d for the first time in January 2019. Currently, two additional liquefaction facilities are being commissioned in the United States—the Elba Island LNG in Georgia and the Freeport LNG in Texas. Elba Island LNG consists of 10 modular liquefaction trains, each with a capacity of 0.03 Bcf/d. The first train at Elba Island is expected to be placed into service in mid-2019, and the remaining nine trains will be commissioned sequentially during the following months. Freeport LNG consists of three liquefaction trains with a combined baseload capacity of 2.0 Bcf/d. The first train is expected to be placed in service during the third quarter of 2019.

Energy Giants Set Their Sights On Brownsville As Home For New Liquefied Natural Gas Plants -- Brownsville, Texas is one of the poorest metropolitan areas in the nation. But it is now being considered for almost $40 billion worth of investment. Three energy companies are planning projects to bring liquefied natural gas plants to the area – striking community controversy and organized opposition to the proposals. Sergio Chapa is an energy reporter for The Houston Chronicle, and he’s been following this story. Chapa says the reason the port city of Brownsville is being pursued by the energy companies is two-fold. “About ten years ago or so, the discovery of the Eagle Ford Shale and the shale revolution, which unlocked previously trapped reserves of oil and gas in the United States,” Chapa says. “It made it economic to tap those resources underground, so what we have created is a surplus of oil and natural gas.” The availability of land, Chapa says, is the other reason the LNG industry is interested in Brownsville. “A lot of the ports along the Gulf Coast are already out of land they can lease,” Chapa says. “[These large facilities] require hundreds of acres in some cases, and without any land at some of the more traditional ports like Corpus Christi or Houston, these developers started looking further south.” While the plan includes nearly $40 billion in private investment, thousands of jobs and additional U.S. exports of natural gas, Chapa says critics are focused on preserving quality of life and the environment in the region. “There’s a lot on the line here,” Chapa says. “These projects are being built in one of the poorest areas of the state, one of the areas of the state with the highest unemployment and also in an endangered species wildlife corridor.” Chapa says one retired couple with firsthand experience in the energy industry is helping lead their community in the fight against the construction of these LNG plants. “[The Gundersons] lived in Texas City – it’s a suburb of Houston – for a number of years, where George Gunderson worked at the B.P. oil refinery,” Chapa says. “That was until an accident in March 2005. A cloud of gas ignited killing a number of people and injuring more than a hundred others.” 

In an energy-hungry world, natural gas gaining the most  - Natural gas was the fastest-growing energy source in the world last year — when global energy consumption rose at its fastest pace in nearly a decade, according to a new International Energy Agency report.  Natural gas accounted for 45% of all energy consumption growth in 2018. Most regions and many industries, including the shipping sector, as shown in the above chart, are turning to the fuel as a cleaner-burning, cheap alternative to coal and oil.  Development of new gas resources, led by America, has ushered in what the IEA predicated in 2011 would be a “golden age of gas.” This is reshaping geopolitics and complicating efforts to address climate change. While the cleanest-burning fossil fuel, natural gas still emits greenhouse gas emissions compared to sources like renewables or nuclear power. One stark example of how environmental concerns overlap with natural gas is the shipping industry’s anticipated shift to liquefied natural gas (LNG) over fuel oil.

  • The IEA projects a tenfold increase in LNG as shipping fuel by 2024, with container and cruise ships accounting for most of that.
  • This shift is being chiefly driven by tougher environmental rules on the maritime industry that a U.N. agency will begin implementing in January 2020.

Much of the debate around natural gas focuses on electricity, such as its role in displacing coal and competing with (and sometimes complementing) variable renewable energy. But it's industrial uses for natural gas, such as chemicals and fertilizers, that are the biggest drivers of growth in most areas of the world, per the IEA report. These uses can’t be as easily replaced with renewables like electricity can. IEA sees more demand growth ahead, but not as fast as last year’s. It projects worldwide demand will rise more than 10% over the next 5 years, with China alone expected to account for 40% of the increase.

Prices Continue Lower On High Injections And Moderate Temperature Forecasts --Highlights of the Natural Gas Summary and Outlook for the week ending June 7, 2019 follow. The full report is available at the link below.

  • Price Action: The now prompt July contract fell 15.7 cents (6.0%) to $2.454 on a 20.2 cent range ($2.646/$2.444).
  • Price Outlook: Prices continued to slide as the EIA reported another storage injection well above expectations while weather forecasts were also considered bearish. The market has now posted a new weekly low for 3 consecutive weeks after the recent 4 consecutive weeks that witnessed a new weekly high. However, this streak falls far shy of the record 9 consecutive weeks lower posted in 2008. Thus, while prices have fallen below long-tern technical support near $2.50, the market is not considered extended to the downside or “due” for a correction..
  • Weekly Storage: US working gas storage for the week ending May 31 indicated an injection of +119 bcf. Working gas inventories rose to 1,986 bcf. Current inventories rise 169 bcf (9.3%) above last year and fall (245) bcf (-11.0%) below the 5-year average.
  • Supply Trends: Total supply rose 1.2 bcf/d to 85.2 bcf/d. US production rose. Canadian imports rose. LNG imports fell. LNG exports rose. Mexican exports fell. The US Baker Hughes rig count fell (9). Oil activity decreased (11). Natural gas activity increased +2. The total US rig count now stands at 975 .The Canadian rig count rose +18 to 103. Thus, the total North American rig count rose +9 to 1,078 and now trails last year by (96). The higher efficiency US horizontal rig count fell (7) to 855 and falls (79) below last year.
  • Demand Trends: Total demand rose +0.9 bcf/d to +69.9 bcf/d. Power demand rose. Industrial demand rose. Res/Comm demand fell. Electricity demand rose +2,063 gigawatt-hrs to 77,831 which trails last year by (5,752) (-6.9%) and exceeds the 5-year average by 557 (0.7%%).
  • Nuclear Generation: Nuclear generation rose 2,406 MW in the reference week to 90,191 MW. This is (3,460) MW lower than last year and +438 MW higher than the 5-year average. Recent output was at 90,078 MW.

The cooling season is beginning. With a forecast through June 21, the 2019 total cooling index is at 424 compared to 1,007 for 2018, 863 for 2017, 850 for 2016, 589 for 2015, 601 for 2014, 648 for 2013, 968 for 2012 and 1,000 for 2011.

Hotter Weather Changes Help Extend Natural Gas Rally -- While natural gas prices remain at very low levels historically, we have now put together nearly a 10 cent rally off the multi-year lows set late last week. The July contract closed the day up just over 4 cents, closing a tick under the $2.40 level. Changes in supply / demand balance data along with firmer cash prices certainly helped the market set at least a temporary bottom, but weather changes have grown increasingly bullish as well compared to what we saw at the conclusion of last week. This was a risk we alerted clients to back in our Friday afternoon "Pre-Close Update". It took a couple of days, but those warmer risks have become much more apparent. Take, for example the 7-11 day surface temperature anomaly forecast from the GEFS back on Sunday: The current forecast, valid the same period, has shifted decidedly warmer: The changes continued beyond this period as well, as can be seen by comparing Sunday's 11-15 day GEFS forecast to the latest run, valid the same dates. Here is Sunday's run: Now, the latest run: The warmer shift in both periods has boosted weather demand forecasts, contributing to this week's natural gas rally. 

 East Texas spot natural gas prices sink to multiyear lows, but exports may bring support— Spot natural gas prices for the five primary East Texas natural gas benchmarks dropped to their lowest levels since November 2016 this week on weaker demand and rising production, but increased exports may provide support. On Thursday, Houston Ship Channel fell to $2.275/MMBtu; Katy Hub to $2.285/MMBtu; Carthage Hub to $2.175/MMBtu and Transco Zone 1 to $2.215/MMBtu. Texas Eastern East Texas fell to $2.18/MMBtu Tuesday and stayed near that low Wednesday and Thursday at a settlement price of $2.185/MMBtu. For the first two weeks of June, the five benchmarks settled an average of 56.8 cents lower this year compared with the same period a year ago. Houston Ship Channel has averaged $2.333/MMBtu the first half of June, down from $2.995/MMBtu the same period a year ago. Carthage Hub has averaged $2.222/MMBtu for the first half of June, down from $2.766/MMBtu a year ago. Texas Eastern East Texas has averaged $2.219/MMBtu this year, compared with $2.784/MMBtu a year ago. Katy Hub has averaged $2.347/MMBtu for the first half of June, down from $2.983/MMBtu last year and Transco Zone 1 averaged $2.293/MMBtu the first half of June, down from $2.727/MMBtu a year ago. Gas production for the first half of June in Texas has averaged 20.7 Bcf/d, 5% above the 2018 average of 19.7 Bcf/d. The state's strongest production increases have come from East Texas Haynesville, which rose about 64% year on year, averaging 2.8 Bcf/d the first two weeks this year from 1.7 Bcf/d the same period a year ago. This increased production in Texas has contributed to stronger reported storage builds this year than last. The US Energy Information Administration reported a South Central regional storage level of 842 Bcf for the week that ended June 7, 5.8% above the 796 Bcf reported for the same week a year ago. Mild temperatures also played a role in the low prices -- the average temperature in Texas for the first two weeks of June was 78 degrees, well below the year-ago average of 84 degrees.

EIA Reports Low-End, Triple-Digit Natural Gas Storage Build - The Energy Information Administration (EIA) on Thursday reported a 102 Bcf injection into storage inventories for the week ending June 7. The slightly smaller-than-expected build provided an initial modest uplift for natural gas futures prices, trimming earlier losses by around 1.5 cents. Ahead of the EIA’s 10:30 a.m. ET report, the July Nymex gas futures contract was trading 2.6 cents lower at $2.36, but as the print hit the screen, the prompt month rose to $2.376, down only a penny on the day. By 11 a.m., however, July futures were trading back down to $2.359, off 2.7 cents. The reported 102 Bcf injection was larger than both last year’s 95 Bcf build and the five-year average injection of 92 Bcf. However, it came in on the low end of expectations as most estimates had clustered around a build near 110 Bcf. NGI had projected a 108 Bcf injection. Nevertheless, most market analysts shrugged off the slight miss, especially after two massively bearish storage reports in a row. With prices remaining in the red, there was further downside risk ahead, according to Flux Paradox LLC President Gabriel Harris. Thus far, lower prices have not made the weather-adjusted injections look any tighter, which starts to cause reasonable doubt in the market on the whole coal-to-gas switching mechanism, according to Harris. “The market will need dramatic evidence that the price-switching mechanism is at full strength before a bottom occurs.” However, Bespoke Weather Services said balance wise, the 102 Bcf injection is considerably tighter than last week’s loose 119 Bcf print, giving the firm more confidence in the data after the previous two big misses. “We feel that the tighter balances will show up in next week’s number as well, though with this week being a low demand week, we could still see another triple-digit build.” By region, the Midwest reported a 33 Bcf injection into inventories, while the East added 26 Bcf, according to the EIA. Stocks in the Mountain region grew by a larger-than-expected 10 Bcf, and stocks in the Pacific rose by 14 Bcf. Working gas in storage as of June 7 stood at 2,088 Bcf, which is 189 Bcf higher than a year ago but still 230 Bcf below the five-year average, according to EIA.

Have Natural Gas Prices Found A Bottom? - It was a choppy week in the world of natural gas, though it ended on a higher note, with the July contract closing just over 6 cents higher on the day today, giving it a 5 cent gain since last Friday's close.  The bullish case had gradually been building all week long. We highlighted the other day the hotter changes in the weather pattern, meaning more demand for natural gas, which has held into today's forecasts, thanks to some heat creeping into the South.  The gradual hotter changes were not enough to bring buyers back in initially, however. After two bearish EIA reports in a row, the market wanted to make sure we would not see a third surprise. We did not, as the report showed a build of 102 bcf, very close to our estimate of 100 bcf. This confirmed our view that balances had tightened significantly compared to prior weeks.  The recipe for a rally had one last hurdle to climb, and that was cash, which was very weak yesterday, again scaring off potential buyers. We maintained our "slightly bullish" view yesterday afternoon nonetheless, feeling that cash would firm back up as demand increases, and allow prices to run higher.  It didn't take long for that to occur, as cash firmed up in today's session with higher demand coming over the weekend and into Monday. This finally gave the green light to buyers that it was safe to at least dip their feet into the water.
With prices ending the week almost 9 cents off the lows of late last week, has a bottom been found? We will refrain from going far enough to make that claim, but we can offer analysis to keep you a step ahead of the market's next move.

 U.S. gas flaring spiked 48% last year — study - Flaring of natural gas jumped by almost half in the U.S. last year on the heels of surging shale oil production, new satellite data suggests.

  Texas Drillers Resort to Pumping Gas Down Wells - Texas drillers may have found a solution to the stubborn natural gas glut that’s forced them to either burn it off into the air, or pay others to take it away. At least five producers, led by EOG Resources Inc., are experimenting with shooting highly-pressurized natural gas into past-their-prime wells that have seen their output slip. The wells are then capped to build up pressure inside with the aim of dislodging any oil still hiding in the rock. The methodology’s been used in conventional wells elsewhere with both natural gas and carbon dioxide for years, but it’s just now emerging in America’s fracked shale fields. The win-win goal: The trapped gas is put to work, and there’s a 30%-to-70% gain in oil output from older wells, according to EOG. As the shale boom ages, the potential could be extensive. “If widely adopted, if it doesn’t lead to challenges and the formations behave as we expect, then we expect it could utilize 25% of the associated gas produced,” Natural gas almost always comes up with oil during drilling, but it’s increasingly become a largely unwelcome byproduct in Texas. With pipeline capacity for gas limited, prices there have cratered, dropping as low as minus $9 per million British thermal units in early April. In late 2018, Permian flaring -- the burning off of associated gas -- more than doubled from a year earlier to 500 million cubic feet a day, and that’s likely to rise, It’s a problem from both an economic point of view, and environmentally. Generally, the use of injected gas is known as enhanced oil recovery, or EOR. Initially, EOG was the main company using natural gas to boost shale oil output. "But the fact is that now we have seen four other producers do it," he said. “And with remarkable results.” . Gas injection can potentially extend crude production volumes in older wells by 18 to 24 months, Krishnamoorti said. What’s still to be determined is how well EOR works in different types of rock formations. Not all rock is the same, and while it does appear to be an attractive option in many parts of the Permian, it’s “not particularly good” in at least one section, the Wolfcamp zone, according to Krishnamoorti,

The World's First Zero-Carbon Oilfield Could Be Coming To Texas – Maybe? - Experts say carbon emissions need to be reduced and even removed from the atmosphere to avoid catastrophic climate change. Could carbon-neutral oil be a part of that? One company setting up shop in the West Texas oilfields says yes. The Canadian firm Carbon Engineering recently announced a partnership with oil giant Occidental Petroleum to create what they say could amount to a carbon-neutral oilfield. The plan is to build a facility in the Permian Basin to filter carbon dioxide out of the atmosphere. The oil company will then pump that CO2 back into the earth to force more oil out of the ground, in a process called enhanced oil recovery. Carbon Engineering CEO Steve Oldham stands in front of the company's Squamish, British Columbia, plant. Simply put: It would replace the oil in the ground with atmospheric CO2. If the process can be accomplished without extra emissions, the companies say, the oil that’s produced can be considered carbon-neutral. KUT spoke with Carbon Engineering CEO Steve Oldham to learn more. (interview transcript)

Agency: Safeguards Failed in Fire That Killed 5 at Gas Well (AP) — The failure of safety devices designed to prevent blowouts contributed to an explosion and fire that killed five workers last year at a southeastern Oklahoma natural gas well, according to a federal agency's report Wednesday that also lists inadequate training and a deactivated alarm system as factors. The report by the U.S. Chemical Safety and Hazard Investigation Board says the safeguards, designed to prevent the uncontrolled release of gas and other fluids from the well, were ineffective before the Jan. 22, 2018, explosion and fire in Pittsburg County near Quinton, which is about 125 miles (200 kilometers) east of Oklahoma City. Among other things, the 158-page report found certain operations at the Houston-based Patterson-UTI Energy Inc. drilling site were conducted "without needed planning, equipment, skills, or procedures," nullifying the primary barrier designed to prevent a blowout. In a statement, Patterson said it does not agree with all of the agency's findings but is evaluating what policies, procedures and training it could implement to address the issues raised in the report. "We remain committed to preventing an accident like this from ever happening again," the statement says. The explosion was the deadliest drilling accident since the Deepwater Horizon rig exploded in the Gulf of Mexico in 2010, killing 11 people. The report represents the first time the board has investigated a deadly accident at an onshore drilling site, according to its interim executive, Kristen Kulinowski,

 Court Sides With Trump on Keystone XL Permit, but Don’t Expect Fast Progress - A federal appeals court on Thursday threw out a lower court decision to halt construction of the Keystone XL pipeline. But several major obstacles remain to the controversial project's progress, ensuring that the much-delayed Keystone XL will likely not be built soon.The Ninth Circuit Court of Appeals decision hands a victory, at least for now, to the Trump administration and tar sands oil interests that have sought to jump-start construction of the northern leg of the pipeline from Alberta to Nebraska. President Barack Obama had decided in 2015 that Keystone XL should not be built, saying it wouldn't serve the U.S. national interest. But in one of his first acts in the White House, President Donald Trump signed an executive order reversing that decision and directing the State Department to issue a construction permit. The issue has been litigated ever since. Last November, a federal district court judge in Montana stopped construction of the pipeline, ruling that the Trump administration had failed to fully take into account the pipeline's impact on the environment, including the climate. "The Trump administration "simply discarded prior factual findings related to climate change to support its course reversal," wrote Judge Brian Morris of the United States District Court for Montana. In response, Trump scrapped the pipeline's State Department approval in March and issued in its place a new presidential permit for Keystone XL, arguing that such a permit, originating in the White House, does not need to abide by federal environmental reviews. Keystone XL's owner, TC Energy, and the administration then appealed the Montana court's decision to the Ninth Circuit Court, asking the panel of judges to throw out the lower court's ruling since the State Department permit had been revoked. The Ninth Circuit ruled in favor of the administration and the company.

 Wyoming BLM: Study drilling project climate impacts — The Bureau of Land Management’s Wyoming Office has directed federal regulators to do additional analysis of the climate impacts of a planned 156-well drilling project in northern Converse County.The Casper Star-Tribune reports that the decision Wednesday states that the BLM Casper Field Office must complete a supplementary analysis of additional greenhouse gas emissions that would result from the development of oil and gas wells on public lands leased by Houston-based EOG Resources. A representative from the Center for Biological Diversity says the decision appears to represent a “growing acknowledgment” within the BLM that environmental laws require public land managers to consider the climate consequences of public lands fossil fuel development. A spokesman for EOG Resources says the company will continue to work with the BLM on the project.

 Plans advance for new oil pipeline to serve Bakken, Rockies regions -- Two companies announced Monday they plan to move forward with a new oil pipeline to transport Bakken crude to Oklahoma, but the route of the project is not yet clear. Phillips 66 and Bridger Pipeline announced they have formed a joint venture to build the Liberty Pipeline to transport growing volumes of crude oil from production areas in the Bakken and the Rockies. If approved, it would be the first major crude oil transmission pipeline built in North Dakota since Dakota Access, which began operating in June 2017 to transport oil to Illinois. The North Dakota portion of the Liberty Pipeline is proposed for the southwest corner of the state, said Bill Salvin, a spokesman for Bridger. North Dakota crude would flow to Guernsey, Wyo., and then on to Cushing, Okla., though the exact route is still being determined, he said. The project, which will need approval from regulators, is expected to transport up to 200,000 barrels of oil per day from the Williston Basin to Cushing, said Justin Kringstad, director of the North Dakota Pipeline Authority. The $1.6 billion pipeline could be in service as early as the first quarter of 2021, the companies announced. Previously, they said the project would have a total capacity of up to 350,000 barrels per day. Phillips 66 will lead the project construction and operate the pipeline, according to a news release.

$1.6B pipeline proposed to move North Dakota crude oil (AP) — Two companies are proposing a $1.6 billion pipeline to move North Dakota crude oil, making it the biggest such project to move oil out of the state since the Dakota Access pipeline that sparked violent clashes between protesters and law enforcement in 2016 and 2017. Houston-based Phillips 66 and Casper, Wyoming-based Bridger Pipeline announced the joint venture called Liberty Pipeline on Monday. It’s designed to move 350,000 barrels of oil daily — the bulk of which from western North Dakota’s oil patch — to the nation’s biggest storage terminal in Cushing, Oklahoma. From there, the companies said shippers can access multiple Gulf Coast destinations. The exact route of the 24-inch (60-centimeter) pipeline has not been disclosed, though the companies said in a statement the project “will utilize existing pipeline and utility corridors and advanced construction techniques to limit environmental and community impact.” The pipeline would start in Guernsey, Wyoming, and end in Cushing, Oklahoma, Bridger Pipeline spokesman Bill Salvin said. A separate 55-mile (88.5 kilometer), 16-inch (40-centimeter) North Dakota line would run through the west-central part of the state, travel south though Montana and connect with the Liberty Pipeline at Guernsey, Salvin said. Forty-four miles of the North Dakota portion would parallel an existing pipeline corridor, he said. As described, the pipeline would be west of the Dakota Access pipeline and far from the most productive portion of North Dakota’s oil patch in the northwestern part of the state. “Pipelines are a matter of great concern to folks,” Salvin said. “We are acutely aware of pipeline routing in North Dakota and we are doing everything in our power to use existing pipeline rights of way and corridors.” “Importantly, the new line will not cross any tribal lands,” he said.

 Delegation urges feds to settle state's DAPL cost claim  - North Dakota’s congressional delegation is urging two Trump administration officials to address the state’s year-old demand for $38 million to cover the cost of policing large-scale and at times violent protests against the Dakota Access oil pipeline. The request last Thursday by U.S. Sens. John Hoeven and Kevin Cramer and U.S. Rep. Kelly Armstrong came the same day that a federal appeals court ordered dismissal of a lawsuit by environmentalists and American Indians who seek to stop the Keystone XL oil pipeline. Opponents have vowed similar protests against that project. President Donald Trump has been a staunch advocate of both pipelines and has actively pushed for their completion. “This administration has reset the precedent on permitting this type of project,” the delegation said in a letter to U.S. Attorney General William Barr and Acting Defense Secretary Patrick Shanahan. “But we urge you to also reset the federal government’s precedent in these matters to maintain law and order on federal land and recognize the overwhelming responsibility the state and local authorities in North Dakota employed to maintain public safety.” The all-Republican delegation asks Barr and Shanahan to work with North Dakota “to achieve an equitable settlement” of the state’s claim. North Dakota contends the Army Corps of Engineers allowed protesters to illegally camp without a federal permit. The Corps has said protesters weren't evicted due to free speech reasons. Justice Department spokesman Wyn Hornbuckle declined comment Monday, the day the delegation announced the letter. The Defense Department didn’t immediately comment.

US Leads the World in Oil Reserves- The U.S. currently holds the title of global leader in recoverable oil resources, according to the latest annual report of world recoverable oil resources by energy research firm Rystad Energy. With 293 billion barrels of recoverable oil resources, the U.S. beats out both Saudi Arabia and Russia by 20 billion barrels and 100 billion barrels, respectively. Rystad’s estimates of U.S. recoverable oil is also five times more than reported proven reserves published in the BP Statistical Review of World Energy 2019. According to Rystad analysis, the Permian’s tight oil plays hold 100 billion barrels of recoverable oil resources and the resources there remain largely flat from the previous year. Improvements in well configuration plays a part in this. “We also note that production has not been fully replaced by increased reserves in some U.S. shale plays, including Eagle Ford in Texas and Utica in Ohio,” Rystad Energy CEO Jarand Rystad said in a release sent to Rigzone. “Oil companies have been focusing on core development and cash flows rather than exploration and de-risking non-core assets.” Using the standard of the Society of Petroleum Engineers (SPE) when estimating reserves and resources in fields in order to consistently compare OPEC and non-OPEC countries as well as conventional and unconventional fields, Rystad estimates the world’s proven oil reserves to total 386 billion barrels. “Official reserves reporting from Saudi Arabia indicates an upwards revision of 10 percent, but we don’t see increases in activity that would justify such a large upgrade, so this revision could be due to changes in reporting methodology,” said Per Magnus Nysveen, Rystad’s head of analysis. “The 20 percent revision to official U.S. reserves, on the other hand, is due to higher reserves reported by the operators and is based on more stringent rules from the U.S. Security Exchange Commission.”

US 2018 Oil, Gas Output Surges Outpaced All Countries -- U.S. natural gas and crude oil production increased last year at the fastest pace ever for a single country. U.S. gas output soared 86 billion cubic meters in 2018, the largest annual increase by any country ever, according to statistics published Tuesday by BP Plc. That’s roughly equivalent to consumption in the U.K., one of the oldest users of the fuel, and almost 40% more than the previous record set by Russia in 2010. And in a twin first, U.S. oil output jumped 2.2 million barrels a day -- also the largest amount ever by a single country in a year. “What you saw last year was really quite amazing -- this amazing unique double first for the U.S.,” said Spencer Dale, BP’s global chief economist. “This is pretty astonishing growth and I don’t think this is some sort of unique aberration. This is a function of the U.S. shale revolution in both oil and natural gas -- it’s alive and well and it’s powering strongly.” The jump in the production of the polluting fossil fuels happened three decades after nations including the U.S. set up a United Nations framework to try save the climate. The figures will stoke angst in those continuing negotiations, where countries are seeking to collaborate and tighten greenhouse-gas targets ahead of the Paris climate deal to limit the risk of runaway heatwaves, drought and flooding after next year. As part of the talks, they’re discussing historical responsibility for the climate crisis.

Where Is All the Missing US Oil? -- Oil traders and analysts closely watching weekly U.S. inventory figures have been scratching their heads in the last few weeks wondering one thing: Where are the missing barrels? U.S. Energy Information Administration data Wednesday showed a crude supply adjustment factor -- the difference between reported stockpiles and those implied by production, refinery demand, imports and exports -- of more than 800,000 barrels a day. While that doesn’t seem like that much, it’s added up to more than 24 million barrels over the past four weeks, and potentially hundreds of millions of dollars in trading opportunities. The figure tends to swing back and forth, depending on irregularities in various surveys the EIA pulls from for its reports. It’s the only time since records going back nearly two decades that reported stockpiles have been so much higher than the implied figure for so long, which has surprised traders and investors. Popular guesses for the discrepancy include missing production from the prolific Permian Basin or miscounting of imports or exports. The source could be important, because higher-than-expected production would continue weighing on U.S. oil prices just as investors expect the start of summer driving demand season to spark a rebound. While crude production may be higher, it’s unlikely the full picture, said Robert Merriam, director of the office of petroleum and biofuels statistics at the EIA. He cautioned that while the adjustment factor is high, it only accounts for about 4% of U.S. crude demand.  Besides understating oil production, one of the culprits may be plant condensate associated with natural gas output, Merriam said. That plant condensate -- a natural gas liquid recovered and separated in processing plants -- can get blended into the crude oil stream. While that supply is added into inventories, it’s not getting counted as crude production because it comes from the natural gas stream. As a result, crude stockpiles could rise without a commensurate increase in output.In a research note on Wednesday, Macquarie Group Ltd. analysts suggested potential errors in net imports could be the culprit. The analysts added that May balances implied exceptionally strong production, which means U.S. oil output may be even higher than the 12.4 million barrel-a-day record in this week’s data -- a narrative that many bearish market participants believe. Rystad Energy AS said Thursday that its May data shows crude supply averaging 12.5 million.

A Gusher Of Red Ink For US Shale  - Oil prices are off more about 20 percent in the last two weeks on growing fears of a brewing economic recession. Commodities of all types have been hammered by the pessimism. “Fear of global economic growth slowing,” said Peter Kiernan, lead energy analyst at the Economist Intelligence Unit (EIU), according to Reuters, “afflicting the entire energy complex with worries that demand growth will be bearish this year.” Prices for coal, natural gas and LNG, and crude oil have plunged. “The continued escalation in trade tensions and broad-based fall in manufacturing...suggest that the downside risks to growth are becoming more prominent,” Morgan Stanley analysts said in a note. Yet another downturn could not come at a worse time for U.S. shale drillers, who have struggled to turn a profit. Time and again, shale executives have promised that profitability is right around the corner. Years of budget-busting drilling has succeeded in bringing a tidal wave of oil online, but a corresponding wave of profits has never materialized.Heading into 2019, the industry promised to stake out a renewed focus on capital discipline and shareholder returns. But that vow is now in danger of becoming yet another in a long line of unmet goals.“Another quarter, another gusher of red ink,” the Institute for Energy Economics and Financial Analysis, along with the Sightline Institute, wrote in a joint report on the first quarter earnings of the shale industry.The report studied 29 North American shale companies and found a combined $2.5 billion in negative free cash flow in the first quarter. That was a deterioration from the $2.1 billion in negative cash flow from the fourth quarter of 2018. “This dismal cash flow performance came despite a 16 percent quarter-over-quarter decline in capital expenditures,” the report’s authors concluded. Rystad Energy put it somewhat differently, although came to the same general conclusion. “Nine in ten US shale oil companies are burning cash,” the Norwegian consultancy said late last month. Rystad studied 40 U.S. shale companies and found that only four had positive cash flow in the first quarter. In fact, the numbers were particularly bad in the first three months of this year, with the companies posting a combined $4.7 billion in negative cash flow. “That is the lowest [cash flow from operating activities] we have seen since the fourth quarter of 2017,” Rystad’s Alisa Lukash said in a statement.

Can Shale Survive Low Oil Prices- OilPrice.com - Lower oil prices could drag down U.S. shale drillers at a time when their finances are already looking shaky. But the impact on oil production growth is still murky. WTI is in the low-$50s per barrel, which means that the average shale driller is likely burning through cash. In the first quarter, most U.S. E&Ps were cash flow negative, a period of time when WTI averaged $54 per barrel, right about where oil is trading today.  The rig count continues to fall. In the week ending on June 7, the U.S. oil rig count plunged by 11, falling to 789. The rig count has declined by roughly 11 percent, or 100 rigs, from a recent peak reached last November. In the Permian basin, where much of the action is, the rig count fell by more than 9 percent over that timeframe, from 493 to 446.  Complicating matters further for Texas shale drillers is the increasing shift of the oil slate to lighter forms of crude. Oil coming out of the ground in West Texas was light to begin with, but as drillers begin to shift increasingly from the Midland to the Delaware basin, oil is becoming lighter and lighter. The refineries along the Gulf Coast are not equipped to handle oil that light. It is typically mixed in with other streams to create WTI, but rising volumes of ultra-light oil are forcing changes. Instead, the industry is beginning to separate out oil of different qualities, forming new grades, as Reuters reports. In addition to WTI, markets are opening up for West Texas Light (WTL) and even West Texas Condensate (WTC). These newer, lighter grades are trading for discounts, which means that some companies are selling their product for prices well below the prevailing WTI price.  But while drillers take an additional hit from discounts, the larger problem is an inability to turn a profit during virtually any period of the shale revolution. Despite years of cost-saving measures, improvements in drilling techniques and promises to lower break-even costs, the shale industry is by and large still not profitable. Investors are losing patience, and as the Wall Street Journal reports, access to capital is beginning to close off for many shale companies. “By our math, very few oil-and-gas companies, 15% or less, can really achieve capital discipline,” Todd Dittmann, head of energy at Angelo Gordon & Co., told the WSJ. “This leaves most public companies with hope strategies and little more, hoping insufficient capital spending won’t lead to near-term production declines.”

Energy Dominance Or Flatulence? Shale Drillers Bleed Cash - All of President Trump’s foreign policy can be summed up by two themes, making the world safe for Israel and controlling the price of energy. He calls the latter “Energy Dominance.” And to those who still believe Trump has a plan, these two things are the only ones consistently in evidence.   His reactions to things contrary to his plan, however, are purely limbic.These two themes converge completely with Iran. Trump wants Iran neutered to force Jared Kushner’s now-delayed again, “Deal of the Century” onto the Palestinians while also taking Iran’s oil off the market to support surging U.S. domestic production in the hopes of taking market share permanently.Everything Trump does is in support of these two themes while throwing some red meat at his base over China, Mexico and the border.It was never his intention to leave Syria back in December, really. Look how easy was it for John Bolton and the Joint Chiefs to convince him to stay because how else would we cut Iran’s exports to zero if we didn’t stop the land route through Iraq?This is why we’re still harboring ISIS cells in the desert crossing around Al-Tanf at the Jordan/Iraq/Syria border, to stop Iranian oil from coming into the country.This feeds right into hurting all of Syria’s allies to strengthen Israel’s position.To paraphrase the song from Aladdin, “It’s stupid, but hey, it’s home.”If the average Trump voter truly understood the lengths we are going to starve the Syrian army from having enough energy to finish wiping out the Al-Qaeda-linked groups in Idlib and Homs provinces they would burn their MAGA hats and stay home next November.But they don’t so Trump’s approval rating keeps climbing.On the other hand, people mostly understand exactly what the “Bay of Fat Pigs” operation in Venezuela was all about, protecting domestic oil production and getting control of Venezuela’s.The sad truth is that many Americans consider this comeuppance for being stupid enough to elect Nicolas Maduro President.But this is the guts of Trump’s “Energy Dominance” policy. Use tariffs, sanctions, threats and hybrid warfare to destroy the competition and therefore MAGA.It would be sad if it wasn’t so pathetic. And the irony is that the whole plan is predicated on sustainable and nigh-exponential growth of U.S. domestic production. There’s only one problem with that. It’s completely unsustainable. From Zerohedge via Nick Cunningham at Oilprice.com comes this beauty of an image:

 The US will maintain oil production despite falling prices, says deputy energy secretary - The U.S. will maintain its oil production — or even ramp it up higher — despite low energy prices and slowing economic growth, Deputy Energy Secretary Dan Brouillette said Wednesday. Shale producers in the U.S. will continue to produce a record 12 million barrels a day throughout next year, he said, citing projections from the Energy Information Administration. They may even go up to as high as 13 million barrels, he added. “U.S. production numbers are going to continue for quite some time,” Brouillette told CNBC. U.S. West Texas Intermediate (WTI) crude futures have fallen almost 20% since reaching their 2019 peaks in late April, as oil prices were dragged down by intensifying fears of an economic downturn that’s started to impact oil consumption. But Brouillette rejected fears that oil demand would be hit amid slowing growth. “Growth is slowing down slightly ... over the course of early 2019. But I suspect that as the economy begins to rev up, we’ll start to see that demand pick up as well. And it’s going to be good news for oil producers,” he said. On Wednesday, Brent crude futures were at $61.34 per barrel, and U.S. crude futures were at $52.40 per barrel — off this year’s highs of around $74 and $66 per barrel in April.Even though shale drillers in the U.S. have been said to face obstacles on growing output amid a wave of belt-tightening that’s cutting billions of dollars from budgets, and the number of operating oil rigs have declined this year, Brouillette said that production is not actually the biggest problem.“Our biggest challenge in the United States is not maintaining production, it’s actually getting the product to market. We are developing infrastructure ... at a rapid pace, but we need to do more. We need more pipeline capacity in order to have the oil and the gas reach these export markets,” he said.In fact, Brouillette said, there will be increased production, not falling output, in the U.S.

Trump Thinks US Oil Is His Strength When It's His Achilles' Heel - Headlines abound about the massive surge in US shale oil production. The energy independence-cheering punditocracy hail this as a great victory. This includes President Trump. And it would be if this surge in production was built on financially stable ground. But it isn’t. The fracking industry continues to bleed massive amounts of cash.   As I pointed out in an article earlier this week, when accounting for this inconvenient truth much of the U.S’s return to dominance in the energy space is a lot of hot air.  Heading into 2019, the industry promised to stake out a renewed focus on capital discipline and shareholder returns. But that vow is now in danger of becoming yet another in a long line of unmet goals. “Another quarter, another gusher of red ink,” the Institute for Energy Economics and Financial Analysis, along with the Sightline Institute, wrote in a joint report on the first quarter earnings of the shale industry. The report studied 29 North American shale companies and found a combined $2.5 billion in negative free cash flow in the first quarter. That was a deterioration from the $2.1 billion in negative cash flow from the fourth quarter of 2018. “This dismal cash flow performance came despite a 16 percent quarter-over-quarter decline in capital expenditures,” the report’s authors concluded. This lack of profitability is maintained solely through financial engineering and a continued bull market in structured credit in the US due to the needs of pension funds to make a 7.5% yield to maintain their defined benefit payouts. They aren’t the only ones fueling this fracking boom but it is a major driver of both US equities and the commercial paper market. . So, why is this Trump’s foreign policy Achilles’ heel? Because with the global economy slowing down, US domestic production is already in massive oversupply. There is a glut of oil and gas so profound that it ensures the bottom lines of these companies will not improve, leaving them at the mercy of these creditors.  There are two problems with this. First, other countries with lower costs of production can keep the market in relative equilibrium, living on small profits, but profits nonetheless. Second, and more importantly, US shale oil has an upper limit on demand since it’s too light for most refineries and requires blending with heavier feedstock. This is why, for example, US imports of Russian oil are rising rapidly to feed Gulf coast refineries starved of Venezuelan oil thanks to Trump trying to take it off the market.

Will Occidental's $38B Gamble Be a Shale Win? -  Oxy is aiming for billions of dollars' worth of cost savings and productivity gains from the Anadarko deal, but many investors remain skeptical. Occidental Petroleum, ranked 167 in Fortune 500, recently snatched victory from Chevron with a winning bid of $38 billion for one of the largest U.S. Independent oil and gas companies; Anadarko ranked just 237, making this the largest American oil and gas merger in more than a decade and the 11th biggest ever, for an energy and power company, according to business data provider Refinitiv. Having outbid Chevron and perhaps before any asset sales take place, Occidental must reduce its debt and pay an 8 percent dividend on the $10 billion of preference shares it sold to Berkshire Hathaway. The Anadarko purchase doubles the size of Occidental and will saddle the company with debts of around $50bn, in return for a business that has been failing to cover its capital spending from its operating cash flows. Another oil price crash bringing oil below $40 a barrel could jeopardize Occidental’s financial position. In addition, there is growing public concern, backed up by recent studies by the Universities of Texas and Dallas, that the re-injection of waste water into the ground produced from fracking, could be triggering increased seismic activity in previously dormant areas. Unless the industry can reassure the public by finding a solution to prevent such “earthquakes,” public opinion could constrict further growth in fracking activity. Vicki Hollub has made it clear that Occidental’s real interest lies in Anadarko’s 10,000 drilling sites in the Permian Basin, which is currently one of the world’s most productive, producing 3.8 million barrels a day at the end of 2018, according to reasearch firm Rystad Energy. In addition, the Permian is one of the cheapest places for oil drilling in the world. Some Permian drillers can make money at $40 per barrel. Before the takeover, Occidental was already the largest owner of drilling rights in the Permian and has developed an in-depth knowledge of the Permian plays, especially the Delaware Basin. On average, Occidental’s shale wells in the region have produced 74 percent more oil in their first six months than Anadarko’s. Also Occidental expects that, with economies of scale and its scientific and logistical capabilities, to boost recovery rates of 6 percent today to at least 14 percent by employing the “huff-and-puff” method: pumping carbon dioxide into a well, waiting for a while, and then allowing the oil to start flowing out mixed with the gas. 

2 Key U.S. Pipelines for Canadian Oil Run Into Trouble in the Midwest -- The fate of two major oil pipelines for carrying crude oil from Canada's tar sands region has been called into question over environmental concerns as judges in Minnesota overturned a key approval for a proposed pipeline and Michigan's attorney general threatened to shut down an aging pipeline under the Great Lakes. The actions are a further setback for Enbridge, the company behind both pipelines, and for Canadian tar sands oil producers that have struggled in recent years as attempts to build more pipeline capacity failed.New pipelines for tar sands crude oil have faced fierce opposition from environmental and indigenous rights advocates who fear both the immediate effects of an oil spill and as the climate impact from tar sands oil, a particularly carbon-intensive fuel. The Minnesota Court of Appeals on Monday reversed a decision by state regulators who, last June, approved an environmental impact assessment for a larger replacement of the existing Line 3. The project would carry tar sands crude oil across northern Minnesota on its way from Alberta to U.S. refineries.The judges ruled in favor of environmental and Native American groups who argued that the environmental impact statement of the proposed replacement pipeline did not address the risk of an oil spill into the Lake Superior watershed.  The ruling was the latest setback for a series of five pipeline projects designed to bring additional tar sands crude to market that have either been canceled or delayed. The other projects include Energy East andNorthern Gateway, both of which were canceled, and Trans Mountain expansion and Keystone XL pipelines, both of which are on hold.  "What you are looking at is an industry that has put forward these five proposals and so far none of them have been completed," Collin Rees of Oil Change International said. "Line 3 I think they actually thought was the one that was almost certainly going to go through, but there has been this incredible resistance. The political terrain has changed, and it's looking much less certain."

 Produced water spill prompts AER to order energy company to suspend activity at affected well = The Alberta Energy Regulator says it has ordered Calgary-based Obsidian Energy to suspend activity at a well “and associated infrastructure” where 400,000 litres of produced water spilled late last month. Story continues below Advertisement“The company has notified Yellowhead County and one area landowner of the release,” the AER said in a statement emailed to Global News on Monday. “This release occurred at an water injection well, not a hydraulic fracturing site, due to a failed piping component near the well.” According to Obsidian Energy, the spill was discovered on Wednesday afternoon. The AER said Monday it occurred about 40 kilometres northwest of Drayton Valley. While a nearby wetland was impacted, the AER said no impacts to wildlife were reported as a result of the produced water spill. “Produced water is a byproduct of oil and gas development,” the energy regulator said. “It refers to water that is extracted with oil from reservoir formations. The impact of produced water is extremely variable depending on the concentration of oil and whether the substance is ‘sweet’ or ‘sour.'” It also depends on the regional conditions of the release, detection and containment actions taken. “Produced water contains chloride, which can adversely impact the safety of wildlife and the environment. In the case of this release, the produced water was sweet — meaning it is salt water that does not contain H2S (hydrogen sulfide).”

Oil spill near Blackfalds being cleaned up --There was an oil spill just outside of Blackfalds earlier this week.Vesta Energy Ltd. experienced a pipeline release of oil during construction activities on a well site about six kilometres out of town around 4 p.m. on Wednesday.“The pipeline was immediately depressurized and isolated. There were no injuries,” a company release said.The size of the spill is estimated at 10 cubic metres and is being cleaned up. The release states there is no impact to wildlife and watercourses. “Vesta is working with the Alberta Energy Regulator to determine the cause. Nearby landowners have been notified.”

New Brunswick's Indigenous chiefs issue warning against Tory OK of gas fracking -- A decision by New Brunswick's Progressive Conservative government to allow shale gas development in one region is drawing sharp criticism from Indigenous leaders who say they weren't properly consulted. Premier Blaine Higgs confirmed on Tuesday that his government has quietly passed regulatory changes to permit the method of extracting hydrocarbons to resume in the Sussex area. The process known as fracking involves pumping water and chemicals deep underground at high pressure to fracture layers of shale and release pockets of gas. Higgs's move fulfils a commitment his minority government made in its throne speech earlier this year and is in line with his party's past support of the process. However, the organization that represents Mi'kmaq chiefs -- Mi'gmawe'l Tplu'taqnn Inc., or MTI -- denounced the step as secretive and a step backwards in the province's relationship with Indigenous populations. A 2016 final report of a commission on the shale gas issue had urged the province to rebuild its relationship with Indigenous peoples, and to maintain the moratorium introduced in 2014 by the Liberals. The decision by former Tory Premier David Alward to embrace the shale gas industry led to a series of public protests, culminating in a violent demonstration in the fall of 2013 in Rexton. A total of 40 people were arrested and six police vehicles were burned. Many of those arrested were Mi'kmaq residents involved in the protests.

Shell to invest up to $2.4 billion in Mexican deepwater oil projects – (Reuters) - Mexico’s oil regulator on Thursday approved exploration plans for four deepwater areas operated by Royal Dutch Shell , after it gave the green light to five others earlier this week, committing the oil major to invest at least $791 million. The plans stipulate that the Anglo-Dutch company could invest up to $1.06 billion in the four blocks, mostly dedicated to drilling at least six new wells. One of the blocks is in the Perdido Fold Basin, which straddles the U.S.-Mexico maritime border in the Gulf of Mexico, while the other three are further south in the Salina Basin. On Tuesday, the regulator, known as the National Hydrocarbons Commission, or CNH, approved Shell exploration plans for five other deepwater areas in the same two basins which included investment commitments of at least $397 million and as much as $1.316 billion. Taken together, Shell could invest up to $2.4 billion in the nine deepwater areas over the next four years and will drill at least 13 wells in the projects. The blocks are not expected to begin producing oil and gas until 2026 at the earliest, said CNH Commissioner Sergio Pimentel. Shell won exploration and production rights to the nine deepwater blocks at an auction run by the CNH in early 2018.

Greenpeace Activists Stop BP Rig Bound for North Sea, Stalling Plan to Drill for 30 Million Barrels of Oil - Three Greenpeace campaigners halted a British Petroleum oil rig off the coast of Scotland on Sunday as it prepared to leave for the North Sea to drill oil wells. Carrying enough provisions to last several days aboard the rig, the climate action advocates pulled up to the 27,000-ton vessel in small boats as it attempted to leave Cromarty Firth, bound for the Vorlich oil field whereBP plans to access up to 30 million barrels of oil.The campaigners unfurled a banner reading "Climate Emergency" after climbing the rig. BREAKING: Two activists are blocking a @BP_plc oil rig from setting out to the North Sea where it intends to drill for 30 million barrels of oil. We're in a #ClimateEmergency - the age of oil is over. RT to show your support! #NoMoreOil — Greenpeace UK (@GreenpeaceUK) June 9, 2019   Despite recent studies from the world's top climate scientists warning that governments must transition torenewable energy sources and end their dependence on fossil fuels to stem the effects of the climate crisis, the UK's Oil and Gas Authority last week awarded 37 license areas to 30 companies."The approval threatens to result in scores of new projects at exactly the time we need to halt the growth of new oil and gas production," said Greenpeace.The new licenses suggest that the country is not following its recent declaration of a climate emergency with concrete action, as campaigners have demanded."The government may be bent on draining the North Sea of every last drop of oil but this clearly contradicts their climate commitments," said one of the activists who boarded the rig, who was identified as Jo."The perverse idea we must maximize our oil and gas reserves cannot continue," she added. "That means the government must seriously reform the Oil and Gas Authority and instead invest heavily in the crucial work of helping oil communities like those in Scotland move from fossil fuels to the industries that will power our low carbon future."

Trump team is adopting a pipeline plan to wean Europe off Russian fuel - President Donald Trump’s top national security aides believe the roadmap to Middle East peace has been traced on a physical map they have hanging in the White House marked by power plants, gas terminals and ambitious pipeline projects. According to three senior administration officials, that map – declassified and obtained by McClatchy – has motivated members of the National Security Council to prioritize the formation of a gas forum in the Eastern Mediterranean that would simultaneously boost and entangle the economies of several countries that have been at odds for decades. Fascination with regional energy resources has formed the basis of an organizing principle for policymaking among key members of Trump’s inner circle, who similarly view oil and gas needs as critical to their strategies toward Russia and the European Union, according to White House and Defense Department sources. It is a rare instance of continuity between the Trump and Obama administrations. The map was first created by State Department cartographers and energy diplomats working at the direction of former Vice President Joe Biden, according to its architect, Amos Hochstein, former special envoy and coordinator for international energy affairs. “It took us a long time to create,” Hochstein told McClatchy. “There’s complete continuity, and it is thanks to the vision and leadership of Vice President Biden.” The Trump administration is supporting two bipartisan congressional efforts that track with its approach: One bill that “promotes security and energy partnerships in the Eastern Mediterranean,” introduced on a bipartisan basis in both houses in May, and another threatening to sanction European firms supporting the construction of Nord Stream 2 pipelines into Germany, predominantly funded by Russia’s state-owned Gazprom. Secretary of Energy Rick Perry briefed President Donald Trump two weeks ago in the Oval Office on the Russian pipeline effort, which circumvents Ukraine by running through the maritime territory of Baltic states that are entirely reliant on Russian fuel. The administration has grown increasingly vocal in its opposition to the Nord Stream 2 project. “If Germany persists in building the Nord Stream 2 pipeline, as President Trump said, it could turn Germany’s economy into literally a captive of Russia,” Vice President Mike Pence said in April at a NATO anniversary event in Washington.

Trump considering sanctions over Russia's Nord Stream 2 natgas pipeline (Reuters) - President Donald Trump said on Wednesday he was considering sanctions over Russia’s Nord Stream 2 natural gas pipeline project — which the United States has told European companies to avoid — and warned Germany against being dependent on Russia for the fuel. “We’re protecting Germany from Russia and Russia is getting billions and billions of dollars from Germany,” Trump told reporters at an appearance with Polish President Andrzej Duda at the White House. Nord Stream 2, a 760-mile (1,225-km) pipeline project to ship gas from Russia under the Baltic Sea to Germany, would double the capacity of the existing Nord Stream pipeline and has divided the European Union. Eastern European, Nordic and Baltic Sea countries see the pipeline as increasing Moscow’s economic grip on Europe. But many politicians and energy companies in Germany support Nord Stream 2 because the country, Europe’s biggest economy, needs steady gas supplies as it seeks to wean itself off of coal and nuclear power. Nord Stream 2 is led by Russian state gas producer Gazprom, with 50% of the funding provided by Germany’s Uniper and BASF’s Wintershall unit, Anglo-Dutch firm Shell, Austria’s and France’s Engie.

Trump says he's considering slapping sanctions on gas pipeline from Russia to Germany - President Donald Trump on Wednesday said he is still considering using sanctions to block a controversial pipeline that would increase natural gas flows from Russia to Germany. “Well, we’re looking at it. People have a right to do what they want to do. I think it’s something that I’ve been looking at and I’ve been thinking about and I’m the one that brought up the pipeline problem,” Trump told reporters during an appearance with Polish President Andrzej Duda. Trump has claimed since last year that Germany is captive to Russian energy exports. Like past U.S. presidents, he opposes the Nord Stream 2 pipeline, which would run beneath the Baltic Sea alongside an existing line linking eastern Russia and northern Germany. The U.S. and many European nations fear the pipeline would help Russia bypass infrastructure in Ukraine, allowing Moscow to use energy supplies as a weapon against its neighbors without disrupting flows to Western Europe. Russia and Germany assert Nord Stream 2 is a purely economic project. Russian energy giant Gazprom is building the line, with financing from European companies including Royal Dutch Shell and Wintershall. Sen. Ted Cruz, R-Texas, and Sen. Jeanne Shaheen, D-N.H., last month filed a bill that would impose sanctions on vessels used to build Nord Stream 2. Energy Secretary Rick Perry and other administration officials have also raised the prospect deploying sanctions to block construction. The Trump administration is seeking to displace Russian pipeline supplies to Europe with U.S. exports of liquefied natural gas, a form of the fuel chilled to liquid form for transport by tanker ship. Poland, one of the fiercest critics of Nord Stream 2, has entered agreements to buy U.S. LNG in a bid to reduce its dependence on Russian gas.

 Ecologists inspect oil spill in Yakutia - Ecologists launched an inspection of the oil spill that took place in Yakutia's Mirninsky District, while the local authorities declared a state of emergency. The spill was caused by a leak in the Irelyakhskoye pipeline owned by Vostochnaya Sibir, said Yakutia's Minister of the Environment, Natural Resources and Forestry Sakhamin Afanasyev in an interview with RIA Novosti. The ecologists report that the oil spill covers an area about eight kilometers from the city of Mirny. Since the pipeline is located underground, experts failed to identify the leak in the course of above-ground inspection. "We are now carrying out an administrative investigation, taking samples, calculating the spilled oil volume," the minister said. "Following the investigation, we will prosecute the subsoil user responsible for the spill as well as clean the spill up and reclaim the land at the expense of the responsible party. The Mirninsk District administration declared a state of emergency."   Ecologists launched an inspection of the oil spill that took place in Yakutias Mirninsky District, while the local authorities declared a state of emergency . . .

Colombia tribunal begins hearing evidence on use of fracking - (Reuters) - Colombia’s top administrative court on Friday began hearings that could be long and contentious about proposals to drill for oil using the technique known as fracking, hailed for sharply boosting supplies but criticized for causing environmental damage. The public hearings in the Council of State, which is tasked with ruling on administrative matters, stem from a decision made late last year to temporarily suspend regulations for development of non-conventional oil deposits. Fracking is not yet in use in Colombia. While there is no law against the practice, the government says regulations are needed before it can be used. Its possible use has sparked vitriolic debate among lawmakers, activists, officials and regular citizens about whether it could cause pollution or other environmental harms. “We consider this high-impact litigation,” Magistrate Ramiro Pazos told Reuters after the largely procedural hearing. “It’s an issue of extreme importance for the country.” Six magistrates could rule next month on whether the suspension should continue, Pazos said, while evidence gathering on whether fracking should go ahead will take until the end of the year. The next hearing, which will include witness testimony, is scheduled for July. The tribunal’s decision to suspend the regulations came after environmental lawyer Esteban Lagos, with support from the Universidad del Norte college, anti-fracking activists and a leftist lawmaker, filed a suit against the energy ministry to halt potential use of the technique.

Ecopetrol closes section of pipeline after oil found in Colombia river  (Reuters) - Colombia’s state-run oil company Ecopetrol said late on Tuesday it closed the valves on a section of its Cano Limon pipeline in central Boyaca province after crude oil was detected in a local river.The 485-mile (780-km) pipeline was not pumping when the oil was detected, the company said in a statement, but people in the area around the Cobaria river should not drink water. The causes of the incident are unclear, Ecopetrol said, and it is sending a technical team to investigate. It added the area has recently been affected by heavy rains and rising river levels. Pipelines in the Andean country are regularly bombed in attacks generally attributed to the National Liberation Army (ELN) rebel group. There have been more than two dozen attacks on Colombian pipelines so far in 2019. Cano Limon was hit more than 80 times in 2018, which kept it offline for most of the year.

Shell FLNG Facility Ships Maiden Cargo -  The first shipment of liquefied natural gas (LNG) from the Shell-operated Prelude Floating LNG (FLNG) facility offshore Australia has sailed and is destined for customers in Asia, Royal Dutch Shell plc reported Tuesday. Shell operates Prelude FLNG – located 295 miles (475 kilometers) northeast of Broome, Western Australia – on behalf of joint venture partners INPEX Corp., Korea Gas Corp. (KOGAS) and CPC Corp. unit Overseas Petroleum and Investment Corp. (OPIC). The Spanish-flagged LNG carrier Valencia Knutsen is transporting the maiden cargo. According to the website MarineTraffic.com, the ship departed Prelude shortly after 11 p.m. local time Monday.  According to Shell, Prelude FLNG can produce 3.6 million tonnes per annum (mtpa) of LNG, 1.3 mtpa of condensate and 0.4 mtpa of liquefied petroleum gas (LPG). An Oct. 2017 fact sheet published by the company, which owns a 67.5-percent interest in the facility, states that Prelude LNG’s dimensions of 1,601 feet (488 meters) long by 243 feet (74 meters wide make it the largest offshore floating facility ever built. INPEX, KOGAS and OPIC own 17.5-percent, 10-percent and five-percent stakes, respectively.

Mysterious 150m oil spill in Christchurch creek still not cleared - The cause of a large oil spill in the middle of a Christchurch creek remains a mystery. Environment Canterbury (ECan) Banks Peninsula Gillian Jenkins said an apparent oil spill of about 150 metres in length was discovered on Lodestar Avenue in Wigram on Wednesday. On Wednesday evening, ECan​ staff along with CityCare​, attempted the initial clean-up, but the decision was made to reassess the site in the morning. About 150 meters of vegetation was covered in oil-like sludge.On Thursday, they discovered about 150m of vegetation was covered in oil-like sludge. The spill is contained within a Christchurch City Council reserve. ECan and Christchurch City Council (CCC) will work to remove the rest of the oil on Monday. Fire and Emergency New Zealand assisted ECan on Friday, but were unable to clear all the affected area. The cause is unknown and it remains under investigation. There were no threats to drinking water supply. "To ensure the safety of people and domestic pets we would recommend avoiding the stream until it has been cleaned up. Some plants may be affected by the oily substance and are likely to need removal." Under the Resource Management Act, if the source of the contamination could be found, the parties responsible could face an infringement fine of $750.

 Makueni government, KPC clash over Kiboko oil spill  - The Makueni county leadership and residents of Kiboko have accused Kenya Pipeline of colluding with government administrators to cover up the Kiboko oil spill. Oil spillage hit Kiboko natural springs along the newly constructed Sh48 billion Mombasa-Nairobi pipeline on March 30. The Water Resources Authority has said Kiboko River water is unfit for human and livestock consumption. KPC, however, disputed the results arguing that it had conducted independent chemical and toxicological analysis of the water which showed no contamination. When the Senate Energy committee conducted public hearings on the spill on Monday, it was clear mistrust had set in among the county and national governments, the agencies handling the matter and residents. Kiboko Water Resource Users Association chair Wilson Munguti unleashed the first salvo accusing Kenya Pipeline of disregarding joint water testing by Nema, KPC and WRA. "In the last meeting we held with KPC, we all agreed that​ we will have to choose together the laboratories to​ do testing of the water. Nema was chairing the meeting together with WRA but in between KPC started playing games. They held another meeting and chose three laboratories without involving the county government and the residents through the Water Resource Users Association", Munguti said.

Platts: OPEC Oil Production Slumps With Saudis Cutting Deeper - OPEC’s oil production dropped by 170,000 bpd from April to 30.09 million bpd in May—the lowest level since February 2015, as Saudi Arabia cut its oil output even deeper despite the end of the U.S. sanction waivers for Iranian oil customers, according to the monthly S&P Global Platts survey.  According to the survey that measures well-head crude oil production in each OPEC state, the cartel’s largest producer Saudi Arabia further slashed its production in May—by 120,000 bpd from April to 9.7 million bpd last month. This was the lowest Saudi oil production in four and a half years, according to Platts estimates.  At the end of May, a Reuters survey showed at that although OPEC’s oil production dropped to a 2015 low of 30.17 million bpd in May, Saudi Arabia boosted its production by 200,000 bpd. This rise in Saudi supply, however, was unable to offset an even larger production decline in Iran after the U.S. removed all sanction waivers at the beginning of May.After the U.S. choked off more Iranian supply with the end of the waivers, Saudi Arabia appears to have lifted its oil supply by 200,000 bpd to 10.05 million bpd, according to the monthly Reuters survey that tracks supply to the market from shipping data and sources at OPEC, oil companies, and consulting firms. Related: Why Is China Pouring Money Into The Arctic? Yet, even with the 200,000-bpd boost in May estimated by Reuters, Saudi Arabia was comfortably below its 10.311-million-bpd cap under the OPEC+ deal as it had been overachieving in its share of the cuts by 500,000 bpd in the previous months. The Platts survey showed that the Saudis appear to have cut deeper last month, despite the end of the U.S. waivers for Iranian buyers and the opportunity to increase the Saudi market share at the expense of Iran. OPEC will release its official crude oil production data for May in the Monthly Oil Market Report (MOMR) on Thursday, June 13, weeks before OPEC and allies are set to discuss the fate of their production cut pact currently expiring at the end of June.   OPEC is close to reaching an agreement to extend the deal beyond June, Saudi Energy Minister Khalid al-Falih said last week. 

Hedge funds sell oil as economic fears intensify- Kemp (Reuters) - Hedge fund managers are liquidating bullish oil positions at the fastest rate since the fourth quarter of 2018 amid increasing fears about the health of the global economy. Hedge funds and other money managers were net sellers of 104 million barrels of futures and options linked to the six most important petroleum contracts in the week to June 4. Fund managers have sold a total of 290 million barrels of petroleum in the last six weeks, after buying 609 million in the previous 15 weeks since Jan. 8. Portfolio managers still have an overall bullish position of 621 million barrels but that has been reduced sharply from a peak of 911 million on April 23 (https://tmsnrt.rs/2R64PYJ). Funds were net sellers last week of Brent (48 million barrels), NYMEX and ICE WTI (13 million barrels), U.S. gasoline (10 million), U.S. heating oil (5 million) and European gasoil (28 million). Hedge fund long positions now outnumber short positions by a ratio of 4:1, down from almost 9:1 on April 23, according to an analysis of exchange and regulatory records. Mounting fears about a possible recession in the United States and around the rest of the world have outweighed continued output restraint by Saudi Arabia and disruptions to exports from Russia, Iran and Venezuela. Since the end of April, oil prices have tumbled in tandem with equity prices and bond yields, before recovering slightly late last week amid growing hopes of a cut in interest rates by the U.S. Federal Reserve.

 Oil steady as Russia and Saudis discuss output deal, US-China trade war lingers - Oil prices steadied on Monday as major producers Saudi Arabia and Russia had yet to agree on extending an output-cutting deal and U.S.-China trade tensions continued to threaten demand for crude. Front-month Brent crude futures, the international benchmark for oil prices, were down 28 cents at $63.01 around 10:25 a.m. ET (1425 GMT). U.S. West Texas Intermediate crude futures were down 11 cents at at $53.88 per barrel. Saudi Energy Minister Khalid al-Falih said on Monday that Russia was the only oil exporter still undecided on the need to extend the output deal agreed by top producers. OPEC and some non-members, including Russia, have withheld supplies since the start of the year to prop up prices. Moscow is considering whether further cuts could allow the United States to take Russian market share and has yet to signal whether it will continue to curb its supply. Russian Energy Minister Alexander Novak said on Monday he could not rule out a drop in oil prices to $30 per barrel if the global deal was not extended, saying there were big risks of oversupply. A deal between the United States and Mexico to combat illegal migration from Central America late last week removed the threat of U.S. tariffs on goods imported from Mexico, buoying markets on Monday. But analysts said there were still concerns about the health of the global economy with no signs of an end in sight to the United States’ trade war with China.

US crude falls 1.4% in delayed settle amid uncertainty on supply cuts, US-China tariffs  -- Oil prices settled lower after a choppy trading session on Monday, as major producers Saudi Arabia and Russia had yet to agree on extending an output-cutting deal and U.S.-China trade tensions continued to threaten demand for crude. U.S. West Texas Intermediate crude futures settled 73 cents lower at at $53.26 per barrel, falling 1.4% on the day and settling later than usual on Monday. Front-month Brent crude futures, the international benchmark for oil prices, fell $1 per barrel, or 1.6%, to $62.29. Saudi Energy Minister Khalid al-Falih said on Monday that Russia was the only oil exporter still undecided on the need to extend the output deal agreed by top producers. OPEC and some non-members, including Russia, have withheld supplies since the start of the year to prop up prices. Moscow is considering whether further cuts could allow the United States to take Russian market share and has yet to signal whether it will continue to curb its supply. Yet Russian energy minister Alexander Novak said there is a still a risk that oil producers pump out too much crude and prices fall sharply. Novak said he could not rule out a drop in oil prices to $30 per barrel if the global deal was not extended. “Indeed, there are big risks of over-production. But on the whole ... we need to analyze deeper and look at how the events will develop in June in order to take a balanced decision at the joint OPEC+ meeting in July.” Many oil exporting countries have confirmed they are prepared to hold a policy meeting with OPEC in Vienna over July 2-4, instead of the scheduled date later this month, Novak said.

OPEC’s Struggle To Avoid $40 Oil -  On Monday, officials from Saudi Arabia and Russia reportedly discussed a possible scenario in which oil prices crashed below $40 per barrel, a recognition that the market has rapidly deteriorated. They view that outcome as a possibility if they can’t agree on an extension. “Today there are big risks of oversupply,” Russian Energy Minister Alexander Novak said in Moscow after meeting with Saudi oil minister Khalid al-Falih. “We’ve agreed that we need to run a deeper analysis and to see how events unfold in June.”  Russian President Vladimir Putin seemed to fuel speculation of a rift in Vienna in comments to Interfax news last week. “Of course Saudi Arabia wants oil prices to remain higher,” the Interfax news agency quoted Mr. Putin as saying. “But we have no such need due to the more diversified nature of the Russian economy.” The Saudis, of course, are desperate to prevent such a downward spiral. “Both at the bilateral and the OPEC+ level, we work in order to take preventive steps so as not to allow that scenario to happen,” al-Falih said in Moscow. He is undoubtedly trying to convince Novak of the wisdom of extending the production cuts. Perhaps to sweeten the pot, Saudi Arabia is considering investments in “multiple” projects in Russia, including the Arctic LNG 2 gas project, a stake in Russian petrochemical company Sibur Holding, along with other projects in partnership with Gazprom and Rosneft, Bloomberg reports.  The outlook for the oil market has darkened rather quickly. Less than a month ago, the IEA predicted a rather significant supply deficit in the second quarter even as it acknowledged some cracks in demand. But since then things have seemingly taken a turn for the worse, with oil posting its worst month since the financial crisis. A growing number of analysts are drawing up downbeat assessments for the oil market next year. “The balances for 2020 were already worrisome, and the downgrade in demand we are contemplating put them potentially in the ugly category,” Roger Diwan of IHS Markit Ltd. told Bloomberg. Notably, top analysts see a supply surplus next year even if output from Iran and Venezuela fails to rebound. For instance, S&P Global Platts, as of now, estimates a surplus of 400,000 bpd in 2020, while the EIA puts the glut at a more modest 100,000 bpd. IHS Markit sees a whopping 800,000-bpd surplus. The reason is that demand is cratering and U.S. shale is still expected to grow. “There is growing evidence of a sharper-than-expected slowdown in demand,” said Martijn Rats, oil analyst at Morgan Stanley, according to Bloomberg. The U.S.-China trade war has dramatically increased concerns about an economic slowdown. The global economy is decelerating, with manufacturing activity around the world slowing down, a sure sign of an economy hitting some bumps.

Oil edges up as OPEC supply cuts counter growth concerns - Oil prices edged higher on Tuesday as firmer equities and expectations that OPEC and its allies will keep withholding supply countered concern about slowing economies and demand. Russia said on Monday it might support an extension of OPEC-led supply cuts that have been in place since January, while equities rose after China eased financing rules to stem an economic downturn, giving oil a lift. Brent crude, the global benchmark, rose 10 cents to $62.39 a barrel around 9:50 a.m. ET (1350 GMT). U.S. West Texas Intermediate was up 30 cents, or or half a percent, at $53.56. “Prices are finding support from the prospect of OPEC oil production remaining restricted beyond mid-year,” said Carsten Fritsch, an analyst at Commerzbank. Still, the price of Brent is down about 17% from its 2019 peak above $75 a barrel in April, pressured by an economic downturn that has started to impact oil demand. “Even planned and unintentional supply restrictions of more than 4 million barrels per day have not been able to support prices as economic considerations took over in the last two weeks,” said Tamas Varga of oil broker PVM. “The immediate price outlook remains anything but clear.” OPEC and some allies including Russia, known collectively as OPEC+, have been withholding supplies since the start of the year to prop up prices. OPEC+ is due to meet in late June or early July to decide whether to extend the pact. Russia’s comments on Monday, and remarks last week from Saudi Arabia, bolstered expectations the deal will be renewed. While the talk of prolonged supply restraint is supporting prices, concern about slowing demand and economic growth has had a bigger impact on sentiment. “It is proving hard work papering over a suite of rather less supportive data being digested by the market,”

Saudi Arabia Successfully Calms Oil Markets –   Oil prices rebounded a bit on Tuesday on Saudi assurances that OPEC+ would not let the oil market slide any further. “Prices are finding support from the prospect of OPEC oil production remaining restricted beyond mid-year,” Commerzbank said in a note.   Saudi oil minister Khalid al-Falih traveled to Moscow to meet his counterpart, and the two apparently discussed the possibility that crude oil would crash below $40 per barrel without a deal in Vienna. While Russia has been cagey about committing to an extension, market analysts say the odds of a rollover in the cuts is likely.   The Trump administration is considering another round of sanctions that would target the European Union’s financial vehicle that was intended to keep trade alive with Iran. The U.S. sanctions would hit the financial entity Iran established to do business with the EU. Europe’s effort has largely been inadequate, but any U.S. move would damage its relationship with its European allies.    Iran has no intention of leaving OPEC despite the fact that the group has been turned “into a political forum,” treating Iran like an enemy, Iranian oil minister Bijan Zanganeh said. Iran has been outraged at the seeming cooperation between Saudi Arabia and the U.S. to block Iranian oil exports.  When the new regulations on marine fuels take effect at the start of next year, jet fuel could become more expensive. The heightened demand for low-sulfur fuels and distillates will cut into supplies needed by the aviation industry.  The red ink accumulated by U.S. shale companies is making it difficult for them to access capital markets as investors are growing tired of the poor returns. New bond and equity issuances have ground to a halt, forcing more asset sales. If low oil prices persist, bankruptcies could begin to pile up.

Oil Closes Near $53 - Oil was little changed Tuesday as the market awaited U.S. crude inventory figures and continued to speculate on the outcome of a potential OPEC+ meeting in coming weeks. Futures closed 1 cent higher at $53.27 a barrel in New York as traders looked ahead to the industry-funded American Petroleum Institute’s report scheduled for 4:30 p.m. in Washington, and U.S. government inventory numbers that are due on Wednesday. U.S. stockpiles probably shrank by 1 million barrels last week, according to a Bloomberg survey, which would be the biggest decline since May. The U.S. Energy Information Administration has reported U.S. crude inventory builds for three out of the last four weeks of data. That’s a bearish indicator, said Tariq Zahir, a commodity fund manager at New York-based Tyche Capital Advisors LLC, since drawdowns of stockpiles normally occur this time of year. Crude edged higher earlier in the session amid speculation that the Organization of Petroleum Exporting Countries and its allies will reach an agreement to extend supply curbs when it meets the coming weeks, said James Williams, president at WTRG Economics in London, Arkansas. “We probably have some upside here in oil, commodities and risky assets," Jeffrey Currie, global head of commodities research at Goldman Sachs Group, said in a Bloomberg Television interview. In a separate interview, Currie pointed to the U.S.-China trade dispute complicating OPEC+’s task of balancing supply and demand. Current demand growth “neither will support exiting the production agreement, nor is bad enough to reinforce more cuts,” he said. West Texas Intermediate futures trading stood at 1.04 million contracts Tuesday, according to preliminary numbers, the lowest since May 21. The contract fell 73 cents to close at $53.26 on Monday, snapping a two-day gain. Brent for August settlement dropped $1 to $62.29 a barrel on London’s ICE Futures Europe Exchange. It closed up 2.6% on Friday. The global benchmark crude was trading at an $8.6 premium to WTI for the same month

WTI Tumbles To $52 Handle After Another Surprise Crude Build - Oil prices were practically unchanged on the day, unable to hold the $54 handle early on in the day as eyes once again focus on US crude inventories.Additionally, BP said in its annual energy statistical review released Tuesday that the oil market’s "rollercoaster" would run for some time to come, with slowing economic expansion possibly impacting demand. API

  • Crude +4.85mm (-1.0mm exp)
  • Cushing +2.4mm (+1.97mm exp)
  • Gasoline +830k (+700k exp)
  • Distillates-3.5mm (+1.1mm exp)

After last week's surprise inventory builds across the board, expectations (or bullish hopes) were for a small draw but API reported another major crude build (+4.85mm vs -1.0 exp)WTI tumbled on the print, testing down to a $52 handle... Jeffrey Currie, global head of commodities research at Goldman Sachs pointed to the U.S.-China trade dispute complicating OPEC+’s task of balancing supply and demand. Current demand growth “neither will support exiting the production agreement, nor is bad enough to reinforce more cuts,” he said.

 Has the Oil Glut Disappeared? -It would seem from the IEA’s May Oil Market Report that geopolitical issues and industry disruptions are confusing the market. Ongoing production problems in Libya, alongside OPEC+ production cuts and U.S. sanctions on Iran, as well as lower than expected output in Mexico, have raised fears of a supply crunch. In addition, attacks by pirates or terrorists on shipping near the UAE port of Fujairah and the pumping stations of a Saudi oil pipeline have unsettled traders. On April 24th, Transneft halted shipments of contaminated Urals blend to the 1.4 mb/d (million barrels per day) Druzhba pipeline system and to tankers at the Ust-Lunga export terminal in the Baltic, which serve refineries in Germany, Poland, Ukraine, Hungary, Slovakia and the Czech Republic. As of April 25th, while the Czech Republic and Hungary have started to receive half their normal daily supply, the northern spur pipeline to Belarus, Poland and Germany was still closed, depriving European refineries of around 700,000 barrels of crude per day. In Germany, Total’s Leuna plant has shut down and in Rotterdam some refineries are running at lower rates. It could take months to clean up the contaminated oil and will prove costly. This incident has spurred a loss of confidence in Russia’s ability to supply market grade crude and the search is on for alternative suppliers. In sum, these supply interruptions have caused a shortage of heavy and medium sour crudes which could impact prices. To mitigate against these supply declines and disruptions, U.S. crude oil output is expected to climb by 1.7 bpd this year, not to mention the 650m barrels of crude in the strategic oil reserves, enough to meet U.S. demand for a month. Two thirds of this crude consists of sour, viscous grade, ideal for U.S. refineries. Moreover, the International Energy Agency requires its members to hold the equivalent of 90 days-worth of crude imports and China has some 300 million barrels in reserve. Also, as Bloomberg has pointed out, Russia is still pumping 11 mb/d despite the pipeline contamination. Surprisingly, in the light of the diminishing supply picture, Brent crude prices have fallen rather than risen. This could reflect confidence that OPEC+ could ramp up production to compensate for supply cuts from Iran and Venezuela and still meet current global demand.

 WTI Plunges To $50 Handle After Crude Stocks Hit 2-Year Highs - Oil prices extended their losses overnight after API surprised with notable builds in crude and gasoline (and at Cushing) - sending WTI to a $51 handle - and not helped as US-China tensions show no sign of abatement. “U.S. crude stocks have been rising almost uninterrupted since mid-March,” said Bjarne Schieldrop, Oslo-based chief commodities analyst at SEB AB.  DOE:

  • Crude +2.21mm (-1.0mm exp)
  • Cushing +2.096mm (+1.97mm exp)
  • Gasoline +764k (+700k exp)
  • Distillates -1.0mm (+1.1mm exp)

After last week's biggest US aggregate energy inventory build in history, hope was for some draws this week but once again that hope was dashed as EIA reported builds in Crude and Gasoline stocks (and at Cushing). U.S. crude stockpiles rose to the highest since July 2017 as oil production hovered near record highs. US Crude production reached a new record high the prior week, but the turn down in rig counts suggests that peak production is imminent. WTI traded around $52 the figure ahead of the EIA data (having bounced from intraday lows in the European session) but pushed back towards the lows after the crude build...

Oil falls on weaker oil demand growth, surprise rise in US crude stocks - Oil prices sank on Wednesday following government data that showed another rise in U.S. crude stockpiles and as the market continues to grapple with concerns about weakening fuel demand.U.S. commercial crude inventories rose by 2.2 million barrels in the week through June 7, according to the U.S. Energy Information Administration. Analysts in a Reuters poll had expected stockpiles to fall by 481,000 barrels.Brent crude, the international benchmark for oil prices, was down $1.14, or 1.8%, at $61.15 around 10:40 a.m. ET (1435 GMT). Brent hit a session low at $60.30 in early morning trading.U.S. West Texas Intermediate crude futures fell $1.18, or 2.2%, to $52.09 per barrel. WTI fell as low as $51.46 earlier in the session. Crude futures fell to a nearly five-month low last week after EIA figures showed crude stocks surged to the highest level since July 2017. Brent is now down nearly 20% from its 2019 high in April, while WTI is trading more than 22% lower over the same period. Oil prices ended Tuesday’s session roughly flat, supported by expectations that OPEC and its allies will continue to prop up prices by limiting production, but buffeted by concerns that the U.S.-China trade war will weigh on global economic growth and fuel demand. President Donald Trump on Tuesday said he is holding up negotiations until Beijing agrees to return to the terms of negotiations laid out earlier in trade talks.

Oil Prices Tumble More Than $2 - Price movements were decidedly downward Wednesday for West Texas Intermediate (WTI) and Brent crude oil futures.The July WTI contract price plunged $2.13 during midweek trading, settling at $51.14 per barrel. The benchmark traded within a range from $50.72 to $53.05.As Bloomberg reported earlier Wednesday, oil demand projections by major Wall Street players such as Morgan Stanley and JPMorgan Chase & Co. have been increasingly pessimistic. Moreover, concerns about ongoing trade tensions between the United States and China have dampened the outlook for oil consumption growth.Steve Blair, senior account executive with the RCG Division of Marex Spectron, observed that the WTI has been in a wide congestion pattern – bounded by a resistance and support levels from $55.10 to near $51.00, respectively – since May 31.“This market continues to be subject to the weekly petroleum reports, which has been one of the main attractions along with the concerns regarding global and, particularly, Chinese demand as the trade war continues between the U.S. and China,” said Blair. “We look to trade this congestion range until such time as it is broken out of, on a close basis. Should major support be broken on a close basis, there could be another $3 to $4 downside action, as seen on the daily and daily continuation charts.”Also falling sharply was Brent crude oil for August delivery, which lost $2.32 to end the day at $59.97. Blair pointed out the recent pattern for Brent has closely resembled that of WTI. He noted that August Brent’s congestion pattern has been slightly wider than that of July WTI, bounded by $64.26 on the upside and $59.66 on the downside. “The $58.49 level is also an important support level which is seen on the more macro weekly chart,” he said. “Like WTI, we want to trade this congestion pattern until such time as the market breaks either side, on a close basis. Also like WTI, a breakdown through support could see the market move much lower to the $56.53 level and potentially the $55.00 level, as seen on the daily and daily continuation charts.”

Oil prices could fall to $45 per barrel if US-China trade war escalates, says investor - Global oil prices could fall to as low as $45 per barrel if tensions between the U.S. and China worsen, an investment strategist told CNBC Thursday.Oil prices have been on a downward trend in recent weeks as investors become increasingly concerned about slowing demand. Appetite for oil is at risk of a further slump if the U.S. and China fail to the resolve trade differences, which will cause the global economy to weaken even more, said Rainer Michael Preiss, executive director at Taurus Wealth Advisors.“I think a lot of market focus is on the G-20 meeting,” Preiss told CNBC’s“Capital Connection” on Thursday.“If America and China couldn’t agree, and America raises tariffs again on Chinese imports, potentially this could slow down the economy meaningfully,” he added.U.S. President Donald Trump previously said he would make a decision about whether to impose further tariffs on China after meeting Chinese President Xi Jinping at the G-20 meeting in Japan later this month.Washington has so far slapped 25% tariffs on $250 billion of Chinese goods, with Trump threatening to apply the same elevated levy on the remaining imports from China worth around $300 billion. In retaliation, Beijing raised tariffs on billions of dollars worth of American products.Tensions between the U.S. and China have also extended beyond trade.Washington placed Huawei on a blacklist that restricts American companies from doing business with the Chinese tech giant, while China threatened tocut off its supply of rare earths to the U.S.Those developments have hurt sentiment among businesses and consumers, and are blamed for contributing to much of the economic slowdown globally. Now, any potential uplift in the global economy hinges on Trump and Xi reaching a deal, said Preiss.

Oil extends decline after slump on high inventories, demand outlook - Oil prices fell for a second day on Thursday, extending declines of as much as 4% in the previous session, on continued increases in U.S. crude stockpiles and concerns about lower demand growth. Brent crude futures were down 6 cents, or 0.1%, at $59.91 a barrel by 0336 GMT after earlier rising slightly. Prices fell 3.7% on Wednesday to settle at $59.97, the international benchmark’s lowest close since Jan. 28. U.S. West Texas Intermediate crude futures were down 8 cents, or 0.2%, at $51.06 a barrel. They fell 4% in the previous session to $51.14, the lowest close since Jan. 14. “It was a brutal move, sheer panic,” said Stephen Innes, managing partner at Vanguard Markets. The U.S. Energy Information Administration (EIA) on Wednesday reported crude stockpiles rose unexpectedly for a second week in a row, climbing 2.2 million barrels last week after analysts had forecast a decrease of 481,000 barrels. At 485.5 million barrels, U.S. commercial stocks were at their highest since July 2017 and about 8% above the five-year average for this time of year, it said. On Tuesday, the EIA cut its forecasts for 2019 world oil demand growth. The negative outlook is prompting hedge fund managers to exit oil positions at the fastest rate since the fourth quarter of 2018 due to increasing fears about the health of the global economy. The escalating trade war between the United States and China, the world’s two biggest oil consumers, is causing the most concern among oil analysts, with consultants and banks cutting their demand growth forecasts Goldman Sachs said on Wednesday an uncertain macroeconomic outlook and volatile oil production from Iran and others could cause the Organization of the Petroleum Exporting Countries (OPEC) to roll over supply cuts it has enacted with other producers. OPEC and non-member producers including Russia have limited their oil output by 1.2 million barrels per day this year to prop up prices.

Oil jumps more than 3% on reports of tanker incident in the Gulf of Oman off Iran coast -- Brent crude spiked 3% on Thursday morning on reports of tanker explosions in the Gulf of Oman. United Kingdom Maritime Trade Operations, a division of the U.K. Royal Navy, said it is currently investigating what it has called an “incident” in the Gulf near the Iranian coastline. It has urged “extreme caution” amid mounting tensions between Iran and the U.S.  Iranian state media has reported that two oil tankers were targeted in explosions, without providing evidence.A spokesman for the US Navy’s Fifth Fleet in Bahrain told the Associated Press that his command was “aware” of the incident and was seeking further details. U.S. Naval ships are in the area and are “rendering assistance” after forces in the region received two separate distress calls, the Fifth Fleet said. Brent crude is currently trading at $61.77 a barrel.

Oil jumps on reports of tanker incident in Gulf of Oman off Iran coast - Oil prices jumped as much as 4% on Thursday following attacks on tanker ships off the coast of Iran, renewing fears about conflict in the Middle East following a series of strikes last month. Brent crude, the international benchmark for oil prices, was up $2.02, or 3.4%, at $61.99 per barrel around 9 a.m. ET (1300 GMT). Brent earlier rose more than 4% to $62.64. U.S. West Texas Intermediate crude rose $1.66, or 3.3%, to $52.80, after topping out at $53.45 earlier in the session. Tankers the Front Altair and the Kokuka Courageous have sustained significant fire damage and its crews have been evacuated, according to multiple shipping agents and chartering sources. The Kokuka Courageous, a chemical tanker that loaded in Saudi Arabia and was en route to Singapore, caught fire at the same time as the Front Altair just before 6:00 a.m. local time. The cause of the fires remain unclear, but they’ve sparked fears of attack and come just weeks after alleged ship sabotage in the region.  A representative for BSM Ship Management, the Kokuka’s Singapore-based manager, said 21 crew had abandoned ship due to the “security incident”, which damaged the ship’s starboard hull. They were rapidly rescued from a lifeboat by a nearby vessel, according to the company’s spokesman. “The Kokuka Courageous remains in the area and is not in any danger of sinking. The cargo of methanol is intact,” the spokesman said in a statement. The ship is roughly 14 nautical miles off the coast of Iran and 70 nautical miles from the coast of the United Arab Emirates’ Fujairah, which was the site of alleged sabotage attacks on four tankers in mid-May that U.S. authorities have blamed on Iran. Iran denies any involvement. When four tankers sustained damage in the attacks of May 12 — two Saudi-owned, one from the UAE and one from Norway — crews did not have to abandon ship, indicating that today’s attack is much more serious.

 IEA sees oil demand growth falling to lowest level in years as global economy stalls - The International Energy Agency (IEA) slashed its estimate for global oil demand growth for the second consecutive month on Friday, citing intensifying trade concerns amid fears of a global recession. The energy agency’s closely-watched report comes as world oil markets have undertaken a dramatic shift in recent months, switching from supply-side risks like OPEC’s output cuts or U.S. sanctions against Iran and Venezuela to worries about deteriorating demand growth. Crude futures have turned a 45% price rally in the first four months of 2019 into a fall of more than 15% since the start of April. “The main focus I think we should be looking at here is that until very recently the geopolitical factors related to Iran and Venezuela and Libya… they were at the forefront of people’s minds,” Neil Atkinson, head of the oil industry and markets division at the IEA, told CNBC’s “Street Signs Europe” on Friday. “Now we are starting to see that confidence in demand is taking over and that is the main driving factor behind the current state of the oil market.” International benchmark Brent crude traded at around $61.25 Friday morning, down around 0.1%, while U.S. West Texas Intermediate (WTI) stood at $52.15, nearly 0.3% lower.

US crude rises on Iran tensions, but posts weekly loss as oil demand outlook weakens -- Oil rose on Friday after attacks on two oil tankers in the Gulf of Oman this week raised concerns about potential supply disruptions, but prices remained on track for a weekly loss on fears that trade disputes will dent global oil demand. U.S. West Texas Intermediate crude futures settled 23 cents higher at $52.74. Brent crude futures rose 70 cents, or 1.1%, at $62.01 a barrel. Futures briefly extended gains on Friday as Iranian military fast-boats in the Gulf of Oman were preventing two privately owned tug boats from towing away one of the oil tankers. The attacks near Iran and the Strait of Hormuz pushed up oil prices by as much as 4.5% on Thursday. It was the second time in a month tankers have been attacked in the world’s most important zone for oil supplies as tensions increase between the United States and Iran. Washington blamed Iran for Thursday’s attacks, prompting a denial and criticism from Tehran. “Yesterday’s attacks on the Japanese and Norwegian tankers in the Gulf of Oman underscore the severity of the security risks stemming from the Iran crisis and the difficulty of achieving a diplomatic off-ramp as long as the crippling U.S. sanctions remain in place,” RBC bank said. Still, Brent was on course to register a weekly decline of more than 1.5% and U.S. crude fell 2.7% on the week. “The deteriorating demand outlook is holding back prices, despite these tensions,”

OPEC’s oil output falls to 5-year low in May as group warns of weaker demand --Oil output from OPEC fell in May, hitting a five-year low as the group warned that U.S.-China trade tensions could lead to slower economic growth and weak fuel demand.Production from the 14-nation producer club fell by 236,000 barrels per day last month to 29.88 million bpd, according to independent sources cited by OPEC in its monthly report. It was the first time OPEC pumped below 30 million bpd since June 2014.The slump in production comes as OPEC is considering whether to extend a six-month deal to hold down output. In the monthly report, OPEC says it will carefully consider the economic outlook when it meets with Russia and other oil-exporting nations in coming weeks.“Throughout the first half of this year, ongoing global trade tensions have escalated, threatening to spill over, and geo-political risks remained in many key regions,” OPEC said. “This has resulted in a slowdown in global economic activities, and weaker growth in global oil demand, both compared to a year earlier.”  OPEC expects the global economy to remain under pressure in the second half of 2019, largely due to trade disputes, casting uncertainty over oil demand.The group now expects global oil demand to grow by 1.14 million bpd in 2019, slightly lower than its last forecast. OPEC expects producers outside the group to hike output by 2.14 million bpd this year, meaning supply growth will swamp the rise in demand. Concerns about softening demand have pushed oil prices to five-month lows, but crude futures rose about 3% on Thursday on reports of tanker attacks in the Gulf of Oman.

OPEC Says Trade Tensions are Hurting Oil Demand - OPEC said that international trade tensions are hurting demand for oil, slashing its estimates for consumption earlier in the year and predicting further challenges ahead. The organization, due to meet in the coming weeks to set production levels for the second half, said demand increased by less than 1 million barrels a day in the first quarter after cutting its assessment by more than 20%. The world economy is headed for its weakest growth in a decade, buffeted by a prolonged tariff battle between the U.S. and China. “Throughout the first half of this year, ongoing global trade tensions have escalated,” resulting in “weaker growth in global oil demand,” the cartel’s Vienna-based secretariat said in its monthly report. “The observed slowdown in the global economy in the first half will be further challenged in the second half.” Oil prices slumped into a bear market last week, sinking below $60 a barrel in London for the first time since January, on concerns that faltering demand would lead to a crude surplus even as the Organization of Petroleum Exporting Countries and its allies keep supply in check. Prices surged 3% today on suspected attacks on oil tankers in the Persian Gulf. Although OPEC reduced demand estimates for the first quarter, it kept forecasts for 2019 as a whole mostly unchanged and projects that consumption growth will accelerate during the rest of the year. World demand will rise by 1.14 million barrels a day, or 1.2%, on average this year, down from an estimate of 1.21 million a day in last month’s report. As a result, the report signaled that if OPEC maintains production at current levels then global markets should tighten significantly during the third quarter, by about 1.3 million barrels a day. Output from its 14 members fell by 236,000 barrels a day to 29.9 million a day last month as the U.S. tightened its squeeze on Iranian exports, it said. Nonetheless, as OPEC and its partners prepare to meet in Vienna, its members appear focused on continuing to restrict supplies.

Oil rises but ends week lower on demand fears despite Mideast tensions (Reuters) - Oil rose about 1% on Friday after attacks on two oil tankers in the Gulf of Oman this week raised concerns about potential supply disruptions, but prices remained on track for a weekly loss on fears that trade disputes will dent global oil demand. Brent futures settled 70 cents, or 1.1%, higher at $62.01 a barrel, while U.S. West Texas Intermediate (WTI) crude futures rose 23 cents, or 0.4%, to close at $52.51. The attacks on oil tankers near Iran and the Strait of Hormuz pushed up oil prices by as much as 4.5% on Thursday. It was the second time in a month tankers have been attacked in the world’s most important zone for oil supplies as tensions increase between the United States and Iran. Washington blamed Iran for Thursday’s attacks, prompting a denial and criticism from Tehran. On Friday, a U.S. official said Iranian military fast-boats in the Gulf of Oman were preventing two privately-owned tug boats from towing away one of the damaged tankers. “The possibility of what we’ve seen (in the Middle East) over the past few days could intensify into the weekend and traders are reluctant to be short in front of that,” said Anthony Headrick, energy market analyst at CHS Hedging LLC in Inver Grove Heights, Minnesota, noting “The recent headline of restricting those tug boats got some traders off the fence to cover shorts.” Still, Brent registered a weekly decline of around 2%, putting it down for a fourth week in a row, while U.S. crude lost almost 3%. “The deteriorating demand outlook is holding back prices, despite these tensions,” said John Kilduff, a partner at Again Capital LLC in New York. Slowing economic conditions have eaten into demand growth, overshadowing ongoing tensions between the U.S. and Iran, Kilduff said. As a result, prices may be stuck in a holding pattern. “We are stalemated here.” The International Energy Agency cut its demand growth forecast for 2019 by 100,000 barrels per day (bpd) to 1.2 million bpd, citing worsening prospects for world trade. However, the Paris-based agency said it expects demand growth to climb to 1.4 million bpd in 2020. On Thursday, the Organization of the Petroleum Exporting Countries (OPEC) cut its 2019 forecast for growth in global oil demand even lower than the IEA, to 1.14 million bpd. 

Oil Prices Down for the Week - West Texas Intermediate (WTI) crude oil for July delivery finished higher Friday, gaining 23 cents to settle at $52.51 per barrel. Compared to the June 7 close, the WTI is down 2.7 percent. August Brent futures also rose, adding 70 cents to end the day at $62.01 per barrel. Week-on-week, Brent is down two percent. Tom Seng, Assistant Professor of Energy Business at the University of Tulsa’s Collins College of Business, observed that crude oil entered its fourth week of a bearish trend this past week. He added that weakening demand and a surprise increase in inventory overshadowed the attack on two oil tankers in the Gulf of Oman near the Strait of Hormuz. “Lower early week trading reflected ongoing concerns about the global economy and possibly lower demand for oil while a bearish inventory report only served to propel prices even lower Wednesday,” said Seng. “With the threat of tariffs on Mexican imports delayed, the market turned this week to the continuing lack of a trade agreement between the U.S. and China as a factor in a possible global economic slowdown along with actual weaker economic data coming out of China.”  Seng also noted that increasing U.S. oil inventories, coupled with tepid gasoline demand and record U.S. production, cast a “solid bearish slant” on market fundamentals. He said that Wednesday’s Weekly Petroleum Status Report from the U.S. Energy Information Administration (EIA) revealed:

  • An unexpected second straight weekly increase in oil inventories that sent the daily settlement price to levels not seen since mid-January; the 2.2-million-barrel build was well below the American Petroleum Institute’s 4.9-million-barrel projection but higher than the Wall Street Journal’s 600,00-barrel forecast
  • Total crude stocks at 485 million barrels – the highest level since July 2017 and eight percent above the five-year average for this time of year
  • An increase in refinery utilization to 93.2 percent with an increase in gasoline production and a decrease in distillate output
  • 52.9 million barrels of oil in storage, or approximately 70 percent of available capacity, at the Cushing, Okla., hub – a 2.1-million-barrel increase
  • A nine-percent drop in U.S. crude imports compared to year-ago levels
  • A decrease in oil production from 12.4 to 12.3 million barrels per day (bpd)

“Yesterday’s attacks on the two oil tankers in the Gulf of Oman spurred a rally which almost erased the losses from the prior session,” continued Seng, adding that oil prices nevertheless remain below week-ago levels. Seng also pointed out that BP’s latest installment of its Annual Statistical Review of World Energy – released this week – reported that global energy grew 2.9 percent last year while oil demand and U.S. energy consumption rose by 1.5 percent and 3.5 percent, respectively. He added that the report indicated the U.S. experienced the largest year-on-year gain for oil and gas production of any country – ever. Moreover, he noted that U.S. stock market indicators stayed close to their recent levels on settlement – a scenario that provided little signal for oil price direction.

Escalating Trade War Signals More Pain For Oil - Trump backed off his proposed trade war with Mexico in the face of intense pressure from business groups and even his own party, but his faith in tariffs remains unbowed. In fact, Trump may have internalized a lesson that presents further risks to the global economy and to oil markets. “If we didn’t have tariffs, we wouldn’t have made a deal with Mexico,” Trump said on Monday. “We got everything we wanted.”The proposed 5 percent tariff on Mexico was suspended because Trump said that the Mexican government agreed to a series of demands to tighten up migration through the country. However, press reports suggest that some of the provisions in the deal, such as Mexico agreeing to buy agricultural goods, are a mirage, while others, such as expanding border security, were agreed to months ago.Leaving those pesky details aside, Trump was triumphant. Indeed, even though the White House saw pushback from business groups and the Republican-controlled U.S. Senate, in Trump’s mind the whole episode seems to have reaffirmed his strategy.With the U.S.-China trade war unfinished, the U.S. President feels emboldened to take a hardline on Beijing.“The China deal’s going to work out,” Trump said in an interview on CNBC. “You know why? Because of tariffs. Because right now China is getting absolutely decimated by companies that are leaving China, going to other countries, including our own, because they don’t want to pay the tariffs.” Moreover, he says that the tariffs to date have been successful. “We’ve never gotten 10 cents from China. Now we’re getting a lot of money from China, and I think that’s one of the reasons the G.D.P. was so high in the first quarter because of the tariffs that we’re taking in from China,” he told reporters on Monday.  All evidence points to the contrary. Global growth concerns have ballooned since the hike in tariffs last month. Recently, finance ministers from G-20 recently met and said that risks from trade and geopolitical tensions were “intensifying.”

The Most Crucial Pipeline Of The Middle East -- Contemporary Middle Eastern history is strongly influenced by energy politics. Besides providing revenue for the state’s coffers, oil is also a potent geopolitical tool in the hands of resource-rich countries. Recently, officials from Lebanon, Syria and Iraq have engaged in talks to restart the dysfunctional pipeline that once connected oilfields near Kirkuk in Iraq with the coastal city of Tripoli in Lebanon. Restarting the pipeline could have long-term political, economic, and strategic consequences for the involved states and the wider region. The original infrastructure was constructed during the 30s of the previous century when two 12-inch pipes transported oil from Kirkuk to Haifa in British mandated Palestine and Tripoli in French-mandated Lebanon. The Tripoli line was supplemented by a 30-inch pipeline in the 50s which could transport approximately 400,000 barrels/day. The Kirkuk-Tripoli pipeline was suspended by Syria during the Iraq-Iran war in an attempt to support Tehran in its struggle against Baghdad. The current political climate, which has enabled cooperation between Lebanon, Syria, and Iraq, is the consequence of one country’s foreign policy. Since the U.S. invasion of Iraq and the overthrow of Saddam Hussein, Iranian influence has grown considerably across the Middle East. Tehran’s support for proxies in neighboring countries has strongly influenced regional politics and made Saudi Arabia nervous of what it sees as “Persian encroachment”. While Iran’s participation in regional politics was necessary for creating the right environment for cooperation, Russia's involvement has proven to be crucial. The Kremlin’s decision to participate in the Syrian civil war on the side of Assad’s forces was a pivotal moment in reestablishing control over territories essential for the Kirkuk-Tripoli pipeline to commence operations. Moscow has also established good political relations with both Iraq and Lebanon to become a broker for facilitating an agreement. The participation of Rosneft was very useful for Moscow’s efforts in the region. The Russian energy giant maintains good relations with the Iraqi government where it operates several oil fields and the Kirkuk-Ceyhan oil pipeline. Recently, Rosneft signed an agreement with the Lebanese government to operate the storage facility in Tripoli for the next twenty years. Therefore, Russian involvement was important for the Arab countries to consider refurbishing the outdated Kirkuk-Tripoli pipeline.  Despite the modest capacity of the pipeline, reestablishing trade could have a long-term impact on regional politics. The new pipeline would be a physical link between the participating countries and will cement the political ties for decades due to interdependency regarding energy security and the economic interest of energy exports.

Iran scrambles to lift petrochemical sales as sanctions hammer oil (Reuters) - Iran has been racing to step up exports of petrochemicals and tap new markets to compensate for sliding oil sales, Iranian and international industry sources said, but now risks losing that crucial revenue as Washington tightens the screw on sanctions.Tehran has been selling increased volumes of petrochemical products at below market rates, in countries including Brazil, China and India, since the United States reimposed sanctions on Iranian oil exports in November, according to the six sources who include two senior Iranian government officials. Available ship-tracking data also points to a rise in monthly shipments since then. The scramble to bolster petrochemical sales could be an indication of how successful the U.S. administration of Donald Trump has been in choking off Iran’s oil revenues, which have fallen further than under previous sanctions in 2012. While the November sanctions applied to petrochemicals as well, the four industry sources said there was a degree of ambiguity given the multiple types of products - including urea, ammonia and methanol - which allowed Iran to keep selling. However on Friday the U.S. Treasury moved to tighten the restrictions by prohibiting companies from doing any business with Iran’s largest petrochemical group, Persian Gulf Petrochemical Industries Company, citing its ties to Iran’s elite Revolutionary Guards. The measures also apply to 39 subsidiary companies and foreign-based sales agents. The Treasury said it intended to “vigorously enforce” the new petrochemical sanctions, which could deal another hammer blow to the Iranian economy. It is difficult to put a comprehensive figure on Iran’s income from petrochemicals, Iran’s second-largest export industry after oil and gas, but officials said in February that non-oil revenues had surpassed the amount earned by oil exports. This week Iranian media quoted Ahmad Sarami, a member of the Iranian Oil, Gas and Petrochemical Products Exporters’ Union, as saying Tehran received $11 billion from petrochemical exports in the year ending in March.

US Middle East commander proposes permanent buildup against Iran - The chief of Central Command (CENTCOM), which oversees all of the Pentagon’s operations in the Middle East, claimed over the weekend that Iran continues to pose an “imminent” threat to Washington’s interests in the region and that a permanent military escalation against the country and its 82 million people may be required. Gen. Frank McKenzie during a tour of the region that included both Baghdad and the carrier USS Abraham Lincoln, sailing in the north Arabian Sea, told reporters that he is “negotiating” with the Pentagon on plans for “bringing additional resources into the theater” to step up the military campaign against Iran. Last month, the Trump administration ordered the USS Lincoln’s carrier battle group, a bomber strike force led by nuclear-capable B-52s, along with 900 additional ground troops and a Patriot missile battery into the region on the pretext of responding to supposed Iranian threats. Plans were also leaked calling for the mobilization of as many as 120,000 troops for deployment to the region, a similar force as that which was assembled in advance of the 2003 US invasion of Iraq. General McKenzie claimed that the military deployments and US threats had caused Iran to “step back and recalculate the course that they apparently were on.” He told the Associated Press, however, “I don’t believe the threat has diminished. I believe the threat is very real.” Speaking with reporters, he said that US intelligence on Iranian threats was “clear” and “compelling,” adding that these alleged threats were “advanced, imminent and very specific.” The AP noted, however, that the general provided no specific information on the “threats,” insisting that the “compelling” intelligence was all classified. In addressing thousands of sailors assembled on aircraft carrier Lincoln, McKenzie declared: “I am the reason you are here. I requested this ship because of ongoing tensions with Iran, and nothing says you're interested in somebody than 90,000 tons of aircraft carrier and everything that comes with it. “My intent by bringing you in here was to stabilize the situation, let Iran know that now is not the time to do something goofy.”

Iran at High Level of Readiness as US General Continues to Claim Imminent Threat - Growing US military buildups throughout April and May in the Middle East were a reaction, according to officials, to Iran’s military being at a high level of readiness. Now, with all those extra US forces in the area, Iran remains at a high level of readiness.This is something of a challenge for the US to parse, now, as it makes sense for Iran to be at a high level of readiness after months of escalation and US threats, and officials are trying to figure out if this is just the new normal.Gen. Frank McKenzie, the top US commander in the region, is continuing to hype up Iran as an “imminent threat.” Gen. McKenzie played up this threat on Thursday, and used virtually identical comments on Saturday, claiming Iran’s threat has “evolved in certain ways.”Rear Admiral John Wade, the commander of the USS Lincoln’s carrier strike group, on the other hand, downplayed the situation. Rear Adm. Wade says that all interactions with Iran have been “safe and professional,” and Iran has done nothing to impede the strike group’s maneuverability. This suggests the Pentagon is at least somewhat split on the matter, and the rear admiral is talking up a situation of relative normalcy, even as Gen. McKenzie, likely aware that regional military funding hinges on there being a “threat,” continues to see a threat evolved, but otherwise intact.

System to circumvent US sanctions on Iran ready soon: German FM -- A European payment system designed to circumvent US sanctions on Iran will be ready soon, Germany announced on Monday. German Foreign Minister Heiko Maas met Iranian President Hassan Rouhani and Foreign Minister Mohammad Javad Zarif in Tehran as part of European efforts to salvage the historic JCPOA nuclear pact and defuse rising US-Iranian tension. Iran and Germany held "frank and serious" talks on saving the 2015 deal with world powers, Zarif told a joint press conference. "Tehran will cooperate with EU signatories of the deal to save it," Zarif said. Maas said earlier the payment system, known as INSTEX, (Instrument in Support of Trade Exchanges) will soon be ready to go after months of work. "This is an instrument of a new kind so it's not straightforward to operationalise it," he said, pointing to the complexity of trying to install a totally new payment system. "But all the formal requirements are in place now, and so I'm assuming we'll be ready to use it in the foreseeable future," added Mass about the system for barter-based trade with Iran. A cautious thaw in relations between Tehran and Washington began in 2015 when the deal was struck between six world powers and Iran, limiting its nuclear activity. But tensions with the US have mounted since President Donald Trump withdrew Washington from the accord in 2018 and reimposed sweeping sanctions. Iran has criticised the European signatories of the JCPOA for failing to salvage the pact after Trump pulled the US out. "There is a serious situation in the region. An escalation of tension is becoming uncontrollable and military action wouldn't be in line with the interests of any party," Maas said.

Tanker incident in Gulf of Oman CNN -  What you need to know about the apparent vessel attack  Two tankers were apparently attacked in the Gulf of Oman Thursday, less than a month after four other ships were struck in the region.  Here's what we know about the apparent attack:

  • The ships involved: The two ships — one carrying oil and the other transporting a cargo of chemicals — were struck in international waters near the strategically important Strait of Hormuz.
  • What happened: Three explosions were reported on board the Marshall Islands-flagged "Front Altair" oil tanker, which is owned by the Bermuda-based Norwegian company Frontline, the Norwegian Maritime Agency said. The company said that a fire broke out after an explosion and that the cause of the blast was unclear. A second vessel, the Japanese-owned chemical tanker, "Kokura Courageous" was "attacked" twice "with some sort of shell" around 6:00 a.m. local time (10 p.m. ET Wednesday), the ship's co-manager Michio Yuube said.
  • Condition of the crew: All crew members were evacuated and are safe, according to the owners of the two ships. The US Navy said it was providing assistance.
  • Past oil tanker attacks: In May, four oil tankers were attacked off the coast of the United Arab Emirates, an incident that the US suspected was the responsibility of Iran. Tehran denied any involvement in the earlier attacks. Iran's Foreign Minister Mohammad Javad Zarif said "suspicious doesn't begin to describe" this latest incident.

Trump administration blames Iran for oil tanker attacks in Middle East – Secretary of State Mike Pompeo on Thursday blamed Iran for attacks earlier in the day on oil tankers in the Gulf of Oman near Iran and the Strait of Hormuz, a vital shipping route through which much of the world’s oil passes. “Iran is lashing out because the regime wants our successful maximum pressure campaign lifted,” Pompeo said without citing specific evidence as to why Tehran was responsible. “No economic sanctions entitle the Islamic Republic to attack innocent civilians, disrupt global oil markets and engage in nuclear blackmail.” “The international community condemns Iran’s assault on the freedom of navigation and the targeting of innocent civilians,” he said, adding that the U.S. will defend its forces, interests and partners. Oil prices rose as much as 4% on Thursday on renewed fears of conflict in the Middle East after a series of strikes last month. Crude futures briefly jumped back above 3% after Pompeo accused Tehran of being involved in the latest attacks. The White House said President Donald Trump was briefed on the matter and blamed Tehran for being behind a similar attack on May 12 on four tankers in the same area. Trump wrote in a tweet Thursday that “it is too soon to even think about making a deal” with Iran, saying that “they are not ready, and neither are we!”

Today’s Attacks On Ships In The Gulf Of Oman Are Not In Iran’s Interest – Or Are They? (Updated)  Early this morning, around 6:00 UTC, two tankers in the Gulf of Oman were attacked by surface weapons. Both ships were some 50 kilometers south-east of Bandar-e Jask, Iran, and some 100+ kilometers east of Fujairah. The Front Altair, a 250 meter long crude oil tanker under the flag of the Marshal Islands, came from the United Arab Emirates and was on was on its way to Taiwan. Its load of 75,000 tons of naphta caught fire and the crew had to abandon the ship.  The second attacked ship is the Kokuka Courageous, a 170 meter long tanker flagged by Panama. It was coming from Saudi Arabia and on its way to Singapore. The ship has its hull breached above the water line, but its load of methanol seems to be intact.  The Iranian Search and Rescue ship Naji picked up the 44 crews members of both ships and brought them to Bandar-E Jash. Oil prices increased by some 4%.These attacks come a month after four ships anchoring near the UAE port Fujairah were damaged by explosives attached to their hulls. The investigation of that incident by the UAE did not blame anyone for the attack but suggested that a nation state must have been behind it. U.S. National Security Advisor John Bolton blamed Iran.It is likely that Iranian proxy forces were involved in the May attacks. It seems unlikely that Iran had anything to do with today's attacks.The May attack was accompanied by two drone strikes launched by Houthi forces in Yemen on the Saudi east-west pipeline that allows some Saudi exports to avoid a passage through the Street of Hormuz. A third strike was a medium range missile launch by the Islamic Jihad in the Gaza strip against the city of Ashkelon in Israel.All three strikes together were a warning that those countries who instigate for a U.S. war on Iran would get seriously hurt should Iran be attacked. The attack today comes at an inconvenient time for Iran. The loud anti-Iran campaign John Bolton initiated in April and May recently calmed down.  That Iran might have this motive does not mean or prove that it is responsible for today's attack. Risking to sink two foreign tankers in international water is not what an otherwise cautious Iran would typically do. Someone else might have initiated it to blame it.

Tanker attacks were Iran's doing, Mike Pompeo says after 2nd attack on vessels in Gulf of Oman today - Two tankers were attacked Thursday near the strategic Strait of Hormuz, marking the second time in a month tankers have been seriously damaged in the region. U.S. intelligence pointed to Iran as being responsible for the attacks, Secretary of State Mike Pompeo said Thursday. "This assessment is based on intelligence, the weapons used, the level of expertise needed to execute the operation, recent similar Iranian attacks on shipping and the fact that no proxy group operating in the area has the resources and proficiency to act with such a high degree of sophistication," Pompeo said. Pompeo said U.S. Ambassador to the United Nations Jonathan Cohen would raise the issue at a hastily called meeting of the Security Council on Thursday. The U.S. mission to the U.N. requested the Security Council hold closed-door consultations Thursday on the situation in the Middle East. Thursday's attack near the vital shipping channel of the Strait of Hormuz was "only the latest in a series of attacks started by Iran and its surrogates against American and allied interests" aimed at "escalating tension," Pompeo said. "On April 22nd, Iran promised the world it would interrupt the flow of oil through the Strait of Hormuz. It is now working to execute on that promise." He said the U.S. would defend its forces and interests in the region but gave no specifics about any plans for retaliation, and he took no questions.

Iran says US has no 'shred of factual or circumstantial evidence' that Tehran attacked oil tankers - Iran has denied that it was responsible for the attacks on two oil tankers in the Middle East. U.S. Secretary of State Mike Pompeo on Thursday blamed the Islamic Republic for the explosions on the oil tankers in the Gulf of Oman. In response, Iranian Foreign Minister Mohammad Javad Zarif on Friday accused the U.S. of jumping “to make allegations against Iran—w/o a shred of factual or circumstantial evidence.” Two oil tankers — the Norwegian-owned Front Altair and the Japanese-owned Kokuka Courageous — suffered significant damage after experiencing explosions while they were traveling near the Strait of Hormuz, the world’s busiest sea lane for oil shipments. Crews were forced to abandon ship and leave the vessels adrift in waters between Gulf Arab states and Iran. It was not immediately clear who was responsible for the attacks, but the U.S. military released footage on Thursday which it said showed Iran’s Revolutionary Guard Corps removing an unexploded mine from the side of one of the stricken tankers. The attacks come as tensions between Washington and Tehran soared after the Trump administration withdrew from an international nuclear pact with Iran. Tehran has repeatedly threatened to block traffic in the Strait of Hormuz in retaliation for U.S. sanctions on the Islamic Republic. Earlier, Iran’s mission to the United Nations said in a statement: “Iran categorically rejects the U.S. unfounded claim with regard to 13 June oil tanker incidents and condemns it in the strongest possible terms.” On Twitter Friday, Zarif accused the U.S. of “sabotage diplomacy” adopted by the “B-Team.” The so-called B-Team refers to a group including U.S. National Security Advisor John Bolton — an Iran hawk, Israeli Prime Minister Benjamin Netanyahu, and Saudi Crown Prince Mohammad Bin Salman. Zarif had previously said the group could prod U.S. President Donald Trump into a conflict with Tehran.

 U.S. releases video purporting to show Iranians removing mine before ship explosions WaPo - The Trump administration on Friday intensified its effort to demonstrate Iran’s culpability in a spate of damaging oil tanker attacks, as dueling accusations from Washington and Tehran heightened concerns about military conflict. American officials said newly released intelligence, including a grainy video, illustrated Tehran’s role in twin explosions Thursday that crippled Japanese- and ­Norwegian-owned ships in the Gulf of Oman. But European nations appealed to all sides to de-escalate, as statements by the owner of one of the targeted ships appeared to challenge the U.S. account that Iranian naval boats had employed limpet mines. President Trump insisted that the video released by U.S. Central Command that appeared to show unidentified people in a small boat removing something from the side of a tanker — which officials said was an unexploded mine — was proof that Iran had carried out the attacks. “Well, Iran did do it,” he told Fox News. “And you know they did it because you saw the boat.” Depicting Iran as a “nation of terror,” the president’s remarks underscored the urgency that has characterized his administration’s approach to a country it has identified as its primary adversary in the Middle East.

Japanese oil tanker owner disagrees with US military that a mine caused blast near Iran — The Japanese owner of one of the oil tankers attacked near Iran on Thursday said the vessel was struck by a projectile and not by a mine, which is what U.S. officials assessed as the source of the blast. “We received reports that something flew towards the ship,” Yutaka Katada, president of Kokuka Sangyo, said at a press conference Friday. “I do not think there was a time bomb or an object attached to the side of the ship,” he said, adding that a projectile landed above the waterline. On Thursday, U.S. Central Command said in a statement that the Japanese oil tanker, Kokuka Courageous, had an “unexploded limpet mine on their hull following an initial explosion.” The Pentagon did not immediately respond to CNBC’s request for comment. President Donald Trump said Friday that if Iran were to block the Strait of Hormuz, “it’s not going to be closed for long,” but did not elaborate on what potential steps the U.S. would take in response. “They’re not going to be closing [the strait],” Trump reiterated during a telephone interview on “Fox & Friends.” Earlier this year, Iran threatened to close the strait in response to a U.S. decision to end waivers on reimposed sanctions for companies that export oil from Iran. The Strait of Hormuz is the world’s most important oil choke point. It’s a gateway for almost a third of all seaborne crude oil.

 Iran FM: "Suspicious Doesn't Begin To Describe" Attack On Japanese Tanker During Abe's State Visit - With the words "Gulf of Tonkin" trending on Twitter this morning at a moment that a senior American defense official told CBS News that "it's highly likely Iran caused these attacks," it appears the general public is not even close to buying the claim that Iran attacked two tankers near the strategic Strait of Hormuz this morning. Iranian Foreign Minister Javid Zarif pointed out a crucial obvious factor not likely to make it across the US mainstream airwaves or headlines: "Suspicious doesn't begin to describe what likely transpired this morning," he said.  This especially crucial according to his comments given that one of the vessels is a Japanese tanker supposedly "attacked" by Iran in the middle of a visit to Tehran by Japan's Prime Minister Shinzo Abe. Japan's Trade Ministry later confirmed that one of the ships hit Thursday morning was carrying "Japan-related cargo."  The details of the Japanese tanker are described by the AP as follows: The Japanese operator of a tanker that was damaged in a suspected attack in the Strait of Hormuz says all of its crewmembers are now safe onboard a U.S. Navy warship.  The chemical tanker Kokuka Courageous, operated by Kokuka Sangyo Co., was apparently attacked as it was passing through the Strait of Hormuz toward Singapore and Thailand destinations to deliver methanol. Currently Iran is desperately attempting to salvage the 2015 nuclear deal with other world powers at a time its economy is being crushed under US sanctions, and Wednesday's visit by the Japanese PM appears an attempt to mediate. The tanker incident and emergency nature of what transpired "eclipsed the Abe visit, an unexpected bit of outreach to Iran by someone Trump calls a friend," as CNN noted.

Trump says 'Iran did do it,' as U.S. seeks support on Gulf oil tanker attacks -(Reuters) - The United States on Friday blamed Iran for attacks on two oil tankers at the entrance to the Gulf and said it was seeking international consensus about the threat to shipping, despite Tehran denying involvement in the explosions at sea. Thursday’s attacks raised fears of a confrontation in the vital oil shipping route at a time of increased tension between Iran and the United States over U.S. sanctions and military moves in the Middle East, Tehran’s proxy groups in the region and its nuclear program. “Iran did do it and you know they did it because you saw the boat,” U.S. President Donald Trump told Fox News. He was referring to a video released on Thursday by the U.S. military which said it showed Iran’s Revolutionary Guards were behind the blasts that struck the Norwegian-owned Front Altair and the Japanese-owned Kokuka Courageous in the Gulf of Oman, at the mouth of the Gulf. Iran said the video proved nothing and that it was being made into a scapegoat. “These accusations are alarming,” Foreign Ministry spokesman Abbas Mousavi said.

The US blames Iran for the tanker attacks. Here’s what the Navy could do next - The war of words between the U.S. and Iran took a dangerous turn after two ships were attacked in the Gulf of Oman. One of the tankers was operated by a Japanese company. They were hit Thursday, the same day Japanese Prime Minister Shinzo Abe met with Iran’s Supreme Leader Ayatollah Ali Khamenei and President Hassan Rhouhani. The Trump administration put the blame squarely on Iran. “It was not an accident that the Japanese tanker was attacked,” said Alireza Nader, who heads the New Iran Foundation, a Washington-based think tank that opposes the Islamic Republic. “This was a very blunt warning. Iran is saying to the world we are able to disrupt the world’s oil markets and we’re going to do it.” But not everyone is convinced. “You have to fully understand what happened before you start shooting” said Mark Cancian, a defense expert with Center for Strategic and International Studies and a former colonel in the Marines with decades of operational knowledge of naval combat.“The Department of Defense will be reluctant to retaliate until they are certain what happened and who fired on whom, and why,” he said. Nader and Cancian believe it’s possible Iranian-funded Houthi rebels, who are mired in a civil war in Yemen, may be to blame. If that’s the case, “the U.S. will not want to get involved in a shooting war over Yemen,” Cancian said. It will likely take days, weeks or even months for the military to go through the forensics needed to find out exactly who is behind the attack. But if it is determined to be Iran, Cancian believes the U.S. forces in the area will make quick work of Iran’s navy. “The U.S. has assets designed to take on Russia and China. Iran’s ships are very exposed. I’d expect the U.S. would be able to sink Iran’s navy in about two days.”

Iran Has Little to Gain From Oman Tanker Attacks -- Two oil tankers have been damaged in a suspected attack in the waters between the United Arab Emirates and Iran as they were leaving the Persian Gulf. This is the second incident in four weeks, and raises the question of who gains what from them.  Fingers will certainly be pointed at Iran as the mastermind behind these events. But the potential benefits to the Persian Gulf nation are outweighed by the risks. And even if Tehran isn’t responsible, it will still suffer the consequences. If Tehran is attacking tankers leaving the Persian Gulf — either directly, or through proxies — it sends a message that transit through the world’s most important choke point for global oil flows is not safe without its consent. If Iran is pushed to the brink economically by sanctions, it will not go quietly. Other nations in the region will bear the cost of disruptions to their own oil exports, while America and its allies will have to cope with higher crude prices and disruptions to supplies.Not since 2005 have the world’s insurers considered shipping in the Persian Gulf so dangerous for oil tankers. Nevertheless, we are still far from the level of tension that existed during the so-called Tanker War of the 1980s, when 451 vessels (259 of them oil or refined petroleum product tankers) suffered some sort of attack in the region, according to a report from the U.S. Naval Institute. The incidents took place during the Iran-Iraq War, and the culprits were forces from both countries. Then, the U.S. Navy resorted to escorting vessels through the Persian Gulf. That would be an expensive operation to repeat and would tie up a large part of the U.S. and allied fleets in the region. It would also raise the cost of the U.S. drive against Iran, which began with President Donald Trump’s decision to pull out of the Iran nuclear deal in May 2018.

Trump: If Iran blocks the Strait of Hormuz, 'it's not going to be closed for long' - President Donald Trump said Friday that if Iran were to block the Strait of Hormuz, “it’s not going to be closed for long,” but he did not elaborate on whether the United States had an obligation to keep open the international shipping gateway, which is critical to the oil industry.“They’re not going to be closing [the strait],” Trump said in response to a hypothetical question during a telephone interview on “Fox and Friends.”“They know it, and they’ve been told in very strong terms. We want to get them back at the table, if they want to go back,” he said, referring to the administration’s ongoing efforts to start bilateral negotiations on a new nuclear deal with Iran.  “I’m ready when they are, but whenever they’re ready, it’s OK. And in the meantime, I’m in no rush. I’m in no rush,” he added.   Earlier this year, Iran threatened to close the strait in response to a U.S. decision to end waivers on reimposed sanctions for companies that export oil from Iran. However, analysts question whether closing the channel is feasible, given the large American naval presence in the strait and the portions of coastline that are controlled by Oman and the United Arab Emirates.The president was responding to attacks Thursday on two oil tankers in the Gulf of Oman, south of the strait, for which the United States has blamed Iran. The Strait of H ormuz is a crucial maritime shipping channel that serves as a gateway for up to a third of all the world’s tanker-carried crude oil and petroleum products.

Tanker Strikes Spell Doomsday Scenario For OPEC - An attack by an unknown party on two oil tankers in the Gulf of Oman has put the Arabian/Persian Gulf region on edge. After the possible Iranian attack on three vessels offshore the Emirati port ofFujairah last month, the current attack could be setting the scene for a direct military confrontation. Two tankers, the Front Altair and the Kokuka Courageous, both filled with petroleum and chemical products, such as methanol, were “suspected to be hit by a torpedo”. This statement was made by Taiwanese company KPC and Front Altair’s owner, Norwegian company Frontline and has also been confirmed by the operator of the Kokua Courageous, Bernard Schulte Shipmanagement, which claimed that the ship was damaged in a "suspected attack." The last hours, search and rescue operations have been performed by the US, Iran and others. No direct accusations have been made at present, but indicators point to Iran or Iranian proxies, even as Tehran already has denied any involvement.  The oil market is in a state of shock, and many analysts weren’t expecting an increased military escalation between Iran and its Arab neighbors. After the Fujairah attacks, tensions have eased somewhat, but today’s attacks could end the status quo in the Strait of Hormuz. After two weeks of media frenzy that the bulls have left the market and that OPEC is struggling to quell the negative sentiment in the market, a new reality could be here very soon. Oil prices surged today, incorporating the increased risk of a regional confrontation that could be threatening the majority of oil and gas supplies heading to Asia. This time, the targets have been chosen very well, as they don’t involve Saudi or Emirate vessels, but Western tankers filled with petroleum products, such as methanol. Based on current information, the involvement of torpedoes, which suggests a high level of planning by sophisticated culprits, could lead to a military escalation in the ongoing US/Arab-Iranian confrontation. If it’s true that the Kokuka Courageous has been hit twice within three hours, it means that the attack is most probably conducted by a submarine or by under-the-radar moving assets, which points at the involvement of a state-level party, and not a proxy in the region. The US Navy’s 5th Fleet, which is patrolling in and around the Gulf region, has already reacted to the attack, as officials stated.

Iran renews nuclear pact ultimatum amid tensions with U.S. - (Reuters) - Iran will continue scaling back compliance with a nuclear deal unless other signatories to the pact show “positive signals”, the Iranian president said on Saturday as tensions with the United States escalated over tanker attacks in the Gulf region. Iran stopped complying in May with some commitments in the 2015 nuclear deal that was agreed with global powers, after the United States unilaterally withdrew from the accord in 2018 and ratcheted up sanctions on Tehran. “Obviously, Iran cannot stick to this agreement unilaterally,” President Hassan Rouhani told Russian, Chinese and other Asian leaders at a conference in Tajikistan. His comments follow rising tensions with Washington, which has accused Tehran of carrying out Thursday’s attacks on two oil tankers in a vital oil shipping route at the mouth of the Gulf. Tehran has denied having any role. Rouhani did not refer to this week’s tanker incident in his speech to the Conference on Interaction and Confidence Building Measures in Asia, behind held in the Tajik capital Dushanbe. “It is necessary that all the sides of this agreement contribute to restoring it,” he said, adding that Iran needed to see “positive signals” from other signatories to the pact, which include Russia, China, Britain, France and Germany.

 NZ troops to pull out of Iraq 'alongside of Australia' -  New Zealand will withdraw its troops from Iraq over the next year and do so "alongside of Australia", its defence minister says. Since 2015, New Zealand has deployed personnel alongside Australian forces to train Iraqi soldiers at Camp Taji, north of Baghdad, with 95 Kiwis currently there. Its government on Monday afternoon announced the nation's contribution to the mission would be ending over the next year, with its troops to be gradually withdrawn by June in 2020. "The goal of any training mission is to ensure that it becomes a sustainable program," Defence Minister Ron Mark said. "Significant progress has been made in this area, which will allow the mission to reduce in numbers and conclude within the next year." But Mr Mark added New Zealand's withdrawal was not unilateral. "Now it's about mentoring and training trainers and then, alongside of Australia, exiting and having an exit plan. It's not just New Zealand that's downsizing here," he told reporters. "We will be downsizing alongside of them, working with them, not just walking away from the mission." New Zealand Prime Minister Jacinda Ardern said "I think their deployment has changed but it's not for me to ultimately put a date on their decision". She said she had discussed New Zealand's withdrawal with Prime Minister Scott Morrison. The Australian government has also been considering the future of Task Group Taji, amid speculation a ninth rotation of trainers, deployed in June, may be the last.

U.S. Ambassador to Israel: Israel has right to annex part of West Bank - U.S. Ambassador to Israel David Friedman said that Israel has the right to annex some but "unlikely all" of the West Bank in an interview with The New York Times on Friday. This comes after Prime Minister Benjamin Netanyahu promised to begin annexing settlements in the West Bank, a move that would put a dent in any attempts at a two-state solution in the area. "Under certain circumstances, I think Israel has the right to retain some, but unlikely all, of the West Bank," Friedman said. Following Friedman's interview, an administration official reacted Saturday, saying: "Our policy has not changed," The Jerusalem Post's Omri Nahmias reports. The comment by Friedman stirred plenty of controversy, since much of the world views Israeli settlements in the West Bank as illegal. Friedman further clarified that the "Deal of the Century" was aimed at improving life for Palestinians, but without any "permanent resolution to the conflict." However, the United Nations resolution in 2016 allowed by the Obama administration which condemned the Israeli settlements in the West Bank was heavily criticized by Friedman, who said that "Israel's entitled to retain some portion of it." "David Friedman has once again made clear that he is acting not as the US ambassador to Israel but as the settlement movement's ambassador to the United States," said Jeremy Ben-Ami, president of the pro-Israel liberal nonprofit J Street, which encourages American leadership to end the Arab-Israeli conflict. "By essentially giving the Netanyahu government a green light to begin unilaterally annexing Palestinian territory in the West Bank, the Trump administration is endorsing a flagrant violation of international law."

Yemen's Houthis strike Saudi airport, coalition vows to retaliate - (Reuters) - The Saudi-led military coalition vowed to respond firmly to a missile attack by Yemeni Houthi forces on a civilian airport in southern Saudi Arabia on Wednesday that wounded 26 people.  The Western-backed, Sunni Muslim alliance that has been battling the Iran-aligned Houthi movement in Yemen said the early morning strike was proof of Iranian support for what it called cross-border terrorism. The coalition said a projectile hit the arrivals hall at Abha airport, causing material damage. Three women and two children were among the wounded, who were of Saudi, Yemeni and Indian nationalities, it said in a statement. The Houthis said on their media channels that they fired a cruise missile at Abha airport, which is about 200 km (125 miles) north of the Yemen border and serves domestic and regional routes. “Evidence indicates Iran’s Revolutionary Guards supplied the Houthis with the weapon that targeted Abha airport,” Saudi-owned Al Arabiya TV quoted the coalition as saying. The Saudi civil aviation body told Reuters flight traffic was currently running normally at the airport. The Houthi media center said the strike destroyed the control tower. The coalition’s spokesman did not immediately respond to a request for comment. Reuters could not independently verify the claim. The attack follows an armed drone strike last month on two oil-pumping stations in the kingdom that were claimed by the Houthis. Saudi Arabia accused Iran of ordering the attack, a charge that Tehran and the Houthi movement deny. The coalition said the strike on Abha airport could amount to a war crime and it would take “urgent and timely” measures in response.

Saudi Arabia is Using Battlefield Technology to Track Down Women Fleeing the Country— Saudi Arabia is going to extraordinary lengths to hunt down women who are fleeing the country seeking life outside the repressive kingdom. Technology normally used by the military to track targets for lethal drone strikes is being used against women that run away from the country. The use of such advanced technology, which is rarely employed by civilians, was exposed by four Saudi women who spoke to the Business Insider about the way in which they were tracked down through their mobile phone’s unique 15-digit International Mobile Equipment Identity (IMEI) number. Saudi security services used various means to track the IMEI number including raiding the homes and interrogating the family members of women who fled the country. They demand to be shown the packaging box of cell phones which contain the IMEI number. Some of the women who had fled to Europe and were tracked down were brought back to the country. This method of tracking people using an IMEI is thought to be almost exclusively a tool used by the police, national security and military bodies. Saudi Arabia’s use of this technology against civilians is said to be not only a sign of desperation but also an indication of the threat faced by dozens of women that have fled the kingdom. The seriousness with which Riyadh views this growing phenomenon is a source of concern. According to the Business Insider after two high-profile escapes in early 2019, Saudi Arabia’s Presidency of State Security produced a video in February likening women who run away to jihadist terrorist operatives working for the likes of Daesh. Technology experts said that escaping the radar of the kingdom’s security was not a simple matter. Changing a phone’s SIM card is not sufficient. IMEI numbers are unique to the phone and the only way to escape being tracked is to replace the handset, physically remove and replace a chip to obtain a new IMEI, or use a phone which has a reprogrammable IMEI.

With Friends Like Turkey, Who Needs Enemies? -Turkey, America’s erstwhile NATO ally, is now arming America’s enemies in Libya, a flagrant violation of the 2011 United Nations arms embargo. The clearest evidence of Turkey’s violation of U.N. embargoes came in the hold of a Turkish-crewed ship named “Amazon.” It delivered some 20 Turkish-made armored vehicles, known as “MRAPs,” the military news website South Front reported. A local blogger photographed the armored vehicles on the dock.Turkey supports Libya’s Government of National Accord holed up in Tripoli. Qatar and, seemingly, Iran also back it. If it prevails, its government will impose Sharia law, corrupt the press, socialize the economy, and open a safe haven for terrorists. America backs General Khalifa Haftar’s Libyan National Army, which commands a large swathe of eastern Libya. Gen. Haftar’s promises an Egypt-style government, if he wins. That means basic human rights, rule of law, a semi-free press, and regular elections that are usually won by the ruling party. And a new ally in the war on terror. America’s security is often strengthened by such hard compromises with its principles, leaving many Americans uneasy. This is an alliance that makes sense. Mainly because all of the realistic alternatives are far worse.Gen. Haftar was once a high-ranking official in Muammar Gadhafi’s regime. He defected, worked with the CIA, and spent the better part of two decades living in the northern Virginian suburbs before returning to his homeland a few years ago. His forces are large, broadly disciplined, and well equipped. So far Haftar’s army has easily swept away all opposition in their path.  Yet Tripoli may be beyond its grasp. Urban warfare is the opposite of fast-moving desert campaigns. It is usually a house-to-house proposition in which defenders make invaders pay for yards gained… in lives lost.  Civilians are often murdered, maimed, or raped by one side or the other. Some join the resistance, becoming human bombs or amateur snipers. Even corpses are boobytrapped with explosives. Tripoli is a humid Stalingrad. Haftar’s forces arrived in April. Almost two months later, it controls less than half of the city. In this urban battleground, Turkish-supplied armor makes a big impact. America used similar vehicles to clear the Baghdad airport road of dug-in insurgents in 2005. Turkish armor will either lengthen the war and widen the death toll or, worse, prevent the war’s end by enforcing a murderous stalemate. Without aircraft or armor of its own there is little Haftar’s soldiers can do.

 US Wipes Out Entire Afghan Security Forces Unit in Second Major Friendly Fire Incident — For the second time in less than a month, US forces carried out airstrikes “in self defense” in Afghanistan, only to discover that they were actually attacking Afghan security forces. The Wednesday strike ended up wiping out an entire unit, though officials have yet to disclose the exact number of deaths, beyond it apparently being everyone present.The previous attack saw US ground troops believing they were under fire, and the warplanes attacking police, killing 18. In this case, too, US officials said they believed the troops came under fire, and the airstrikes targeted the Afghan forces, who had been firing machine guns.Despite all the talk of self defense and US troops being “under effective fire,” officials insist not a single US casualty occurred. US officials expressed “regret” for the deaths of Afghan partners. Interestingly, however, US spokesman Col. David Butler praised the operation as “extensively planned and coordinated” with the Afghan forces, with an eye toward preventing exactly what ended up happening. An investigation is promised, but all too often the investigations into incidents like these, where the result was particularly embarrassing, never really publicly end, and the day of the attack ends up the last we hear about it.

Japan's Abe heads to Iran with oil and the US on the agenda - Japanese Prime Minister Shinzo Abe is in Iran for a two-day mission with clear goals: to secure his country’s energy supply, and to bring adversaries Iran and the U.S. to the negotiating table. Both are challenging feats, and they require Abe — an ally of President Donald Trump and the first Japanese prime minister to visit Iran since its 1979 Islamic Revolution — to walk a thin tightrope between Japan’s economic needs and its maintenance of geopolitical relationships. Japan imports nearly all of its oil, and most of it from the Middle East, so sanctions on Iranian crude and potential instability in the region threaten its economy. But it also doesn’t want to anger the U.S., its most powerful ally and security partner. Abe is slated to meet with Iranian Supreme Leader Ayatollah Ali Khamenei and President Hassan Rouhani, and may well attempt to persuade them not to abandon the Iranian nuclear deal, from which the U.S. withdrew in May of last year. Trump gave Abe the green light for his visit, saying last month, “I know for a fact that the prime minister is very close with the leadership of Iran, and we’ll see what happens. That would be fine.” Henry Rome, an Iran analyst and political risk consultancy Eurasia Group is skeptical of progress. “While the meetings may help ease tensions in the short term, Abe will likely fail to convince Iranian leaders to negotiate directly or indirectly with Washington,” he said in a research note Monday.

Australia Is at War With Itself Over China - On one side is the security agencies and Australian Defence Force on the other is other departments and the Parliament and they are in a fight to do the death. Last week we saw an unprecedented raid on Newscorp after it released secret papers relating to a push by the Australian Signals Directorate (the ADF intelligence arm) to spy locally, previously via Herald Sun: Under the plan, emails, bank records and text messages of Australians could be secretly accessed by digital spies without a trace, provided the Defence and Home Affairs ministers approved.…The Sunday Telegraph can reveal the Secretary of the Department of Home Affairs Mike Pezzullo first wrote to the Defence Secretary Greg Moriarty in February outlining a plan to potentially allow government hackers to “proactively disrupt and covertly remove” onshore cyber threats by “hacking into critical infrastructure”.…Under the proposal, seen by The Sunday Telegraph, Home Affairs Minister Peter Dutton and Defence Minister Marise Payne would tick off on orders allowing cyber spooks to target onshore threats without the country’s top law officer knowing.In short, this is about tracking Chinese agents of influence, which is why the ASD is involved (though these days it has e volved beyond just Defense).The media is in uproar and for good reason. The raids were heavy handed and stupid. The proposal itself is potentially overreach. Some are describing it as part of an evolution towards a surveillance state in an era of unconventional threats and terrorism. That is partly true. But there is a larger frame of reference that is all the more threatening. It is the swift deterioration of US/China relations and how our ill-prepared institutions are coping with it.

China exports grow despite U.S. tariffs, but import slump most in nearly three years -  (Reuters) - China’s exports unexpectedly returned to growth in May despite higher U.S. tariffs, but imports fell the most in nearly three years in a further sign of weak domestic demand that could prompt Beijing to step up stimulus measures. Some analysts suspected Chinese exporters may have rushed out shipments to the United States to avoid new tariffs on $300 billion of goods that President Donald Trump is threatening to impose in a rapidly escalating trade dispute. But Monday’s better-than-expected export data is unlikely to ease fears that a longer and costlier U.S.-China trade war may no longer be avoidable, pushing the global economy towards recession. China’s May exports rose 1.1% from a year earlier, compared with market expectations for a modest decline, customs data showed. “We expect export growth to remain positive in June, likely supported by continued front-loading of U.S.-bound exports, but it should then tumble in the third quarter, when we expect the threatened tariffs to be imposed,” economists at Nomura said in a note to clients. “Therefore, we believe Beijing will likely step up its stimulus measures to stabilize financial markets and growth.” Business distortions related to April’s cut in the value-added tax (VAT) may also have eased, helping export readings, Nomura added.

Chinese Rare Earth Exports Tumble As Trade War Accelerates - China, the world’s largest producer and exporter of rare earths elements, sharply reduced its overseas shipments of the critical product in the first five months of 2019, amid growing populist calls by nationalists and officials to use the country’s stockpile as a tit-for-tat retaliation in its trade war with the United States. Exports of rare earth elements fell 16% in May from a month earlier to 3,640 metric tons, according to the General Administration of Customs data. Overseas shipments for the first five months of 2019 fell 7.2% to 19,265 metric tons  compared to the same period last year. In 2018, China produced 120,000 metric tons or 70% of the world’s total rare earths, according to the United States Geological Survey. In the same period, the US mined 15,000 metric tons of rare earths last year. Rare earths are 17 elements on the periodic table with names like europium and ytterbium which share similar chemical and physical properties. Although as abundant in the earth’s crust as other metals, these elements are “rare” because they always occur in nature as compounds and oxides, which make them extremely expensive and environmentally polluting to refine and extract in commercially viable quantities. They are used to provide precision polishes to flat-panel displays, remove impurities in steelmaking and to make phosophers used in incandescent and LED lights. Some are even used as pigments in ceramics. Another commonly used rare earth is neodymium, found in permanent magnets in motors, miniature amplifiers and speakers. According to the SCMP, the declines are pointing to the use of export permits over rare earth as leverage in China’s trade negotiations with the US, the world’s biggest importer of the elements. The US was the world’s largest importer of refined rare earth elements, with 59% of imports valued at US$92 million sourced from China, according to data by the US International Trade Commission.

Wolf Richter: Global Semiconductor Sales Plunge 24% from Peak, Deepest % Plunge since Financial Crisis, Deepest $ Plunge Ever. Here’s Why - Global semiconductor sales dropped 14.6% in April from April last year, to $32.1 billion, on a three-month moving average basis, the World Semiconductor Trade Statistics (WSTS) organization reported Tuesday afternoon. The three-month moving average in April has plunged 24% from the peak last October, thus continuing the deepest plunge in semiconductor sales since the Financial Crisis:   In dollar terms, semiconductor sales plunged by over $10 billion in April compared to the pace in October 2018, the largest peak-to-trough dollar-drop ever. During the Financial Crisis, chip sales dropped by $9 billion from peak to trough.  But in percentage terms, the current plunge doesn’t quite measure up: 24% versus the 39% collapse during the Financial Crisis and the 45% collapse during the long dotcom bust.  The Semiconductor Industry Association (SIA) said in its press release that sales, based on the data compiled by the WSTS, dropped in all major geographic regions in April (three-month moving averages compared to the same period last year):  The SIA “endorses” the WSTS projections that chip sales for the full year 2019 will fall by 12% from the record levels of 2018, to $412 billion. In terms of regions, the SIA expects semi sales to fall across the board for the full year 2019:  Potential tariffs and trade tensions between the US and China and potential export controls of tech products, such as semiconductors, to China has caused a stampede in 2018 to front-run these policies. Just how prescient this stampede was has now been demonstrated by US efforts to clip the wings of Chinese tech and telecom giant Huawei Technologies, whose telecom infrastructure equipment (think 4-G and 5-G) and smartphones, are sold around the globe. They contain US semiconductors. And Huawei has been preparing for these eventualities.

Tour of China Shows a Nation Girding for Protracted Trade War - President Donald Trump is eager to crow about the economic weapon he wielded against Mexico to win concessions on immigration: “Tariffs are a great negotiating tool,” he declared Tuesday.Now, Trump says, it’s China’s turn to cower. Yet to visit China these days is to encounter the limits of his punch-them-in-the-nose strategy. Even as Trump threatens to raise import duties to painful levels, 10 days of meetings with Chinese officials, academics, entrepreneurs and venture capitalists revealed a nation rewriting its relationship with the U.S. and preparing to ride out a trade war. Trump is seeking to increase pressure on Xi Jinping, his Chinese counterpart, before this month’s G-20 summit, but Trump may already have pushed too far. Last month, Xi exhorted his countrymen to a second Long March, an echo of Mao’s seminal strategy to preserve the communist revolution. What Xi didn’t say was that the new march -- this time in the service of China’s own model of capitalism -- is already underway. “This is definitely an inflection point,’’ said Tom Liu, chief executive officer of Shanghai-based data company ChinaScope Financial Ltd. ”People are seeing an indefinite trade shock.’’ And they are planning for it. At Huawei Technologies Co., the telecom giant at the center of the clash, preparations are already on. The U.S. last month labeled Huawei a threat to U.S. national security and placed the company on an export blacklist cutting it off from suppliers such as Alphabet Inc.’s Google and Intel Corp.Trump has since then dangled the possibility of a resolution to Huawei’s woes being part of a larger trade deal. But Huawei executives say they have had no contact with U.S. authorities and rather than count on a settlement they are shifting supply chains and making other preparations for a prolonged fight. “We have full confidence in our own survival,’’ Liang Hua, Huawei’s chairman, told American journalists visiting during a trip organized by the U.S.-China Exchange Foundation, a Hong Kong non-profit run by the territory’s former chief executive. Liang outlined more than a decade of planning to replace U.S. suppliers. Informing part of the decision to move on is the Chinese view of Trump as an erratic partner after four months of negotiations over a broad trade agreement broke down in May. U.S. officials blamed China for reneging on commitments; the Chinese blamed Trump’s ever-changing demands.

China Auto Sales Just Posted Their Worst Month Ever - China's automobile market has continued to catalyze the global auto recession, posting its worst sales month in history for May according to the China Association of Automobile Manufacturers (CAAM). The data showed a decline of 16.4% for May, following a decline of 14.6% in April and 5.2% in March. It was the sharpest decline ever for China's auto industry. Xu Haidong, CAAM’s assistant secretary general ignored the fact that his country was in the midst of a trade war and instead told Reuters: "One key reason for the drop was provinces implementing 'China VI' vehicle emission standards earlier than the central government’s 2020 deadline, stoking uncertainty among manufacturers." Or the same reason Europe has been using to explain away its own automotive depression recession. "We gave the manufacturers too little time to prepare," he continued, also noting that May's drop in demand was attributable to a "decline in purchasing power in the low-to-middle income groups as well as expectations of government stimulus to encourage purchases."

The gaokao is China's notoriously tough entrance exam, which can also get you into western universities — check out its punishing questions - Students across China are studying hard for the gaokao, the country's notoriously tough national standardized test that can get them into universities in countries including the US, UK, Italy, Australia, and Canada. This year's gaokao — which means for "high exam" in Chinese — takes place between June 7 and June 9 this year. It's China's version of the American SAT and British A-level tests, and is known as one of the hardest exams in the world. More than 9.7 million people across the country took it last year, the state-run Xinhua news agency reported.Only Chinese universities accepted gaokao results in the past, but more and more Western institutions have started to accept them. Last year the University of New Hampshire became the first US state university to accept students based on their gaokao scores, rather than have them take other standardized tests. Britain's University of Cambridge, Australia's University of Sydney, Canada's University of Toronto, Italy's Accademia delle Belle Arti di Firenze and some private US institutions also accept it. gaokao parents pray Parents pray for high marks for their children taking the gaokao in Shenyang, northeastern China in June 2018. VCG/VCG via Getty The subjects on the test vary by region but typically include the Chinese language, mathematics, and a foreign language (typically English), Xinhua said. The hardest questions are the essays — which can range from the student's views on philosophy, history, the environment, and President Xi Jinping's policies. Try and tackle 15 questions from past gaokao exams here:

Beijing Bans Washington Post, Guardian Websites Amid Political Crackdown -- China has banned the websites of The Washington Post and The Guardian amid a government crackdown on information surrounding the politically sensitive 30th anniversary of the Tiananmen Square massacre on June 4th, according to the Post - which notes that the two websites were among "the last few major English-language outlets that were still regularly accessible from mainland China" without using a VPN. As we noted last week, Chinese social media sites were placed on lockdown ahead of the anniversary, as messing app WeChat and micro-blogging site Weibo prevented users from changing their personal information, including profile photos. Another Chinese platform - video sharing website Bilibili, said that it suspended real-time comments and other features for "technical upgrades." All but the most oblique references to the incident were immediately scrubbed, and, during the days around the anniversary, users complained about not even being able to access the function to change their avatars.Every language edition of Wikipedia was fully banned in mid-May. A CNN reporter said the network’s website was blocked again this week shortly after CNN.com ran a top story commemorating the 1989 event. -Washington Post Beijing rarely divulges their reasoning for blocking various websites, and it's unclear whether the Post and Guardian bans are permanent. If past behavior is any indicator, they're toast. 

Last Fight For Hong Kong - Over 1 Million March In Protests Against China Extradition Bill -- Over 1 million Hong-kongers (according to the organizers; 240K according to the police), or one in seven, flooded Hong Kong’s streets on Sunday to oppose a proposed extradition bill that would allow Beijing to take people from Hong Kong to stand trial in mainland China. According to the SCMP, it was the most unified protest march in the city in more than a decade, with some calling it the ultimate showdown over the bill, which goes to a vote on June 12 and if passed would allow the transfer of fugitives to jurisdictions. If turnout numbers are accurate, it would represent the biggest protest since 2003, when 500,000 people demonstrated against national security legislation that was later withdrawn by the government.  The sea of marchers set off from Victoria Park just before 3pm and streets in nearby Causeway Bay were soon brought to a standstill as protesters clad in white chanted and sang songs as they walked in the oppressive heat, according to the SCMP.Tensions escalated in recent weeks as Hongkongers from all walks of life have spoken out against the proposal. The massive turnout, with crowds filling public parks and roads up to six lanes wide for more than a mile and a half, heaps pressure on the city’s leaders and their political masters in Beijing to shelve the law, although unlike 2003, China’s ruling Communist Party under President Xi Jinping has in recent years taken a much stronger line against dissent in the former British colony. The proposed law, which would allow suspects to be extradited to mainland China for trial, has sparked anger in an unusually wide swath of the population, from teachers to lawyers and business leaders. The uniting fear is that the law, if passed, would expose citizens to the mainland’s more opaque legal system, where detainees could be subject to torture and other abuses of human rights. It would also remind the local population that HK is merely a Chinese colony now, and its own unique laws could be subverted overnight.

 Hong Kong protesters block access to government headquarters - Riot police fired tear gas, water cannon, and pepper spray after thousands of protesters surrounded the legislature and forced a delay in a debate over a controversial extradition bill. What was a relatively peaceful demonstration erupted on Wednesday at about 3:30pm local time (07:00GMT) as hundreds of protesters tried to storm the legislative council complex, prompting police to retaliate. Black-shirted protesters wearing helmets and goggles taunted police outside the complex as they descended on the streets against the bill which, critics say, will undermine the city's civil freedoms in its "one China, two systems" structure.The frontline of demonstrators in hard hats, their faces covered with masks, moved metal crowd control barriers, ignoring police pleas to stop. After several failed attempts, the crowd gained access to the grounds of the building and the police released more tear gas to push them back.After the majority of the crowd was dispersed, about 100 demonstrators could be seen donning gas masks and holding their ground at one section of the complex.  People in Hong Kong have chafed against what they see as the mainland's increasing influence over the city.Roads and pedestrian overpasses surrounding the legislature building in the heart of the city were crowded with thousands of protesters, ringed in by lines of police clad in riot gear, at about 8:30am (00:30GMT). Near the main vehicle entrance to the complex, protesters engaged in shouting matches with the police, daring them to use pepper spray to force them to disperse. A hardcore few threw crowd-control barriers in a heap outside the gate, just metres away from the line of police, which shifted inward, tightening ranks as one officer warned the police would use crowd-control measures. Protesters pushed foward against the police line to be met with sporadic jets of pepper spray.

As it happened: How Hong Kong's protest march against the extradition bill turned ugly | South China Morning Post -- A protest march ended in violence at the Legislative Council when a mob stormed barricades and police responded with batons and pepper spray.  What began as a peaceful protest, and held for nearly 10 hours, turned sour after midnight. Ugly scenes of violence erupted outside the Legislative Council as a mob stormed steel barricades. Police responded with batons and pepper spray as news cameras rolled.The day started with hundreds of thousands of people flooding the streets to oppose thein the most unified protest march in the city in more than a decade. Some called it the ultimate showdown over the bill, which will resume its second reading on June 12 and if passed would allow the transfer of fugitives to jurisdictions the city had no previous agreement with.Tensions have escalated in recent weeks as Hongkongers fromall walks of lifehave spoken out against the proposal. Petitions against the bill have circulated, thousands of lawyers staged a silent marchand several chambers of commerce havevoiced concerns. The bill's proponents, notably the city's administration, see it as a  vital tool to fight transnational crimeand maintain the rule of law. Our live blog below captures how events unfolded.

Hundreds of thousands are protesting an extradition bill in Hong Kong. Here’s why -  Hundreds of thousands of protesters flooded the streets of Hong Kong on Sunday to demonstrate against proposed amendments to an extradition bill, which would allow the transfer of those accused of crimes to mainland China. The massive demonstration took place just three days before Hong Kong's full legislature considers the bill, which critics fear would let China target political opponents in the former British colony and could undermine its judicial independence. The Sunday protest was one of the biggest in recent Hong Kong history. Police estimated the crowd at 240,000; organizers said it was closer to 1 million. After around 10 hours of peaceful protest, tensions rose when a group of protesters stormed the barriers at the government headquarters. The group briefly made it to the lobby, but police responded with batons and pepper spray. Opponents say the extradition bill will allow China to increase control over Hong Kong's legal system and will target political dissidents, who critics fear could then face unfair trials. Proponents, namely the city's government, say the revised bill will help fight crime and maintain order. Hong Kong currently limits extraditions to jurisdictions with which it has prior agreements with, or on a case-by-case basis. China was excluded because of concerns over its troubled history with legal independence and human rights.The amendments would allow Hong Kong courts to extradite people to jurisdictions even lacking this prior agreement. Despite widespread opposition, Hong Kong's Chief Executive Carrie Lam has championed the legislation.

Hong Kong leader defiant as city gears up for fresh protests over extradition bill (Reuters) - Hong Kong braced for strikes, transport go-slows and another mass demonstration in protest against a proposed extradition law that would allow people to be sent to China for trial, as the Chinese-ruled city’s leader vowed defiance. Hong Kong Chief Executive Carrie Lam said she would push ahead with the bill despite deep concerns across vast swaths of the Asian financial hub that triggered its biggest political demonstration since its handover from British to Chinese rule in 1997. In a rare move, prominent business leaders warned that pushing through the extradition law could undermine investor confidence in Hong Kong and erode its competitive advantages.The extradition bill, which has generated unusually broad opposition at home and abroad, is due for a second round of debate on Wednesday in the city’s 70-seat Legislative Council. The legislature is controlled by a pro-Beijing majority. An online petition has called for 50,000 people to surround the legislature building at 10 p.m. (1400 GMT) on Tuesday and remain until Wednesday. Britain handed Hong Kong back to China under a “one-country, two-systems” formula, with guarantees that its autonomy and freedoms, including an independent justice system, would be protected. But many accuse China of extensive meddling, denying democratic reforms, interfering with local elections and the disappearance of five Hong Kong-based booksellers, starting in 2015, who specialized in works critical of Chinese leaders. Sunday’s protests plunged Hong Kong into political crisis, just as months of pro-democracy “Occupy” demonstrations did in 2014, heaping pressure on Lam’s administration and her official backers in Beijing. She warned against any “radical actions”, following clashes in the early hours of Monday between some protesters and police after Sunday’s otherwise peaceful march.

Protests set stage for historic clash in Hong Kong - Throngs of youthful black-clad demonstrators with umbrellas, goggles and face masks blockaded major roads around Hong Kong’s legislature building on Wednesday, a surge of mass dissent against an extradition bill that, if passed, would allow city residents to be sent to mainland China for trial. Leaderless but highly organized, protesters in their tens of thousands had been in an hours-long stand-off with riot police bearing shields and wielding batons in scenes reminiscent of the protracted Occupy Central democracy protests of late 2014. Police used pepper spray, beanbag rounds, tear gas and even rubber bullets against protesters who defied the show of official force and refused to retreat. The protests have symbolically erupted just after the 30-year anniversary of China’s lethal crackdown on pro-democracy protesters in Tiananmen Square. How the protests, if sustained, will ultimately be handled is unclear, but the stage is now set for a pivotal clash of pro- and anti-Beijing forces in China’s special administrative region. Mass opposition to the bill has fast spiraled into a political crisis for Chief Executive Carrie Lam with escalating street protests and strikes clogging key roads near government offices three days after Hong Kong’s biggest political demonstration since its return to Chinese rule in 1997 drew more than one million people, according to organizers.  The bill has been widely opposed by academics, student activists, legal groups and businesspeople who are typically pro-establishment due to widespread distrust of China’s judicial system and fears that the legislation could be used to hand Hong Kong dissidents, critical journalists and pro-democracy activists to the mainland on spurious charges. Chaotic scenes unfolded throughout the day with restive demonstrators attempting to charge through metal barricades set up at police junctions. Protesters passed medical supplies, goggles, water and food out amongst themselves earlier in the day, while others vowed to obstruct the road until the government abandons the contentious rendition bill.

Hong Kong extradition protests leave city in shock - BBC News - Authorities have shut some government offices in Hong Kong's financial district after the worst violence the city has seen in decades. By Thursday morning the crowds had largely dispersed around government headquarters - where police and protesters had pitched battles on Wednesday. The protesters are angry about plans to allow extradition to mainland China. Despite the widespread opposition, the government has not backed down. However, Hong Kong's Legislative Council (LegCo) delayed a second reading of the controversial extradition bill and it is unclear when it will take place. The second reading, or debate over the extradition bill was originally scheduled for Wednesday. In an attempt to prevent lawmakers from participating in the debate, activists in the tens of thousands blockaded key streets around the government headquarters in central Hong Kong. Police were also out in riot gear. Later the tensions boiled over as protesters tried to storm key government buildings demanding the bill be scrapped. Police responded by firing tear gas and rubber bullets to block them and get them to disperse. After hours of chaos, the crowd eventually dissipated overnight. Rights group Human Rights Watch accused the police of using "excessive force" against protesters. Seventy-two people aged between 15 and 66 were injured in the violence, including two men who were in critical condition and some 21 police officers, nine of whom were taken to hospital. Two protesters have now been arrested for rioting, according to news site SCMP. An SCMP reporter said they were detained while trying to get a check-up in hospital. They had reportedly revealed to medical officers that their injuries were a result of the protests. It is not clear if they are the same men who were described as critical. A Telegram group administrator has also been arrested for conspiracy to commit public nuisance, local news outlets reported.

Surveillance-savvy Hong Kong protesters go digitally dark - Hong Kong's tech-savvy protesters are going digitally dark as they try to avoid surveillance and potential future prosecutions, disabling location tracking on their phones, buying train tickets with cash and purging their social media conversations.Police used rubber bullets and tear gas to break up crowds opposed to a China extradition law on Wednesday, in the worst unrest the city has witnessed in decades.Many of those on the streets are predominantly young and have grown up in a digital world, but they are all too aware of the dangers of surveillance and leaving online footprints.Ben, a masked office worker at the protests, said he feared the extradition law would have a devastating impact on freedoms."Even if we're not doing anything drastic -- as simple as saying something online about China -- because of such surveillance they might catch us," the 25-year-old said.This week groups of demonstrators donned masks, goggles, helmets and caps -- both to protect themselves against tear gas, pepper spray and rubber bullets, and also to make it harder for them to be identified.Many said they turned off their location tracking on their phones and beefed up their digital privacy settings before joining protests, or deleted conversations and photos on social media and messaging apps after they left the demonstrations.There were unusually long lines at ticket machines in the city underground metro stations as protesters used cash to buy tickets rather than tap-in with the city's ubiquitous Octopus cards -- whose movements can be more easily tracked. In a city where WhatsApp is usually king, protesters have embraced the encrypted messaging app Telegram in recent days, believing it offers better cyber protection and also because it allows larger groups to co-ordinate.

Hong Kong activists plan weekend mass rally against extradition bill - Hong Kong activists say they are planning another mass rally at the weekend to pressure the government to drop a plan to allow extraditions to China, as worries over the future of the former British colony’s unique status grow.The Civil Human Rights Front, a political advocacy group, announced Thursday on its Facebook page that it applied for a police permit to hold a march on Sunday.That’s exactly one week after the group claimed a million people rallied for the Hong Kong government to withdraw the contentious legislation it wants to pass this month. Police estimated the turnout last week was far lower, at about 240,000.But it still marked the largest mass demonstration in the Asian trade and financial hub since 2003, when an estimated 500,000 people gathered in the streets to rally against the government’s plans for tighter security legislation.A bullet was fired into the heart of each citizen ... The people of Hong Kong are pained and infuriated. Tensions intensified on Wednesday as clashes between riot police and a large crowd — estimated at more than 10,000 people, according to police — left scores injured in violence outside the local Legislative Council. Police fired tear gas and rubber bullets, while protesters threw objects and charged police lines. Lawmakers were scheduled to debate the bill that critics, including foreign businesses, say threatens Hong Kong’s protections under a “one country, two systems” framework with China. That has been in place since 1997 when the mainland regained sovereignty from Britain.But the protests made holding the session impossible. While the scale of demonstrations has since subsided, Legco — as the Legislative Council is known — has yet to reschedule the debate. Now, with plans for more protests, concerns are rising again. “I don’t know what’s going to happen next because the situation, actually, is quite volatile,” Audrey Eu, a former Legco member, told CNBC’s “Squawk Box” on Friday. The government claims it must act quickly on the bill to plug what it calls a legal “loophole” and extradite a Hong Kong man accused of murder in Taiwan back to the self-governed island. But the change would also allow fugitives to be sent to mainland China, stoking fears the country might use it to go after dissidents and others who speak out against it.

Hong Kong Suspends China Extradition Plan in Stunning Reversal - Hong Kong’s leader suspended efforts to pass a bill allowing extraditions to China, in a dramatic reversal that she said was necessary to restore order in the Asian financial hub and avoid further violence and mass protests. Carrie Lam, Hong Kong’s chief executive, announced the legislative “pause” at a news conference Saturday, even as activists asked hundreds of thousands of residents who marched in protest last weekend to return to the streets and demand her resignation. Lam acknowledged that debate had shattered a period of relative calm in the former British colony, including clashes between demonstrators and police Wednesday that left more than 80 people hurt.  “Polarizing views in relation to this bill in society have given rise to violence, very serious confrontations,” Lam told reporters in a briefing that lasted 75 minutes. “That’s why I have come to the view that I have to do something decisively to address the issue of how could I restore as fast as possible the calm in society, and how could I avoid any more law enforcement officers and ordinary citizens being injured.” Lam stopped short of withdrawing the proposal, which would let Hong Kong reach one-time agreements with mainland China and other jurisdictions, arguing that would contradict her belief that reform was necessary. She said, however, it was unlikely the government would seek its passage before the end of the year. Hong Kong and Macau Affairs Office, the Beijing-based agency that oversees the city, expressed “support, respect and understanding,” the official Xinhua News Agency said Saturday, citing an unnamed spokesman. The statement echoed Lam’s own remarks during her news conference, in which she repeatedly said the decision to suspend consideration was her own.

North Korean Leader's Assassinated Half-Brother Was A CIA Informant- WSJ -- The half brother of North Korea's Kim Jong Un - who was assassinated in Kuala Lumpur International Airport in Malaysia in February 2017, when two women smeared his face with the nerve agent VX - was an informant for the Central Intelligence Agency and met with agency operatives on several occasions, Wall Street Journal reports, citing a person who knew about the matter.  Kim Jong Nam was once considered to be the heir to late North Korean leader Kim Jong Il but he fell out of favor with his father in 2001 after he was caught trying to enter Japan on a false passport, and was arrested at Tokyo airport, apparently en route to Disneyland. Kim Jong Nam had been critical of Kim Jong Un, reportedly saying in 2012 that he “won’t last long” because of his youth and inexperience. The two brothers have different mothers, Bloomberg reports.While details of Kim’s relationship with the CIA are not clear, several former U.S. officials told WSJ that he had no known power base in Pyongyang and would unlikely be able to give details of North Korea’s inner workings. The same unnamed U.S. officials also told the Journal that Kim was also in contact with security services of China. WSJ notes that the CIA has long taken an intensive interest in North Korea, although its totalitarian culture, and the lack of a U.S. embassy there, makes it one of the agency’s hardest targets.  As Joel Wit, a former State Department official and senior fellow at the Stimson Center think tank, noted:

Just why is the North Korean status quo so persistent?  Last month in The Interpreter, I argued that inter-Korean status quo is deeply persistent. US President Donald Trump and South Korean President Moon Jae-in have tried all sorts of tactics in the last 28 months to change things, yet nothing seems to work.In 2017, Trump reached to the limits of coercive bargaining by threatening war against the North. For a few months there, it actually seemed like he might do it, unlike the many hollow threats of his predecessors. But the North did not back down. In 2018, Trump and Moon switched dramatically to a dovish track. In the place of “fire and fury”, North Korea became a brother Korea state in a “love” affair with the US president. All this flattery – including a one-to-one meeting with the US president – does not appear to have worked either.North Korea has not made in any meaningful concessions for its increasing normalisation through engagement. By meaningful concessions, I mean movement on major political or strategic issues such as human rights, nuclear warheads, missiles, other weapons of mass destruction, and so on. Smaller give-aways, such as the return US Korean War MIAs or inter-Korean family reunions, grease the wheels but are not genuinely weighty concessions. Given all the hawkish pressure, followed by dovish engagement – arguably the most intense efforts ever to solicit North Korean change – the lack of change is a puzzle. I see three possible reasons, drawing from the “levels of analysis” literature in international relations theory.

Duterte Turns Death Squads on Political Activists – Foreign Policy - Early in the morning of March 30, Philippine security forces set out to execute dozens of search warrants in the remote towns of Canlaon, Manjuyod, and Santa Catalina on the country’s southern Negros Island. Within hours, the operation had left 14 farmers dead. The Philippine National Police says the “Negros 14,” as they are now known, were communist rebels killed after refusing arrest and firing at police officers. Filipino and international rights groups refute this claim. A fact-finding report by a Philippines rights coalition, based on witness interviews, says that police forced family members to stand outside of their homes before entering and killing their targets, planting firearms as they departed in order to claim they faced armed foes. The chilling report conjures images of the Philippine drug war, known as Oplan Tokhang—“tokhang” translates to “knock and plead.”   Drug war tactics, which the country’s human rights commission says could be responsible for as many as 27,000 extrajudicial killings, have become the foundation of President Rodrigo Duterte’s developing counterinsurgency strategy—and rights groups allege its range of targets is growing to include an expanding list of those whom Duterte and his allies consider their enemies. “This is just the beginning. I think this is the logical morphing of the drug war.” Duterte, who insists a supposed communist plot called “Red October” threatens his presidency, recently threatened to suspend the writ of habeas corpus for his critics and unveiled an opposition “matrix” containing supposed links between political opponents, journalists, activists, and communist leaders. Security forces, said Conde, are “no longer making any distinction as to who to target as long as the directive is clear. So they can use the methods of the drug war [to] go after these people.”

India to buy US missile system to shield Delhi - India is swiftly moving ahead to acquire the National Advanced Surface to Air Missile System-II (NASAMS-II (https://timesofindia.indiatimes.com/topic/NASAMS-II)) from the US, which will be used along with indigenous, Russian and Israeli systems to erect an ambitious multilayered missile shield over the National Capital Territory of Delhi against aerial threats ranging from drones to ballistic missiles. Defence ministry (http://timesofindia.indiatimes.com/topic/Defence-ministry) sources said the US is likely to send the final draft of the ‘letter of acceptance’ for the sale of NASAMS-II to India under its foreign military sales programme, at a cost of over Rs 6,000 crore (almost $1 billion), by July-August.“Several rounds of negotiations, including selection of sites for deployment of the missile batteries around Delhi, have already taken place. Once the deal is inked, the deliveries will take place in two to four years,” said a source. The MoD had earlier granted ‘acceptance of necessity’ to the NASAMS acquisition, which was followed by India issuing a formal ‘letter of request’ (LoR) to the US, as reported by TOI in July last year. Though the US is mounting pressure on India to also consider its Terminal High Altitude Area Defence (THAAD) and Patriot Advanced Capability (PAC-3) missile defence systems, MoD sources said “there is no plan to scrap” the $5.43 billion (almost Rs 40,000 crore) deal inked with Russia for five squadrons of the advanced S-400 Triumf surface-to-air missile systems. India inked the S-400 deal with Russia in October 2018 after four years of extensive negotiations and an inter-governmental agreement despite the threat of sanctions under the US law called CAATSA (Countering America’s Adversaries through Sanctions Act). “The American THAAD is not comparable to the Russian S-400, which meets our operational requirements,” said another source.

Language Policy: Education in English Must Not Be the Prerogative of Only the Elites - Released in the first flush of its stunning election victory, the NDA government’s draft National Education Policy categorically sought to convert our multilingual nation into a Hindi-speaking one. After protests in South India, the draft was ‘revised’ and a three-language policy mooted in which it was said that Hindi would not be imposed on states which did not want to compulsorily teach it. However, the policy envisages that every child should now learn three languages – English, the language of the state in which they are born and also one more language of another state. The draft policy thus says that children in Hindi-speaking states will have to learn another language from some other linguistic region of India. South Indian states like Tamil Nadu must also teach, apart from English and Tamil, one more language of another state. This language could be from South India – i.e. Malayalam, Kannada or Telugu – or Bengali, Assamese, Odia or even Hindi or Urdu. Bhartiya Janata Party and Rashtriya Swayamsevak Sangh leaders are worried that their own ministers from South India are perhaps not so comfortable speaking Hindi. One could see that from the recent oath-taking ceremony. Nirmala Sitharaman and Sadananda Gowda took their oaths in English. That the BJP would come up with a plan to impose Hindi on all states is hardly a surprise. But this policy hit a roadblock and hence the NDA government has chosen to take temporary refuge in the ‘three language formula’. At the same time, one point is worth noting: This may be the first time the BJP’s education policy endorses the idea that English should be taught across the country in all government schools. Of course, the plan envisages that government schools treat English as just another subject while the medium of instruction will be the language of each state. However, the medium of instruction in private schools will be English while the one constant in the government’s language policy from UPA to NDA is this: the mandi-bazaar schools, where the masses study, must teach their students only in Hindi or in other regional languages.

Mali attack: At least 95 killed in ethnic Dogon village - At least 95 people were killed in an attack on an ethnic Dogon village in central Mali in the latest deadly violence to hit the restive region. Nineteen others were missing after unknown armed men attacked the village of Sobane-Kou, in the Mopti region, in the early hours of Monday, the government said in a statement. No immediate claim of responsibility was made but the massacre bore the hallmarks of tit-for-tat ethnic attacks that have claimed hundreds of lives. It came less than three months after nearly 160 members of the Fulani ethnic group were killed by a group identified as Dogon. "This country cannot be led by a cycle of revenge and vendetta," Mali's President Ibrahim Boubacar Keita told ORTM public television from Switzerland, where he cut short an official visit. He called on Malians to come together to "allow our nation to survive, because this is a question of survival". The attackers also killed animals and burned down houses, the government statement said, adding an investigation was under way. A Malian security source at the site of the massacre said: "A Dogon village has been virtually wiped out." A survivor who gave his name as Amadou Togo told the AFP news agency "about 50 heavily armed men arrived on motorbikes and pickups". "They first surrounded the village and then attacked - anyone who tried to escape was killed," Togo said. "Some people had their throats cut or were disembowelled, grain stores and cattle were torched. No one was spared - women, children, elderly people."

Venezuela inflation falls below 1 million percent in May for first time since 2018: congress (Reuters) - Venezuela’s annual inflation dropped below 1 million percent in May for the first time since 2018, the opposition-run congress said on Monday, the result of the central bank restricting the domestic money supply. Consumer prices in the 12 months ending in May rose 815,194%, the legislature said, compared with 1.3 million percent in April. Prices rose 906 percent in the first five months of year, it said. The slowdown is the result of regulations requiring banks to keep a greater percentage of the bolivar currency in reserve, and because the central bank is issuing fewer new bolivars than in the past. The result is that the banking system has less capacity to lend, said legislator Angel Alvarado in an interview, which will further slow an already ailing economy. “They are slowing inflation through greater economic contraction,” Alvarado said. The figures are significantly more dire than those published by the central bank last week that showed inflation at around 130,060% in the 12 months ending in April, part of the first official economic indicators released in more than five years. Those figures show that the economy, which went into recession in 2014, contracted 22.5% in the third quarter of 2018 with respect to the same period a year earlier. The government of President Nicolas Maduro says Venezuela’s economic problems are caused by U.S. sanctions that have crippled the OPEC member’s export earnings and blocked it from borrowing from abroad. Critics say a dysfunctional system of price and currency controls along with a wave of nationalizations of private businesses turned what was once a strong economy into a collapsing basket case.

WTO Warns Global Trade May Plunge 17% In Full Trade War -  In the event of a full-blown trade war, global trade would collapse by 17%, a move that would rival the Dot Com bust, warned the World Trade Organization (WTO). Keith Rockwell, director for information and external relations at WTO, told regional Asian parliamentarians on Tuesday that the global synchronized decline is due to protectionist measures on the rise. Rockwell said tariffs aren't uncommon between trading partners, but the sheer magnitude of trade duties between the US and China since early 2018 have been disturbing."Between October 2017 and October 2018, measures were put in place affecting US$588 billion worth of trade," said Rockwell, at the event organized by the S. Rajaratnam School of International Studies (RSIS) and the WTO.This amount of tariffied trade comes in at seven times more than the previous year and doesn't include the recent tariff escalation.Rockwell said, during the conference about international trade flows, that the WTO has reviewed 24 trade dispute settlement cases in 2018, mostly related to the deepening trade war between the US and China.The increased trade tensions have forced the International Monetary Fund (IMF) to slash its global growth forecast from 3.7% to 3.5%."If the two sides carry through with their threats to wipe out all bilateral trade via prohibitive tariffs, this could have the impact of knocking off even more," he added. Rockwell said global imports of capital goods dropped 3% in 1Q19, the lowest level seen in over three years and a warning that the global economy is cycling down through summer. "We see uncertainty rampant, we see manufacturing output stalling, and export orders are down. All of this bodes ill for economic growth," he said.

$11.7 Trillion- Global Negative-Yielding Debt Back To All Time High -  Three years after the stock of global debt with negative yields hit an all time high just above $12 trillion, the NIRP trap is back, and the amount of sovereign debt sporting a negative yield is just shy of all time highs, hitting $11.7 trillion today according to Bloomberg, nearly double where where it was just last September. Of course, that this is taking place with the S&P500 just a few percent off all time highs is the reason why traders are having nightmares - this does not happen when everything is hunky dory in the economy, and in fact it is an indication that risk assets are overinflated only for one reason: expectations that the Fed will step in and "rescue" risk assets. This is also a nightmare for the Fed, because - in a reflexive feedback loop - with the S&P near record, unemployment at all time lows, and wage inflation near the highest it has been since the financial crisis, the Fed will be hard pressed to justify a rate cut at this time, and not be accused of having turned political, and easing only to placate President Trump who has repeatedly stated he is unhappy with the Fed's "high" rates. Which is also why as Jeff Gundlach sayd yesterday, next week's FOMC decision will be especially interesting, why the potential for a huge disappointment is present if the Fed does not sound nearly as dovish as the market expect it to, and why Powell will be eager to keep the press conference as short as possible. What is striking is that even though a rational person would certainly brace for a hawkish surprise - as that would immediately result in the "max pain" scenario in which everyone is forced to reverse hawkishly - the market refuses to do so, and as BofA's Michael Hartnett shows in his latest weekly "flow show", in the past 6 months there has been a record $47bn inflows into government bond funds...

For Central Americans, Fleeing to Europe May Beat Trying to Reach U.S. NYT — For María Marroquín, life in El Salvador had become intolerable. Gang members extorting money had killed merchants in the market where she worked. She feared for her 27-year-old son, David, after a cousin had been kidnapped and was never found. So last year, Ms. Marroquín, now 53, decided to flee the country. But unlike many Salvadorans making a similar, wrenching decision, she headed across the Atlantic Ocean to Europe instead of joining the tens of thousands of people trekking north in hopes of reaching the United States and seeking asylum there. “Going to the United States would be crazy right now,” she said, citing the Trump administration’s push for tougher immigration policies. An increasing number of Central Americans have been weighing their options and begun heading to Europe instead. The number seeking asylum in Europe has increased nearly 4,000 percent in the last decade, according to official figures, and the rate of arrivals is accelerating. Nearly 7,800 applied for asylum in Europe last year, up from 4,835 in 2017. The distance may be greater, but many have found that the journey to Europe is safer and much cheaper than paying smugglers to get through Mexico to the United States. Ms. Marroquín has another son in Belgium, who filled out the paperwork to allow her, along with her husband, her daughter and David, to enter as tourists. When she had saved enough money, she booked a flight to Brussels. A few days after arriving, they applied for asylum.

Scottish government threatens to seize Irish fishing vessels -- Last week, the Irish government received a formal letter of notice from the Scottish government’s minister for external affairs, Fiona Hyslop, threatening “enforcement action” against Irish fishing vessels found to be operating within 12 miles of Rockall. Hyslop made clear she intended to dispatch fishery protection vessels to the area. Fergus Ewing, the Scottish minister for the rural economy, indicated that Irish fishing vessels refusing to “cease and desist” from fishing “would be boarded and action taken in accordance with law.” In response, the Irish government insisted there was “no basis for excluding Irish fishing vessels from the Rockall waters, as they are legitimately pursuing EU fishing opportunities in these waters and have done so unhindered for decades.” Tánaiste (deputy premier) and foreign minister, Simon Coveney, told the press, “We have never recognised UK sovereignty over Rockall and accordingly we have not recognised a territorial sea around it either.” Agriculture minister Michael Creed said that the Dublin government was prepared to take the matter to the EU courts. Rockall’s status has long been contested. The volcanic plug was first claimed by the British government in 1955 to prevent the islet being used by Soviet observers of British missile tests from the island of South Uist in the Outer Hebrides. Britain formally incorporated Rockall into the Scottish county of Inverness in the Island of Rockall Act of 1972, following attempts the previous year to install a light beacon on the islet’s summit. The move was designed to reinforce British rights to whatever mineral resources might lie underneath the seabed. The Irish government, however, has never accepted the British claims, which were undermined by a 1982 United Nations convention on the law of the sea. The convention ruled that “Rocks which cannot sustain human habitation or economic life of their own shall have no exclusive economic zone or continental shelf.”

Everything you think you know about Leavers and Remainers is wrong It is commonly assumed that Leave supporters want to leave the EU — regardless of the type of Brexit — more than Remain supporters want to remain. But a new YouGov survey of over 1,600 British citizens carried out by academic researchers shows it is wrong. In fact, the opposite is true. While 33 per cent of the country now want a no-deal Brexit, 42 per cent say it is their least-favourite outcome. Our survey also shows that support for the Brexit Party is higher among financially comfortable voters — adding to previous research showing that support for no-deal is also higher in that group. Remainers care more about remaining than Leavers do about leaving (regardless of the Brexit outcome) The survey asked respondents to rank the following potential Brexit outcomes in order — no-deal, Theresa May’s withdrawal agreement, a softer Brexit and remaining in the EU. It then asked people how much they preferred each option to the one ranked below it. For example, someone who had ranked no-deal as their first choice and May’s deal as their second choice was then asked whether they preferred no-deal “a bit”, “a fair amount” or “a lot” more than May’s deal. Over two-thirds (69 per cent) of respondents who gave Remain as their first choice preferred remaining a lot compared to their most preferred Leave option (in most cases, this was a softer Brexit). By contrast, only a third (35 per cent) of people who gave Leave as their first choice preferred their least preferred Leave option “a lot” compared to remaining. This is an important finding. Why? Several prominent politicians have argued that leaving the EU with some form of soft Brexit would be a reasonable compromise. Their reasoning is that Leave voters simply want to get on with leaving, and do not care much about the manner in which the UK exits the EU. They assume that giving Leavers what they want would then open up the space to implement a softer Brexit deal of the kind Remainers would be able to live with. These results show that neither part of the argument stacks up. Many Leavers do have strong preferences between different Leave outcomes. Forty five per cent have at least one option that they prefer “a lot” over another Leave option. Almost a quarter (24 per cent) feel so negatively about some of the Leave options that they would prefer to Remain rather than see it implemented. What this means is that whichever way the government chooses to leave the EU will end up making a large number of Leavers unhappy. As for Remainers, the fact of leaving the EU itself would also make many of them unhappy, even if the UK left with a soft Brexit. Only 10 per cent of them say they only prefer Remain “a bit” to their most preferred Leave option. Neither our survey or the recent European parliament election results provide much evidence that most voters — whether Leavers or Remainers — would accept a compromise.

UK’s Boris Johnson says would withhold Brexit bill as PM - Boris Johnson, considered the frontrunner to succeed British Prime Minister Theresa May, said on Saturday he would refuse to pay the country's Brexit bill until the EU agrees better withdrawal terms. The former foreign secretary -- the leading contender to replace May after her resignation as Conservative leader Friday -- also signalled he would scrap a controversial provision for the Irish border contained in the current divorce deal. "Our friends and partners need to understand that the money is going to be retained until such time as we have greater clarity about the way forward," he told The Sunday Times. "In getting a good deal, money is a great solvent and a great lubricant," Johnson added, in his first newspaper interview since launching his bid to become Britain's next premier. May stepped down as Conservative Party leader on Friday and formally triggered the race for a successor -- currently being contested by Johnson and 10 other MPs -- but will remain prime minister until a new leader is chosen. The leader of the party, which won the most seats at the last general election in 2017, automatically becomes prime minister. The battle is expected to conclude by the end of next month, with ex-London mayor Johnson the bookmakers' favourite. In a boost to his campaign, several cabinet members this weekend joined a growing number of centrist Tory MPs in declaring they were ready to throw their support behind him. They included Communities Secretary James Brokenshire, Transport Secretary Chris Grayling and Welsh Secretary Alun Cairns. Johnson argued Saturday that only he could defeat leftist Labour leader Jeremy Corbyn and anti-EU populist Nigel Farage, whose new Brexit Party has been poaching Tory voters disgruntled at their party's handling of Brexit. "This can only be achieved by delivering Brexit as promised on October 31," he said. Britain's departure from the European Union has been delayed twice under May amid parliamentary gridlock over her withdrawal agreement with Brussels, with the end of October the latest deadline. The so-called Irish backstop provision has proved a key stumbling block in the process. The arrangement would prevent the return of border checks between the British province of Northern Ireland and the Republic of Ireland if the sides fail to agree a free trade pact at the end of a transition period after Britain leaves the bloc.

 Ten Tories Vie to Be the Next U.K. Leader - A record 10 British Conservatives will fight each other for the chance to lead their party and the country after the race to become the next prime minister formally opened. Candidates including the favorite, Boris Johnson, and his highest profile rivals, Environment Secretary Michael Gove and Foreign Secretary Jeremy Hunt, made it safely onto the ballot paper when nominations were announced. All the candidates agree that Britain has to leave the European Union. But when it comes to how exactly to resolve the Brexit crisis that brought down Theresa May, there are few specifics. The list of 10 is the largest field of contenders in a Tory contest since the party first began electing leaders in 1965. Over the next two weeks, 300 Tory politicians will narrow down the field to two. Then 160,000 party members will vote by post for the next leader. The result is expected in the week of July 22.

Boris Johnson, the frontrunner to be the UK’s next prime minister, explained  - Boris Johnson’s day has finally come. Maybe. The 54-year-old Conservative member of Parliament, former foreign minister, and former mayor of London is the presumed frontrunner in the crowded contest to replace outgoingPrime Minister Theresa May, who was forced to step aside after failing to deliver a Brexit deal.An ardent backer of Brexit, Johnson has a reputation for brashness, bombast, bending the truth, and really bad hair, which has earned him more than a few comparisons to President Donald Trump (who also happens to be a fan of his).Johnson can be a cringeworthy character (see: that time he got stuck dangling from a zipline), but that’s also somehow part of his charm, and why he’s among the most popular Conservative politicians in a party that isn’t too popular right now. He’s also been a vocal opponent of May’s Brexit deal.But Johnson’s critics see him as a calculating self-aggrandizer, someone who’d do or sayjust about anything to get ahead. Or, as one prominent Conservative politician once put it: Johnson “waits to see the way the crowd is running and then dashes in front.”Johnson is now one of 10 candidates vying for the prime ministership, and though he’s the presumed favorite right now, there’s always a chance that his candidacy implodes. But his is a name you’ll be hearing a lot of now that May has officially stepped down as Conservative leader as of last week and the contest to replace her has begun.So here’s what you need to know about Johnson and the leadership contest that may or may not make him the British prime minister — and the next in line to solve Brexit, a crisis that’s also partly of Johnson’s own making.

Boris Johnson supporters want no-deal Brexit and less talk of climate change – new survey of party members reveals -- By the end of July the UK will have a new prime minister. They will be chosen not by the electorate but by a group of around 160,000 members of the Conservative Party. This selectorate gets to choose between the two candidates who finish first and second in a series of votes held among Conservative MPs.There has, perhaps not surprisingly, been a degree of disquiet expressed about this situation. Members of political parties are, generally speaking, more zealous than members of the public. Some argue that it might be better to leave the choice of the country’s PM up to MPs. They, at least, have a direct mandate from voters. And, since governments in parliamentary systems must retain the confidence of the legislature in order to stay in office, allowing MPs to choose would at least guarantee a chain of democratic accountability from executive to electorate. That is bypassed completely when party members alone make the decision.Such concerns are surely all the more pressing because, as our research has already shown, grassroots Conservatives can hardly be said to be representative of the country as a whole, either demographically or ideologically. There are far more men among them than there are women; most of them live in the southern half of the country; they are generally pretty well-off; they are relatively old (although not quite as ancient as often suggested); they are very, very white; and they are also significantly more right wing than the average voter – whether we’re talking about their economic or social attitudes.Our new analysis, however, using data from a recent survey of Conservative Party membersthat was kindly provided to us by Chris Curtis of YouGov, reveals something that is possibly even more worrying for critics of the process. The party members who support the clear front runner, Boris Johnson, are even more ideologically unrepresentative of British voters than are the bulk of their counterparts.  Indeed, compared to the kind of members drawn to the two contenders who, currently seem to stand the best chance of grabbing the crucial runner up spot – the environment secretary, Michael Gove, and the foreign secretary, Jeremy Hunt – Johnson’s supporters look anything but moderate.

US Secretary of State Pompeo threatens “push-back” to prevent a Corbyn Labour government -- In a closed-door discussion last week, US Secretary of State Mike Pompeo lifted the veil on plans to prevent a Jeremy Corbyn-led Labour government from coming to power in Britain. In an audio recording of a meeting held last Tuesday with the Conference of Presidents of Major American Jewish Organizations, Pompeo is asked if Corbyn “is elected, would you be willing to work with us to take on actions if life becomes very difficult for Jews in the UK?” Pompeo replied, “It could be that Mr. Corbyn manages to run the gauntlet and get elected. It’s possible. You should know, we won’t wait for him to do those things to begin to push back. We will do our level best … It’s too risky and too important and too hard once it’s already happened.” The recording was leaked to the Washington Post, which notes that Pompeo received “fervent applause from attendees” for these comments. The statements were made as US President Donald Trump was in Britain during his three-day state visit. Pompeo’s sinister language confirms that moves to remove Corbyn from the political scene before he is ever allowed to take power are being actively discussed. Extreme right-wing and fascistic elements have been behind the moves to remove Corbyn from the outset. Central to the “Get Corbyn” operation, in place since the day he was elected Labour leader in September 2015, were the US intelligence services—in league with MI5, MI6 and the Israeli government and its intelligence agency, Mossad. The operation has been organised via the Blairite faction of the Labour Party, backed by the ruling Conservative Party and leading representatives of the military.

Brexit: Jeremy Hunt claims Angela Merkel said EU ‘willing to negotiate’ with new PM -- Jeremy Hunt has claimed German Chancellor Angela Merkel told him the EU "would be willing to negotiate" on the Brexit deal with a new prime minister. He is one of a number of candidates in the Tory leadership race insisting they could somehow succeed where Theresa May failed in striking a better Brexit deal with Brussels. The European Union has repeatedly said it would not reopen the Withdrawal Agreement, but Michael Gove - seeking to get his campaign back on course after revelations over his past cocaine use - said "changing the prime minister changes everything". Boris Johnson would use the £39 billion divorce bill to secure a better deal, refusing to hand over the cash unless improved terms were on offer. And Sajid Javid said he would offer to spend "hundreds of millions" on a technological solution to the Irish border question. While hard Brexiteer Esther McVey followed Dominic Raab in saying she would prorogue Parliament to leave the EU without a deal if she became Prime Minister. She accused MPs trying to prevent Brexit of "tearing up 400 years of history". The former work and pensions secretary said it would not be her "priority" to suspend sittings in the House of Commons in the run-up to the October 31 deadline, but said she would be willing to "use all the tools at our disposal" if she won the race to replace Theresa May. Brussels' chief negotiator Michel Barnier has stressed that the deal struck with Mrs May remained the only one on the table and "a new prime minister will not change the problem".But Mr Gove told the BBC's Andrew Marr Show he would have a "smart negotiating team led by myself and other politicians, rather than officials, explaining to the European Union what needs to change in order to make sure we honour the referendum result".

Pound Tumbles After Parliament Rejects Move To Block No-Deal Brexit -  After several weeks in which headlines from the endless farce that is Brexit were mercifully absent around the flux surrounding Theresa May's resignation, we have some bad news: Brexit is back... and with a vengeance because moments ago cable, which had been rising gingerly in recent days, plunged after the House of Commons voted by 309 votes to 298 to reject a motion blocking a no-deal Brexit (something it had voted the opposite way on just a few weeks ago), or specifically to take control of the parliamentary agenda on June 25 to allow time to pass legislation blocking a no-deal divorce from the EU. The motion, proposed by the Labor Party and backed by other opposition parties and some rebel Tory MPs, was opposed by the government (even if it remains unclear who will lead said government). The Labour party said the bill was necessary to stop a new prime minister from taking Britain out of the European Union without parliament’s consent when the latest EU deadline expires on Oct 31. Pound tumbled immediatly on this, sliding as much as 0.3% to 1.2688, with Mizuho's head of hedge-fund currency sales Neil Jones, saying that "the pound should go down more than this," says as Parliament is "unable to obtain control to block a no-deal Brexit now." "If it can’t be done now with potential hardline Brexiteers on the verge of taking over the PM helm, then the market will have doubts it can be done at all. The pound is being sold off on this basis" Jones said.

Government warned of another Grenfell-type disaster as 60,000 people still living in buildings covered in same flammable material Almost 60,000 people are still living in tower blocks covered in the highly flammable material that was used on Grenfell Tower, two years on from the blaze at the west London block, new figures have revealed. There are 24,800 homes in high-rise blocks that are still covered in Aluminium Composite Material (ACM) cladding that is “unlikely to meet building regulations”, ministers admitted. The ACM panels were widely blamed as one cause of the rapid spread of the fire at Grenfell, which killed 72 people, and have since been banned by the government. But ministers have been criticised over the pace at which the material is being removed from the buildings, with more than eight in 10 yet to have the cladding taken down – a figure that rises to more than nine in 10 for privately-owned blocks. Ahead of the second anniversary of the Grenfell fire next week, Labour warned that the failure to remove the cladding from other buildings meant “the risk of such a tragedy being repeated is still far too high”.

Barking fire: residents claim safety fears about flats were downplayed Residents at a six-storey block of flats in Barking, east London, that was engulfed in flames on Sunday have claimed their concerns about potential fire safety breaches were downplayed by its builders only last month. About 100 firefighters and 15 fire engines were dispatched to deal with the blaze on De Pass Gardens that tore through wooden balconies forcing it and neighbouring flats to be evacuated. Peter Mason, chair of the Barking Reach residents’ association, told the Guardian that in early May he contacted the builder Bellway Homes to ask for the fire risk to be investigated after BBC Watchdog broadcast claims of fire safety problems at two other developments by the same builder. In an email seen by the Guardian from the firm’s fire safety helpline last month, Bellway told him not to worry. In a section headed Your Home it said the construction method used on the development in Scotland examined by Watchdog was different and so the Barking homes were not affected in the same way. It concluded: “We understand that these news articles are highly alarming for all residents of new homes and I hope that the above statement has allayed any fears you may have over the safety and construction of your Bellway home.” Mason said he felt “gut-wrenched” by the fire, adding that people had lost their homes and possessions and were in severe distress. The fire appeared to rip through the wooden cladding around the balconies of the building and may have been caused by a barbecue being lit on one of the balconies, Mason said. Twenty flats were destroyed by the flames and a further 10 were damaged by heat and smoke. One man and one woman were treated at the scene after suffering from smoke inhalation. No other injuries were reported.

The disastrous roll-out of the UK’s digital welfare system is harming those most in need  - The UK government has embarked on an ambitious strategy to digitise and automate the delivery of welfare services, but misplaced reliance on these technologies is threatening to further unravel the social safety net.  Last week, the United Nations expert on poverty and human rights and Human Rights Watch published their respective findings on the state of poverty in the UK, documenting the toll of austerity policies on the rights of the poorest people in British society. The UN report, written by Professor Philip Alston, warned in particular that the “British welfare state is gradually disappearing behind a webpage and an algorithm.” The country’s transition to digital welfare is closely linked to its austerity-motivated efforts to slash spending on welfare and other essential public services, while at the same time fundamentally restructuring the social security system. In 2012, the government created Universal Credit, which consolidated six social security benefits into a single benefit paid monthly.  Universal Credit is designed to be “digital-by-default”: most beneficiaries are expected to apply for and manage their benefits through an online portal, and offline means of obtaining benefits have been pared back. The Department of Work and Pensions, which oversees Universal Credit, has claimed that the online delivery of benefits would make them “easier to access” and “cheaper to provide.” In practice, however, the rollout of Universal Credit reveals a mismatch between the government’s digital aspirations and the rights of some of the country’s most vulnerable people. The UN report found that many claimants who lack digital literacy skills or cannot afford internet access at home experience difficulties claiming their benefits online. The burgeoning demand for digital assistance with Universal Credit has transformed public libraries, which provide free computer services, into makeshift crisis centres – a role they are ill-equipped to undertake in light of staff shortages and their own budget cuts.

Sajid Javid signs US extradition order for Julian Assange - The home secretary, Sajid Javid, has revealed he has signed a request for Julian Assange to be extradited to the US where he faces charges of computer hacking. Speaking on BBC Radio 4’s Today programme on Thursday, Javid said: “He’s rightly behind bars. There’s an extradition request from the US that is before the courts tomorrow but yesterday I signed the extradition order and certified it and that will be going in front of the courts tomorrow.” Javid’s decision opens the way to the court sending the WikiLeaks founder to the US. Assange faces an 18-count indictment, issued by the US Department of Justice, that includes charges under the Espionage Act. He is accused of soliciting and publishing classified information and conspiring to hack into a government computer. Javid said: “It is a decision ultimately for the courts, but there is a very important part of it for the home secretary and I want to see justice done at all times and we’ve got a legitimate extradition request, so I’ve signed it, but the final decision is now with the courts.” The 47-year-old Australian was too ill to appear last month at a hearing at Westminster magistrates court in relation to the US request. The hearing has been rescheduled for Friday, and depending on Assange’s condition, may take place at Belmarsh prison where he is being held.