Powell says Fed is ready to raise rates faster if needed - Federal Reserve Chair Jerome Powell said the central bank will take the “necessary steps” to get inflation down even if that means increasing interest rates more rapidly than currently anticipated and eventually to levels that slow the broader economy. Policymakers raised the benchmark lending rate by a quarter point at their meeting last week, the first increase since December 2018, and signaled six more hikes of that magnitude this year, based on the median projection. The rate is anticipated to reach 2.8% in 2023, beyond the so-called neutral rate of about 2.4% that neither speeds up nor slows down economic activity.“If we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so,” Powell said Monday in prepared remarks to the National Association for Business Economics. “And if we determine that we need to tighten beyond common measures of neutral and into a more restrictive stance, we will do that as well.”
Powell opens door to faster hikes, higher rates - Federal Reserve Chairman Jerome Powell on Monday said that the central bank will not hesitate to raise interest rates at a faster than typical pace to curb inflation. In a Monday speech to the National Association of Business Economists (NABE), Powell opened the door to raising interest rates in 0.5 percentage point increments and setting them at a level meant to restrict the economy. Powell touted the strength of the U.S. job market and overall recovery from the coronavirus pandemic, expressing confidence that the Fed won’t cost the economy job gains. Even so, Powell made clear the Fed would no longer wait for supply chains to normalize or other shocks to fade to hike interest rates and pull back on stimulus. “Price stability is essential if we are going to have another sustained period of strong labor market conditions,” Powell said. “We will take the necessary steps to ensure a return to price stability. In particular, if we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so. And if we determine that we need to tighten beyond common measures of neutral and into a more restrictive stance, we will do that as well.” Powell’s comments come one week after the Fed kicked off a series of interest rate hikes meant to cool off inflation that has run much higher and lasted longer than the bank and many economists expected. Annual inflation as measured by the personal consumption expenditures price index hit 6.1 percent in January, more than three times the Fed’s annual target of 2 percent. The Fed slashed interest rates to near zero levels in March 2020 to help stimulate the economy by reducing borrowing costs to encourage lending and investment. The bank is now attempting to raise interest rates to a neutral level — one that does not stimulate or restrain the economy — without harming the long-term prospects for job growth. The Fed raised its baseline interest rate range by 0.25 percentage points last week and projected doing so at least six more times this year. But several Fed officials have called for raising rates by 0.5 percentage points in the hopes of slowing inflation sooner. Powell did not say whether he personally thinks a 0.5 percentage point hike will be necessary at the Fed’s next monetary policy meeting in May, but hinted it could be necessary if inflation does not begin to settle down. He added that while the Fed held off on an increase during previous pandemic-driven supply shocks, the bank will not hesitate to hike rates even if the war in Ukraine sends prices higher. “In normal times, when employment and inflation are close to our objectives, monetary policy would look through a brief burst of inflation associated with commodity price shocks,” Powell said. “However, the risk is rising that an extended period of high inflation could push longer-term expectations uncomfortably higher, which underscores the need for the committee to move expeditiously as I have described.”
Mayhem in the Treasury Market as Powell Adds 50-Basis-Point Rate Hikes (Plural) to Menu, QT “As Soon As” May - By Wolf Richter -Another day, another rout in the bond market. Bond yields are an inverse reflection of bond prices: rising yields means bond prices fell. The 10-year Treasury yield at the moment spiked by 16 basis points to hit 2.31% in afternoon trading, the highest since May 2019.One of the trigger points was possibly – though you can never really tell with these crazy markets – that Fed Chair Pro Tempore Jerome Powell spoke, confirming the Fed’s new-found religion in using its monetary tools to tamp down on inflation, at least a little bit, while trying to achieve a “soft landing” or at least a “soft-ish landing.”His speech included a line that stated that the Fed may impose bigger rate hikes, such as 50-basis-point rate hikes, (possibly plural) if needed to get there:“In particular, if we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so,” he said.So here we go. The two-year Treasury yield spiked by 18 basis points to 2.13% at the moment, the highest since May 2019:All Treasury yields are still ridiculously below the rate of CPI inflation, which spiked to 7.9% in February, and they have a lot of catching-up to do, and they remain deeply negative in real terms.The average 30-year fixed mortgage rate jumped to 4.66% today, the highest since December 2018, according to the daily data by Mortgage New Daily. And all mortgage rates, though they spiked, remain negative in real terms, even for subprime mortgages:And nearly all corporate bond yields, though they too have risen sharply, remain negative in real terms, including most junk bond yields down through the category of single-B, which is considered “highly speculative” – here’s my cheat sheet on corporate bond credit ratings by ratings agency.You have to go down all the way into deep-junk, to CCC-rated bonds and below to beat inflation, where you’re facing anything from “substantial risk” of default to actual default, which is what it now takes to beat inflation while losing all or part of your capital trying, thanks to the most reckless Fed ever.The weight of the Fed’s gargantuan balance sheet is pushing down on long-term yields that the Fed spent years repressing with trillions of dollars of QE since 2008, and most radically since March 2020. QE has ended, but the weight is still there, the $5.76 trillion in Treasury securities and the $2.73 trillion in MBS, for a combined $8.5 trillion in securities. The Fed has taken $8.5 trillion in supply of bonds off the market, and the yield curve reflects that.The Fed is talking about lowering its weight. Quantitative Tightening “could come as soon as” in May, Powell confirmed today, adding that no decision has been made. But when it starts, it won’t move nearly fast enough.At the same time, while long-term yields are repressed by the Fed’s balance sheet, the shortest-term yields of one month to three months are firmly controlled by the Fed’s policy rates.In the one-year through three-year range, it’s a three-way tug of war (why has no one invented that sport yet?) between the Fed’s policy rates at the short end, rate-hike expectations shooting up for the next couple of years, and the Fed’s gargantuan balance sheet sitting on top of the longer-term yields and long-term yields and weighing them down.This is producing a funny kangaroo-shaped yield curve, which is steep in the front up through the three-year yield, but then essentially flat through the 10-year yield, a bump at 20 years, followed by an inversion between the 20-year and the 30-year yields:
Goldman: Expecting Fed to hike 50bps in May and Start Balance Sheet Reduction -- A few excerpt from a Goldman Sachs research note: Moving “Expeditiously” Implies a Faster Pace; Forecasting 50bp Hikes in May and June: In a speech [yesterday], Chair Powell said, “There is an obvious need to move expeditiously to return the stance of monetary policy to a more neutral level, and then to move to more restrictive levels if that is what is required to restore price stability.” He repeated the call “to move expeditiously” at the end of the speech. ... We now forecast 50bp hikes at both the May and June meetings, followed by 25bp hikes at the four remaining meetings in the back half of 2022 ... We continue to expect the FOMC to announce the start of balance sheet reduction at the May meeting. CNBC's Steve Liesman tweeted this morning: "The Dec. Fed Funds contract trades with an implied yield of 2.13... that means 7 MORE hikes from here or 8 total this year. At least one of those meetings needs to be 50bp. The 50bp probability for May is 68%. There is also going to be balance sheet reduction." So a 50bps hike - and balance sheet reduction - are becoming the consensus view.
The US Treasury yield curve is on the verge of inverting - Normally, we should expect to see increasing yields the longer the maturity. This is pretty simple stuff: if I lend you money for a longer period of time before you have to pay it back, I’m taking a bigger risk, so I should get paid more in interest to take that risk. An inverted yield curve means that there are shorter maturities yielding higher interest than longer maturities. It’s well-documented that when the yield curve inverts, especially over a broad range from a few months out to 10 or more years, it is a harbinger of an economic downturn, typically 12 to 24 months later. As of this morning, here are the yields on US Treasuries from 3 months to 30 year maturities. The curve is inverted at 3 maturities, marked with asterisks: I’m not terribly concerned about the 20 year (paying less than the 30 year) or 7 year (paying less than the 10 year) inversions. Neither the 7 nor 20 year bonds are heavily traded. At the moment we’re having a flight to liquidity due to the Ukraine invasion, so the 10 and 30 year bonds have lots of increased buying. The 3 to 5 year (and 10 year) inversion will be more concerning - if it sticks. For the past week, the 3 year Treasury has paid more than the 5, or for that matter, 7 or 10 year Treasury multiple times *during* the day, but at the end of the day has always settled at a yield lower than the longer maturities. I am writing this during the morning, so once again there is an intraday inversion. A 3 to 5 year inversion has historically been one of the earlier maturities to invert, and more often than not, heralds an inversion spreading out along the midrange of the curve. This means, basically, that buyers expect Treasuries to pay more over the next several years than the anticipated long term norm, i.e., the Fed will continue to tighten, credit will be tight, and interest rates will ultimately recede due to slackening consumer demand, typically brought about by higher unemployment and a recession. We’re not there yet. But stay tuned.
Treasury Snapshot: 10-Year Note at 2.38% - The yield on the 10-year note ended March 22, 2022, at 2.38%, the 2-year note ended at 2.18%, and the 30-year at 2.60%. Here is a table showing the yields' highs and lows and the FFR since 2007.The chart below shows the daily performance of several Treasuries and the Fed Funds Rate (FFR) since the pre-recession days of equity market peaks in 2007. A log-scale snapshot of the 10-year yield offers a more accurate view of the relative change over time. Here is a long look since 1965, starting well before the 1973 Oil Embargo that triggered the era of "stagflation" (economic stagnation with inflation). Note the 1987 closing high on the Friday before the notorious Black Monday market crash. The S&P 500 fell 5.16% that Friday and 20.47% on Black Monday.Here's the latest 10-2 spread. Typically, the spread goes negative for a period and then out of the red prior to recessions. The lead time for recessions is quite a range - after going negative, recessions have begun anywhere from 16 to 62 weeks later. We also can see a false positive in 1998 where the spread went negative for a short period. In the last recession, the spread went negative a couple of different times before rising. If we use the first negative spread date as our starting point, the average number of weeks leading up to a recession is 37, or about 9 months. If we use the last positive spread date after being negative before a recession, the average is 17 weeks, or 4.25 months and the median is 14 weeks, or 3.5 months. Note, though, that we only have 3 data points as this treasury data only goes back to 1990.
Fed Chair Powell: FOMC "Not assuming significant near-term supply-side relief" on inflation From Fed Chair Powell: Restoring Price Stability. Excerpt on inflation: The rise in inflation has been much greater and more persistent than forecasters generally expected. For example, at the time of our June 2021 meeting, every Federal Open Market Committee (FOMC) participant and all but one of 35 submissions in the Survey of Professional Forecasters predicted that 2021 inflation would be below 4 percent. Inflation came in at 5.5 percent. Why have forecasts been so far off? In my view, an important part of the explanation is that forecasters widely underestimated the severity and persistence of supply-side frictions, which, when combined with strong demand, especially for durable goods, produced surprisingly high inflation. The pandemic and the associated shutdown and reopening of the economy caused a serious upheaval in many parts of the economy, snarling supply chains, constraining labor supply, and creating a major boom in demand for goods and a bust in services demand. The combination of the surge in goods demand with supply chain bottlenecks led to sharply rising goods prices (figure 4). The most notable example here is motor vehicles. Prices soared across the vehicles sector as booming demand was met by a sharp decline in global production during the summer of 2021, owing to shortages of computer chips. Production remains below pre-pandemic levels, and an expected sharp decline in prices has been repeatedly postponed. Many forecasters, including FOMC participants, had been expecting inflation to cool in the second half of last year, as the economy started going back to normal after vaccines became widely available.3 Expectations were that the supply-side damage would begin to heal. Schools would reopen—freeing parents to return to work—and labor supply would begin bouncing back, kinks in supply chains would begin resolving, and consumption would start rotating back to services, all of which could reduce price pressures. While schools are open, none of the other expectations has been fully met. Part of the reason may be that, contrary to expectations, COVID has not gone away with the arrival of vaccines. In fact, we are now headed once again into more COVID-related supply disruptions from China. It continues to seem likely that hoped-for supply-side healing will come over time as the world ultimately settles into some new normal, but the timing and scope of that relief are highly uncertain. In the meantime, as we set policy, we will be looking to actual progress on these issues and not assuming significant near-term supply-side relief.
Chicago Fed: "Index points to a slight decrease in economic growth in February" -"Index points to a slight decrease in economic growth in February." This is the headline for this morning's release of the Chicago Fed's National Activity Index, and here is the opening paragraph from the report: The Chicago Fed National Activity Index (CFNAI) moved down to +0.51 in February from +0.59 in January. Three of the four broad categories of indicators used to construct the index made positive contributions in February, but two categories deteriorated from January. The index’s three-month moving average, CFNAI-MA3, ticked down to +0.35 in February from +0.37 in January. [Download report] The Chicago Fed's National Activity Index (CFNAI) is a composite of 85 monthly indicators as explained in this background PDF file on the Chicago Fed's website. The index is constructed so a zero value for the index indicates that the national economy is expanding at its historical trend rate of growth. Negative values indicate below-average growth, and positive values indicate above-average growth. The first chart below shows the recent behavior of the index since 2007. The red dots show the indicator itself, which is quite noisy, together with the 3-month moving average (CFNAI-MA3), which is more useful as an indicator of the actual trend for coincident economic activity.
Six High Frequency Indicators for the Economy - These indicators are mostly for travel and entertainment. The TSA is providing daily travel numbers.This data is as of March 20th.This data shows the 7-day average of daily total traveler throughput from the TSA for 2019 (Light Blue), 2020 (Black), 2021 (Blue) and 2022 (Red). The dashed line is the percent of 2019 for the seven-day average. The 7-day average is down 10.5% from the same day in 2019 (89.5% of 2019). The second graph shows the 7-day average of the year-over-year change in diners as tabulated by OpenTable for the US and several selected cities. This data is updated through March 19, 2022. This data is "a sample of restaurants on the OpenTable network across all channels: online reservations, phone reservations, and walk-ins. Dining was mostly moving sideways but declined during the winter wave of COVID and is now increasing. The 7-day average for the US is unchanged compared to 2019. This data shows domestic box office for each week and the median for the years 2016 through 2019 (dashed light blue). The data is from BoxOfficeMojo through March 17th. Movie ticket sales were at $140 million last week, down about 36% from the median for the week. This graph shows the seasonal pattern for the hotel occupancy rate using the four-week average. This data is through March 12th. The occupancy rate was down 9.8% compared to the same week in 2019. The 4-week average of the occupancy rate is close to the median rate for the previous 20 years (Blue). This graph is from Apple mobility: "This data is generated by counting the number of requests made to Apple Maps for directions in select countries/regions, sub-regions, and cities." This data is through March 17th for the United States and several selected cities. According to the Apple data directions requests, public transit in the 7-day average for the US is at 123% of the January 2020 level. Here is some interesting dataon New York subway usage. This graph shows how much MTA traffic has recovered in each borough (Graph starts at first week in January 2020 and 100 = 2019 average). Manhattan is at about 37% of normal. This data is through Friday, March 18th.
Oil prices surging to $200 a barrel could send the economy into recession: Goldman Sachs - Should oil prices explode to $200 a barrel as some experts have warned, Goldman Sachs thinks the U.S. economy would probably enter a recession (or already be in one). "We estimate that it would take a sustained oil price increase to $200 per barrel to produce an income shock similar in magnitude to those that precipitated the 1974 and 1979 recessions — and this would significantly increase the 2022 recession odds," Goldman Sachs chief economist Jan Hatzius said in a new note on Thursday. Oil prices have come off their highs of around $140 a barrel seen at the start of the Russia-Ukraine war, but remain uncomfortably high. Brent crude oil hovered at $122 a barrel Thursday amid concerns on a new spate of sanctions on Russia by the West. "It is not unfathomable for prices to rocket to $200 a barrel by summer, spur a recession and end the year closer to $50 a barrel ($200 call options have been bid). To be clear, this is not our base case, but such a scenario does not sound implausible today," said RBC Capital Markets analyst Michael Tran on Yahoo Finance Live. Meanwhile, the national average price for gasoline is up 71.5 cents from a month ago and $1.37 per gallon higher than a year ago, according to GasBuddy. In turn, that has sent consumer confidence plunging and concerns sweeping Wall Street of a consumer spending pullback (which could lead the economy into a recession). While Hatzius is worried about a recession, he isn't yet ready to predict one for this year despite elevated energy and food costs. Hatzius is modeling for 1.9% GDP growth in 2022. "The commodity shocks in the early stages of the 1974, 1980, 1990, and 2008 recessions fully offset the year-on-year trend in real incomes — implying no scope to increase real consumption without drawing down savings. This is not the case in 2022 thanks to strong payroll and wage growth, nor was it the case during the commodity upswings and continued expansions of 1999, 2005, and 2010. Additionally, the $2 trillion-plus of excess savings accumulated during the pandemic and the record-high household wealth-to-income ratio represent additional buffers for consumer spending growth this year," explains Hatzius.
Recession Is Unavoidable Without Russian Oil, Dallas Fed Study Says -- The global economy likely won’t be able to avoid a recession without a resumption of Russian energy exports this year, according to a study by Federal Reserve Bank of Dallas economists. “If the bulk of Russian energy exports is off the market for the remainder of 2022, a global economic downturn seems unavoidable,” economists Lutz Kilian and Michael Plante wrote in an article posted by the Dallas Fed Tuesday. “This slowdown could be more protracted than that in 1991.” The authors drew a parallel to the 1991 global recession, set off by Iraq’s invasion of Kuwait in the year prior that caused an oil-supply shock. Back then, Saudi Arabia partly reduced the impact by pledging to ramp up production, helping ensure what the researchers called “only a brief U.S. recession,” which lasted less than a year. The refusal of financial institutions to support Russian energy exports has been the main development putting those shipments at risk, the Dallas Fed economists wrote. “This outcome was largely unanticipated, as U.S. and European Union sanctions originally deliberately excluded Russian energy exports.” Replacing that supply may be challenging, given that Saudi Arabia and the United Arab Emirates have signaled they won’t provide relief, the researchers said. They also highlighted that U.S. shale producers are “constrained by supply-chain bottlenecks, labor shortages and the insistence of public investors on capital discipline.” “There are indications that some oil-importing countries are exploring alternative-payment schemes that avoid the use of trade credit, bypass current financial sanctions or rely on alternative currencies,” which could help ease the hit caused by financing difficulties, Kilian and Plante wrote. Without a supply response, the drop-off of Russian exports will cause an inflationary hit that compresses spending, according to the authors. “Unless the Russian petroleum supply shortfall can be contained, it appears necessary for the price of oil to increase substantially and to remain elevated for a long period to eliminate the excess demand for oil,” they wrote. “This demand destruction is likely to be assisted by the recessionary effect of higher natural gas prices and other commodity prices, especially in Europe.”
Washington’s ‘trigger-happy’ sanctions may push countries away from the dollar, says think tank - The U.S. has been "extremely trigger-happy" with stinging economic measures, and central banks may decide to diversify their portfolio of foreign reserves instead of relying heavily on the U.S. dollar, according to the co-director of the Institute for the Analysis of Global Security."Central banks are beginning to ask questions," said Gal Luft of the Washington-based think tank, adding that they are wondering if reliance on the dollar and "putting all their eggs in one basket" is a smart idea."The United States has extended itself, has been extremely trigger-happy when it comes to the use of sanctions and other economic punishments," he said.The White House did not respond to a CNBC request for comment. Luft said the U.S. took "unacceptable and unheard of steps" in recent weeks, such as effectively freezing Russia's central bank reserves and disconnecting Russia from the interbank messaging system, SWIFT.He said one in 10 countries in the world is under some form of U.S. sanctions."That has a cumulative effect and as a result, we see the dollar playing less and less of a role and portfolios of central banks," Luft said.His comments come after a Wall Street Journal report that Saudi Arabia is in accelerated talks with China to accept yuan instead of dollars for oil that Beijing buys.Oil is typically priced in U.S. dollars, and that has allowed Washington to run "huge deficits," he told CNBC's "Street Signs Asia" on Monday.Sanctions, however, make governments want to move away from the U.S. dollar, Luft said.He said the American political class has a "lack of awareness" about the consequences of their actions."It's like a bunch of kids running around with guns shooting all over the place without realizing what they're actually doing, without looking at the cumulative impact of all of this," he said. "On the one hand, you are sanctioning right and left. On the other hand, you want countries to buy your Treasurys and finance your debt. That's not a sustainable scenario," he said.
White House plans major escalation of NATO’s proxy war with Russia - One month since the outbreak of the war in Ukraine, US President Joe Biden will begin a tour of the continent this week in an effort to mobilize the NATO powers in a major escalation of the conflict against Russia.The meetings, including those of NATO and the European Council, will seek to galvanize “international efforts to… impose severe and unprecedented costs on Russia,” the White House said.Ahead of Biden’s trip, NATO military officials have been discussing plans, to be announced at the summit, to vastly expand the positioning of NATO forces on Russia’s borders in Europe as part of an effort to put the continent on a war footing, including potentially doubling the US troop presence in Europe. The series of meetings being held this week are councils of war. According to the White House:
- On Monday, Biden held a call with French President Emmanuel Macron, German Chancellor Olaf Scholz, Italian Prime Minister Mario Draghi and British Prime Minister Boris Johnson to discuss “providing security assistance to the brave Ukrainians who are defending their country from Russian aggression.” The same day, the European Union announced that it would send an additional €500 million in weapons to Ukraine
- Later that evening, Biden addressed the CEOs of America’s largest corporations to “discuss the United States’ response to Russia’s unprovoked and unjustified war with Ukraine.”
- On Wednesday, Biden will arrive in Brussels, Belgium, to attend a meeting of the European Council, which will also include UK Prime Minister Boris Johnson, despite the UK’s exit from the European Union.
- On Thursday, Biden will attend a NATO summit focused on “ongoing deterrence and defense efforts in response to Russia’s unprovoked and unjustified attack on Ukraine.”
- On Friday, Biden will travel to Warsaw, Poland, where he will hold a bilateral meeting with President Andrzej Duda. Last week, Polish Prime Minister Mateusz Morawiecki proposed the deployment of a NATO “peacekeeping mission” to Ukraine.
This series of meetings was preceded by clear signals from the White House that, despite statements from Ukraine that it is pursuing negotiations with Russia, the United States has no interest in finding a diplomatic solution to the war.On Thursday, US Secretary of State Antony Blinken said, “From where I sit, diplomacy obviously requires both sides engaging in good faith to de-escalate.” He added, “The actions that we’re seeing Russia take… are in total contrast to any serious diplomatic effort to end the war.”Following these statements, Biden seemed to do everything he could to personally antagonize Russian President Vladimir Putin, referring to him as a “thug,” a “dictator” and a “war criminal.”Under conditions where a war is raging out of control, killing hundreds of people, and nuclear tensions are at the highest level since the 1962 Cuban Missile Crisis, these statements are a deliberate effort to escalate tensions. The Kremlin will see them as a US declaration of intent to carry out regime-change in Russia or massively escalate US involvement in the war.In response to what Russia called “insults,” Russia’s foreign ministry announced that it had summoned US Ambassador John Sullivan to declare that “Russian-American relations [are] on the verge of rupture.” The “rupture” of relations between states generally signifies that war is imminent.
Biden administration to sanction hundreds of Russian lawmakers: report -The Biden administration will reportedly sanction hundreds of Russian lawmakers in an extension of current sanctions on the Kremlin over its nearly monthlong invasion of Ukraine.The administration has prepared sanctions to be announced Thursday byPresident Biden on his upcoming trip to Europe, reports The Wall Street Journal. Biden, who is traveling to Europe for meetings with NATO allies, will announce sanctions on Russia’s lower house of parliament, known at the State Duma, in conjunction with announcements by the European Union (EU).The sanctions on the Russian State Duma will implicate more than 300 Russian lawmakers.The U.S. and EU will also coordinate their announcements with members of the Group of Seven industrialized nations, composed of six Western countries and Japan.The Duma is made up of 450 lawmakers and is joined by the 170-seat Federation Council, the upper chamber of Russian parliament, to form the Russian Federal Assembly.A committee of the State Duma approved a law this month that would impose penalties, including up to 15 years of prison time, for the distribution of “false news” about the Russian invasion of Ukraine.The White House sanctioned Russian President Vladimir Putin for his command of the war last month and has since placed sanctions on a number of Russian political figures, including the spokesman of the Kremlin.
Biden arrives in Europe to press for military escalation against Russia --US President Joe Biden arrives today in Brussels for two days of meetings with the European Council of European heads of state and then the NATO military alliance. His visit aims to ensure that NATO recklessly escalates military operations against Russia, despite the rising danger of nuclear war. Asked yesterday about Biden’s trip, US National Security Advisor Jake Sullivan stated that the war would continue indefinitely, dismissing reports of successes in Russian-Ukrainian talks on ending the war begun by Russia’s February 24 invasion of Ukraine. “This war will not end easily or rapidly,” Sullivan said. “For the past few months, the West has been united. The president is traveling to Europe to ensure we stay united, to cement our collective resolve, to send a powerful message that we are prepared and committed to this for as long as it takes.” Biden is to discuss plans for a ground invasion of Ukraine by NATO member states during his subsequent March 25 visit to Poland, which has championed plans for NATO troops to deploy to Ukraine as “peacekeepers.” US Ambassador to the United Nations Linda Thomas-Greenfield denied that US troops are now in Ukraine but gave a green light to other NATO states to invade. “I can’t preview what decisions will be made at this NATO conference and how NATO will respond to the Polish proposal [to deploy peacekeepers in Ukraine]. What I can say is American troops will not be on the ground in Ukraine at this moment,” she said, adding that “other NATO countries may decide that they want to put troops inside of Ukraine.” Thomas-Greenfield’s denial of US military involvement on the ground in Ukraine is misleading and false. US private military contractors like Academi (formerly Blackwater) and CIA paramilitaries are aiding Ukrainian nationalist militias and army units against Russia. However, a major escalation is being prepared: retired US military officers have said the Pentagon may double its current force of 100,000 troops in Europe. Conditions are emerging for NATO to launch a land war against Russia in Ukraine that could escalate to global nuclear war. The Russian army has an estimated 1 million regular troops. Of those, around 150,000, largely drawn from elite armored units, are bogged down in bloody fighting in Ukraine. NATO armed forces, at about 3.3 million, enjoy overwhelming numerical superiority on a world scale and are publicly preparing to launch military operations in Ukraine. Yesterday, CNN interviewed Kremlin spokesman Dmitry Peskov and provocatively asked him about Russian willingness to use nuclear weapons. Peskov emphasized that Russia may use nuclear weapons if the Kremlin believes it faces a threat to Russia’s national survival. “We have a concept of domestic security and it's public, you can read all the reasons for nuclear arms to be used. So, if it is an existential threat for our country, then it [the nuclear arsenal] can be used in accordance with our concept,” he said.
Russia threatens rupture of diplomatic ties with US amidst growing frictions within the oligarchy - The Russian Foreign Ministry summoned the US ambassador Monday and issued a protest note, threatening the rupture of US-Russian diplomatic ties because US President Joe Biden called Russia’s Vladimir Putin a “war criminal.” In its statement, the Foreign Ministry stated that Biden’s statement had “put Russo-American relations to the brink of collapse.” The ministry also warned the ambassador that Russia would respond with harsh resistance to the “hostile actions” of the US. The statements by the Kremlin came clearly in response to the massive intervention of NATO in the Ukraine war—the military alliance has shipped billions of dollars’ worth of weapons to the Ukrainian military and neo-Nazi forces—and an open economic war against Russia. Both the economic and military warfare are accompanied by stepped-up efforts at regime change in Moscow. The US has long built up figures in Russia’s oligarchy and upper middle class, most recently the now imprisoned Alexei Navalny, a far-right Putin critic, falsely presenting them to a US audience as “democratic” opponents to the Putin regime, to prepare the ouster of Putin through methods of a palace coup within the oligarchy and state apparatus. The goal is to install a regime that would grant imperialism direct access to Russia’s vast raw material and social resources, and no longer represent an obstacle to the geopolitical ambitions of imperialism in Europe and Asia. The outbreak of the war has produced a rapid breakup within Russia’s ruling oligarchy and the upper middle class. Claims by Ukrainian intelligence that a “coup” is underway with Alexander Bortnikov, the head of the secret service, the FSB, discussed as the potential replacement for Putin have not been independently confirmed. But there are many indications that these frictions extend well into the state apparatus. Several oligarchs that have traditionally been close to Putin, including Oleg Deripaska (net worth $2.2 billion), Mikhail Fridman ($12.2 billion) and Pyotr Aven ($4.4 billion), have publicly denounced the war and called for it to end. Socialite Ksenia Sobchak ($5 million), the goddaughter of Vladimir Putin and a former presidential candidate, has also joined the “billionaires and millionaires for peace” coalition. Hundreds of thousands of members of Russia’s upper middle class have left the country, most of them for the Baltics, the Caucasus and Israel. This includes Russia’s most famous talk show moderator, Ivan Urgant, who makes an estimated $5.6 million a year, and many academics from the country’s most prestigious institutions.
Uranium Stocks Soar After Russia Says Considering Ban On Uranium Exports - Several weeks ago, when Biden instituted a wholesale ban on Russian energy exports, he explicitly carved out Russian uranium suppliers for the simple reason that the US is very much reliant on Russia for its nuclear power plant needs – after all, Russia is the third-largest source of U.S. uranium, accounting for about 16% of total U.S. imports. It’s what prompted us to ask back on March 9 whether Putin would place enriched uranium on the list of banned Russian exports, and why Uranium stocks soared late last week after U.S. Energy Department signaled more aid for current and future nuclear reactors. Well, moments ago the very thorny issue of Russian uranium came to a head moments ago when Russia news agency TASS, cited deputy prime minister Novak, who said that Russia is considering a ban on Uranium exports! The news sent a basket of Uranium stocks and ETFs to fresh 2022 highs…… and pushed uranium miner Canada’s Cameco Corp briefly above $30, the highest price since 2011.
Close Putin ally warns of nuclear dystopia - A close ally of Russian President Vladimir Putin on Wednesday accused the U.S. of seeking "the end of our motherland" and said escalating tensions could result in a nuclear disaster.Dmitry Medvedev, deputy chairman of Russia's Security Council who also previously served as the country's president and prime minister, wrote in a post on Russian social networking site VK.com that Russia has been "the target of the same mediocre and primitive game" since the collapse of the Soviet Union."This means that Russia must be humiliated, limited, shaken, divided and destroyed," Medvedev wrote, saying if Americans succeed in that objective, "here is the result: the largest nuclear power with an unstable political regime, weak leadership, a collapsed economy and the maximum number of nuclear warheads aimed at targets in the US and Europe." Putin last month put Russia's nuclear defense systems on high alert, raising fears of an escalation between the U.S. and Russia, two nuclear superpowers. Russia's invasion of Ukraine last month has drawn widespread condemnation from countries across the world. The U.S. has led in imposing unprecedented sanctions against Russia as tensions ratchet up between the two countries, reaching a level not seen since the Cold War.Before invading Ukraine, Putin had raised concerns about the large presence of NATO in Eastern Europe and had demanded Ukraine never join the alliance, a call rebuffed by the U.S. and its allies.President Biden called Putin a "war criminal" last week, and on Wednesday Secretary of State Antony Blinken determined Russia had committed war crimes in Ukraine.
White House attempts to walk back Biden stating Putin can't stay in power - The White House is attempting to walk back a major moment in President Biden’s remarks on Saturday, in which he declared that Russian President Vladimir Putin should not remain in power. “For God’s sake, this man cannot remain in power,” the president said at the end of his speech in Warsaw, Poland.Following the remarks, a White House official said that comment was referring to Putin exercising power outside of Russia.“The president’s point was that Putin cannot be allowed to exercise power over his neighbors or the region. He was not discussing Putin’s power in Russia, or regime change,” the official said in an email. Much of Biden’s speech involved placing blame for the Russian invasion into Ukraine directly on Putin and delivering a plea to the Russian people that they not be welcoming or supportive of the war. The comment was a particularly notable moment, however, appearing to mark a shift in Biden’s thinking about Putin’s position in Russia. It’s unclear if the White House meant that Biden muddled his words or went off-script with his comments. The White House did not immediately respond to The Hill’s request for comment to clarify the statement.
North Korea test fires its biggest ICBM yet — and it could apparently reach the entire U.S. - North Korea said Friday it test-fired its biggest-yet intercontinental ballistic missile (ICBM) under the orders of leader Kim Jong Un, who vowed to expand the North's "nuclear war deterrent" while preparing for a "long-standing confrontation" with the United States. The report by North Korean state media came a day after the militaries of South Korea and Japan said they detected the North launching an ICBM in its first long-range test since 2017. The launch extended a barrage of weapons demonstrations this year that analysts say are aimed at forcing the United States to accept the idea of North Korea as a nuclear power and remove crippling sanctions against its broken economy that has been further damaged by pandemic-related difficulties. CBS News' Lucy Craft observes that Kim officially marks ten years in power next month, and observers expect his fast and furious pace of weapons development will mean more major missile and nuclear tests in the coming weeks and months. State TV dramatized the testing process like a Hollywood movie, showing Kim walking in slow motion in front of his giant missile in sunglasses and a black leather motorcycle jacket. It edited quick cuts that alternately show Kim and other officials staring at their watches before Kim takes off his shades and nods, with the video then showing the missile being rolled out of the hangar. The Hwasong-17, which was fired at a high angle to avoid the territorial waters of neighbors, reached a maximum altitude of 3,880 miles and traveled 680 miles during a 67-minute flight before landing in waters between North Korea and Japan, Pyongyang's official Korean Central News Agency said. KCNA claimed the launch met its technical objectives and proved the ICBM could be operated quickly during wartime conditions. The South Korean and Japanese militaries had announced similar flight details. Craft points out that Japan's defense minister said the missile's range could put the entire US mainland, including New York or Washington, DC., within reach. The missile's enormous size suggests it could be capable of carrying multiple warheads to several targets and help it overwhelm missile defenses. If North Korea succeeds, Kraft adds, it would be only the third country, after Russia and China, capable of mounting a nuclear missile attack on the U.S.
Pence blames Biden for North Korea missile tests: Trump administration 'stood up to Kim Jong Un' - Former Vice President Mike Pence said on Friday that the Trump administration “stood up to Kim Jong Un” and blamed the Biden administration for North Korea’s latest missile test. “The fact that for the first time in more than four years, Kim Jong Un fired an intercontinental ballistic missile that went into space and landed in the sea of Japan is a great concern,” Pence said in an interview with “Fox & Friends” on Friday. “South Korea responded strongly with five different short-range missile launches, but it's important to remember this stopped happening under the Trump-Pence administration, because we stood up to Kim Jong Un. We brought a maximum pressure campaign on him.” Pence said that the Biden administration was “begging” Iran to reenter the Iran nuclear deal, which he believes North Korea has interpreted as capitulation. “I honestly believe that as you see the Biden administration, you know, literally begging Iran to reenter the Iran nuclear deal. I think that has sent a message of capitulation that they are hearing in North Korea, and so they're back to their old cycle of provocation,” Pence said. “Again, I've said many times, you know, peace comes through strength, but weakness arouses evil.”
Is Biden To Blame For Soaring Gasoline Prices? -- One year ago this week I wrote an article that turned out to be my most popular Forbes article ever: Who Is To Blame For Rising Gasoline Prices? The article got more than a million views, and spawned a large amount of feedback. A year later, the same dynamic I wrote about then is still responsible for most — but not all — of the gasoline price increase we have seen over the past 18 months. To recap, just before the Covid-19 pandemic, U.S. oil production hit an all-time high of about 13 million barrels per day (BPD). As the pandemic unfolded, demand for oil collapsed, and production followed. By May 2020, oil production had dropped by more than 3 million BPD to 9.7 million BPD. When the pandemic crushed oil demand in 2020, some oil companies went out of business. Some small stripper wells — which account for a respectable amount of U.S. oil production — were permanently capped because of the bleak outlook. Some workers left the oil industry. As people went back to work, demand began to bounce back, but production lagged due to the aforementioned issues. Following the production collapse of 2020, the U.S. has been playing catch up as demand recovered. Rising oil prices — in response to insufficient supplies — are the predominant reason for the surge in gasoline prices. Many people attributed the entire price rise to President Biden but, in reality, it began before Biden took office. Further, it was neither primarily President Trump’s nor President Biden’s fault — and these price surges were taking place all over the world.To be clear, the stimulus money that both presidents approved had some impact. When people have more money, they spend it. Demand for goods rises, driving inflation. Stimulus money played a minor part in the gasoline price rise, but it was primarily a function of the oil price surge due to the imbalance brought on in the aftermath of the Covid-19 demand plunge. I often point out that a President has few handles for impacting gasoline prices in the short term. Those handles are primarily 1). Releases of oil from the Strategic Petroleum Reserve; 2). Changing the gasoline tax; or 3). Involvement in a war with a major oil producer. All of these things can have a rapid impact on gasoline prices. When it looked like Russia was massing troops on Ukraine’s border, oil prices broke out above the 2021 range. In January 2022, the average price of WTI moved up to $83.22/bbl. In February, when Russia actually invaded Ukraine, the average price jumped to $91.64/bbl. I attribute this price rise primarily to Vladimir Putin, combined with the world’s response to the invasion. However, there is one action that President Biden does bear responsibility for. Biden’s decision to stop importing Russian oil was the trigger for oil prices surging above $120/bbl. They have retreated from that level for now, but the inefficiencies involved in rerouting Russian imports and backfilling that oil will keep a premium on prices.
Jamie Dimon to Joe Biden: We need a 'Marshall Plan' for US and European energy security - JPMorgan Chase CEO Jamie Dimon urged President Joe Biden in an off-the-record meeting this week to develop a "Marshall Plan" to fortify the energy security of the United States and Europe, a person familiar with the matter confirmed to CNN Wednesday. Dimon's comments came during a Monday meeting of business leaders and White House officials, which was spurred by Russia's invasion of Ukraine sending energy prices surging around the world. The original Marshall Plan was named for US Secretary of State George Marshall, who in 1947 called for a comprehensive program to rebuild Europe's decimated infrastructure in the aftermath of World War II. Hoping to stave off the spread of communism, Congress would eventually devote more than $12 billion to rebuild Western Europe and expand the reach and influence of Western democracy. In a similar vein, Dimon urged Biden on Wednesday to ramp up US natural gas production to strengthen the US and EU's energy security, the person familiar with the matter told CNN. The source said Dimon believes the federal government should focus on four areas: increasing natural gas production in an environmentally responsible way, building additional liquefied natural gas facilities in Europe, investing in new technology for hydrogen and carbon capture resources and streamlining permitting for renewable alternatives like wind and solar. Axios first reported the Marshall Plan push from the JPMorgan (AJLXX) CEO, who is one of America's most influential business leaders. Enter your email to receive CNN's nightcap newsletter. close dialog Of course, environmentalists and progressives would oppose efforts by the federal government to ramp up production of fossil fuels given the worsening climate crisis. Democrats in Congress have also recently urged the White House to consider banning or limiting the export of both oil and natural gas due to high energy prices at home. A top Biden official echoed Dimon's Marshall Plan characterization in a speech on Wednesday. "I think it's a moment for us to ask at this point in our history, what is going to be our version of the Marshall Plan for clean and secure energy in 2022 and beyond," Energy Secretary Jennifer Granholm said at an International Energy Agency event in Paris. "This clean energy transition could be the peace project of our time," Granholm said. "But peace always comes after struggle. So let's give this peace project the focus and the commitment and the resources of a war time effort. Our Marshall Plan." A White House official told CNN the Biden administration has an "historic set of ideas" on the table for investment in the US energy industry that would strengthen security and make the United States "more resilient to actions by leaders like Putin." "Those ideas are concrete and we welcome engagement from all those who would join us in driving investments to strengthen our energy sector," the White House official said. A JPMorgan spokesman declined to comment on the White House meeting, which included the CEOs of ExxonMobil, ConocoPhillips, Marathon Petroleum, Bank of America, US Steel and Cargill, a senior White House official previously told CNN. President Biden was joined by other key officials, including US Treasury Secretary Janet Yellen, Commerce Secretary Gina Raimondo and US national security adviser Jake
Lawmakers want to mitigate high gas prices with payments to Americans -High gas prices have put a strain on many Americans' budgets. Now some Democratic lawmakers are proposing a possible solution: direct rebate payments to Americans. Three congressional leaders have proposed $100 energy rebate payments that would be sent to Americans during any month where the national average gas price is higher than $4 per gallon. The bill — called the Gas Rebate Act of 2022 — was proposed by Reps. Mike Thompson, D-Calif.; John Larson, D-Conn.; and Lauren Underwood, D-Ill.. Other Washington Democrats have issued proposals. Rep. Ro Khanna of California and Sen. Sheldon Whitehouse of Rhode Island have suggested raising taxes on big oil companies and paying rebates of roughly $240 per year for single filers and $360 per year to joint filers. Rep. Peter DeFazio, a Democrat from Oregon, has also proposed a bill that would tax oil companies and provide rebates to consumers. Separately in California, Democratic Gov. Gavin Newsom has a plan to give $400 debit cards to the state's registered vehicle owners. Drivers would be eligible to receive up to two of those tax refund payments. The proposals come as gas prices around the country have soared in the wake of Russia's invasion of Ukraine, though costs at the pump had already started climbing before the conflict. The national average for a gallon of gas is currently $4.24, according to AAA, up from $3.54 a month ago and $2.87 a year ago.
Stimulus checks for gas? Here's what could be coming your way. - Americans already faced searing inflation when gas prices surged to an all-time high earlier this month. Now, some lawmakers want the federal government to offer stimulus payments or rebate checks to help reduce the pain at the pump. Families with two children could get as much $300 per month as long as the nation's average gas price exceeds $4 a gallon, according to one new bill proposed by Reps. Mike Thompson of California, John Larson of Connecticut and Lauren Underwood of Illinois. All three lawmakers are Democrats. And on Wednesday, California Governor Gavin Newsom said he's proposing to send direct payments of $400 per vehicle to state residents, with a cap of two vehicles. Pending approval from California lawmakers, the checks could arrive as soon as July, the statement said. Drivers in California face some of the highest gas prices in the nation, with the state average at $5.87 per gallon on Wednesday, according to AAA.American consumers could see increased costs of $2,000 this year due to the recent surge in gas prices — and that's on top of an extra $1,000 in grocery store costs due to the steepest rise in inflation since 1982. Already, consumers are reporting they are cutting back on spending or driving less, with most blaming sticker shock at the pump.The gas stimulus would "provide middle-class Americans with monthly payments to ease the financial burden of this global crisis," Thompson said in a statement about the proposal, referring to Russia's invasion of Ukraine, which has pushed gas prices higher. Called the Gas Rebate Act, the bill proposed by Thompson, Larson and Underwood would provide a monthly energy rebate of $100 per person. That refund would kick in for the rest of 2022 as long as the national average gas price topped $4 a gallon during any given month. Under the bill, both joint and single tax filers would receive $100 each, while each dependent would also receive $100 each. In other words, a family with two kids could receive up to $300 a month in rebate checks. The plan would work similarly to the three stimulus checks the federal government offered in 2020 and 2021 in that the payments would be aimed at low- and middle-class households. Single people earning less than $75,000 annually would receive the full $100 rebate, with the payment phased out at up to $160,000 in household income, according to Thompson's statement. The proposal doesn't specify how the rebate checks would be paid for, and the text of the bill isn't yet published. A second proposal from Rep. Ro Khanna, a Democrat from California, and Sen. Sheldon Whitehouse, a Democrat from Rhode Island, would provide a quarterly rebate to consumers based on a tax levied on oil and gas companies. The Big Oil Windfall Profits Tax would charge a per barrel tax equal to 50% of the difference between the current price of a barrel of oil and its pre-pandemic average price between 2015 to 2019, according to a statement from the lawmakers. The two lawmakers calculated that if the per barrel price sits at $120, the tax would raise about $45 billion a year — providing single filers with $240 annually and joint filers with $360 each year.
With Inflation Surging, Biden Targets Ocean Shipping -The president is targeting shipping companies that have jacked up prices during the pandemic, but critics say bigger economic forces are at work. With inflation surging at its fastest pace in 40 years, President Biden has identified a new culprit that he says is helping fuel America’s skyrocketing prices: The ocean vessels that ferry containers stuffed with foreign products to America’s shores each year.Shipping prices have soared since the pandemic, as rising demand for food, couches, electronics and other goods collided with shutdowns at factories and ports, leading to a shortage of space on ocean vessels as countries competed to get products from foreign shores to their own.The price to transport a container from China to the West Coast of the United States costs 12 times as much as it did two years ago, while the time it takes a container to make that journey has nearly doubled. That has pushed up costs for companies that source products or parts from overseas, seeping into what consumers pay. Mr. Biden has pledged to try to lower costs by increasing competition in the shipping industry, which is dominated by a handful of foreign-owned ocean carriers. He has cited the industry’s record profits and directed his administration to provide more support for investigations into antitrust violations and other unfair practices. …Congress is also considering legislation that would hand more power to the Federal Maritime Commission, an independent agency that polices international ocean transportation on behalf American companies and consumers.The bill, which has bipartisan support, would authorize the commission to take action against anticompetitive behavior, require shipping companies to comply with certain service standards and regulate how they impose certain fees on their customers. Mr. Biden is pushing lawmakers to add a provision that would allow the commission and Justice Department to review applications for new alliances between companies for antitrust issues, and reject those that are not in the public interest.The House passed its version of the bill in December; it must be reconciled with a Senate version. But it’s unclear to what extent more government oversight and enforcement will actually bring down shipping costs, which are being driven in large part by soaring consumer demand and persistent bottlenecks. Global supply chains are still plagued by delays and disruptions, including those stemming from the Russian invasion of Ukraine and China’s broad lockdowns in Shenzhen, Shanghai and elsewhere. “As a standard matter of economics, if you have inelastic supply and experience a surge in demand, you will see a rise in prices,”
Opinion | We’re in a Fossil Fuel War. Biden Should Say So. - The New York Times -- On one hand, it would seem uncontroversial to point out that Russia’s invasion of Ukraine is a war enabled and exacerbated by the world’s insatiable appetite for fossil fuels. It couldn’t not be so: Russia is a petrostate — its economy and global influence areheavily reliant on its vast reserves of oil and natural gas — and Vladimir Putin its petromonarch, another in a line of unsavory characters whom liberal democracies keep doing business with because they’ve got something we can’t live without.The way out of this bind would also appear obvious and urgent. By accelerating our transition to cheap and abundant renewable fuels, we can address two grave threats to the planet at once: the climate-warming, air-polluting menace of hydrocarbons and the dictators who rule their supply.And yet American politicians on the left sure seem incapable of drawing out this connection, don’t they? In his State of the Union address shortly after Russia’s invasion, President Biden whiffed on a major opportunity to revive his stalled climate change agenda by underlining the geopolitical dangers of fossil fuels. His references to climate change — what he has previously called an “existential threat” to the planet — were buried under, rather than connected to, his comments about the war. Concerned with the effects that disruptions might have on fuel supplies, gas prices and inflation in general, he also announced the release, with 30 other nations, of 60 million barrels of oil.Meanwhile, pundits on the right have had a field day with the notion that Russia’s invasion somehow points up the folly of focusing on climate change. The Wall Street Journal’s editorial board blamed “the Biden Administration’s obsession with climate” for making “the U.S. and Europe vulnerable to Mr. Putin’s energy blackmail” and wrote that “the climate lobby has made Mr. Putin more powerful.” I feel like I’m in the upside-down. If the “climate lobby” were truly so powerful, it might have long ago prevented Europe from building its society upon a devilish bargain with Russian energy. For all their “obsession with climate,” Democrats in the United States Senate have been unable to pass legislation to address climate-warming emissions. Instead, their bill has been stymied by a coal-friendly senator. Now the problem of climate change has been all but overshadowed by the war. Some Democrats seem to have forgotten the planet altogether — Gavin Newsom, the governor of California, wants to give every car owner in his stateup to $800 in rebates to offset the high price of gas. This could have been a moment for moral clarity on the dangers of fossil fuels — but so far, Democrats have fumbled that message. “This narrative has not been out there — that this war is why we need to get off of fossil fuels,” . “More groups need to be connecting the dots, making the case that true energy independence is about running on sunshine, because sunshine is free and abundant and cannot be controlled by dictators.”
Treasury Secretary Yellen: The U.S. should have moved faster toward renewable energy - Treasury Secretary Janet Yellen said on Friday the United States should have moved faster toward renewable energy sources and that, had we done so, the country would be in a better position to address climate change and national security. CNBC's Andrew Ross Sorkin asked Yellen whether the focus on environmental social governance needs to be partially suspended because of national security issues that the focus on ESG "is either creating or has created." Global bans on Russian oil after the Russian invasion of Ukraine have led to higher energy prices, for example. "I don't think that the ESG movement and the emphasis on climate change is creating the problems that we have. If anything the problem is that we haven't moved as rapidly as we should have," Yellen told Sorkin in an interview that aired on "Squawk Box" Friday. "Europe and the United States would be less exposed to the pressures that this conflict is putting on our energy markets if we had greater reliance on renewables," Yellen said. "That remains firmly appropriate as medium and longer-term goals." Renewable energy includes wind-powered energy and solar energy. In the short term, having less global dependence on Russian oil would allow the United States "to punish" Russia for its invasion of Ukraine and to "degrade" the power and influence of Russia in the world economy, Yellen said. Earlier in March, Secretary of Energy Jennifer Granholm spoke to energy executives at CERAWeek and asked them to increase oil production. "We are on a war footing — an emergency — and we have to responsibly increase short-term supply where we can right now to stabilize the market and to minimize harm to American families," Granholm said. And on Monday, JPMorgan Chase CEO Jamie Dimon told President Joe Biden the United States needed to create a "Marshall Plan" for domestic energy production. Dimon called for increased liquid natural gas in Europe, the development of alternative energy sources such as hydrogen and carbon capture, and a broader reduction on Russian energy, according to Axios, which first reported the news. Yellen acknowledged it will be especially difficult for Europe to quickly reduce its dependence on Russian energy. On Friday, Biden and European Commission President Ursula von der Leyen announced a joint task force to address European dependence on Russian natural gas with a plan that will focus on diversifying supplies of liquid natural gas and reducing demand on natural gas. While such "enhanced cooperation" will help, Yellen said, "it's not possible to completely eliminate that dependence certainly this year." Yellen told Sorkin it's even more important for the United States to stay focused on climate goals and a transition to clean energy as the Russian war affects energy markets domestically and abroad. "If anything, seeing what's happening because of our dependence on global markets for oil and to some extent natural gas just emphasizes the importance of making the transition that will shield us from events in Russia, global developments that can negatively impact oil markets," Yellen told Sorkin. "You really want to move ... all of us, the United States and our allies, to move quickly to renewables that will give us a safer and more independent energy picture."
Biden administration doles out $2.9B in infrastructure grants to states, cities - The Department of Transportation (DOT) will soon disperse $2.9 billion in grants for state and local infrastructure projects. Transportation Secretary Pete Buttigieg on Wednesday said the funds, a slice of the bipartisan $1 trillion infrastructure bill President Biden signed into law in November, are intended to support projects such as highway, bridge, freight, port and public transportation extensions and repairs. “President Biden’s Bipartisan Infrastructure Law is a once-in-a-generation opportunity to fix our outdated infrastructure and invest in major projects for the future of our economy,” Buttigieg said in a statement. “Under this approach and with a major infusion of new funding, we have the capacity to green-light more transformational projects that will create good-paying union jobs, grow the economy, and make our transportation system safer and more resilient.” State, regional and local governments will be able to apply for three separate grants by submitting one application, reducing the burden for applicants. The National Infrastructure Project Assistance program will receive $1 billion in its first year and fund major projects “that are too large or complex for traditional funding programs.” It will award half of the funding to projects greater than $500 million and the other half to those more than $100 million but less than $500 million. The Infrastructure for Rebuilding America program, an existing program, will fund smaller-scale highway, freight and railway projects intended to “improve safety, generate economic benefits, reduce congestion, enhance resiliency, and hold the greatest promise to eliminate supply chain bottlenecks and improve critical freight movements.” The Rural Surface Transportation Grant program is exclusive to rural communities in hopes to increase connectivity and generate economic growth. It will allocate up to $300 million in grants this year. DOT said it will prioritize applications for projects that improve safety, economic competitiveness, equity and climate and sustainability. Applications are due May 23. Applicants can secure grants for multiple years. The Biden administration is hoping that these projects can help in the fight against inflation, largely caused by supply-chain issues. “This funding will help enable more communities to build vital infrastructure projects that also strengthen supply chains and reduce costs for American families,” the administration wrote in its statement. Consumer prices rose 0.8 percent in February and 7.9 percent over the last year, according to data released by the Labor Department earlier this month. Annual inflation jumped to the highest rate since 1982 in February.
Biden wants to spend infrastructure billions on climate and equity initiatives. But it’s not his call. - President Joe Biden sold last year’s $550 billion plan for new infrastructure spending by promising it will spur transformative climate and equity programs nationwide. The problem: states control most of the cash and may not share his goals of tackling climate change or reversing the effects of institutionalized racism. With Democrats’ sweeping social and climate spending bill dead in the water, it’s looking increasingly like that bipartisan package that invests hundreds of billions in repairing roads, bridges and water systems will represent Biden’s signature domestic achievement going into the midterms. But the lack of federal control over how these dollars are spent is raising doubts about whether Biden can meet his pledges, disappointing his supporters. Biden’s inability to control how a large portion of the infrastructure money gets spent is largely due to legal constraints. About 75 percent of the infrastructure law will be distributed to states via a complicated formula set by existing statute, including the bulk of federal highway dollars. Communities that have for decades been on the short end of federal funding worry that these constraints will leave them in the same position, missing out on historic cash infusions. “Environmental justice communities have faced more [hardship] than many people have faced in this society, in this country. We have paid with our lives, with our blood, with our labor in addition to the taxes and whatever else we bring to the table,” said Donele Wilkins, CEO of Detroit-based environmental justice group Green Door Initiative. “We just want to get a return on our investment wherever we can get it.” The infrastructure law mandates that 49 percent, or about $21 billion, of funds provided through the drinking water and lead service line replacement programs must be provided as grants and forgivable loans to disadvantaged communities. That funding is intended to address the needs of low-income residents struggling to afford their water bills and lead poisoning disproportionately plaguing communities of color. Federal agencies have largely tried to nudge states to support the administration’s goals and address these funding inequities. EPA issued a 56-page memo earlier this month outlining recommendations and requirements to ensure the revolving funds hit equity targets, such as setting aside a portion of those funds for technical assistance to identify communities in need, help them develop projects and assist with applications. The Federal Highway Administration, similarly, is “encouraging” states to invest their formula dollars on repair and improvements before building new highways, but its statutory and regulatory tools to ensure compliance are limited.
Manchin outlines energy policy objectives - Sen. Joe Manchin (D-W.Va.), a key swing vote in the Senate, on Wednesday laid out some energy policies he supports. During a meeting of the International Energy Agency (IEA) in Paris, Manchin touted a tax credit for clean energy manufacturing, known as 48C, and legislation that would replace fossil fuel generation with advanced nuclear power. “People in states like mine, that the energy transition has hit the hardest, want meaningful work and are looking for a hand up, not a handout,” said Manchin, the chairman of the Senate Energy and Natural Resources Committee. He also expressed support for hydrogen energy, as well as the use of carbon capture — still developing technology that would aim to prevent climate-warming gases from fossil fuels from going into the air. And he reiterated recent skepticism over a transition to using electric vehicles. The Biden administration and House and Senate Democrats have sought to advance this transition through the use of tax credits included in the climate and social spending bill that passed the House but was held up by Manchin in the Senate. “I’m very much concerned about the supply chain,” he said. “I am very much concerned about ... relying on China to supply the necessary resources we need to have that transition happen.” The comments from Manchin follow a report that he is ready to negotiate on the broader package. E&E News reported on Wednesday that Manchin hopes for a deal to be reached during the Senate’s April and May work period on a slimmed down climate and social spending bill. According to the news outlet, there is text circulating, but it is at an early stage. Manchin spokesperson Sam Runyon told The Hill that Manchin is “always willing to engage in discussions about the best way to move our country forward.” She reiterated his concerns about inflation, saying the senator thinks it should be the country’s “first priority,” but also said he hopes to promote U.S. energy and lower the cost of prescription drugs. “We must maintain energy independence by advancing an all-of-the-above energy policy to continue producing energy cleaner than anywhere else in the world. Additionally, he continues to believe we can and must lower the cost of prescription drugs for working Americans to ensure no family has to choose between life-saving medications and putting food on the table,” Runyon said.
Manchin ready to engage on reconciliation - Is it time for a reconciliation resurrection? There have been signs recently that Sen. Joe Manchin is ready to resume negotiations on the massive climate and social spending package he torpedoed late last year, according to people knowledgeable on the matter. Five people who included environmental advocates, lobbyists and senior congressional staff members confirmed to E&E News yesterday that the West Virginia Democrat and chair of the Energy and Natural Resources Committee views the April-May Senate work period as a new goal to reach a deal on a scaled-back budget reconciliation bill known as the “Build Back Better Act.” Four of the people who spoke to E&E News said text is now being passed around, though one person described it as “pencil to paper” to underscore that new legislative language was still in its most nebulous early stages. They were granted anonymity because of the delicate nature of negotiations. It’s not clear what is currently on or off the table. While at one point Manchin was expressing interest in moving the $550 billion climate portion of the original, $1.7 trillion package, he has since said Russia’s war in Ukraine underscores the need to pursue a broader “all of the above” energy policy that includes increased domestic oil and gas production on public lands (E&E Daily, March 18). In the past week alone, Manchin has also cast doubt on whether he would support the bill’s significant investments in expanding access to electric vehicles, citing concerns about U.S. dependence on foreign supply chains for parts. Further clouding the outlook — and the prospects for reaching an agreement — one person in the environmental advocacy community said they had been told that the Energy and Natural Resources Committee’s draft portion of the “Build Back Better Act,” released in mid-December, was no longer the starting point for negotiations on the climate section of a smaller reconciliation bill. Manchin had previously said that he was largely on board with the climate provisions in the reconciliation package (Greenwire, Jan. 4). Some of those provisions came out of his committee, along with the clean energy tax provisions negotiated by Senate Finance Chair Ron Wyden (D-Ore.) and his House counterpart, Ways and Means Chair Richard Neal (D-Mass.). Lawmakers and advocates have been working under the assumption that these policies, alongside other elements of “Build Back Better” like lowering the prices of prescription drugs, would be the basis for moving forward. A draft bill from Energy and Natural Resources, unveiled just days before Manchin walked away from the deal, included major green policy wins like a ban on energy exploration in the Arctic National Wildlife Refuge and new royalty rates for onshore oil and gas drilling (E&E Daily, Dec. 16, 2021). If Manchin is prepared to now scrap his committee’s blueprint and start from scratch in reconciliation talks, that could upend expectations for renewed discussions, with climate hawks left to worry over what the committee chair would be willing to ultimately support. Adding to the intrigue, Manchin spent last Friday with leading Biden administration officials, including Energy Secretary Jennifer Granholm and Interior Secretary Deb Haaland, in his home state of West Virginia, as they promoted provisions that were part of last year’s bipartisan infrastructure law (Greenwire, March 18).
Manchin launches new push for ‘all of the above’ energy bill - The Washington Post --Sen. Joe Manchin III (D-W.Va.) has restarted talks with fellow Democrats about reviving the party’s climate and social spending bill, according to two people familiar with the matter, as administration officials search for oil and gas policies that could make the measure more palatable to him.Manchin, who has traveled in the past week with Energy Secretary Jennifer Granholm and Interior Secretary Deb Haaland, has told staff members and colleagues that the legislation must be voted on before senators leave town in August, according to the two people, who spoke on the condition of anonymity to describe private conversations.Manchin, who chairs the Senate Energy and Natural Resources Committee, has said that he wants the bill to take an “all-of-the-above” approach to energy policy, these people said, and that it’s still possible to reach a deal that includes billions of dollars’ worth of provisions to tackle climate change, cut prescription drug costs and update the tax code.He has also indicated that he wants the Biden administration to make some concessions related to oil and gas drilling in the Gulf of Mexico and natural gas exports, they added. The current five-year plan for offshore oil and gas leasing in federal waters expires June 30, and the Interior Department is running behind schedule in drafting a new one, which has frustrated drilling proponents.Without a new five-year plan, the federal government cannot auction off oil and gas leases in the Gulf of Mexico once the current one expires. Administration officials are looking at what policies aimed at boosting domestic energy production they can offer to win over Manchin’s support, according to one of the individuals familiar with these discussions, including possible offshore lease sales that Interior has said can move forward in light of a recent appellate court ruling. A spokeswoman for the Interior Department, Melissa Schwartz, declined to comment.
Sanders Opposes America COMPETES Act Over Billions in ‘Corporate Welfare’ - U.S. Sen. Bernie Sanders made clear Tuesday that he would not support the upper chamber’s unanimous approval of a global competition bill without changes to provisions he denounced as “corporate welfare.”“At a time of massive and growing income and wealth inequality, the American people are outraged at the unprecedented level of corporate greed that is taking place all around them,” Sanders (I-Vt.) began a speech on the Senate floor.Speaking for more than 20 minutes, the Senate Budget Committee chair laid out his opposition to the America Creating Opportunities for Manufacturing, Preeminence in Technology, and Economic Strength (COMPETES) Act.“Today, while the working class of this country is struggling with higher gas prices, higher food prices, and higher housing prices, the billionaire class and large corporations are doing phenomenally well and, in fact, have never, ever had it so good,” Sanders said. “The American people want Congress to address corporate greed and make certain that the wealthiest people and most profitable corporations pay their fair share of taxes.”“And yet, this week, right now, what are we debating here on the floor of the Senate? We are debating legislation to provide some $53 billion in corporate welfare with no strings attached to the highly profitable microchip industry,” he noted. “And yes, if you can believe it… this legislation also provides a $10 billion bailout to Jeff Bezos so that his company Blue Origin can launch a rocket ship to the moon.”Bezos, who also founded Amazon, has seen his wealth soar during the ongoing pandemic, Sanders pointed out. As of press time, the Bloomberg Billionaires Index ranked Bezos as the world’s second-richest individual, worth $190 billion, behind SpaceX and Tesla CEO Elon Musk at $252 billion.Sanders announced in his Senate speech that he will not back any unanimous consent request to speed up the passage of the America COMPETES Act—which the House approved in February—unless there is a roll call vote on two “extremely important” amendments he has introduced.Taking aim at microchip firms, the senator said that “providing $53 billion in corporate welfare to an industry that has outsourced tens of thousands of jobs to low-wage countries and spent hundreds of billions on stock buybacks with no strings attached may make sense to some people, but it does not make sense to me, nor do I think it makes sense to the American people.”Sanders’ first amendment “would prevent microchip companies from receiving taxpayer assistance unless they agree to issue warrants or equity stakes to the federal government,” he explained. “If private companies are going to benefit from over $53 billion in corporate welfare, the financial gains made by these companies must be shared with the American people, not just wealthy shareholders.” “In other words, all this amendment says is that if these companies want taxpayer assistance, we are not going to socialize all of the risks and privatize all of the profits,” he added. “If these investments turn out to be profitable as a direct result of these federal grants, the taxpayers of this country have a right to get a return on that investment.” The senator noted that his amendment directed at the microchip industry “would also require these highly profitable companies not to buy back their own stocks, not to outsource American jobs, not to repeal existing collective bargaining agreements, and to remain neutral in any union organizing effort.”\
The Biden administration can stop H-1B visas from fueling outsourcing: Half of the top 30 H-1B employers were outsourcing firms in 2021 –EPI - Key takeaways:
- Through its flawed interpretation of the law and lax enforcement, the U.S. government has made the H-1B—the U.S.’s largest temporary work visa program—the “outsourcing visa.” New data show that half of the top 30 H-1B employers in 2021 were outsourcing firms that underpay migrant workers and offshore U.S. jobs to countries where labor costs are much lower.
- The 15 top outsourcing firms alone were issued 21,550 H-1B visas, 25% of the annual limit. Amazon, which is not an outsourcing firm, took the top spot with nearly 6,200 new H-1B workers, but the next four were outsourcing firms: Infosys, Tata, Wipro, and Cognizant.
- President Joe Biden should implement regulations that would prevent outsourcing companies from exploiting the program.
With approximately 600,000 workers, the H-1B is the largest temporary work visa program in the United States—an important program that allows U.S. employers to hire college-educated migrant workers. However, the H-1B program is not operating as intended and needs to be fixed. Instead of being used to fill genuine labor shortages in skilled occupations without negatively impacting U.S. labor standards, the latest data show that the H-1B’s biggest users are companies that have an outsourcing business model that exploit the program by underpaying skilled migrant workers. President Biden can and should implement regulations that would prevent such exploitation. Offshore outsourcing companies, like Cognizant, do not make a product. They are staffing firms that resell labor. They offer customers, like Disney, the opportunity to lower costs by transferring Disney’s in-house technology operations to the outsourcer. Since wages account for the vast majority of technology operation costs, the outsourcing firm business model is only viable if it cuts labor costs substantially. After all, the outsourcing firm must offer the customer a sizable discount, since the customer is taking on risk by ceding some managerial control, and at the same time the outsourcer needs to earn profits for its shareholders. The outsourcer realizes these cost savings by shipping as many of the U.S. jobs and tasks to its overseas operations where wages are substantially lower and by hiring H-1B workers at wages much lower than the U.S. market rate. Once it wins the contract, the outsourcer places H-1B workers at the worksites of client firms where they serve three key roles: to facilitate the transfer of jobs and tasks offshore; to coordinate offshore teams; and to act as a lower cost alternative to hiring or keeping U.S. workers for the jobs that must stay, due to the nature of the job’s tasks, in the United States.
Border Patrol head expects record-breaking surge of migrants at US-Mexico border - The head of U.S. Border Patrol says a record-breaking number of migrants is expected at the southern border this spring, estimating as many as 8,000 people could be apprehended daily.Border Patrol chief Raul Ortiz told CNN that 7,000 to 8,000 migrants a day could soon "become the norm." Ortiz brought on 350 additional agents to assist at the border and another 150 to help with processing remotely.Ortiz estimated that facilities on the border are already over capacity with more than 16,000 migrants in detention."We're managing a flow that's significant," he told CNN, saying the expected surge is "going to put additional strain" on border officials and facilities.Border encounters with migrants climbed to 164,973 in February, up from about 154,000 in January but down from surges in November and December, according to the U.S. Customs and Border Protection.A greater surge this spring and summer is likely because of the expected withdrawal of Title 42, a Trump-era policy kept in place by President Biden. The policy allows the administration to expel migrants under a public health emergency related to the coronavirus pandemic.With the Centers for Disease Control and Prevention (CDC) reviewing the policy through March 30, a letter spearheaded by Sen. Rick Scott (F-Fla.) and signed by more than a dozen GOP senators questioned how the administration is preparing for the expected influx. "This is a grave concern that threatens to overwhelm our already strained immigration system and will only exacerbate a disastrous situation at our southern border,” the letter reads.
Top Democrats probe USPS fleet contractor -Top Democrats on the House Oversight and Reform Committee have launched an investigation into Oshkosh Defense LLC, the company awarded a multibillion-dollar contract to replace the U.S. Postal Service’s aging fleet of vehicles.In a letter sent last week, the lawmakers demanded the Wisconsin-based company produce documents related to its use of unionized labor and production of electric vehicles.The lawmakers, led by committee Chair Carolyn Maloney (D-N.Y.), said they “have been made aware” that Oshkosh may be attempting to sidestep using its own unionized workforce by opening a new manufacturing facility in South Carolina, where it intends to build up to 165,000 new mail trucks.“We are also seeking to understand whether your company is prepared to deliver electric vehicles in an efficient and cost-effective manner at the new facility,” they wrote.Government Operations Subcommittee Chair Gerry Connolly (D-Va.), National Security Subcommittee Chair Stephen Lynch (D-Mass.) and Rep. Brenda Lawrence (D-Mich.) also signed the letter.The probe marks the latest attempt to mitigate Postmaster General Louis DeJoy’s plan to replace his agency’s aging mail truck fleet with 90 percent gasoline-powered vehicles.DeJoy, a Trump appointee, last year bypassed two bidders that proposed hybrid gas-electric and pure battery-electric vehicles in favor of Oshkosh, a firm that primarily makes military vehicles.Despite pressure from the White House and lawmakers, the Postal Service issued a record of decision last month, which was the last step of the federal environmental review process and allowed USPS to move forward with its first order.Maloney last week called on the Postal Service’s internal watchdog to launch an investigation into whether the agency complied with environmental laws when awarding the contract, a concern shared by the White House Council on Environmental Quality and EPA (Climatewire, Feb. 3). Environmental groups are now weighing legal action.Oshkosh will have until April 1 to comply with the committee’s request, which includes a “detailed description” of the company’s plan to manufacture electric vehicles, the cost of production and the anticipated volume.
Can Congress Stop Louis DeJoy’s Plan to Buy a Fleet of Gas-Guzzling Trucks? – As postmaster general, Louis DeJoy has been mired in controversy. Appointed in May 2020 after making massive donations to Donald Trump, DeJoy has sought to implement a plan of austerity to the United States Postal Service. Ahead of the 2020 election, during which a record number of Americans voted by mail, DeJoy took a number of actions that slowed down mail service, including prohibiting overtime and decommissioning hundreds of sorting machines.DeJoy’s most recent controversy has been less publicized: a plan to purchase a fleet of gas-guzzling mail trucks, against the wishes of the Biden administration, for $6 billion.The purchase would be a large investment in infrastructure that will further climate change and be even more costly in the future. President Biden has stated his goal of having federal agencies phase out the use of gas-powered vehicles. But he has no power over the decisions of the USPS, an independent agency.That leaves enforcement up to Congress. And they might be able to stop him.This month, Rep. Gerry Connolly (D-Va.) introduced a bill that would prohibit the United States Postal Service from moving forward with a contract for a new fleet of mail trucks unless 75 percent of those trucks are electric.“Weaning ourselves off of fossil fuel dependence is a major part of trying to cope with greenhouse gas emissions,” Connolly said. “Replenishing [the postal fleet] with vehicles that are electric and hybrid would go a long way towards helping to change the nature of fuel in US vehicles on the roads.”Because the USPS contract with Wisconsin-based Oshkosh Defense is already finalized, legislators will need to move “with all deliberate speed” in their last-ditch effort to secure a green postal fleet, Connolly told me.The USPS, with its generally short routes and designated nightly parking spots, ought to be a perfect use case for electric vehicles, but it’s been hampered by bureaucracy, billions of dollars of made-up debt, and a postmaster general seemingly averse to spending and risk.“When Mr. DeJoy puts his mind to it, he can marshal Republican votes for the Postal Service,” Connolly said. “There’s an appetite in Congress, if they’re willing to work with us, to fund this to ensure that they have a fleet that’s a 21st century fleet that embraces new technology and that is environmentally sensitive.”As for the argument that some postal routes are too long for electric vehicles to be feasible, well, that’s true. But, by the USPS’s own estimate, those 70-mile-plus trips account for only 5 percent of the total postal routes. A fleet with 25 percent gas-powered trucks, as Connolly proposed, should be more than enough to cover those extra-long routes.
The COVID funding fiasco - At the Atlantic, Ed Yong reminds us that COVID has not disappeared, and that our governing institutions are hardly covering themselves in glory on this issue: This week, Congress nixed $15 billion in coronavirus funding from a $1.5 trillion spending bill, which President Joe Biden then signed on Tuesday. The decision is catastrophic, and as the White House has noted, its consequences will unfurl quickly. Next week, the government will have to cut shipments of monoclonal-antibody treatments by a third. In April, it will no longer be able to reimburse health-care providers for testing, vaccinating, or treating millions of uninsured Americans, who are disproportionately likely to be unvaccinated and infected. Come June, it won’t be able to support domestic testing manufacturers. It can’t buy extra doses of antiviral pills or infection-preventing treatments that immunocompromised people are banking on but were already struggling to get. It will need to scale back its efforts to improve vaccination rates in poor countries, which increases the odds that dangerous new variants will arise. If such variants arise, they’ll likely catch the U.S. off guard, because surveillance networks will have to be scaled back too. Should people need further booster shots, the government won’t have enough for everyone. Over at Lawyers, Guns, and Money, Dan Nexon offers this gloss on the situation: I think it worth remembering how we got here. A combination of incompetency and mendacity led the Trump administration to botch its response to COVID-19. Faced with this failure, his right-wing media personalities and officials decided to deny the problem itself; to do so, they turned to conspiracy theories, quack doctors… they “flooded the zone.” It worked, sending the base into the epistemic equivalent of a circular firing squad. But where goes the base, so goes the GOP, and here we are. It’s not clear to me that Republican opposition to vaccines and support for bogus remedies came from right-wing media figures covering for Trump’s failures. Trump himself encouraged crazy thinking about cures (hydroxychloroquine, bleach). Trump was clearly sympathetic to the “herd immunity” strategy pushed by Scott Atlas and the Great Barrington Declaration crew. And all these ideas were percolating in right-wing think tanks before they were picked up by Fox etc. Finally, congressional Democrats bear some responsibility for the fact that funding for treatments, testing, and vaccines is threatened. They had many opportunities to provide these resources. I am certainly not defending Trump or Republicans here; but when the dust settles, Democrats of all stripes need to acknowledge this failure and attempt to figure out why it happened and how we can do better in the future. Republicans are not going to help Democrats make government more effective, Democrats are going to have to carry this water uphill all by themselves.
White House officials say U.S. has exhausted funds to buy potential fourth vaccine dose for all Americans -The Biden administration lacks the funds to purchase a potential fourth coronavirus vaccine dose for everyone, even as other countries place their own orders and potentially move ahead of the United States in line, administration officials said Monday. Federal officials have secured enough doses to cover a fourth shot for Americans age 65 and older as well as the initial regimen for children under 5, should regulators determine those shots are necessary, said three officials, speaking on the condition of anonymity to detail funding decisions. But the officials say they cannot place advance orders for additional vaccine doses for those in other age groups, unless Congress passes a stalled $15 billion funding package. “Right now, we don’t have enough money for fourth doses, if they’re called for,” White House coronavirus coordinator Jeff Zients said on a forthcoming episode of “In The Bubble With Andy Slavitt,” which was recorded Monday and shared with The Washington Post. “We don’t have the funding, if we were to need a variant-specific vaccine in the future.” Advertisement Federal regulators and health officials have not yet determined whether a fourth shot is needed, and some experts question whether the extra dose will be necessary to boost protection for the entire population. But administration officials said placing orders for additional doses ahead of time — rather than waiting for the United States to be swamped by another wave of the virus — was imperative and a key lesson from the pandemic’s past two years. They also noted that the fast-moving omicron variant evaded some immune protection conferred by existing vaccines, demonstrating the need to invest in more targeted shots that could better fend off omicron and potential future variants. “Vaccines don’t just appear when you snap your fingers and say, ‘Okay, I want the vaccine.’ We’ve got to make it,” a senior administration official said. “And this year, it’s going to be more complicated because there’s a very significant chance — although we’re still waiting for data — that the vaccines are going to need to be tweaked to cover omicron.” Advertisement Analysts at Kaiser Family Foundation, a nonpartisan health research organization, independently confirmed that the United States would need to purchase hundreds of millions of additional doses to ensure that every American could receive four shots, if necessary, said Jen Kates, who leads global health policy for the organization and previewed the forthcoming analysis. “If their policy goal is to have enough doses available to provide a fourth dose to everyone, there are not enough doses purchased. They will run out of supply,” Kates said. Kates said her team reviewed several alternate scenarios, such as lowering its projection to 70 percent of Americans who would be vaccinated with four doses, rather than 100 percent. Even with that lower target, “there’s not enough” doses already purchased, Kates said, adding that the full analysis would be published later this week.
Lack Of Funding For Covid Response Will Lead To Dire Consequences: White House - The White House Covid-19 Response Team and Public Health Officials have warned of the dire consequences that the country will face in the fight against the pandemic if Congress fails to provide more funds. At a news conference, Health and Human Services Secretary Xavier Becerra said the continued execution of the President's Covid-19 Preparedness Plan requires continued support from Congress. "And at this stage, our resources are depleted," he told reporters. He said the fund Congress established to reimburse doctors and other medical providers for Covid care for Americans — in particular, the uninsured — is no longer accepting new claims from providers for testing or for treatment services. The fund will also have to stop accepting new claims for vaccination services by April 5. This means doctors, nurses, pharmacists, labs, and other healthcare providers will no longer get payments through the fund for providing these pandemic services to the public. The Biden administration had to cancel a purchase of additional supplies of monoclonal antibody treatments which had been planned for this week. The current supply of these therapeutics is projected to start to run out by late May, according to the HHS Secretary. Monday, the supply of monoclonal antibody treatments that were being distributed to every state was cut by 35 percent. "We're also having to scale back our plans to purchase more doses of AstraZeneca's preventive therapies for Americans who are immunocompromised. This increases the risk of having an insufficient supply of this treatment by the fall of this year," Becerra said. The government will not be able to purchase a proposed 600,000 doses of treatment courses of a new monoclonal antibody unless it gets the funding requested of the Congress. Chief Medical Advisor to the President Dr. Anthony Fauci said, "If we maintain our preparedness, an increase in cases does not need to be a cause for alarm like it once was. Unfortunately, because of congressional action, we're at risk of not having these tools readily available." "For months, we've made clear to Congress, on a bipartisan basis, that funding for core Covid medical supplies — including vaccines, treatments, and tests — was running out. Congress has failed to act. They failed to provide the necessary funding, and we're already seeing the consequences," he told reporters. CDC director Dr.Rochelle Walensky said the BA.2 sublineage of the Omicron variant has been in the United States for about the past two months, and it has increased transmission in comparison to the related BA.1 Omicron variant that circulated in the U.S. this winter. CDC estimates that BA.2 represents about 35 percent of circulating variants nationally.
COVID Bailouts Helped Politically Connected Businesses More Than Others – New Research -- COVID has been a painfully expensive ordeal for countries across the world. Aside from the medical cost of vaccines, testing and treatment, economic aid for furlough schemes and sector bailouts dealt a serious blow to public finances. Nations responded by distributing vast sums of money which are unlikely to be recouped. The UK alone spent £261 billionacross different relief schemes, of which £15 billion is expected to be lost due to fraud and errors. While the government can make a compelling case for the huge sums spent over the course of the pandemic so far, it is worth taking a closer look at where some of the money has gone. Our research reveals that when it came to financial assistance by the government, some businesses were more likely than others to receive it. These included firms with political connections, and those owned by large and influential shareholders. We discovered this by looking at a sample of publicly listed UK firms and examining their political connections using a variety of databases. We found that companies with powerful majority shareholders or with political links (a politician member of the board, for example), had a higher likelihood of being bailed out. This suggests that some firms were able to leverage their political capital to gain a competitive advantage.For its part, the government needed to ensure that recipients of public funds used them for their intended purposes such as continuing to pay suppliers, employees and lenders. This was admittedly a difficult task given all the demands thrown up by the pandemic. But the fact that so much will be written off in fraudulent claims or other kinds of losses shows a lack of due diligence and monitoring. Our research suggests a further element of crony capitalism whereby public funds were directed towards private interests. One recent accusation of cronyism was levelled at Greensill Capital, the bankrupt finance company which received access to government emergency COVID loans. Greensill paid the former UK prime minister, David Cameron, a salary of more than $1 million (£767,000) a year for a part-time board role. Cameron said he was not motivated by personal gain, but because he thought the company “had a really good idea for how to help extend credit to thousands of businesses”.Our research also found that bailouts were often given to firms with high amounts of debt and low cash reserves – businesses which potentially may have gone bust without government support.After accepting tax payer funds presumably given to help them survive, some then went on to pay generous dividends to their shareholders and bonuses to their directors. Elsewhere, some companies belonging to large international corporate groups benefited from a publicly funded opportunity to get cheap, short-term loans, while their contribution or commitment to the UK economy was questionable. For instance, BASF, a German chemical group, received the biggest single payout (£1 billion), but has now closed its UK plant and is moving the work to France. BASF has said it will be repaying the loan.
McCarthy says GOP will win control of House: 'It's not going to be a five-seat majority' - — House Minority Leader Kevin McCarthy (R-Calif.) on Thursday predicted that Republicans will win control of the House in November — and that they won’t just scrape by with the bare minimum number of seats they need. “We're going to win the majority, and it's not going to be a five-seat majority,” McCarthy told Punchbowl News in an interview — billed as a “fireside chat” — during House Republicans’ annual retreat in Florida. McCarthy’s confidence isn’t new. He’s predicted for months that Republicans will win back the majority in 2022, and the GOP is well positioned to do so. For one, the party in power typically loses ground in Congress in midterm elections, and Democrats currently control both chambers of Congress and the White House. At the same time, President Biden’s approval rating has sagged for months — a trend that could portend trouble for Democrats in November. What’s more, Democrats are holding onto a paper thin majority already. The GOP needs to pick up just five seats to recapture control of the House. Still, McCarthy declined to say exactly how many seats he expects the GOP to pick up this year, though he did say that it would fall short of Republicans’ gains in 2010, when the party netted 63 seats in the House. One reason for that, McCarthy said, is because the decennial redistricting process has left fewer competitive seats up for grabs. Consequently, he added, Republicans will have to compete in bluer parts of the country. “The play this time, there’s fewer competitive seats in the old nature, so we’re going to have to be winning seats in Democratic areas,” he said.
Graham gets combative with Jackson: 'What faith are you, by the way?' --Sen. Lindsey Graham (R-S.C.) on Tuesday grew increasingly combative in his line of questioning of Ketanji Brown Jackson, asking President Biden’s Supreme Court nominee about her religious faith, her defense of Guantánamo Bay prisoners and whether she was aware of what he said were left-wing attacks on his preferred nominee to the court. Graham has been seen as a swing GOP vote on Jackson given his support for previous Democratic judicial nominees, but he has signaled he is likely to vote “no” on this nomination. The Republican senator has also made it clear he disliked Democratic questioning during confirmation hearings for former President Trump's Supreme Court nominees and has repeatedly sought to underscore a double standard in how nominees from different presidents are treated. Graham opened his questioning by asking Jackson abruptly about her faith. “What faith are you, by the way?” he asked. When she responded she is a nondenominational protestant, Graham then asked: “Could you fairly judge a Catholic?” When Jackson said she didn’t feel comfortable talking about her personal religious views, Graham then pivoted quickly to how Democrats scrutinized Trump’s Supreme Court nominee Amy Coney Barrett’s Catholic faith in 2017 and 2020. “How would you feel if a senator up here said of your faith 'the dogma lives loudly within you and that’s of concern'?" he said, alluding to what Sen. Dianne Feinstein (D-Calif.) famously told Barrett when she was nominated to a federal appeals court in 2017. “You’re reluctant to talk about it because it’s uncomfortable. Just imagine what would happen if people on late-night television called you a f’ing nut speaking in tongues because you practice the Catholic faith in a way they couldn’t relate to,” he added, making clear he still has a chip on his shoulder over how Democrats and the media treated Barrett. Graham separately accused Jackson, who was an appellate specialist at the private firm Morrison & Foerster LLP from 2007 to 2010, of putting the United States “in an untenable position” by making the argument to the Supreme Court that the executive branch did not have authority to conduct periodic threat reviews to keep suspected terrorists in detention indefinitely. And in a fiery follow-up exchange with Senate Judiciary Committee Chairman Dick Durbin (D-Ill.) that occurred after his questioning, Graham declared that enemy combatants who pose a threat should be held at the Guantánamo Bay detention camp until they die. “As long as they’re dangerous, I hope they all die in jail if they’re going to go back and kill Americans. It won’t bother me one bit if 39 of them die in prison. That’s a better outcome than letting them go,” he said, his voice rising with exasperation. He took a direct shot at Jackson by arguing that her advocacy against keeping detainees in prison indefinitely hurt the nation’s ability to defend itself. “I’m suggesting the system has failed miserably and advocates to change the system like she was advocating would destroy our ability to protect our country,” he fumed, before abruptly walking out of the hearing room.
GOP shoots down Supreme Court boycott - Republicans on the Senate Judiciary Committee are shooting down the idea of boycotting the panel’s vote on Supreme Court nominee Ketanji Brown Jackson. “There’s not going to be any boycott. There’s zero, not one iota chance that we would boycott,” said Sen. Thom Tillis (R-N.C.), a member of the committee. The idea of a committee boycott, which has floated around Capitol Hill for weeks, was spun up after 10 Republicans sent Sen. Dick Durbin (D-Ill.), the committee chairman, a request that he suspend the hearing until they could get pre-sentencing reports tied to child pornography cases that Jackson presided over as a district judge. Durbin immediately rejected the request, accusing Republicans of trying to go on a "fishing expedition." Asked about the possibility that Republicans would try to bottle up Jackson’s nomination in committee by skipping the vote — a tactic they’ve used in other committees — Durbin said he was talking with GOP senators but acknowledged that it was a “danger.” But several GOP senators are indicating they didn’t support a boycott of Jackson, who, if confirmed by the full Senate, would be the first Black woman on the Supreme Court. The Judiciary Committee is split evenly, 11-11, meaning that to successfully boycott and try to bottle up Jackson’s nomination in committee, every Republican would have to skip the committee vote. Sen. Lindsey Graham (R-S.C.), who is viewed as a “no” vote on Jackson, signaled he didn’t think skipping the vote was a good idea. “I don't think that's the right way," Graham said, asked if he would support a boycott. Sen. John Cornyn (R-Texas), who is also a member of the committee and an ally of Senate Minority Leader Mitch McConnell (R-Ky.), told reporters that he thought Republicans should "show up and try to be on our best behavior and treat the nominee respectfully." The committee is expected to hold a vote on Jackson's nomination on April 4, with Democrats eager to confirm her before they leave for a two-week April break. Under committee rules, a nomination can’t be reported to the full Senate “unless a majority of the Committee is actually present at the time such action is taken and a majority of those present support the action taken.” The Senate's rules also require that a simple majority be present in committee. The committee rules also require two members of the minority to be present for a vote, but that has been waived in the past, including when Democrats skipped Justice Amy Coney Barrett's committee vote in 2020. At the time, Republicans had a 12-10 majority on the panel, meaning they could fulfill the simple majority requirement without Democratic help.
Supreme Court Justice Clarence Thomas has been hospitalized with 'flu-like symptoms' -Supreme Court Justice Clarence Thomas was admitted to Sibley Memorial Hospital in Washington, DC, on Friday with "flu-like symptoms," the court said in a statement released Sunday afternoon.The hospitalization is not COVID-19 related, the statement added."He underwent tests, was diagnosed with an infection and is being given intravenous antibiotics," the statement read. "His symptoms are abating, he is resting comfortably, and he expects to be released from the hospital in a day or two. Justice Thomas will participate in the consideration and discussion of any cases for which he is not present on the basis of the briefs, transcripts, and audio of the oral arguments."Sibley Memorial Hospital did not immediately return Insider's request for comment.
Supreme Court silent on Thomas health status - The Supreme Court on Thursday did not respond to inquiries about the health status of Justice Clarence Thomas and whether he remained hospitalized after being admitted late last week. The court on Sunday said Thomas, 73, was admitted to Sibley Memorial Hospital in Washington, D.C., on Friday evening after experiencing “flu-like symptoms” and was diagnosed with an infection. The court’s statement Sunday added that Thomas was being treated with intravenous antibiotics and that “his symptoms are abating” and “he expects to be released from the hospital in a day or two.” Since then, the court has provided no additional details to The Hill other than to confirm reports Monday that Thomas did not have COVID-19. Thomas’s close friend Armstrong Williams on Thursday told The Hill that Thomas is “resting and he’s going to be just fine” but declined to elaborate further on the justice’s health. Pressed on whether Thomas was still in the hospital, Williams declined to answer.“It doesn't matter. He's resting and doing well,” he said, adding: “I don’t think the public cares about where he’s resting — it’s that he’s resting and he’s doing fine. I think the media cares about where he’s resting. The public doesn’t.” Thomas was absent from oral arguments on Monday, Tuesday and Wednesday, with Chief Justice John Roberts announcing prior to Wednesday’s argument that “Justice Thomas is unable to be present today” but providing no additional information.
Ginni Thomas sent Mark Meadows texts urging efforts to overturn election: report - Virginia “Ginni” Thomas, who is married to Supreme Court Justice Clarence Thomas, reportedly sent then-White House chief of staff Mark Meadows text messages after the 2020 presidential election urging efforts to overturn the result to keep former President Trump in office. The House select committee investigating the Jan. 6 Capitol riot is examining the messages, which were obtained Thursday by The Washington Post and CBS News. In one of the 29 texts exchanged between Ginni Thomas and Meadows, sent on Nov. 10, she wrote: “Help This Great President stand firm, Mark!!!...You are the leader, with him, who is standing for America’s constitutional governance at the precipice. The majority knows Biden and the Left is attempting the greatest Heist of our History,” according to the Post. The text was sent shortly after many media outlets began projecting then-nominee Joe Biden as the country's next president. “This is a fight of good versus evil,” Meadows wrote to Thomas on Nov. 24, per the Post. “Evil always looks like the victor until the King of Kings triumphs. Do not grow weary in well doing. The fight continues. I have staked my career on it. Well at least my time in DC on it.” George Terwilliger III, Meadows’s attorney, acknowledged to the Post that the messages exist but said “nothing about the text messages presents any legal issues.” Thomas did not respond to the outlet's requests for comment.
Facebook's 'double standard' on hate speech against Russians- Facebook's decision to allow hate speech against Russians due to the war in Ukraine breaks its own rules on incitement, and shows a "double standard" that could hurt users caught in other conflicts, digital rights experts and activists said.Facebook owner Meta Platforms will temporarily allow Facebook and Instagram users in some countries to call for violence against Russians and Russian soldiers in the context of the Ukraine invasion, Reuters reported last week.It will also allow praise for a right-wing battalion "strictly in the context of defending Ukraine", in a decision that experts say demonstrates the platform's bias.The move represents a "glaring" double standard when set against Meta's failure to curb hate speech in other war zones, said Marwa Fatafta at digital rights group Access Now."The disparity in measures in comparison to Palestine, Syria or any other non-Western conflict reinforces that inequality and discrimination of tech platforms is a feature, not a bug," said Fatafta, policy manager for the Middle East and North Africa."Tech platforms have a responsibility to protect their users' safety, uphold free speech, and respect human rights. But this begs the question: whose safety and whose speech? Why were such measures not extended to other users?" she added.Last year, hundreds of posts by Palestinians protesting evictions from East Jerusalem were removed by Instagram and Twitter, who later blamed technical errors.Digital rights groups slammed the censorship, urging greater transparency on how moderation policies are set and ultimately enforced.Facebook has come under fire for failing to curb incitement in conflicts from Ethiopia to Myanmar, where United Nations investigators say it played a key role in spreading hate speech that fuelled violence against Rohingya Muslims."Under no circumstance is promoting violence and hate speech on social media platforms acceptable, as it could hurt innocent people," said Nay San Lwin, co-founder of advocacy group Free Rohingya Coalition, who has faced abuse on Facebook."Meta must have a strict policy on hate speech regardless of the country and situation - I don't think deciding whether to allow promoting hate or calls for violence on a case-by-case basis is acceptable," he told the Thomson Reuters Foundation.
Manafort removed from plane for revoked passport - Former Trump adviser Paul Manafort was removed from a plane in Miami on Sunday for carrying a revoked passport, according to officials. Public information officer for the Miami-Dade Police Department Detective Alvaro Zabaleta confirmed to The Associated Press that Manafort had been removed from an Emirates Airline flight to Dubai on Sunday night. "Mr. Manafort was denied travel by [Customs and Border Protection] on scene and his US Passport was revoked and he could not take his flight. No further incident," Zabaleta said in a statement to The Hill. Manafort was previously the campaign chairman for former President Trump's 2016 campaign. In 2018, he was convicted on eight counts of bank and tax fraud by a Virginia jury. The case against Manafort had to do in part with whether he engaged in a scheme to avoid paying taxes on income he received for working as a political consultant for pro-Russian politicians in Ukraine. Manafort was sentenced to a prison term of more than seven years in 2019, but was released early in 2020 to serve out the rest of his sentence at home. Trump pardoned Manafort in December 2020 along with a slew of other allies.
Issa lays groundwork for House GOP probe into Hunter Biden laptop story -Rep. Darrell Issa (R-Calif.) is spearheading an effort to investigate 2020 censorship and suppression of news coverage about the contents of Hunter Biden’s laptop, previewing the kind of oversight House Republicans plan to engage in if they win back the House. Issa on Wednesday sent record and document preservation requests to several tech company executives, former intelligence officials and top White House aides relating to the initial story in the New York Post about the laptop contents belonging to President Biden’s son. GOP leaders have already promised an avalanche of investigative and oversight activity if they are in the majority, including into Hunter Biden, the origins of the COVID-19 virus and the withdrawal of U.S. troops from Afghanistan. “Big Tech will resist accountability like it always does — but we are more determined than ever to make certain that we get the truth of the collusion that we know occurred,” Issa said in a statement to The Hill. “We should carry with us an obligation to see this through.” The story from the New York Post in October 2020 said “smoking gun” emails revealed a meeting between Joe Biden, Hunter Biden and Ukrainian business executives, insinuating shady dealings. Former New York Mayor Rudy Giuliani, then serving as President Trump's personal attorney, gave the emails to the outlet, saying that they came from a laptop that Hunter Biden left at a Delaware computer repair shop. Other outlets, including The New York Times, have since authenticated portions of the laptop contents. But at the time, there were widespread concerns about the authenticity of the contents and how they were obtained, with some worrying that the material was hacked. Twitter blocked users from sharing a link to the New York Post story for a little over two weeks in October 2020, at the height of the presidential race, citing violations of its policy about hacked material. Facebook did not block the link but said that it reduced the story’s distribution on the platform. The moves enraged Trump supporters, who argued that the companies suppressed negative information about President Biden in order to protect his candidacy.
At What Point Does a Billionaire’s Greed Hurt the Rest of Us? - Our political system has become so bloated and corrupt with untraceable money, it barely rates a headline when a billionaire like Peter Theil – an out gay man – announces his departure from the Meta (Facebook) Board so he can work full time on electing Trumpists to Congress so they can join the gay-bashing, Fox-touted, anti-tax, anti-vax, and pro “freedom” crowd. I think it fair to say that Thiel has ignored GOP/Trumpian social policy just so long as another humongous tax cut for the super-wealthy might be engineered. Good ROI for his estimated “$20 million, so far” committed to this good cause. Not that intellectual consistency has ever been the strong suit of the billionaire class.So let’s for a moment consider just how much $1 Billion really is. Just a one with a lot of zeros you say? In January 2019, historian Rutger Bregman tried to explain to a bunch of billionaires at the World Economic Forum (held in Davos) why philanthropy is not the way to address inequality. Rather, it’s taxes. On his own website, he helps us understand just how much a billion dollars is in 2019 numbers:If you made $50k a year, and you didn’t ever spend one penny of it — you just put that money into safekeeping and saved it up — do you know how long you would have to work to save up a BILLION dollars? TWENTY THOUSAND YEARS. That’s right… Roughly 4X the length of recorded human history.In his recent book, Davos Man, Peter S. Goodman has chosen a great subtitle: “How the Billionaires Devoured the World.” Perfect description for all of them from Thiel to Putin. (And, yes, he’s one of them, this vaunted war-monger of a Communist leader who is in the midst of invading Ukraine). By the time this is published, he may well have come to terms with what is now widely perceived as over-reaching actions that could reshape the world order, and not for the better. Whether he will be able to enjoy his super-yacht that barely reached Russian waters just days before his war was launched is anybody’s guess. It doesn’t look, though, that it will be welcomed in foreign ports anytime soon. And, for a billionaire, hanging out on a superyacht is part of what makes life worth living (ask Bezos, owner of the longest superyacht yet built at 400 plus feet). In the current era, the B-people have clear sailing to keep adding to their piles.So, back to taxes. For the moment, let’s just consider incometaxes for the highest tax brackets. Again from Bregman’s website come these compelling numbers:Here are the marginal tax rates by president (since WWII) for the top income brackets:And we can see that as the top marginal tax rate decreases, so does the strength of the middle class… The rich get richer, and the poor get poorer. And they give any attempt to correct this trend the evil & scary-sounding moniker of “Socialism.”As is clearly demonstrable in the chart, the middle class was in most ways built DURING the period of highest marginal taxation – the 50s and 60s – completely belying the standard GOP “trickle-down” argument that lowering rates creates jobs. But when you overlay this irrefutable data with the Clintonian era’s overt embrace of “Davos Man” calls for globalization abetted by the World Economic Forum (which attracts a fleet of some 1600 private jets every year) you can begin to gather just why working-class wages have been in a tailspin since Reagan’s famous line, “government is the problem, not the solution.” That the right has been so successful in turning the resulting alienation into political rage against immigrants and intellectuals is beyond telling. It is no surprise that Thiel and others continue to invest heavily in anti-government politics and the accompanying phenomenal ROI they achieve by drowning the beast in the bathtub.
The Billionaire’s Bard - IF THE ART OF SCIENCE FICTION lies in translating the plausible into the prophetic, there’s no practitioner more successful than Neal Stephenson. Across more than a dozen sci-fi novels, techno-thrillers, and works of speculative fiction, Stephenson has developed a reputation for being something of a tech oracle—where his writing goes, so goes the future. Lately, Stephenson’s influential 1992 novel Snow Crash has been in the headlines as the origin of the term “metaverse,” the life-as-virtual-reality concept around which Facebook CEO Mark Zuckerberg has staked his company’s future. And his 1999 novel,Cryptonomicon, so accurately anticipated the possibilities of a digitally encrypted system of anonymous financial transactions that, in 2019, Stephenson had to publicly deny the (mostly tongue-in-cheek) rumor that he might in fact be Satoshi Nakamoto, the mysterious creator of Bitcoin.Stephenson’s fictions have even given rise to entire product lines: the designers of both Google Earth and Xbox Live reportedly consulted Snow Crash for inspiration, while Jeff Bezos was so enamored of Stephenson’s 1995 novel, The Diamond Age: or A Young Lady’s Illustrated Primer, that he dubbed the top-secret development team working on the Amazon Kindle “Project Fiona” after a character in the book. The idea for Blue Origin, Bezos’s commercial spacefaring company, was hashed out over coffee with Stephenson after a joint viewing ofOctober Sky in 1999; for a time, Stephenson was the only employee. Taking into consideration the other tech billionaires who are fans of Stephenson’s work or have cited it as a major influence—the list ranges from Microsoft’s Bill Gates and Palantir’s Peter Thiel to LinkedIn’s Reid Hoffmann and Google’s Sergey Brin—it doesn’t seem like an exaggeration to say that Neal Stephenson might be the most influential novelist among business tycoons since Ayn Rand.
$13.7 Billion in Credit Default Swaps on Russia’s Debt Were Executed in 61-Day Span of 2021 as It Amassed Troops Around Ukraine - By Pam and Russ Martens - As the headlines in mainstream media grew ever more alarming in late 2021 regarding Russia’s troop buildup around Ukraine, approximately $225 million per day (or $13.7 billion over a span of 61 days) had been waged in bets that Russia might default on its sovereign debt. These bets are known as Credit Default Swaps and can be used to hedge exposure or simply speculate on a debt default in hopes of making a profit.This information resides in a publicly-available swap repository maintained by the Depository Trust and Clearing Corporation (DTCC). For the period of September 20, 2021 through December 19, 2021, the DTCC shows that an average of 26 trades per day were being made in the Credit Default Swaps on the Russian Federation’s sovereign debt, for a daily total of $225 million notional (face amount of credit default swaps).The $225 million daily notional is defined as follows by the DTCC:“The transactions covered in this analysis include only transactions where market participants were engaging in market risk transfer activity. Risk transfer activity is defined as transactions that change the risk position between two parties. These transaction types include new trades between two parties, a termination of an existing transaction, or the assignment of an existing transaction to a third party.“It was specifically designed to exclude transactions which did not result in a change in the market risk position of the market participants, and are not market activity. For example, central counterparty clearing, and portfolio compression both terminate existing transactions and re-book new transactions or amend existing transactions. These transactions still maintain the same risk profile and consequently are not included as ‘market risk transfer activity’ transactions.”The trading activity for the period of September 20 to December 19, 2021 was 4.5 times the daily notional volume of $50 million in Credit Default Swaps executed on the Russian Federation’s sovereign debt for the equivalent period in 2020 according to the DTCC database. A small sampling of the numerous headlines that ran in the last quarter of 2021 regarding Russia’s troop buildup around Ukraine include the following, as trading surged in its Credit Default Swaps: The big problem with the DTCC’s swap repository is that it fails to share with the public the names of the parties (typically megabanks) that are buying and selling protection via the Credit Default Swaps on Russian debt. Thus, the public does not know if the bank where they hold their life savings in federally-insured deposits might be on the hook to pay out billions of dollars if Russia defaults on its debt. (Russia’s debt is currently rated “junk” by the three major credit rating agencies – S&P, Moody’s and Fitch – with Fitch saying Russia’s default is “imminent.”)
Waters requests 'detailed information' on U.S. banks' exit from Russia - — The chair of the House Financial Services Committee has requested “detailed information” from banks and other businesses describing how they’ve limited or ended their business dealings in Russia since its invasion of Ukraine.Addressed to more than 30 trade associations — including the American Bankers Association, American Fintech Council, Blockchain Association, Bank Policy Institute, Electronic Transactions Association and U.S. Chamber of Commerce — the letter sent Thursday by Rep. Maxine Waters, D-Calif., adds to the already significant pressure on banks to abandon their activities in Russia.“I have been heartened by how many companies in the financial services industry and in corporate America have taken actions above and beyond those explicitly called for by U.S. sanctions,” Waters wrote. But “the committee currently lacks a clear picture of the extent of these divestments.
While JPMorgan Is Saying “Buy,” Morgan Stanley Is Advising Clients to “Sell” By Pam Martens - The Fed has just raised its benchmark interest rate by a quarter point with a projection of six more rate hikes ahead this year – which is usually the death knell for stocks. Russia has invaded Ukraine, a sovereign country of 44 million people, which has forced NATO countries to provide weapons to Ukraine. This has brought threats of retaliation from Russian President Vladimir Putin, creating the worst military crisis since the beginning of World War II. None of this is the stuff of which bull markets in stocks are made.Despite that, the wizards at JPMorgan Chase are telling its millions of clients around the world that it’s time to buy this stock market. (Before you decide to take advice from JPMorgan Chase, you may want to read this.)Even more interesting, the half of JPMorgan that was split off from it in 1935, Morgan Stanley, is giving the opposite advice to its 16,000 brokers and their millions of customers. Mike Wilson, the Chief U.S. Equity Strategist and Chief Investment Officer at Morgan Stanley, who has spent more than three decades at the firm, is saying it’s time to sell this rally, that it’s nothing more than a “vicious bear market rally.” A “vicious bear market rally,” is also known to veteran traders as a “short squeeze.” That happens when a lot of people (or one or more large hedge funds) have made bets that the stock market (or a particular tradeable security) will decline in price (a short bet), only to have a rumor or intentional news leak or coordinated buying by invisible hands spark a rally that scares the shorts into a buying frenzy to cover their short bets. A secular (long term) bear market is notorious for periodic short squeeze rallies that confuse investors into thinking a new bull market has begun.How does a brokerage firm with 16,000 stockbrokers (now called financial advisors) make money if its clients sell their stocks and sit in cash for an indefinite period of time? Well, Morgan Stanley isn’t telling anyone to sit in cash.Mike Wilson has been around Morgan Stanley long enough to know that brokers can turn on an equity strategist like a vicious pack of wild animals if he makes a bad call that costs them their best clients. That’s exactly what happened to Salomon Smith Barney’s Jack Grubman, who was also eventually charged by the SEC with issuing “fraudulent research” during the leadup to the dot.com bust of 2000. (Grubman was never criminally charged by the Justice Department nor did he go to trial on the SEC’s civil charges. He paid a $15 million fine, was barred from the industry, and walked away. His haul while at Salomon Smith Barney according to the SEC, ‘exceeded $67.5 million, including his multi-million dollar severance package.’ ”)
Wall Street bonuses surge to record high - The New York State Comptroller Thomas P. DiNapoli issued a press release on Wednesday reporting that estimated bonuses for New York City’s financial industry grew by 20 percent in 2021 to a record average of $257,500 per employee. New York state’s top fiscal officer issued his statement as part of the state’s annual report. It showed that the pretax profits from which cash payouts were made to Wall Street bankers totaled $45 billion in the first three quarters of the year, the largest amount on record. There were approximately 180,000 employees in the state’s industry, the same number as 2020. “The numbers pop out … and are higher than what had been projected,” DiNapoli said of the report. He also called it “welcome news” because the Wall Street employees account for 18 percent, or nearly $15 billion, of New York tax revenue even though they represent just 5 percent of the state’s private sector workforce. Although the numbers for 2021 are not yet available, the average annual income of Wall Street employees in 2020 was $483,370 or nearly five times the income of others in New York’s private sector. Bonuses paid out to securities industry employees in 2020 were $213,700, an increase of 28 percent from the previous year. The report says that fourth quarter 2021 Wall Street financial results have not yet been released but, “they are expected to show continued profitability, which would represent the sixth consecutive year of growth in profits since 2015.” Profits are likely “to reach the second-highest level on record after 2009 (which saw $61.4 billion).” The payout of massive bonuses to those who buy and sell financial assets and instruments for various Wall Street securities firms over the past two years is further proof that the capitalist elite has exploited the coronavirus pandemic to further enrich themselves, while the rest of the population has been thrown into economic crisis and have faced the public health devastation of COVID-19.
The SEC is set to announce historic climate disclosure rules -- How much do companies contribute to climate change and how are they impacted by it? Those questions are at the heart of a major announcement expected on Monday from the Securities and Exchange Commission. The country's top financial regulator is expected to propose new disclosure rules that would require companies to report their contributions to greenhouse gas emissions as well as how climate change might affect their businesses. It's part of a global push by regulators to acknowledge climate change as a risk to their economies and their financial systems. Investors are demanding companies disclose potential risks from climate change. But some businesses worry climate-related government mandates could be invasive and burdensome. Some companies, including Apple, already disclose their greenhouse gas emissions as well as those from their suppliers. But the U.S. lacks clear standards on what exactly companies have to report to their investors when it comes to climate impact and risks. The SEC wants to change that. Any rules proposed by the SEC's four commissioners, led by Chair Gary Gensler, would be subject to a public feedback period. "There will be a whole new round of focus on climate disclosure rules, and what it is going to mean for companies, investments, and, of course, climate itself," says Rachel Goldman, a partner at the law firm Bracewell. The push is largely coming from investors themselves, who are increasingly keen to know how climate change might impact the businesses they fund. The White House also wants to address climate-related financial risk. President Biden issued an executive order last year pushing the federal government to help identify the risks posed by climate change.
'Watershed moment.' SEC proposed landmark climate rules Large companies that do business in the United States would be required within three years to lay bare their contributions and vulnerabilities to climate change — including, in some cases, the planet-warming emissions associated with their customers and suppliers. That’s according to the Securities and Exchange Commission, which voted today to propose groundbreaking climate disclosure rules. It’s a landmark moment for President Biden, environmental groups and climate-concerned investors. If finalized, the rules would fundamentally overhaul how publicly listed companies divulge detailed information about their climate risks, strategies and more. “This is a watershed moment for investors and financial markets,” said SEC Commissioner Allison Herren Lee, a leading proponent of the effort. “Climate change poses a pressing and urgent risk for investors, companies, capital markets and the economy,” Lee added. “It’s no surprise, then, that investors representing tens of trillions of dollars — more than the combined GDP of the top five ranked countries in the world — have been clear that they need more and better climate-related disclosure.” The rules have been a long time coming. Business groups, investors and green groups for months have weighed in on what types of information the SEC should ask for, in what form companies should provide it and the extent to which companies would be held accountable for the data points they provide. Now, there are some answers. Under the new framework, publicly listed companies would be required to disclose information including how extreme weather events and the clean energy transition might affect their business in existing SEC filings, such as the Form 10-K. The proposal also aims to crack down on the growing number of corporate climate commitments. It would do so by requiring companies that have set splashy emissions reduction goals to provide more details about how they would achieve those reductions, the extent to which they would rely on carbon offsets to do so and the progress they have made already. Perhaps most important, though, is how the rules handle companies’ planet-warming emissions. The SEC said all public companies regardless of their size would, in the coming years, be required to report their direct greenhouse gas emissions, as well as the carbon output associated with its purchased electricity. More complicated is which companies would need to disclose their Scope 3 emissions, or the emissions associated with their customers and supply chains. Under the current proposal, only two types of companies would be required to report those numbers. First are companies that determine that their indirect emissions are “material” or important to their operations or financial well-being. Second are companies that have set emissions reductions targets that include their Scope 3 emissions. That element of the proposal will likely spark concerns from progressive groups, which have said a “materiality standard” would allow major emitters that haven’t set Scope 3 emissions targets to avoid being transparent about the full extent of their emissions by claiming they aren’t financially important. While some of the climate-related information would eventually be subject to review by third-party groups such as auditors, the same wouldn’t apply to Scope 3 data.
Where will banking regulators go next on climate policy? --Moderating climate risk in the financial system and other business sectors has morphed into a political brawl.Republicans came down harshly on the Securities and Exchange Committee’s proposal this week to require climate disclosures at some publicly traded companies. And earlier this month, GOP pushback led Sarah Bloom Raskin to withdraw from consideration for vice chair for supervision of the Federal Reserve, partially over her past writing about limiting lenders’ exposure to the fossil-fuels industry. The partisan battle could intensify. If Republicans retake the House and/or the Senate in the midterm elections, they would have more power to stymie any of the Biden administration’s climate ambitions that would rely on new legislation. At that point, Biden’s regulators could have as little as two years before the next presidential election to enact the kind of financial climate risk changes it has promised.
FDIC advances bank merger proposal - The Federal Deposit Insurance Corp. has set the wheels in motion to publish its request for information on bank merger policy, putting the policy fight that led to the resignation of former Chair Jelena McWilliams back on the front-burner and eliciting a new round of industry reaction.On Friday the agency said it has sent its proposal to the Federal Register for publication and will allow 60 days for public comment. The FDIC board had approved the request for information in December, but it’s not official until published.Since the board’s 3-0 vote in December, the agency conducted a final technical review before formalizing the request, according to FDIC staff. The vote occurred amid a power struggle between McWilliams — a Republican appointee — and Democrats on the board, including now acting Chair Martin Gruenberg and Consumer Financial Protection Bureau Director Rohit Chopra. McWilliams stepped down from the agency in February.
OCC overhauls community, midsize bank supervision The Office of the Comptroller of the Currency will overhaul its supervision of community and midsize banks, including designating one deputy comptroller responsible for overseeing “novel banks and technology service providers,” according to a memo obtained by American Banker. The changes will put a bigger emphasis on supervising fintech and cryptocurrency, as well as creating flexibility the agency might need to account for consolidation of small banks. The reorganization will take effect Oct. 1. “This is a significant restructuring of the midsize and community bank department,” said Daniel Stipano, a partner at Davis Polk and a 30-year veteran of the OCC. “It’s recognizing the changes that have taken place in the industry, particularly those due to technology and consolidation.”
High-stakes trial could complicate BMO’s deal for Bank of the West A high-stakes lawsuit involving allegations that Bank of Montreal lied to a judge after a predecessor bank destroyed key evidence is slated for trial this fall, potentially complicating the Canadian banking giant’s deal to acquire Bank of the West. The lawsuit, which grew out of a long-defunct Ponzi scheme, was filed a decade ago, but last summer BMO started making public disclosures about the possibility of a large financial liability. The plaintiff is seeking $1.9 billion in compensatory damages, plus interest, punitive damages and attorneys’ fees, BMO stated in a March 1 report to its shareholders. The suit against BMO’s U.S. subsidiary was filed by trustees in the bankrupt businesses of Thomas Petters, seeking damages from Petters’ Ponzi scheme, which fell apart in 2008.Clarification: An earlier version of this article noted that BMO's March 1 report to shareholders included an estimate that the trial may take place no earlier than late 2022. That statement is accurate, but BMO first included the updated estimate of the trial's timing in a Dec. 3 report to shareholders. The story has been updated to reflect when the language in BMO's legal disclosures changed.
Pro-crypto Republican's push for bill gets backing of a Democrat - A push by Republican Sen. Cynthia Lummis, one of the crypto industry’s staunchest supporters in Congress, to write a new law for digital assets is getting the support of at least one Democrat. New York Sen. Kirsten Gillibrand said on Thursday that she’s working with the Wyoming lawmaker to introduce the legislation in the next several weeks. The bill will cover a range of issues, including banking, taxes, privacy, and consumer protection, the two said during an event hosted by Politico in Washington. “The work we’re doing is going to be a very complex and intensive review of different aspects of this industry,” said Gillibrand.
Biden is planning a new digital currency. Here's why you should be very worried - Whenever the White House says it is working on a plan that would transform a vital part of the U.S. economy, and that the administration is doing so with the “highest urgency,” it should go without saying that the press should pay close attention to what’s going on. Even more importantly, the press should eagerly and comprehensively inform the public of the potential risks associated with such a proposal. Unfortunately, that’s not happening today, and the effects of the media’s negligence could reverberate for decades to come. On March 9, the Biden administration released an executive order (EO) instructing a long list of federal agencies to study digital assets and to propose numerous reports about their use and proposals to regulate them. Much of the executive order is focused on cryptocurrencies such as bitcoin and ethereum, which run on blockchain technology and have become increasingly popular among many investors and consumers in recent years. But there is an even more important part of the EO: President Biden has instructed the federal government and Federal Reserve to lay the groundwork for a potential new U.S. currency, a digital dollar. If the United States were to adopt a digital currency like the one discussed in Biden’s executive order, it would be one of the most dramatic expansions of federal power ever made, one that could put individuals and businesses in grave danger of losing their social and economic freedoms. Among other important actions, the White House executive order directs several federal agencies, including the Treasury Department, to study the development of a new central bank digital currency (CBDC) and to produce a report within 180 days of the EO discussing the potential risks and benefits of a digital dollar. The order further directs the Treasury Department, Office of the Attorney General and Federal Reserve to work together to produce a “legislative proposal” to create a digital currency within 210 days, about seven months. A digital dollar would not merely be a digital version of the existing U.S. dollar, but rather an entirely new currency that would, at least at first, exist alongside today’s currency. Similar to cash, the CBDC would be used to pay for goods and services and would likely be managed by the Federal Reserve, the central bank of the United States. Unlike the current dollar, though, a central bank digital currency would not exist in physical form, meaning you wouldn’t be able to go to a bank or ATM and withdraw it. It is important to understand that the digital dollar would not be similar to cryptocurrencies like bitcoin. Cryptocurrencies operate on blockchain technology, which is decentralized by design. No group or individual can truly control cryptocurrencies once they are launched. Digital dollars, on the other hand, would be traceable and programmable. The Federal Reserve (or some other designated entity) would have the ability to create more digital dollars whenever it sees fit, and, depending on how the legislation is written setting up the currency, the dollars could be formulated to have various rules and restrictions built into their design.
Powell says digital dollar must ensure privacy, identification -Federal Reserve Chair Jerome Powell outlined four qualities a hypothetical digital currency in the U.S. must have while adding that no final decision has been made on whether to proceed with creating one. Powell said a central bank digital currency would need to ensure user privacy; it would need to be “identity verifiable,” similar to the way U.S. bank accounts are identifiable to prevent money laundering; it would need to be “intermediated,” or widely embraced by the current banking system; and serve as a widely accepted means of payment. Powell made the comments Wednesday during a virtual panel at the Bank for International Settlements Innovation Summit.
Don’t discount the importance of regulatory sandboxes for fintechs | American Banker op ed - When the UK Financial Conduct Authority introduced the concept of regulatory sandboxes in 2016, the agency was broadly lauded as forward-leaning and it wasn’t long before some U.S. regulators, including the Commodity Futures Trading Commission and the Office of the Comptroller of the Currency, followed suit with similar innovation programs.But while the concept of early regulatory engagement with fintech innovation has spread globally — nearly 50 regulatory sandboxes are either live or in development — there is a growing chorus of voices seeming to share the view of former New York State Department of Financial Services Superintendent Maria Vullo, who once said: “Toddlers play in sandboxes. Adults play by the rules.”As former regulators and heads of innovation programs from both the U.S. and the United Kingdom, we recognize why some observers express concern. Nevertheless, we believe in the importance of vigorously supporting such efforts, whether designed as sandboxes, labs, or related early-engagement initiatives.
PayPal suit poses broad threat to CFPB authority -A legal fight between PayPal Holdings and the Consumer Financial Protection Bureau over digital wallets could upend the bureau’s authority to mandate consumer protection disclosures across the financial services industry. The online payments giant sued the CFPB in 2019, claiming digital wallets should not be subject to the same fee disclosures as prepaid cards because they are inherently different products. A ruling in favor of PayPal could limit the CFPB's authority under the Dodd-Frank Act to mandate and prescribe consumer disclosures, experts said. Brian Tate, president and CEO of the Innovative Payments Association, an industry trade group, called the PayPal lawsuit “one of the most important and least-covered stories in payments, depending on which way the court rules. ... This case has the potential to have a huge impact on the marketplace.”
Fed eyes red-hot housing market for financial stability risks - It’s beginning to look a lot like 2007 in the U.S. housing market, and the Federal Reserve Board has taken notice. Home prices, the number of first-time buyers and the share of properties being bought as nonprimary residences are all at or near the cyclical highs of the mid-2000s housing bubble, Fed. Gov. Christopher Waller said during a Thursday webinar on U.S. and Israeli real estate hosted by Rutgers and Tel Aviv University. He called the growth in the housing market a “singular feature of the U.S. expansion since the COVID-19 recession.” “An important question I will keep my eye on is whether the sharp and ongoing increase in home prices poses risks to financial stability,” Waller said.
Wells Fargo faces persistent racial gap in mortgage refinancing - Wells Fargo, which approved fewer than half of mortgage refinancings sought by Black homeowners in 2020, prompting calls for regulatory investigations, greenlighted a larger share of applications from such borrowers last year. But the gap between the bank’s approval rates of Black and white applicants in the second year of a $5 trillion pandemic refinancing boom remained greater than that of any other major lender, according to a Bloomberg News analysis of new federal mortgage data. Wells Fargo accepted 58% of Black homeowners who completed applications for refinancing conventional home mortgages, compared with 47% of Black applicants the year before. By comparison, the San Francisco-based bank approved 79% of White borrowers in 2021, a higher rate than the previous year when it approved 72%.
Appraisers facing stricter oversight from financial regulators - Bank regulators are sharpening their tools for identifying and curbing discriminatory practices in the home appraisal industry.The Federal Reserve Board, the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau and the National Credit Union Administration plan to devise new ways to monitor appraisal processes for racial, ethnic and sex-based biases, according to a report published this week by a White House task force aimed at addressing long-running prejudices in appraisals.The agencies will also scrutinize mortgage lenders to identify patterns of bias, work with other government agencies to enforce new rules and create a shared database of historical appraisals to benefit research and enforcement efforts. They will also take steps to improve the reevaluation process for buyers who feel their properties have been unfairly discounted and design guidance for computer-generated valuations.
Freddie Mac: Mortgage Serious Delinquency Rate decreased in February --Freddie Mac reported that the Single-Family serious delinquency rate in February was 0.99%, down from 1.06% in January. Freddie's rate is down year-over-year from 2.52% in January 2021. Freddie's serious delinquency rate peaked in February 2010 at 4.20% following the housing bubble and peaked at 3.17% in August 2020 during the pandemic. These are mortgage loans that are "three monthly payments or more past due or in foreclosure". Mortgages in forbearance are being counted as delinquent in this monthly report but are not reported to the credit bureaus.This is very different from the increase in delinquencies following the housing bubble. Lending standards have been fairly solid over the last decade, and most of these homeowners have equity in their homes - and they will be able to restructure their loans once (if) they are employed. Also - for multifamily - delinquencies were at 0.08%, down from the peak of 0.20% in April 2021.
MBA Survey: "Share of Mortgage Loans in Forbearance Decreases to 1.18% in February" --Note: This is as of February 28th. From the MBA: Share of Mortgage Loans in Forbearance Decreases to 1.18% in February: The Mortgage Bankers Association’s (MBA) monthly Loan Monitoring Survey revealed that the total number of loans now in forbearance decreased by 12 basis points from 1.30% of servicers’ portfolio volume in the prior month to 1.18% as of February 28, 2022. According to MBA’s estimate, 590,000 homeowners are in forbearance plans.The share of Fannie Mae and Freddie Mac loans in forbearance decreased 8 basis points to 0.56%. Ginnie Mae loans in forbearance decreased 10 basis points to 1.50%, and the forbearance share for portfolio loans and private-label securities (PLS) declined 30 basis points to 2.72%“There were many positive results in overall mortgage performance in February. The percentage of borrowers in forbearance declined for the 21st consecutive month, and the percentage of borrowers current on their mortgage payments increased to almost 95 percent – 350 basis points higher than one year ago. Finally, the percentage of borrowers with existing loan workouts who were current on their mortgage payments improved for the first time since June 2021,” said Marina Walsh, CMB, MBA’s Vice President of Industry Analysis. “These three results – the lower forbearance rates and higher performance rates for both total borrowers and borrowers in workouts – are especially favorable given that there is typically a dip in mortgage performance in February because of the shortened number of days to make a payment.”Added Walsh, “We can credit several factors to the improved performance, including the availability of viable loss mitigation options, low unemployment that is now below 4.0 percent, strong wage growth, and rising home equity."This graph shows the percent of portfolio in forbearance by investor type over time. The number of forbearance plans is decreasing.'
Mortgage Applications Decrease in Latest MBA Weekly Survey – MBA - Mortgage applications decreased 8.1 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 18, 2022.... The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 12 percent lower than the same week one year ago.“Rates on 30-year conforming mortgages jumped by 23 basis points last week, the largest weekly increase since March 2020. The Refinance Index decreased 14 percent from the previous week and was 54 percent lower than the same week one year ago.comes as markets moved to price in a much faster pace of rate hikes, as well as expectations of fewer MBS purchases from the Federal Reserve. With mortgage rates now at 4.5 percent, compared to rates at or below 3 percent not that long ago, it is no surprise that refinance volume has dropped by more than 50 percent compared to this time last year. MBA’s new March forecast expects mortgage rates to continue to trend higher through the course of 2022,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “Purchase application volume was down slightly for the week, with a larger drop in FHA and VA purchase volume, and a small decline in conventional purchase loans. First-time homebuyers, who rely on these government programs, are increasingly challenged by both the rapid increase in home prices and higher mortgage rates. Repeat homebuyers, who are more likely to use conventional loans, benefit from the gains in home equity realized on a sale which can be used to fuel their next purchase, even with rates moving higher.”...The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 4.50 percent from 4.27 percent, with points increasing to 0.59 from 0.54 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
Mortgage Rates Moving Closer to 5% - Today, in the Calculated Risk Real Estate Newsletter: Mortgage Rates Moving Closer to 5%. A brief excerpt: Mortgage News Daily reports that the most prevalent 30-year fixed rate is now at 4.66% for top tier scenarios. Matthew Graham at Mortgage News Daily wrote yesterday: Bond Market Betrayal as Mortgage Rates Hit Another Long Term High: The event in question was a speech (and subsequent comments) from Fed Chair Powell. Rather than do anything at all to push back against last week's Fed-driven rate spike, Powell forcefully doubled down on the Fed's urgent need to shift Fed policy to an even less rate-friendly stance. Mortgage lenders were already roughly an eighth of a point higher in terms of 30yr fixed rates this morning. After Powell, rates nearly doubled that move (i.e. some lenders are a quarter of a point higher in rate versus Friday's latest levels). That makes today one of only 5 days with this big of a spike in more than a decade. Lender rate offerings are widely stratified and many are still getting caught up with the market volatility, but it's safe to say the average lender is now over 4.5%, and much closer to 4.625% for top tier conventional 30yr fixed scenarios. Of course, rates are still historically low. But rates are up sharply from the recent lows, and my view is the change in rates is what will impact housing (see my post last week: Housing, the Fed, Interest Rates and Inflation; Housing is a key transmission mechanism for the FOMC). Here is a long-term graph of 30-year mortgage rates (Freddie Mac PMMS, February is today’s rate).
Mortgage Rates Are Rising Much Faster than Treasury Yields. What’s the Deal? By Wolf Richter - The average 30-year fixed mortgage rate tracks the 10-year Treasury yield, running roughly in parallel but higher. It tracks the 10-year yield because the average 30-year mortgage gets paid off in just under 10 years, either through the sale of the home, or through a refi. But they don’t move in lockstep, and the difference between the two – the spread – has been widening sharply, with mortgage rates suddenly rising much faster than the 10-year yield. The US Treasury 10-year yield has shot up since the Fed made its infamous “pivot” in the fall of 2021, from willfully ignoring and assiduously brushing off the incredibly spiking inflation to actually acknowledging, even if tepidly at first, its existence and persistence. Back in August 2021, the 10-year yield was still at around 1.3%. Today it’s 2.34%, having gained 1.03 percentage points in seven months. Over the same period, the average 30-year fixed mortgage rate, as tracked by Freddie Mac, jumped by 1.55 percentage points, from 2.87% to 4.42%: The chart above shows what happened during the March 2020 chaos, when the Fed cut its policy rates to near 0% and announced a huge QE program which caused the 10-year Treasury yield (green line) to plunge, while mortgage rates just continued their methodical decline that lasted through December 2020. That decline in mortgage rates was kicked off in late November 2018, when Powell, getting hammered on a daily basis by Trump, caved and communicated that the Fed would soon stop tightening. At the time, inflation was below the Fed’s target, and the Fed was hiking rates that were already above CPI and it was reducing its balance sheet at a rate of about $50 billion a month (QT). Housing was getting hit, and stocks were tanking, and Trump, who’d taken ownership of the Dow, had had it. The fact that the 10-year yield plunged in March 2020 while mortgage rates were only slowly declining caused the spread between the two to blow out. It maxed out at the end of April at 2.73 percentage points. The average 30-year fixed mortgage rate continued to drop until it hit a historic low in December 2020 of 2.66%. But the 10-year Treasury yield had started rising four months before mortgage rates started rising, bouncing off its historic low of 0.55% in August, causing the spread between the two to narrow. By December 2020, when mortgage rates had hit their low point, the 10-year Treasury yield had risen to 0.9%. And the spread continued to narrow into 2021. Part of what contributed to the very low mortgage rates in 2021 was the narrow spread between the 10-year Treasury yield and the 30-year mortgage rates. At the time, it ran in the range between about 1.3 percentage points and 1.6 percentage points. But in January 2022, the spread suddenly started widening, with mortgage rates rising much faster than Treasury yields. As of the latest weekly mortgage rate, the spread has reached 1.81 percentage points, after having hit 2.09 percentage points in early March. Note the increasing volatility of the spread:
NAR: Pending Home Sales Decreased 4.1% in February -From CNBC: Pending home sales sink in February, setting a grim tone as housing market enters key spring season: In a grim sign for the housing market’s busiest season, pending home sales, which measure signed contracts on existing homes, fell 4.1% in February compared with January, according to the National Association of Realtors.Sales were down 5.4% compared with February 2021. Analysts were expecting a slight gain. This is the fourth straight month of declines in pending sales, which are an indicator of future closings, one to two months out....Regionally, pending sales rose 1.9% month-to-month in the Northeast but were down 9.2% from a year ago. In the Midwest, sales decreased 6.0% for the month and were down 5.2% from February 2021. In the South, sales fell 4.4% monthly and 4.3% annually, and in the West they were down 5.4% for the month and 5.3% from a year ago. This was well below expectations of a 1.5% increase for this index. Note: Contract signings usually lead sales by about 45 to 60 days, so this would usually be for closed sales in March and April.
New Home Sales decrease to 772,000 Annual Rate in February -The Census Bureau reports New Home Sales in February were at a seasonally adjusted annual rate (SAAR) of 772 thousand.The previous three months were revised up slightly, combined. Sales of new single‐family houses in February 2022 were at a seasonally adjusted annual rate of 772,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 2.0 percent below the revised January rate of 788,000 and is 6.2 percent below the February 2021 estimate of 823,000.The first graph shows New Home Sales vs. recessions since 1963. The dashed line is the current sales rate.New home sales are now declining year-over-year since sales soared following the first few months of the pandemic.The second graph shows New Home Months of Supply.The months of supply increased in February to 6.3 months from 6.1 months in January.The all-time record high was 12.1 months of supply in January 2009. The all-time record low was 3.5 months, most recently in October 2020.This is above the top of the normal range (about 4 to 6 months of supply is normal)."The seasonally‐adjusted estimate of new houses for sale at the end of February was 407,000. This represents a supply of 6.3 months at the current sales rate."The last graph shows sales NSA (monthly sales, not seasonally adjusted annual rate).In February 2022 (red column), 65 thousand new homes were sold (NSA). Last year, 70 thousand homes were sold in February, The all-time high for February was 109 thousand in 2005, and the all-time low for February was 22 thousand in 2011.This was below expectations, however sales in the three previous months were revised up slightly, combined.
February New Home Sales: Few Completed Inventory, High Number of Homes Under Construction Today, in the Calculated Risk Real Estate Newsletter: February New Home Sales: Few Completed Inventory, High Number of Homes Under Construction Brief excerpt: The next graph shows new home sales for 2021 and 2022 by month (Seasonally Adjusted Annual Rate). Sales in February 2022 were down 6.2% from February 2021.The year-over-year comparisons will be easier going forward....The next graph shows the months of supply by stage of construction. “Months of supply” is inventory at each stage, divided by the sales rate.The inventory of completed homes for sale was at 35 thousand in February, up from the record low of 33 thousand in several months in 2021. That is about 0.5 months of completed supply (red line). This is about half the normal level.The inventory of new homes under construction is at 4.1 months (blue line) - well above the normal level. This elevated level of homes under construction is due to supply chain constraints.And 106 thousand homes have not been started - about 1.7 months of supply (grey line) - almost double the normal level. Homebuilders are probably waiting to start some homes until they have a firmer grasp on prices.
Inventory of New Houses Piles Up to Highest since 2008. Sales & Prices Drop. Stocks of Homebuilders Swoon - By Wolf Richter - The inventory of new single-family houses for sale rose to 407,000 houses in February (seasonally adjusted), the largest unsold inventory since August 2008, up by 40% from a year ago. This represents 6.3 months of supply at the current rate of sales, according to data from the Census Bureau today.A problematic mix. Homebuilders are facing historic spikes in costs, and they’re hobbled by shortages of materials, supplies, and labor that have been stalling construction projects and impeded the completion of projects. Potential buyers are hobbled by surging mortgage rates and prices that last year spiked into the sky. This is turning in to a problematic mix.Sales of new houses in February fell to a seasonally adjusted annual rate of 772,000 houses, down 6% year-over-year. Sales remain far below the boom years of 2002-2006.Sales of new houses are registered when the sales contracts are signed, not when deals close, unlike sales of existing homes, which are tracked when sales actually close. Trends of new-house sales tend to be an early but volatile indicator of broader home sales.The median price of single-family houses sold, having apparently hit some kind of ceiling last year, fell to $400,600 in February, down about 7% from the peak in November 2021 ($430,300), having now bounced up and down in the same range since July 2021 ($406,000). This whittled down the year-over-year gain to 10.7%, from the year-over-year gains of 20% to 24% that had raged last year through November.Note the ridiculous price spike from June 2020 through July 2021, and how prices might have bumped into some sort of ceiling late last year: Construction costs of single-family houses – excluding the cost of land and other non-construction costs – spiked by 17% year-over-year, the third month in a row of 17% spikes, according to separate data from the Census Bureau today. These were the worst cost spikes in the data that go back to 1964, amid all kinds of shortages and delays, and with everyone being able to pass on higher prices. This chart shows the year-over-year increases in the construction cost index of new single-family housesThe chart below shows the actual index, with index values. Since June 2020, the index has spiked by 24%. Note what happened during the Housing Bust: Between April 2007 and February 2012, the construction cost index fell by 11%:Homebuilder stocks swooned upon the news.
AIA: "Demand for design service continues to grow" in February - Note: This index is a leading indicator primarily for new Commercial Real Estate (CRE) investment. From the AIA: Demand for design service continues to grow: Demand for design services in February grew slightly since January, according to a new report today from The American Institute of Architects (AIA).AIA’s Architecture Billings Index (ABI) score for February was 51.3, up from a score of 51.0 in January. Any score above 50 indicates an increase in billings. Firms reported both project inquiries and design contracts remaining positive in February, but while project inquiries increased to 62.5 from 61.9 in January, design contracts decreased to 55.2 from 56.1.“Despite the continued healthy demand for design services, activity is plateauing as firms face a myriad of external challenges, from staffing to supply chain disruptions to high inflation and rising interest rates,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “While the rebound from the pandemic has positively impacted firms in most regions, the prolonged lack of demand for design services in the Northeast is of growing concern.”
• Regional averages: South (58.6); Midwest (53.2); West (47.9); Northeast (44.3)
• Sector index breakdown: commercial/industrial (55.4); mixed practice (53.8); multi-family residential (52.6); institutional (47.2)
This graph shows the Architecture Billings Index since 1996. The index was at 51.3 in February, up from 51.0 in January. Anything above 50 indicates expansion in demand for architects' services.Note: This includes commercial and industrial facilities like hotels and office buildings, multi-family residential, as well as schools, hospitals and other institutions.This index has been positive for thirteen consecutive months. This index usually leads CRE investment by 9 to 12 months, so this index suggests a pickup in CRE investment in 2023.
Another Office Tower Goes Bust: Blackstone Walks from Manhattan Tower it Bought for $605 Million. CMBS Holders to Eat Remaining Losses - Another older office tower is going to cost lenders an arm and a leg, after it already cost PE firm Blackstone an arm and a leg. Blackstone is walking away from the 26-story 621,000-square-foot office tower at 1740 Broadway in Midtown Manhattan that it had bought in 2014 for $605 million. The two biggest tenants moved out well before their leases expired: L Brands, occupying 77% of the rentable area (lease expires March 31); and law firm Davis & Gilbert, which had 15.8% of the space. Now the building is mostly vacant. The property, built in 1950, is the collateral for a $308 million loan that was originated by Deutsche Bank and securitized into a single-asset single-borrower CMBS in 2015. This CMBS is backed by only the loan on this building, and there is no diversification within it. Now Blackstone is letting the holders of the CMBS have the building and eat the losses. “This asset faces a unique set of challenges, and we are working diligently to find a solution that is in the best interests of all parties involved, including our investors and lender,” a Blackstone spokesperson told the Commercial Observer. “It’s the smartest move for their investors,” one source told the Commercial Observer. Investing more money to upgrade the building, on top of the $308 million in existing debt, didn’t make any sense, particularly with the continued uncertain recovery of the Midtown submarket, another source told the Commercial Observer. Blackstone’s investment – it purchased the tower for $605 million – had been written down before the pandemic due to the broader challenges in both the Midtown office submarket and the asset, and the pandemic only accelerated those pressures, particularly on the leasing front, sources told the Commercial Observer. InManhattan, 18.6% of the total office space was on the market for lease at the end of Q4, according to Savills. And new buildings are being completed and add to the total availability, and when their lease expires, companies can upgrade to the latest and greatest, and they can downsize and upgrade, and what’s left behind are these vacant older office towers. These reports of vacant older office towers going back to lenders are piling up, as the shift to working-from-home and to hybrid arrangements has reduced the need for corporate office space. Companies are moving out of older buildings and are upgrading to newer and often smaller spaces. And as new office towers are still being built, the older office towers end up vacant. Lenders get to eat the often huge losses while the future of these older office towers remains uncertain. We got some ideas of how big the losses can be when the older office towers were sold in foreclosure sales. All this can take years.For example, in Houston’s Energy Corridor, the 450,000-square-foot Two Westlake Park defaulted on a $87.5 million loan in 2018 and was sold in mid-2020 in a foreclosure sale for $18 million. After fees and expenses, the CMBS holders booked a loss of 82%. The vacant Three Westlake Park in the same complex, once “valued” at $121 million, was sold last month at a foreclosure sale for $20.6 million. After fees and expenses, the CMBS holders booked a loss of 88%.
Next Shoe Drops on Office Markets: State & Local Governments Dump Office Space amid Working-from-Home/Hybrid Model - By Wolf Richter -- At the end of 2019, state and local governments leased 22.6 million square feet (sf) of privately owned, corporate-grade office space in the US, according to data by JLL US Office Research, cited by Bisnow. But thanks to the shift to the hybrid model, combining office and working-from-home, governments are reducing their office footprint. And by the end of 2021, the total amount of privately owned office space that state and local governments leased dropped by nearly 10%.And this is just the beginning. JLL estimates that over time state and local governments could shrink their office footprints in leased privately owned buildings by 25% or 30%.The space that becomes available in government-owned buildings due to the hybrid work model could then be filled by transferring departments that are in leased buildings to the owned buildings. In addition, space in leased buildings can be consolidated. Buildings whose leases expire can then be left to the landlord to worry about.Many government jobs cannot be performed at home, but others can. And many employees find flexible work arrangements attractive, which makes it easier for governments to recruit and retain workers, in a historically tight labor markets where many businesses are already offering flexible work arrangements in order to be competitive.The government of California already gotten rid of 767,000 sf of office space, for an annual savings of $22 million, and over the next three years will try to dump 20% of its leased office space, for $85 million in savings, California Department of General Services Deputy Director Monica Hassan told Bisnow.In San Francisco, 26% of the total office space was on the market for lease at the end of Q4, a catastrophically high rate, and up from the single digits in 2018, and only slightly less catastrophic than Houston (31%) and Dallas Fort Worth (28%), according to Savills.Last year, Fort Worth, Texas, purchased the 425,000-sf office tower that had been the headquarters of Pier 1 imports which filed for bankruptcy in 2020 and was liquidated. The City paid $69.5 million for the building and figured that it would have to spend $30 million on renovations to turn it into its new City Hall.The tower will then consolidate 16 departments that are spread over nine city-owned buildings. “We’re going to empty them and sell them for the most part,” Fort Worth Director of Property Management Steve Cooke told Bisnow. “To sit here and say that it’s going to save us 30 million bucks, I can’t do that sitting here right now,” Cooke said. “But it certainly helps.” This will put even more vacant office space on the market, in an office market that is already struggling. In the Dallas-Fort Worth office market, 28% of the total office space is already on the market for lease, worse even than in San Francisco (26%), and only slightly less bad than Houston (31%).
March Vehicle Sales Forecast: Decrease to 13.4 million SAAR --From WardsAuto: Forecast March U.S. Light-Vehicle Sales: SAAR Down from February but First-Quarter Results Best Since Q2-2021 (pay content). Supply issues continue to impact vehicle sales, but it appears the supply chain disruption bottom is in. This graph shows actual sales from the BEA (Blue), and Wards forecast for March (Red). The Wards forecast of 13.4 million SAAR, would be down about 5% from last month, and down 24% from a year ago (sales were solid in March 2021, as sales recovered from the depths of the pandemic, and weren't yet impacted by supply chain issues).
U.S. Sees Highest Gasoline Demand Since At Least 2017 --This past Sunday registered the highest gallons count of gasoline demand GasBuddy has ever recorded in data going back to 2017, Patrick De Haan, head of petroleum analysis for the fuel-savings app, said on Tuesday. According to GasBuddy data, U.S. gasoline demand on Sunday jumped by 12.6 percent compared to the previous Sunday. It was also 14.5 percent above the average of the last four Sundays, De Haan noted. U.S. gasoline prices fell slightly last week from the highs on March 11, when they hit $4.33 per gallon of regular gasoline, AAA said on Monday. Since March 11, the national average for a gallon of gasoline has fallen to $4.25. As of March 22, the national average was $4.242 per gallon, per AAA data. The main reason for the lower gasoline prices since March 11 was the lower international crude oil prices, which slumped last week as a COVID resurgence and new lockdowns in China sent the market questioning immediate fuel demand in the world’s largest crude oil importer. “Domestically, gasoline demand is defying seasonal trends and has dipped slightly, perhaps in response to higher prices at the pump,” AAA said on Monday. “Usually this time of year, with warmer weather and longer days, we’d see an uptick in gasoline demand as more people hit the road,” said Andrew Gross, AAA spokesperson. “But we had a slight drop in demand last week, which may be due to higher pump prices. In our new survey of drivers, 59% said they would change their driving habits or lifestyle if the cost of gas hit $4 per gallon. And if gas were to reach $5, which it has in the Western part of the country, three-quarters said they would need to adjust their lifestyle to offset the pump price.” Meanwhile, Los Angeles has become the first major U.S. city to reach the $6 per gallon average after reaching $5/gal just weeks ago, GasBuddy’s De Haan said today.
Gas prices: 'We're starting to see demand destruction', says expert - High gasoline prices are already impacting demand, according to one energy expert. "Above $4 per gallon, you do see the American public change their driving habits. And we do actively see demand destruction," Regina Mayor, global head of energy at KPMG, told Yahoo Finance Live. "I think that's one of the things that helps the overall tightness of supply, is when we see demand start to dip back down," she added. U.S. West Texas intermediate (CL=F) and Brent (BZ=F) have seen massive price swings since the outbreak of the Russia-Ukraine war. Western nations imposed sanctions against Russia, a world crude exporter. The U.S. and U.K. also implemented a ban on Russian oil imports. Gasoline's national price average currently sits at $4.24 per gallon. Mayor expects prices to stay elevated for a while as we head into the summer driving season. "We've got summer vacations. The travel industry is anticipating that airline activity will be higher because there's a lot of pent-up demand from the pandemic. And this is when gas prices typically are higher anyway," said Mayor. "We've got crude oil prices that are through the roof. So unfortunately, I think in the near-term, consumers are going to still be seeing very high prices at the pump," she said. On Tuesday, WTI futures were down more than 1%, hovering above $110 per barrel. Brent crude was also slightly lower, is sitting above $114 per barrel.
Consumers felt pinch at the pump with rising gas prices in February. Here's who was affected the most - Low-earners bore the brunt of the economic fallout after the initial onset of Covid-19.Now, as gas prices have spiked and historic high inflation drives consumer costs up, that same cohort is feeling the biggest pinch to their budgets, according to a new report on February data from Morning Consult.People with $50,000 or less in annual income already have thinner margins between the money they take home and what they spend, according to Kayla Bruun, economic analyst at Morning Consult.Now, people in that income group are seeing those margins erode, she said. Meanwhile, higher-earners have been able to absorb the cost increases without necessarily disrupting their spending."Lower-income adults are really feeling these gas prices; they're having to cut back on discretionary spending," Bruun said."The highest-income earners, those earning $100,000 per year or more, were actually able to increase their purchases and celebrate the end of omicron, to a certain extent, in February," she said.Month-over-month spending on gas climbed 13% in February from the previous month, according to Morning Consult.Yet it was still only the third-highest spending category to see a bump. Hotels and airfare saw bigger spikes, with 19% and 17% increases, respectively.Areas tied to travel, personal care and recreation bounced back as the omicron variant of Covid receded, though rising prices and seasonal factors also account for the higher outlays.Just how big a bite high gas prices take out of household budgets depends on income growth.Average incomes have increased by 4.9% compared with a year ago, according to Morning Consult. Meanwhile, the U.S. Bureau of Labor Statistics' Consumer Price Index, which measures certain prices consumers pay, has climbed 7.9%, indicating those income gains are not keeping pace.But workers are in a better position than they were last year, said Morning Consult. In February, 61% of adults had income from working, up from 57% in the previous year. At the same time, just 13% of adults are relying on unemployment checks, down from 19% who said the same last year.
Gas prices: California Governor Newsom announces rebate of up to $400 per car -Yahoo Finance's Dani Romero discusses elevated gas prices in California and the rebate program Governor Newsom has proposed to offset high fuel costs. Transcript:
- Well, a number of relief plans are being proposed by state lawmakers across the US to ease that pain at the gas pump. California's gas prices topping that list of the highest prices in the US. Joining us with more on that is Yahoo Finance's own Dani Romero. Dani, what can you tell us?
- Yeah, you're right. Some relief is coming-- could be on the way for California drivers, as the current gas price now sits at $5.88, compared to the national average, which is $4.24. Now this is down from just two days ago, where it hit a record of $6.01, nearly $0.17 more expensive than it was a week ago. But these high gas prices is what's really driving Governor Newsom to propose this new proposal. Let's take a listen to what he has to say.
- GAVIN NEWSOM: So today, we're announcing a $9 billion tax refund to tens of millions of Californians, $400 for each registered vehicle that an individual owns, up to two vehicles. That direct relief will address the issue that we all are struggling to address. And that's the issue of gas prices, not only here in our state, but of course, all across this country.
- So let's break that down. A registered car owner could get $400 $100 per vehicle. Payment would be capped at $800, so two vehicles for each individual and family. Those who own or lease gas and electric vehicles would qualify. Eligibility will be based on vehicle registration, not tax records. And there will be no income cap.Aside from this proposal, there are also two other proposals on the table, one of them on Friday. Democratic leaders proposed a $200 payment for taxpayers and dependents in households earning less than $250. And the other proposal was proposed by another group of state Democrats that want to send every California taxpayer $400. And that cost would be about $9 billion.Meanwhile, Republican lawmakers are proposing a suspension on California's $0.51 gas tax for six months as a way to increase oil production in the state. Again, it's unclear if this proposal will be passed because it still has to go back to the state legislature. Guys.
California gas prices: If Gov. Newsom's $400 rebate plan gets approved, how soon could CA car owners expect to see the money? - -- Californians shouldering the nation's highest gas prices could soon get a tax break, free rides on public transit and up to $800 on debit cards to help pay for fuel under a proposal revealed Wednesday by Gov. Gavin Newsom, but how soon could taxpayers start seeing the money? Gas prices have soared in recent weeks, the result of pandemic-induced inflation and Russia's invasion of Ukraine State governments across the country have been debating what to do about it, with the most popular choices being slashing fuel taxes or offering rebates to taxpayers. Last week, the governors of Maryland and Georgia signed laws temporarily suspending their state's gas taxes, while Georgia on Wednesday also offered $1.1 billion in refunds to taxpayers in a separate action. California's average gas prices hit a new state record Wednesday at $5.88 per gallon, more than $2 higher than it was a year ago, according to AAA. California has the second-highest gas tax in the country at 51 cents per gallon. But the state's Democratic leaders have been wary of suspending the gas tax because they fear oil companies would not pass along the savings to drivers. Instead, they want to send money directly to taxpayers. The governor's office says the average California driver spends about $300 per year on gas taxes. Newsom's idea is to give car owners $400 debit cards for up to two vehicles, for a total of $800. The money would go to everyone who has a car registered with the state.
LA Area Port Traffic: Record February Inbound Traffic - Container 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 up 0.3% in February compared to the rolling 12 months ending in January. Outbound traffic was down 0.3% compared to the rolling 12 months ending the previous month. The 2nd graph is the monthly data (with a strong seasonal pattern for imports). Usually 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. As expected, there wasn't a dip in February this year with ships still backed up waiting to unload. Imports were up 4% YoY in February, and exports were down 3% YoY.
Richmond Fed Manufacturing: Activity Improved in March -Fifth District manufacturing activity improved in March, according to the most recent survey from the Federal Reserve Bank of Richmond. The composite index rose from 1 in February to 13 in March and indicates expansion. The complete data series behind today's Richmond Fed manufacturing report, which dates from November 1993, is available here. Here is a snapshot of the complete Richmond Fed Manufacturing Composite series.
Kansas City Fed Survey: Record Growth in March - The latest index came in at 37, up from 29 last month and a record high, indicating steady continued expansion in March. The future outlook rose to 41. All figures are seasonally adjusted. Here is a snapshot of the complete Kansas City Fed Manufacturing Survey.Quarterly data for this indicator dates back to 1995, but monthly data is only available from 2001.Here is an excerpt from the latest report:The Federal Reserve Bank of Kansas City released the March Manufacturing Survey today. According to Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City, the survey revealed that Tenth District manufacturing activity grew at a record pace, and expectations for future activity remained solid. “Regional factory activity increased at a record pace in March,” said Wilkerson. “However, due to increasing input costs and supply chain disruptions, nearly a quarter of firms noted a significant decrease in profit margins since the beginning of the year, and another 44% reported a slight decrease in profit margins.” [Full report here] Here is a snapshot of the complete Kansas City Fed Manufacturing Survey.
A third of US workers make less than $15 an hour, and they're struggling to make ends meet -Low-wage workers, including many who were praised as "essential" or as "heroes" during the pandemic, "have not been given adequate compensation," according to Kaitlyn Henderson, author of a new report from Oxfam America analyzing pay in the US.Those low wages come amid a period of soaring corporate profits, which "are not being equitably distributed to workers," Henderson, senior researcher at Oxfam America, told Insider.The report from Oxfam America finds that there are over 51.9 million US workers — about a third of the labor force — who are making less than $15 per hour, or about $31,000 per year working full-time. Henderson said this level of pay "is just not livable." Inflation, which is at a 40-year high, isn't helping, with Henderson noting that it can be difficult for these workers to be able to pay for basic necessities. The prices of important goods and services, like electricity and medical care are far higher than before the pandemic. Alongside the new report are interactive maps from Oxfam America that highlight the share of workers by state who are earning less than $15, as well as breakdowns by race, age, parenthood, and gender. Mississippi had the highest share of people making less than $15 per hour among the states and DC, at 45.3% for the state. Puerto Rico had a higher share than any state in the analysis, with 76.5% of its workers making less than this amount. Henderson said the map shows that "where you live really determines whether or not you're going to be able to afford the cost of living." California and Washington as well as DC have smaller shares of their workforces earning less than $15 an hour compared to the rest of the US. One reason for this could be because of their higher minimum wages.
Alaska Airlines offering flight attendants double pay for extra trips amid staffing shortage - Alaska Airlines flight attendants can earn double pay by working extra trips as the company attempts to resolve staffing shortage issues. “Like many other airlines, we are facing general staffing challenges,” the company said in a statement, according to CNBC. “In response, we’re offering flight attendants pay incentives to fill gaps in staffing for a short period of time this Spring.” The airline started offering bonuses and up to triple pay for pilots and flight attendants during the busy holiday travel season as the increase in COVID-19 infections driven by the omicron variant caused many staffers to be out sick, CNBC reported. The company has already trained 165 new flight attendants and intends to hire 700 more this June, per the outlet. The Hill has reached out to Alaska Airlines for comment. This comes after airlines saw global staffing issues during the holiday season, with over 3,000 flights scheduled for Christmas Eve and Christmas Day being cancelled globally and over 4,600 flights being delayed. More recently, multiple airlines have said they are seeing higher-than-ever demand for flights, even with spiking ticket prices. "We've not seen a stronger demand ... in my career," Delta Air Lines Chief Executive Ed Bastian said earlier this month. Delta has increased its prices by about 10 percent each way in order to make up for rising fuel prices. United and Southwest Airlines have also said they have raised their ticket prices.
Man who lived under different name for decades outed by COVID-19 vaccine, authorities say - Federal authorities said a Tennessee man who lived under a different name for decades was outed after he received his COVID-19 vaccine, The Charlotte Observer reported. According to court documents obtained by the newspaper, authorities said Jerry Leon Blankenship of Newport, Tenn. used the identity of another person to avoid military service after leaving the U.S. Navy in the early 1980s. A woman who was in a brief romantic relationship with Blankenship suggested that he use the identity of the father of her child to avoid trouble from the military, sharing important information such as the father’s social security number. Authorities said Blankenship later started dating the “estranged” daughter of his first wife, from a different relationship, and the couple ultimately settled in Newport where they raised three children and started a home repair business together, according to court documents. Law enforcement officials became aware of Blakenship’s offenses after a man reported identity theft in North Carolina, saying he has been plagued “with identity theft issues” for the last two decades.The man noted a recent incident had taken place in March 2021 when Walgreens notified him about a COVID-19 vaccine shot he never received, which led to authorities obtaining a video of Blankenship receiving the vaccine under the man’s name, court documents said. Blankenship, who pleaded guilty to one count of false use of a social security number and one count of aggravated identity theft, on Monday was sentenced to serve 25 months in prison followed by three years of supervised release, according to The Observer. In a letter, Blankenship's daughter called her father an “incredible, faithful, caring and honest man” and “an outstanding citizen” “Although it came as a surprise to us all when we found out he had been taken into custody and why, it doesn’t change who he is as a person,” Blankenship’s daughter wrote in the letter. Blankenship, 65, could also face a military tribunal for his desertion from the Navy, court documents noted.
Senators Introduce Right to Repair Legislation by Jerri-Lynn Scofield - Three U.S. Senators – Ron Wyden, Cynthia Lummis, and Ben Ray Luján – introduced legislation last week to ensure the right to repair. The Fair Repair Act of 2022 would require manufacturers of digital electronic equipment to make tools, parts, and documentation available to owners and independent repair providers. This is the first right to repair measure introduced into the Senate that would apply broadly to several industries, including consumer electronics, farm equipment, medical equipment, and motor vehicles.Previously, narrower initiatives have been considered, limited to single industries. In 2020, Wyden introduced a measure that would have established a right to repair for medical equipment only. Similarly, earlier this year, Senator Jon Tester introduced legislation to cover farm equipment. Biden issued a right to repair executive order last year and reaffirmed his support in January. The Federal Trade Commission (FTC) has also undertaken separate initiatives to advance the concept (see Biden Taps Lina Khan to Chair the FTC, FTC Votes 5-0 to Crack Down on Companies For Thwarting Right to Repair, and FTC, Where Art Thou?: Appliance Manufacturers Routinely Invalidate Warranties if Customers Use Third-Party Repair Services). Despite this activity, it’s not altogether clear to me whether the Biden team will make passing legislation a priority at this time – especially as a powerful array of corporations opposes the right to repair, including Apple and John Deere (see, e.g., my recent post, Failing the Fix: Grading Apple, Dell, Google, Microsoft on the Ease of Repair of Their Products). Their business models rely on thwarting the ability of consumers or third-party repair shops to fix things when they break.
At least 5.2 million children have lost a parent or caretaker to Covid-19, study estimates – CNN -At least 5.2 million children globally have lost a parent, grandparent or family member who helped care for them to Covid-19, a new study says. The study, published Thursday in the medical journal The Lancet Child & Adolescent Health, looked at Covid-19 mortality data from 21 countries from the start of the pandemic in March 2020 through October 2021 and estimated the number of children who lost a parent or caregiver. The number of children affected rose by 90% from the end of April 2020 to the end of October 2021.While beyond the scope of the study, real-time data using the same model suggest that the number of kids who lost a parent or caregiver is around 6.7 million as of January. This "heart-breaking hidden pandemic," as the authors call it, has outpaced the total number of Covid-19 deaths, according to World Health Organization totals. The study follows an earlier analysis published in July. The authors said they felt they needed to update it because of "the proliferation of new coronavirus variants, updated mortality data, and disparities in vaccine access increased the amount of children experiencing Covid-19-associated orphanhood."The authors -- including researchers from the US Centers for Disease Control and Prevention, USAID, the World Bank, University College London and elsewhere -- believe their estimate is conservative. Many countries lack a robust reporting system for deaths. Covid-19 death in Africa, for example, are believed to be 10 times higher than what is known.
Why teachers should oppose the Minneapolis Public Schools-MFT “Educators of Color” memorandum - Under conditions of growing anger among educators over widespread poverty and inequality, an unending pandemic, ongoing police violence, and increasingly disastrous conditions in the schools, both the Minneapolis Federation of Teachers (MFT) and Minneapolis Public Schools have been negotiating a Memorandum of Agreement (MOA) that prioritizes race in decisions over layoffs or “excesses” (i.e., when a position at a school is eliminated, but an educator may apply for other job openings in the district).The MOA would create exemptions centered around race that would allow the school district to circumvent seniority protections in determining who would be subject to layoff. A December 9, 2021, draft of the MFT’s proposed MOA states, “If the placing of any educator on layoff or nonrenewal before another teacher would prevent students from having access to educators of color and/or educators who reflect the diversity of enrolled students, the district may excess or non-renew educators at the site, out of seniority order in order to protect educators who fall into [one or more categories].”The categories—including “Alumni of Historically Black Colleges or Universities (HBCUs), Tribal Colleges and Universities, and/or Hispanic Association of Colleges and Universities (HACU) programs”—have been formulated in such a way as to attempt to avoid violating civil rights laws prohibiting workforce reductions which discriminate based on race.MPS has welcomed the proposal, having primarily tactical differences over how broad the exemptions to seniority rules should be. School board negotiators have proposed additional so-called “equity” measures purportedly aimed at “retaining staff of color,” including another memorandum titled “Black Men Teach.” MPS’ summary of that proposal states, “This MOA proposes identifying two partnership elementary schools where vacancies will be held for fellows from Black Men Teach, a community partner organization that recruits, prepares, places, and retains Black male educators in elementary schools.”The “Educators of Color” MOA and related proposals are thoroughly reactionary and anti-working class. They have nothing to do with a struggle against racism or for social justice, whatever the proponents of the MOA may think. The effect of such measures, were they to be implemented, would be to pit educators against each other along racial lines and enormously damage the struggle for genuine equality. This outcome is in fact the desired aim of the Democratic Party, which has long used identity and racial politics as a wedge in a divide-and-conquer strategy against the working class.
Minneapolis School Board, Democratic Party demand millions in budget cuts in provocation against striking educators --With the strike by approximately 4,500 teachers and school support staff in Minneapolis having entered its third week, the Democratic Party-dominated Minneapolis School Board is throwing down the gauntlet and redoubling its demands for austerity, provocatively insisting that even meager wage increases be offset by millions in budget cuts. This weekend, the Minneapolis Public Schools (MPS) put forth its “last, best and final offer” for low-paid educational support professionals (ESPs), stating that it will be predicated on at least $10 million in cuts to the school budget. ESPs make as little as $24,000 currently, forcing them to take on second or third jobs and some even into homelessness. On Sunday, MPS board Chair Kim Ellison said in an announcement, “Even though it puts us beyond what we have in resources, which means we will have to make budget cuts in the future, we have presented a ‘last, best and final offer’ to the ESPs that we believe represents their value.” In a statement the same day, the board wrote, “MPS is reaching beyond its financial means on behalf of our ESPs and will need to make more than $10 million in reductions for the next school year as a result.” MPS Superintendent Ed Graff has indicated previously in board meetings this year that “hard decisions” will have to be made, pointing to the MPS’s budget deficit, and the district has floated the possibility of roughly 180 layoffs a year over the next five years. Teachers and staff should reject this provocation with the contempt it deserves. Amid soaring corporate profits and a nearly $10 billion state budget surplus, the claim that there is “no money” to provide educators a decent standard of living and expand funding for public education is a lie. There are more than enough resources to provide all educators with a living wage, hire hundreds more teachers, and massively expand mental health and other necessary programs. The necessary resources, however, are being hoarded by an unimaginably wealthy financial aristocracy, whose interests are being defended by both the Democratic and Republican parties. In other words, teachers confront a political struggle over how, and in whose interests, society’s resources will be used.
Minneapolis educators strike at crossroads as MFT reaches deal to end walkout - Early Friday morning, the Minneapolis Public School Board and the Minneapolis Federation of Teachers union (MFT) announced that they had reached a tentative agreement, in a bid to end the courageous 18-day strike by educators in the city. In a statement, the school board wrote that it “looks forward to welcoming students and staff back to school on Monday, March 28, pending a Minneapolis Federation of Teachers (MFT) membership vote. A tentative contract agreement has been reached with the MFT and Education Support Professionals (ESPs), ending the strike.” The MFT is seeking to ram through the deal in votes this weekend, providing teachers and support staff virtually no time to carefully study the contract’s terms. In its own statement, the MFT claimed that it had won “historic agreements” with “major gains” in pay for support staff, classroom size caps, and mental health support. The press release also touted “protections for educators of color,” which in fact is a reactionary and divisive scheme to create racial preferences in hiring and firing. The Memorandum of Agreement would pit educators against each along racial lines, undermining both teachers’ seniority rights and the unity of workers. Statements by the MFT earlier this week—that their counter-offers were “within the parameters” of the board’s self-proclaimed budgetary constraints—mean that the tentative agreement will inevitably be an austerity contract which fails to meet the needs of educators and students. Moreover, it will open the door to new rounds of cuts and layoffs, with the board in recent weeks floating $10 million in budget reductions and hundreds of layoffs over the next five years. As the statement below, published on the WSWS Thursday night, explains: With such clear signs that an austerity agreement is being prepared, the biggest mistake would be for educators to adopt a wait-and-see attitude, and hope against all available evidence that the union will somehow bring back a contract which meets their needs. The urgent task facing striking Minneapolis educators is to move now to organize independently by forming rank-and-file strike committees at every school...Teachers must demand at least a week, while the strike continues, to carefully study any contract proposal before voting. Such a demand is entirely reasonable, with the future of educators and their students at stake.
How student loan debt became a crisis - President Biden is under mounting pressure to address the student loan debt crisis with lawmakers urging him to issue blanket forgiveness. However, outstanding loan debt is only one part of the problem as soaring tuition costs and an increasing availability to federal loans continues to drive the crisis. The student debt crisis so far has led 43 million borrowers to collectively owe around $1.6 trillion. Some of the main drivers of that growing debt are rising tuition costs and increased federal loan availability –further exacerbated by corresponding wage stagnation. Already a pandemic-related freeze on student loan payments beginning in March 2020 has now been extended five times across two administrations, and lawmakers are calling on the president to again extend the moratorium set to expire May 1. Democratic lawmakers have also argued that not extending the pause is a risky maneuver during a midterm election year. Rep. Pramila Jayapal (D-WA) recently called on the president to cancel up to $50,000 worth of loans per borrower as the costs of food and gas rise amid Russia’s invasion of Ukraine, but Jayapal upped the ante on Sunday urging Biden to cancel all student debt. “Extending the payment pause just isn’t enough,” Jayapal wrote on Twitter. “We need to cancel every last penny of student debt, once and for all.” Tackling current outstanding debt may ease the financial burden for millions of borrowers, freeing up income to purchase a car or invest in a home. However, that move would not prevent future borrowers from entering into the same debt crisis. Collective student debt increased by 144 percent over a 13-year period from 2007 to 2020, moving from $642 billion to $1.566 trillion, according to a 2020 report published by the Bipartisan Policy Center (BPC). During the same period the number of borrowers increased from 28 million to 43 million. The report ties both issues partly to the rise in unemployment caused by the Great Recession beginning in 2007. The recession led to policy shifts, including an expansion of the Federal Direct Loan program. Before the overhaul, most federal loans were handled by private lenders with the federal government footing the bill in case of a default. But Congress expanded the program in 2010, allowing the government to issue all federal loans using funds from the Treasury Department. That move proved to be monumental, as it increased access to student loans creating a “vicious cycle of rising tuition and higher debt loads,” BPC explained. With more students gaining access to funding, colleges and universities could begin charging higher tuition prices without any serious drops in enrollment. Published tuition rates at colleges and universities rose by 60 cents for every dollar increase in the annual lending limit for Federal Direct Subsidized Loans. That shift saw near-immediate effects, with BPC’s report noting that federal student debt grew to 6.6 percent of the U.S. Gross Domestic Product (GDP) in 2015, compared to only 3.5 percent in 2007. Meanwhile, the cost of college has doubled in the past two decades and is growing each year by 6.8 percent according to The Education Data Initiative. Data shows the average cost to attend an in-state public school for one year is $25,487. Students attending private schools pay nearly twice as much as the average single-year cost doling out around $53,217. Both numbers cover tuition, fees and additional expenses. Yet the price of college has far exceeded the corresponding wage increase by more than 100 percent over the past four decades, according to analysis of education data by Georgetown University last fall. Between 1980 and 2019 college fees rose by 169 percent, while wages for young workers aged 22 to 27 went up by 19 percent over the same period.
Tennessee bill allows anyone – even relatives of rapists – to sue abortion providers - The Tennessee state house is considering a “Texas-style” abortion ban that would allow relatives, friends, neighbors and the spouse of a rapist to sue anyone who provides or assists in the provision of abortion services to his victim.The bill, which would ban abortion entirely with no exceptions for rape or incest, cleared one hurdle last week, when a health subcommittee passed it.The bill is modeled after the Texas six-week ban, which the US supreme courtlet stand.The Texas bill deputizes private citizens to enforce the law by giving them the right to sue any abortion provider they believe has violated the law or anyone aiding provision. As in Texas, the government will not be the enforcer under the Tennessee bill.“This bill is modeled directly after the legislation passed in Texas last year,”said the Republican Rebecca Alexander, the legislation sponsor, in a committee session. “Abortions since that bill has been passed have dropped 60% in Texas.”She added: “This is my bill. My intent is to bring a bill that protects the unborn life in this state.”The bill would allow people to sue anyone who helps someone obtain an abortion, “regardless of any standing they have in the case”. Lawsuits filed against abortion providers and assistants would come with a minimum fine of $10,000.A state Democrat, Bob Freeman, asked Alexander if the bill would allow a rapist’s relatives, friends, spouse and neighbors to sue a victim.“My assumption is that they could, other than the rapist,” said Alexander.Although rape victims could not be sued under the bill, the bill would “allow investigators to ask people who lose a pregnancy how it was lost”, said Rejul Bejoy, a legislative attorney.In 2019, nearly 6,000 cases of sexual assault were reported to Tennessee law enforcement agencies. According to the state department of health, children between 14 and 17 had the highest rate of sexual assault victimization.“This bill, while it’s being framed as an anti-abortion bill, is really not doing anything to further restrict abortion,” Freeman told NBC’s Today. “It’s really just going to bring all sorts of lawsuits and force people to have to potentially answer questions about a miscarriage.
The mystery of COVID-19 reinfections: A global systematic review and meta-analysis of 577 cases -As the COVID-19 pandemic rages on, reports on disparities in vaccine roll out alongside reinfection and reactivation from previously recovered cases have been emerging. With newer waves and variants of COVID-19, we conducted a systematic review to assess the determinants and disease spectrum of COVID-19 reinfection.Eighty-one studies reporting 577 cases were included from 22 countries. The mean age of patients was 46.2±18.9 years with males accounting for 45.8% of the study population while 179 (31.0%) cases of comorbidities were reported. The average time duration between first infection and reinfection was 63.6±48.9 days. During first infection and reinfection, fever was the most common symptom (41.4% and 36.4%, respectively) whilst anti-viral therapy was the most common treatment regimen administered (44.5% and 43.0%, respectively). Overall, comparable odds of symptomatic presentation and management were reported in the two infections. However, a higher Intensive Care Unit (ICU) admission rate was observed in reinfection compared to first infection (10 vs 3). Ten deaths were reported with 565 patients fully recovering. Respiratory failure was the most common cause of death (7/10 deaths). Seventy-two studies were determined to be of good quality whilst nine studies were of fair quality. As the first global-scale systematic review of its kind, our findings support immunization practices given increased ICU admissions and mortality in reinfections. Our cohort serves as a guide for clinicians and authorities for devising an optimal strategy for controlling the pandemic.
Outdoor long-range transmission of COVID-19 and patient zero - Abstract: Following the outdoor model of risk assessment developed in one of our previous studies, we demonstrate in the present work that long-range transport of infectious aerosols can initiate patient "zero" creation at distances downwind beyond one hundred kilometers. The very low probability of this outdoor transmission can be compensated by a high number and density of susceptibles such as it occurs in large cities.
Toxic Epidermal Necrolysis associated with COVID‐19 infection: A case report - Jouhar - 2022 - Clinical Case Reports - Wiley Online Library - COVID-19 infection has been spreading worldwide since December 2019.1 Skin manifestations are common as 60% of patients had skin involvement such as rashes, urticaria, purpura, and vasculitis.2 Toxic Epidermal Necrolysis (TEN) is a life-threatening dermatological disease distinguished from Steven–Johnson syndrome (SJS) by the percentage of body surface area involved (>30% for TEN, <10% for SJS). The pathophysiology is not fully understood yet the disease is linked to immune system activation triggered by drugs or infections or unknown causes. TEN/SJS presents with erythematous macules that develop central necrosis and bullae lesions followed by a painful full-thickness skin and mucosal membranes exfoliation. The diagnosis is made based on clinical features in addition to histopathology findings.3 The mainstay of treatment is supportive care and local wound care. Studies in children showed better mortality and morbidity outcomes with using Intra Venous Immunoglobulins (IVIG) and steroids. Other agents can be used such as cyclosporin, plasmapheresis, and TNF a inhibitors.4 In this study, we are reporting a case of biopsy-confirmed TEN in pediatrics patient with a history of recent COVID-19 infection. Informed consent was obtained from the parents and the letter was approved by the Institutional Review Board (IRB) at out institution. Abstract: Toxic Epidermal Necrolysis/Steven–Johnson Syndrome (TEN/SJS) is one of the most serious dermatological adverse reactions triggered mainly by drugs and less likely by infections. COVID-19 disease is caused by Sever Acute Respiratory Syndrome Coronavirus 2 (SARS-CoV-2) with a wide range of clinical manifestations. Skin involvement is common in COVID-19 patients including urticaria, purpura, and vasculitis. There were reported cases of TEN/SJS in adults with COVID-19 infections and only two reported cases in pediatric patients. The causality relationship between COVID-19 infection and TEN/SJS was not established in most cases due to history of drug usage that could be the trigger. In this study, we are reporting a case of previously healthy child apart from COVID-19 infection who was admitted to the intensive care unit with TEN involving more than 30% of body surface area confirmed by skin biopsy. The child was treated with intravenous immunoglobulins, steroids, and cyclosporin with a very good outcome.
Covid Analysis: Vitamin D for COVID-19: real-time meta analysis of 186 studies - Statistically significant improvements are seen in treatment studies for mortality, ICU admission, and hospitalization. 33 studies from 30 independent teams in 14 different countries show statistically significant improvements in isolation (25 for the most serious outcome).
- • Random effects meta-analysis with pooled effects using the most serious outcome reported shows 81% [53‑92%] and 38% [30‑44%] improvement for early treatment and for all studies. Results are similar after restriction to 66 peer-reviewed studies: 77% [45‑90%] and 38% [30‑45%], and for the 43 mortality results: 76% [37‑91%] and 37% [25‑47%].
- • Acute treatment (early 81% [53‑92%], late 48% [32‑61%]) shows greater efficacy than chronic prophylaxis (30% [21‑39%]). RCTs show a similar effect (early 89% [-86‑99%], late 43% [6‑65%], prophylaxis -95% [-3010‑88%]).
- • Late stage treatment with calcifediol/calcitriol shows greater improvement compared to cholecalciferol: 73% [57‑83%] vs. 38% [20‑52%].
- • Sufficiency studies show a strong association between vitamin D sufficiency and outcomes. Meta analysis of the 115 studies using the most serious outcome reported shows 54% [49‑60%] improvement.
- • While many treatments have some level of efficacy, they do not replace vaccines and other measures to avoid infection. Only 10% of vitamin D treatment studies show zero events in the treatment arm.
The Effectiveness of COVID-19 Vaccines Against the Omicron Variant - With the world's dinosaur media now distracted by all things Russian/Ukrainian, a new study that appeared in The New England Journal of Medicine provides us with the latest information on the effectiveness of the booster vaccines against the omicron variant. The study entitled "Covid-19 Vaccine Effectiveness against the Omicron (B.1.1.529) Variant", authored by Dr. N. Andrews and Dr. J. Stowe et al opens with this sentence: "A rapid increase in coronavirus disease 2019 (Covid-19) cases due to the omicron (B.1.1.529) variant of severe acute respiratory syndrome coronavirus 2 in highly vaccinated populations has aroused concerns about the effectiveness of current vaccines."Let's start with this definition:"A test-negative case-control study design is commonly used to determine the effectiveness of vaccines. The “test-negative design” , in which the same clinical case definition is used for enrollment of both cases and controls, and laboratory testing is subsequently used to distinguish which patients were cases and which were controls." The authors used a test-negative case-control study design to estimate the effectiveness of the COVID-19 vaccines against symptomatic disease caused by the omicron and delta variants in England. Vaccine effectiveness (VE) was calculated after primary immunization with two doses plus a booster dose of the Pfizer-BioNTech, AstraZeneca or Moderna COVID-1 vaccines. The study took place between November 27, 2021 and January 12, 2022 and involved a total of 886,774 eligible persons infected with the omicron variant, 205,154 eligible persons infected with the delta variant and 1,572,621 eligible test-negative control persons with all persons being aged 18 years and older. Vaccine effectiveness was assessed in five year bands from ages 18 to 89 inclusive. Let's look at some of the more interesting findings of the study, breaking it down by vaccine manufacturer and variant:
1.) Pfizer/BioNTech - delta variant
- dose 1 - 45.2 percent in weeks 0 to 3, 72.3 percent after 4 weeks
- dose 2 - 90.9 percent weeks 2 to 4, dropped to 62.7 percent in week 25
- booster dose - 92.3 percent in week 1, dropped to 89.9 percent in week 10
Pfizer/BioNTech - omicron variant
- dose 1 - 42.8 percent in weeks 0 to 3, dropped to 31.5 percent in week 4
- dose 2 - 65.5 percent weeks 2 to 4, dropped to 8.8 percent in week 25
- booster dose - 66.9 percent in week 1, dropped to 45.7 percent in week 10
2.) Moderna - delta variant
- dose 1 - 60.1 percent in weeks 0 to 3, dropped to 57.4 percent in week 4
- dose 2 - 94.5 percent in weeks 2 to 4, dropped to 84.5 percent in week 25
- booster dose - 95.3 percent in week 1, rose to 96.4 percent in weeks 2 to 4
Moderna - omicron variant
- dose 1 - 47.9 percent in weeks 0 to 3, dropped to 31.9 percent in week 4
- dose 2 - 75.1 percent in weeks 2 to 4, dropped to 14.9 percent in week 25
- booster - 68.1 percent in week 1, dropped to 66.3 percent in weeks 2 to 4
3.) AstraZeneca - delta variant
- dose 1 - 42.9 percent in week 4
- dose 2 - 82.8 percent in weeks 2 to 4, dropped to 43.5 percent in week 25
- booster - 77.1 percent in week 1, rose to 83.3 percent in weeks 5 to 9
omicron variant
- dose 1 - 17.7 percent in week 4
- dose 2 - 48.9 percent in weeks 2 to 4, dropped to -2.7 percent in week 25
- booster - 57.7 percent in week 1, dropped to 46.7 percent in weeks 5 to 9
The authors also studied the mixing of the two mRNA vaccines and the adenovirus vector vaccine and the impact of the mixing on the effectiveness of the vaccines against both the delta and omicron variants. If you wish to see this data for yourself, please click here. Let's summarize by looking at the authors' conclusions. First, the authors noted that after two doses, k vaccine effectiveness waned rapidly with very limited vaccine effects seen from 20 weeks aft ere second dose of any vaccine. Booster doses did result in a substantial increase in protection against mild infection, however, once again, the protection waned quickly as time passed. The authors also noted that they were unable to determine the degree of protection that the vaccines offered against sever cases of the disease because of the use of the test-negative case-control method due to the small number of omicron cases resulting in hospitalization. The authors found that two doses of the Pfizer/BioNTech and AstraZeneca vaccine are "insufficient to give adequate levels of protein against infection with the omicron variant and mild disease. Boosting with the Pfizer/BioNTech vaccines provided a substantial increase in protection against mild disease, although waning occurred over time." They do note that "boosters will probably offer even greater levels of protection against severe and fatal disease" although this was not part of the study.
Pfizer CEO Pushes Yearly Shots for Covid. Not So Fast, Experts Say. When Pfizer CEO Albert Bourla said March 13 that all Americans would need a second booster shot, it struck many covid experts as a self-serving remark without scientific merit. It also set off spasms of doubt over the country’s objectives in its fight against the coronavirus. The decision on how often and widely to vaccinate against covid-19 is part science, part policy, and part politics. Ultimately it depends on the goals of vaccination at a time when it’s becoming clear that neither vaccines nor other measures can entirely stop the viral spread.On March 15, Pfizer made a more limited request of the FDA, seeking authorization of a second booster only for people 65 and older. Advisers for the FDA and the Centers for Disease Control and Prevention are likely to approve a fourth shot for people in that age group because they’re the group most likely to be hospitalized or die of covid. Pfizer competitor Moderna on March 17 also filed for a second booster shot, although its application extended to all adults.The vaccines’ protection against covid infection generally wanes within several months in all age groups. But experts disagree on whether frequent boosters, especially for younger people, can do anything about that. Two or three vaccinations protect most people from serious disease — but do relatively little to prevent infection, which is generally mild or asymptomatic, after three or four months.Statements like Bourla’s create public pressure for a fourth dose that could force the Biden administration’s hand before government experts have time to assess the evidence, said John Moore, professor of microbiology and immunology at Weill Cornell Medical College.
White House to announce second COVID-19 booster for older Americans: report -The Biden administration will be giving elderly Americans a second COVID-19 booster shot, multiple people familiar with the plan told The New York Times.Those above the age of 50 will be able to get a second booster of either the Pfizer-BioNTech or Moderna vaccines. However, multiple issues complicate the plan as the administration has to calculate when the next COVID-19 wave could hit the U.S., sources told the Times. The administration will want to get the second booster to the elderly before another wave hits, but not too far before that protection could wane.Other complications include how to explain the plan to the public and how long the second booster’s protection will remain strong, the Times noted. White House adviser Anthony Faucisaid last week that COVID-19 cases could begin increasing in the coming weeks.
US COVID-19 death toll reaches 1 million - By this evening, the official COVID-19 death toll in the United States will surpass 1 million, according to the Worldometers tracker. Due to the absence of uniform data, the exact death toll from COVID-19 and the moment it will pass 1 million on other data trackers is unknown, but by the end of April every tracker will likely surpass this horrific milestone. Estimates of excess deaths caused directly or indirectly by the pandemic place the true US death toll at over 1.2 million. The catastrophic loss of life and broader societal impacts of the pandemic are unprecedented in American history. Entire families have been wiped out. One out of every 100 people above 65 years old has been killed by COVID-19. Over 200,000 children have lost a parent or primary caregiver to the disease. In the span of two years, more Americans have died from COVID-19 than the cumulative death toll of every war fought by the United States in the 20th century. On average, 2,735 Americans have died from this preventable disease every two days over the past two years, close to the total of 2,977 people killed in the September 11 terror attacks. In the first year of the pandemic alone, life expectancy in the US dropped by an astounding 1.8 years, the largest decrease since World War II. At this point, the cumulative total decline in life expectancy is likely approaching five years. Lost among the statistics of mass deaths are countless individual tragedies. Parents, grandparents, aunts, uncles, sons, daughters, the elderly, people in the prime of life, youth who had hardly even begun to live, have all been struck down by COVID-19. In response to this monumental social catastrophe and the approaching milestone of 1 million deaths, everywhere there is massive official indifference. One would imagine that a series of solemn memorials, tributes and serious discussions on the pandemic would be held in the days and weeks leading up to this milestone. Nothing of the sort. The pandemic is now all but ignored by the entire political establishment and the corporate media, as a potential new surge of the more infectious, vaccine-resistant and virulent Omicron BA.2 subvariant looms in the background and all federal pandemic funding has completely dried up. While the 1 million needless deaths are the most tragic element of the pandemic, millions and possibly tens of millions more Americans now suffer from Long COVID as a result of their illness. These include a myriad of symptoms that can affect nearly every organ in the body, including the lungs, brain, heart, kidneys and immune system. Seroprevalence studies indicate that likely upwards of 200 million Americans have been infected with COVID-19. Studies on Long COVID estimate that at least 10 percent of infections lead to long-term symptoms, with comparable rates among breakthrough infections in vaccinated people, meaning that upwards of 20 million Americans are likely experiencing some form of long-term ramifications. Further, there is a growing body of evidence proving that those infected with COVID-19 face increased risk of brain damage, heart disease, kidney disease, diabetes and more. The overall long-term societal impact is incalculable. The overwhelming majority of COVID-19 infections and deaths have befallen the working class and lower-middle class. Comprising the bottom 90 percent of income earners, they have been compelled to return to unsafe workplaces and send their children into unsafe schools, which have been the primary centers of viral transmission. By September 2021, according to CDC estimates, roughly 25.8 million children had already been infected with COVID-19 in the US. The full reopening of schools since that time likely pushed the figure above 40 million, with millions infected or reinfected with Omicron. For the capitalist ruling class, the pandemic has been an unprecedented bonanza. This Sunday will mark two years since the CARES Act was signed into law by Donald Trump after passing with near-unanimous bipartisan support. This initiated the greatest transfer of wealth in US history, with US billionaires amassing a staggering $2.1 trillion through October 2021.
CDC “adjustment” slashes child COVID-19 deaths by 25 percent - The US Centers for Disease Control and Prevention (CDC) slashed its reported number of child COVID-19 deaths by nearly 25 percent Wednesday without any serious explanation, amid a deepening effort by the entire political establishment to cover up the ongoing mass death from the pandemic. According to Newsnodes, an average of 1,138 people are dying from COVID-19 every day in the US as the official death toll approaches 1 million. In its COVID Data Tracker, the CDC eliminated 72,277 deaths previously reported across 26 states, including 416 pediatric deaths. David J. Sencer CDC Museum in Atlanta, GA (Source: Wikimedia Commons) Explaining the change, the CDC claimed that “data on deaths were adjusted after resolving a coding logic error. This resulted in decreased death counts across all demographic categories.” In a subsequent response to an inquiry by the World Socialist Web Site, the CDC elaborated on its earlier statement, writing, “An adjustment was made to COVID Data Tracker’s mortality data on March 14 involving the removal of 72,277—including 416 pediatric deaths—deaths previously reported across 26 states because CDC’s algorithm was accidentally counting deaths that were not COVID-19 related.” This response clearly indicates that the CDC has changed what is counted as a COVID-19 death. The move comes as the CDC is actively working to implement measures that would differentiate COVID-19 hospitalizations and deaths “from” COVID-19 as opposed to “with” COVID-19, in what is widely perceived to be an effort to reduce the number of official COVID-19 hospitalizations and deaths. Greg Travis, a data analyst with decades of experience in the healthcare industry, told the WSWS that the CDC’s data change “makes very little sense.” Travis commented that he has never witnessed a change of this type or magnitude, noting, “Sometimes you will see small variants in the Data Tracker where deaths decrease by a few dozen one month to another, but I’ve never seen the toll in a specific age group start shooting up and then come crashing down. And I have never seen the number of deaths they’re drawing data from come down. That’s never happened.”
U.S. Records Lowest Weekly Average In Covid Cases In 8 Months The United States on Monday recorded the lowest seven-day average of Covid positive cases in more than eight months.As the pandemic at its low, the latest weekly average is 29,696 cases, as per the New York Times tally.With 44,101 new cases of coronavirus infection recorded from across the country on Monday, the national total increased to 79,632,049, according to the latest data from Johns Hopkins University.With 1,472 deaths reported on the same day, total U.S. Covid casualties reached 972,634. There has been a 19 percent decline in Covid deaths and a 29 percent decrease in cases in the last fortnight.California reported the most number of cases - 9,170 - while Colorado reported the most casualties - 963.Just 21,679 patients are remaining in the country's hospitals for treatment for the viral disease. Hospital admissions have tumbled by 41 percent in two weeks.There is also a concurrent reduction in the number of patients admitted in intensive care units - 46 percent within a fortnight. I.C.U. admissions dropped to 3,696.63,254,918 people have so far recovered from the disease, the Worldometer tally shows.As per the latest data published by the Centers for Disease Control and Prevention, 217,093,232 Americans, or 65.4 percent of the eligible population, have been administered both doses of Covid vaccine so far. This includes 88.9 percent of people above 65.44.5 percent of the eligible population, or 96,675,246 people, have already received a booster dose that is recommended to provide additional protection from the killer virus.With 16,246 more deaths reported from across the globe on Monday, the number of lives lost due to Covid in the world has risen to 6,094,632.
Health care struggles grow in the US as Omicron BA.2 surge spreads - As the mainstream news centers continue to push ever more for war with Russia there has been a near media blackout concerning the coverage of COVID-19 in the US. A new mutation of the virus, the Omicron BA.2 subvariant, is ripping through populations in Asia and Europe and has already migrated to North America, accounting for nearly 25 percent of new cases in the US as of this writing. The danger posed by the BA.2 subvariant was shown by the massive spread of infection that crushed hospital systems in Hong Kong. An even worse situation threatens US health systems, with a dwindling and increasingly overtaxed workforce, facing staff shortages and deteriorating living standards due to the surge of inflation. These conditions have sparked an uptick in strikes by health care workers in the US as well as among health care workers globally, who face similar conditions. In just the past week there have been strikes and protests in the US states of Pennsylvania, Minnesota, Nevada and California as well as in Haiti, South Africa and Turkey. On March 13, 220 nurses went on strike at Armstrong County Memorial Hospital (ACMH) in Kittanning, Pennsylvania in response to understaffing and lack of pay. Nurses have criminally been kept on the job working for eight months by the ACMH Nurses United under the umbrella of the Pennsylvania Association of Staff Nurses and Allied Professionals (PASNAP) since their contract expired in July 2021. The union ended the strike on Friday March 18 despite providing no acknowledgment that any of the demands of nurses had been met. One emergency room nurse, Athena Scanlon, noted in a statement put out by the union itself that she has at times had to care for 18 patients when their labor agreement called for only three or four patients. PASNAP bargains on behalf of more than 9,000 health care workers in the state. The trade unions, who are tied by a thousand threads to the Democratic Party, are complicit in the horrendous working conditions for health care workers. ACMH for instance, has overseen deteriorating conditions and has not called a strike for improved conditions in more than 20 years. Instead, it has peddled false hopes in legislative actions such as the current state House Bill 106 and Senate Bill 240, or Patient Safety Act. The rural hospital is the only one in the county with a population of some 65,000. Rural areas have been even harder hit throughout the pandemic than urban ones, often with poorer and sicker populations who face long travel distances. Rural hospitals themselves have fewer funds and are overall less attractive to the shrinking pool of travel nurses. Rural Americans have died from COVID at more than twice the rate of their urban counterparts, according to the Kaiser Family Foundation’s analysis of data from the Rural Policy Research Institute. The ACMH hospital’s Community Health Needs Assessment published last June notes that the hospital is the largest employer in Armstrong County and serves a rural working poor population where the annual per-capita income for Armstrong County residents is at $27,715 and 12 percent are experiencing food insecurity. The report also notes that “22.6% of the Armstrong County Population is 65 or older.” One nurse had this to say to the Courier Express about unsafe staffing, “I love my job, but in the ER, we go into the med room and cry; we go home and cry.” She went on to say, “It’s unsafe for the patients; it’s unsafe for us.”
Coronavirus Dashboard for March 21: the likely course of BA.2 in the US --This is the second part of my discussion of the likely US trajectory of the BA.2 Omicron subvariant. Part one was Friday, and if you missed it, here is the link.To quickly refresh, there have been many warnings about the new BA.2 wave which has overtaken much of Europe, specifically including the UK, and warning that the same is in store for the US. The truth appears to be more complicated. As I wrote on Friday, “the data she has collected demonstrate that BA.2 is very much an Omicron, rolling in and out like a tsunami. Like BA.1, the BA.2 variant causes peak infections by or very shortly after it approaches 100% of all infections.” To cut to today’s chase, the course of BA.2 in any given area depends on the level of previous infection by BA.1:- Where BA.2 overtook BA.1 very quickly, there was only 1, more intense and longer lasting, wave. - Where BA.2 only overtook BA.1 after a long time, there were relatively few people left who BA.2 could reach, resulting in a “long tail” of declining cases, but no new wave.- Only where BA.2 overtook BA.1 after its peak, but - probably because of better mitigation efforts - there were lots of people left who BA.2 could reach, has there been a new wave. The Let’s start with the 26 countries in the EU. Like me, you’ve probably seen the graph showing cases rising sharply in some EU countries. Here’s what the entire Union, plus the UK, looks like:1. There are a number of countries in the EU - Norway, Sweden, Denmark, Poland, Lithuania, Latvia, Estonia, Hungary, Bulgaria, Czechia, and Spain - where no increase has happened at all, and in fact cases are decreasing.
2. There are 15 countries where cases bottomed and started increasing between February 24 and March 9, the majority of which were between March 1 and March 3.
3. Of those 15, 6 - Ireland, Belgium, the Netherlands, Cyprus, Finland, and Portugal - appear to have already peaked, generally about 2 to 2.5 weeks after the increase began. Their increases varied but generally were in the range of a 75% to 100% increase from a low level (I.e., don’t freak out over the percentages).
4. That leaves 9 of 20 European countries still increasing, less than 3 weeks after the new “waves” began. In several of those - the UK, Germany, Austria, Greece - the rate of increase appears to have slowed substantially. In the remaining 5, notably in France and Italy, the wave is continuing in full force.
So let’s be clear: BA.2 has not started a new “wave” everywhere. And where it has caused a new wave, it appears to be short, as in 2 to 4 weeks from trough to new peak.
COVID-19 in Ohio: 3,668 new cases in first full weekly release — The Ohio Department of Health on Thursday reported 3,668 new COVID-19 cases for the past seven days, the first full weekly period since infection reporting switched from daily earlier this month.Ohio averaged about 524 new coronavirus infections over the past seven days, in line with a trend since early March in which cases per day have been well under 1,000. Cases haven’t been this low since July 2021.The switch to weekly reporting coincides with new infections continuing at a low level after the omicron variant wave. Last week, the first weekly report, covered only four days.Hospitalization, death and vaccine reporting are also weekly now. The 193 hospitalizations reported by ODH in the past seven days (about 28 per day) follow recent trends. And 383 more Ohioans died of COVID-19. 7,460 Ohioans started the COVID-19 vaccination process in the past seven days, per ODH data. Another 9,242 finished vaccination by getting their second dose. Around 6 in 10 Ohioans are partially or fully vaccinated.When asked in a Thursday news conference whether daily reporting will come back if COVID-19 cases spike again, ODH Director Dr. Bruce Vanderhoff said he could not predict that. He said weekly reporting follows a risk model established by the Centers for Disease Control and Prevention.“Data scientists looked back over time and said, ‘What paradigm would help to best understand risk at a community level related to COVID-19,” he said, “given the kind of data that we collect and is available?”The CDC switched its county risk map in late February from daily to weekly, and the color code is now based more on hospitalizations than cases.While reporting daily cases in Ohio was “helpful,” Vanderhoff said, “it had some shortcomings,” like how numbers would vary depending on day of the week.
Vanderhoff: BA.2 omicron subvariant unlikely to severely impact Ohio -- – Ohio’s health director, Dr. Bruce Vanderhoff, said Thursday the COVID-19 subvariant increasing cases in some foreign countries and is also present in the U.S. is unlikely to change the improving situation in the Buckeye State.The BA.2 subvariant of omicron COVID-19, a slightly different strain than the BA.1 subvariant that pushed Ohio infections to record levels in the winter, is more contagious, Vanderhoff said in a news conference.“Nevertheless, they seem to have similar severity, be similarly responsive to vaccines, and — very importantly — it’s rare to see a BA.2 infection after a BA.1 infection,” Vanderhoff said, “which means immunity to BA.1 provides good protection against BA.2.”These insights, he said, come from studies of developed European countries like the Netherlands and Denmark, which are coming off BA.2 surges.In the U.S., BA.2 is a growing percentage of cases, Vanderhoff said, however, “To use a baseball analogy, BA.2 is playing cleanup but probably won’t hit a home run.”Vanderhoff said the emergence of BA.2 is a good reminder to get vaccinated, the most effective way to stave off COVID-19. As of last Thursday, 62.17% of all Ohioans have at least one dose of a vaccine. The Ohio Department of Health publishes new coronavirus numbers on Thursdays.
As Omicron BA.2 threat grows, US COVID-19 testing, treatment funds exhausted - Amid mounting evidence of a new surge in coronavirus driven by the BA.2 subvariant of Omicron, federal funds for COVID-19 testing and treatment and future mass vaccinations are running out. At a White House briefing Wednesday, officials of the coronavirus task force warned that the congressional failure to approve a $15.6 billion funding package last week meant that federal financial support for a wide range of programs would be ending over the next month. The first cutbacks have already been made, as the administration has reduced the supply of monoclonal antibody treatments being distributed to the states by 35 percent. Health and Human Services Secretary Xavier Becerra told the Wednesday briefing that this cut would be followed by ending federal reimbursement of the cost of COVID testing and treatment for the uninsured, and ending federal funding of vaccinations for the uninsured sometime in early April. White House coronavirus coordinator Jeff Zients, who is leaving the administration at the end of the month, told the briefing, “The virus is not waiting for Congress to act. With every minute this funding request is stalled, we’re losing our ability to protect people and be prepared.” Zients was speaking only of the mitigation efforts conducted by the administration over the past year, which are nothing like a genuine campaign to suppress the deadly virus and actually protect the population. But even these limited actions are headed for the scrap heap. The specific cutbacks outlined by Zients included a hold on placing orders for a second round of booster shots (fourth doses) of the Pfizer and Moderna vaccines, if these prove to be useful in extending immunity or combating further variants of coronavirus. He added, “If things change, and if there’s a need for that new vaccine, a new formulation, for example, a very specific vaccine, we won’t be able to secure doses for the American people.” Zients said that funding has already been provided to secure a full supply of vaccine doses for children younger than age 6 when and if the Food and Drug Administration (FDA) authorizes administration of those vaccines. Moderna announced Wednesday it was submitting a formal request for FDA approval for its version of the vaccine for young children. At the same briefing, Dr. Rochelle Walensky, director of the Centers for Disease Control and Prevention (CDC), confirmed that BA.2 now accounts for about 35 percent of new COVID-19 cases in the United States, and that in some regions this figure is over 50 percent. BA.2 is significantly more infectious than Omicron BA.1, the subvariant which has wreaked such a deadly toll over the past three months. BA.2 has largely displaced BA.1 wherever it has had the chance, including in Britain and much of continental Europe, and it is now doing so in the United States. In just the past week, BA.2 has gone from 22 percent of coronavirus infections to 35 percent, while in New England the figure has jumped from 39 percent a week ago to 55 percent. Other areas with higher levels of BA.2 include California, Florida, Pennsylvania, Michigan and Texas. Perhaps the most immediate damage from the funding cutbacks would be the impact on the use of monoclonal antibodies and oral antivirals such as Pfizer’s Paxlovid, which has cut rates of hospitalization by as much as 90 percent when administered after the initial infection is detected. This is particularly valuable for millions of immunocompromised people and elderly people with severe underlying health conditions. Effective use of these treatments requires early detection, and therefore frequent and regular testing.
Omicron BA.2 wave begins its assault on the United States - A growing number of public health experts in Europe and the United States predict that the US will see a sharp rise in COVID-19 infections in the coming weeks due to the spread of the highly infectious and immune-resistant Omicron BA.2 subvariant. These assessments are based on the current wave of COVID-19 infections now impacting 18 countries across Europe, where surges have consistently proved a harbinger of another wave in the US. It is necessary to place the immune evasive characteristics of BA.2 into context, as it will have significant implications for the US. In the UK, despite high levels of population antibodies to SARS-CoV-2, believed to be roughly 97–99 percent from vaccinations and previous infections, the Office for National Statistics indicated that between 6–9 percent of the population tested positive for COVID-19 last week. Following the explosion in infections in the UK, hospitalizations across England have accelerated upwards again, approaching the highs seen during the last Omicron wave when there were 14,256 admissions in one week in mid-January. After dramatically falling in February, admissions have clawed back up to 12,576. As expected, many of these patients are the elderly and most vulnerable, but there has also been a sharp rise in hospitalization among children, who remain the least vaccinated age group. The death toll due to COVID-19 in the UK has swung upwards by 22 percent over the previous week. The seven-day average of daily new deaths has doubled since the first day of March, with 128 deaths per day. Though population immunity in the US from previous infections and vaccinations remains considerable, vaccinations and booster uptakes have been much more stagnant, with less than 3 percent of the population receiving a booster shot in the past two months. This means that the American population can expect a more pronounced impact when the momentum from the surge accelerates. There is a growing body of evidence of the impending BA.2 surge in the US. First, the number of sequenced cases of the BA.2 version in the US has doubled in the last two weeks and now accounts for 34.9 percent of all new infections. In Europe, COVID-19 cases began to turn upwards when BA.2 sequences surpassed the 50 percent mark, which will likely happen by the end of next week. In New England, half of all sequenced COVID-19 infections are now BA.2. In Boston, daily cases have jumped almost three-fold in recent days to nearly 200. Former New York City Council Member Mark Levine recently tweeted, “Manhattan is driving the current increase in cases in NYC,” where test positivity rates are soaring. The 14-day change in daily new cases in New York is up by 44 percent, the highest increase in the country. Twelve states, including six in the Northeast, have reported upward trends, despite overall decreases in population testing and a shift towards home-based rapid antigen test kits that go unreported.
Surge in UK COVID cases fuelled by Omicron BA.2 - The Omicron BA.2 sub-variant is fuelling a resurgence of COVID cases and deaths in Britain. According to the Office for National Statistics (ONS) an estimated one in every 20 people were infected with the disease last week. COVID infections are increasing among every sections of the population, including the most vulnerable 75 years and over. BA.2 was only discovered in India and South Africa in late December 2021. By mid-January, the UK Health Security Agency designated it a “variant under investigation” after 1,072 cases were identified in England. The highly transmissible strain became dominant in the UK within a month, making up 52 percent of all Covid infections in Britain in the week to February 20. Just two weeks prior BA.2 accounted for just 19 percent of all cases. As of March 11, the variant was already accounting for more than 80 percent of cases in England. Last Thursday, the UK passed a grim milestone of 20 million people infected. This is just short of 30 percent of the entire population. According to the ONS, a total of 187,261 deaths have occurred where COVID-19 is mentioned on the death certificate. Such hellish figures have been all but excluded from the national media, with only the Sun newspaper bothering to report the 20 millionth case. The media is on board with Prime Minister Boris Johnson’s declared policy of “Living with COVID-19”. The fact is, as scientists and the WSWS predicted, for many this means “Dying with COVID-19”. Since “Living with COVID-19” was published February 22, according to official figures, a further 4.33 million people have been infected and 2,663 people have died. The government only records COVID deaths if a person dies within 28 days of testing positive. In the seven days to March 18, 552,198 people were infected nationally, up 152,378 and a nearly 40 percent increase on the week prior. Deaths are beginning to rise again, with the 752 recorded in the same week, up 3 percent on the week prior.
Massive increase in COVID-19 in Austria after protective measures ended - The number of COVID-19 infections is reaching new records every day in Austria after almost all protective measures were lifted on March 5. Despite this, the last remaining quarantine regulations were abandoned Monday. This development underlines the inhuman character of a policy that prioritizes profit over the life and health of people. On Friday, more than 50,000 new infections were reported for the third day in a row. With 51,112 cases, the number of infections reached the third highest level since the beginning of the pandemic. The Ministry of Health again expects more than 50,000 infections a day this week. The 7-day incidence is 3,600 infections per 100,000 inhabitants. Almost 450,000 people are actively infected, of whom 3,040 are receiving treatment in hospital. Between 20 and 30 people die on average every day. The total number of people who died of COVID-19 now stands at 15,344. Among the almost 9 million inhabitants of the country, 3.4 million infections have been officially registered since the beginning of the pandemic. The number of unreported cases is undoubtedly much higher. Hospitals are treating 297 more people than a week ago, 207 of them receiving intensive care. Since March 5, clubs and restaurants throughout the country have been open without restrictions. There are no longer any attendee limits at events. The mask mandate was completely abolished with few exceptions. Other than in hospitals and nursing homes, there are no longer any access restrictions. To cover up the extent of the infections, the government, a coalition of the right-wing conservative Austrian People’s Party (ÖVP) and the Greens, will severely restrict free tests from April 1. Only five PCR tests and five antigen tests are available free of charge per person per month. There will only be exceptions for people in hospitals or nursing homes, the elderly and people with symptoms. As of Monday, all quarantine regulations will cease to apply. Since previously vaccinated contact persons were already exempted from quarantine, the latest relaxation also applies to unvaccinated contact persons. Exceptions apply only to restaurants and event attendees. From the middle of the week onwards, health workers who have tested positive will continue working. This means that in hospitals and nursing homes, the sick and infirm will be exposed even more than at present to the risk of infection, not to mention the threat of further virus spread among the staff themselves. The number of infections and deaths in the health and care sector will continue to increase as a result. As of last Friday, employees in the state of Lower Austria who test positive are allowed to resume work in health and care facilities if they have been symptom-free for only two days.
The coronavirus subvariant surging in Europe is a more-contagious type of Omicron which experts fear could soon take over in the US - A subvariant of Omicron called BA.2 is driving a new wave of COVID-19 cases in Europe. Experts warn it could soon become dominant in the US, causing concern of an impending surge. BA.2 spreads more quickly than 'normal' Omicron BA.1. The Omicron variant is made up of three genetically distinct sub-variants, BA.1, BA.2, and BA.3. All of these subvariants are capable of spreading much more quickly than earlier variants like Delta. But BA.2 is thought to spread the quickest. According to Antony Fauci, the White House Medical advisor BA.2 is 50 to 60% more transmissible than BA.1, though others say it is closer to 30% more transmissible. Omicron is thought to dodge immunity from two doses of vaccine much more efficiently than Delta, and early data suggests BA.2 is no exception. The UK Health Security Agency (UKHSA) found that BA.2 seems just as good at dodging two-shot protection against symptomatic disease as BA.1. It's not yet clear whether BA.2 evades protection against more severe outcomes — hospitalization and death — more efficiently than other Omicrons.Experts have encouraged people to get booster shots, which increases the protection against severe outcomes after Omicron infection. Protection against severe outcomes from two doses of vaccine seems to wane much more quickly with Omicron than with Delta.Two shots reduced the risk of hospitalization from Omicron by only 30% to 35% six months after the second shot, compared to 70% to 85% against Delta, per UKHSA.A booster increased the protection against hospitalization, reducing the risk of hospitalization by 80% to 95% within three months of the shot, and 75% to 85% four to six months, per UKHSA. Omicron seems to gravitate to different parts of the body than Delta, and that's good news. The variant prefers staying in the upper airways of the body, which may be why it causes less severe disease after infection, per early research.BA.2 is expected to behave in a similar way. Though one preprint on hamsters suggested that the virus could replicate more quickly in upper airways than BA.1, early real-world data from Denmark, South Africa, and the UK suggest BA.2 does not cause more severe disease than BA.1, Medical News Today reported.But even though a smaller proportion of people infected with BA.2 will be severely ill, the burden on the healthcare system could remain high because the variant causes more cases overall. Infection by BA.1 seems to provide robust protection against BA.2, though it is not clear for how long, the World Health Organization said. There have been some documented cases of people who had caught BA.1 being reinfected by BA.2, but this seems rare.
South Korean COVID-19 infections top 10 million - South Korean health officials said on Wednesday that total COVID-19 infections in the country since the beginning of the pandemic have exceeded 10 million amid a surge in severe cases and deaths,Reuters reported. South Korea’s total caseload as of Tuesday was 10,427,247, with a virus-related death toll of 13,432, according to the Korea Disease Control and Prevention Agency (KDCA), per Reuters.On Tuesday alone, the KDCA reported 490,881 new COVID-19 cases and 291 new virus-related deaths, marking the highest daily case total since March 16, when virus cases peaked at 621,205, according to the wire service.The rise in COVID-19-related deaths is putting strain on South Korea's crematories and funeral parlors, Reuters reported.On Monday, the country's health ministry directed 1,136 funeral parlors with the storage capacity to hold roughly 8,700 bodies to expand their facilities, according to the wire service. The same day, it instructed 60 crematories across the nation to extend their hours of operation in order to cremate more bodies per day.Health ministry official Son Young-rae noted that authorities previously increased crematories' daily capacities, but said that the greater Seoul area has continued to see long wait times and a large backlog of bodies, per Reuters."Crematories' capacity is increasing," Son said. "But there are still regional differences."Son added that crematories will be temporarily permitted to receive reservations from outside their regions to alleviate the body pileup, according to Reuters. They were previously barred from doing so by some local governments in the country. This comes as the country has been battling a recent wave of COVID-19 driven by the omicron variant, though authorities have lifted some virus restrictions and eased up on contact tracing, quarantine and social distancing initiatives, Reuters reported. Amid the surge, South Korea’s drug agency has granted emergency approval for the use of Merck & Co Inc.'s COVID-19 treatment pill for adults, branded as Lagevrio, after previously doing the same for Pfizer's oral Paxlovid treatment, according to the wire service.The first shipment of Lagevrio, which will be only prescribed to non-pregnant patients 18 years or older, is expected to arrive on Thursday, Reuters reported, citing the South Korean health ministry.
'Forever chemicals' found in fast food wrappers -An analysis by Consumer Reports was released Thursday of “forever chemicals” that were found in certain fast food wrappers from popular fast food chains. PFAS are labeled as “forever chemicals” because the compounds are human-made chemicals that can not break down in the environment.The analysis showed this class of chemical was found in excessive amounts in the wrappers for some products from Burger King, Chick-fil-A, Stop & Shop, Sweetgreen, Nathan’s Famous, Cava and Arby’s.Nathan’s Famous saw the highest indicators of PFAS, 876 ppm (parts per million) for one bag of sides and 816 ppm for another bag of sides.The report says Denmark only allows a 20 ppm limit for the chemical, with California aiming for less than 100 ppm limit by 2023. “We know from our testing that it is feasible for retailers to use packaging with very low PFAS levels,” Brian Ronholm, director of food policy at CR, said. “So the good news is there are steps that companies can take now to reduce their use of these dangerous chemicals.” Consumer Reports says they tested 118 food products with multiple samples from over two dozen stores and fast food restaurants in Connecticut, Mississippi, New Jersey, New York and Texas.
Scientists find microplastics in blood for first time -- Scientists have discovered microplastics in human blood for the first time, warning that the ubiquitous particles could also be making their way into organs. The tiny pieces of mostly invisible plastic have already been found almost everywhere else on Earth, from the deepest oceans to the highest mountains as well as in the air, soil and food chain. A Dutch study published in the Environment International journal on Thursday examined blood samples from 22 anonymous, healthy volunteers and found microplastics in nearly 80 percent of them. Half of the blood samples showed traces of PET plastic, widely used to make drink bottles, while more than a third had polystyrene, used for disposable food containers and many other products. "This is the first time we have actually been able to detect and quantify" such microplastics in human blood, said Dick Vethaak, an ecotoxicologist at Vrije Universiteit Amsterdam. "This is proof that we have plastics in our body—and we shouldn't," he told AFP, calling for further research to investigate how it could be impacting health. "Where is it going in your body? Can it be eliminated? Excreted? Or is it retained in certain organs, accumulating maybe, or is it even able to pass the blood-brain barrier?" The study said the microplastics could have entered the body by many routes: via air, water or food, but also in products such as particular toothpastes, lip glosses and tattoo ink. "It is scientifically plausible that plastic particles may be transported to organs via the bloodstream," the study added. Vethaak also said there could be other kinds of microplastics in blood his study did not pick up—for example, it could not detect particles larger than the diameter of the needle used to take the sample. The study was funded by the Netherlands Organization for Health Research and Development as well as Common Seas, a UK-based group aimed at reducing plastic pollution. Alice Horton, anthropogenic contaminants scientist at Britain's National Oceanography Center, said the study "unequivocally" proved there was microplastics in blood. "This study contributes to the evidence that plastic particles have not just pervaded throughout the environment, but are pervading our bodies too," she told the Science Media Center. Fay Couceiro, reader in biogeochemistry and environmental pollution at the University of Portsmouth, said that despite the small sample size and lack of data on the exposure level of participants, she felt the study was "robust and will stand up to scrutiny". She also called for further research. "After all blood links all the organs of our body and if plastic is there, it could be anywhere in us."
Ex-Michigan governor must testify in Flint water civil trial, judge says -A federal judge ruled Monday that former Michigan Gov. Rick Snyder(R) must testify in a trial involving engineering firms sued over lead-contaminated water tied to the Flint water crisis.Snyder and four other former officials will testify at Michigan’s Eastern District Court after U.S. District Judge Judith Levy rejected their motions to quash subpoenas. Snyder was charged last year with two misdemeanor counts of willful neglect of duty over the water crisis.Levy wrote that the individuals' motions were denied because they each testified without invoking Fifth Amendment protections in previous depositions.The former officials are considered potential witnesses to two engineering companies — Lockwood, Andrews & Newman (LAN) and Veolia North America (VAN) — that are being sued by attorneys for four children who were harmed by Flint’s contaminated drinking water.The suit claims the firms did not ensure the water was being treated properly from 2014 to 2015 and were negligent in advising officials.The engineering firms were not part of the $626 million settlement made last year between Flint residents and the state, city and other parties.Levy wrote in her opinion that a hearing will be held to determine how the court will address specific arguments where they could self-incriminate. Other problems with lead-contaminated water surfaced in Michigan after the Flint crisis. Last October, Gov. Gretchen Whitmer (D) issued an executive order to allocate federal, state and local resources to replace the lead service lines in Benton Harbor after discovering elevated levels of lead in tap water in the southwestern part of the state. More than 99,000 residents were exposed to the contaminated drinking water in Flint, and it has been linked to at least 12 deaths and 80 illnesses.
Poultry experts warn of rapidly spreading, dangerous bird flu - — Food prices could soon skyrocket even more as a new bird flu sweeps across the country, threatening to wipe out farmer's flocks. Aaron Brand is a longtime farmer in Farmington who tends to thousands of chickens. His livelihood could be at stake if the birds contract the highly contagious avian influenza that has been circulating in Europe and Asia for months. "What's going to end up happening with them is they're going to get killed, immediately," said Brand. University of Minnesota Extension Educator Abby Schuft says euthanasia only happens on premises with infected birds and financial reimbursement is provided if it happens under the Minnesota Board of Animal Health. Spread by migratory bird droppings, the U.S. Department of Agriculture is reporting cases in 30 states, totaling roughly 13 million birds that have had to be killed. The cases have been found Wisconsin, South Dakota and Iowa, but not Minnesota, which is the country's top turkey producer. "So the density — the hosts — that we have here make it almost a perfect storm to host that virus," said Schuft. She recommends commercial and hobby farms tighten-up bio-security measures. "They're minimizing who has access to the farm and minimizing trips in and out of the barns," said Schuft. "The dangerous time right now is the next couple of months." An outbreak triggered by a similar bird flu seven years ago wiped out 50 million hens and turkeys, mostly in Iowa and Minnesota, and caused prices to soar for months. "Their livelihood is put down in a matter of hours," said Brand. "They can’t do anything, they can’t repopulate the barn until they get through the quarantine process." Brand is already raising his egg prices $0.50 for the first time as the cost of feed keeps going up due to inflation and the war in Ukraine. "I don't think we've seen the high, they're still going to creep up," he said. Experts say the next couple months are the most crucial, as they hope the wild birds move out and take the strain with them. "Our best hope is that this will simply fly right over us," said Schuft. "Especially if the Canadian weather cooperates and those migratory birds move on up and over us and don’t stop and rest."
570,000 broiler chickens to be destroyed as bird flu hits Nebraska poultry farm - Nebraska has confirmed its first case of the bird flu in a commercial flock of chickens. The state Department of Agriculture said the highly contagious disease has been found in a flock of 570,000 broiler chickens in Butler County. Jessica Kolterman, a spokesperson for Lincoln Premium Poultry, confirmed that the flock is on a farm that raises chickens sent for processing at the company's Costco-affiliated operation in Fremont. Bird flu had previously been found in several wild geese and a mixed backyard flock in Merrick County, but its discovery in a commercial poultry operation ups the stakes in Nebraska. The state Agriculture Department said the farm has been quarantined and all 570,000 birds will be humanely destroyed. It also has set up a 6.2-mile control zone around the farm, and producers within that radius will not be allowed to move poultry products on or off their premises without permission. Kolterman said she believes there are other Lincoln Premium Poultry operations within that quarantine zone. State Veterinarian Roger Dudley said the Butler County farm had increased its safety practices and heightened observational testing amid the nationwide outbreak. It quarantined itself after noticing higher-than-normal mortality among its flock and notified the department. "Having a second farm in Nebraska confirmed to have HPAI is unfortunate but not completely unexpected,” said Agriculture Director Steve Wellman
Bald eagle dies after Meramec River rescue; avian flu suspected - A bald eagle rescued along the Meramec River over the weekend has been sent to a state lab for testing after the bird died. John Loida of Eureka said he and Sherry Spencer spent Sunday morning fishing and were enjoying an afternoon of casually riding around on his boat when they spotted an eagle along the riverbank. As Loida piloted the boat closer to get a picture of the eagle, he noticed the animal was in distress. He said the bird rolled into the water and was in danger of drowning, so he and Spencer used their fishing net to scoop the eagle up and call for help. Loida and Spencer arrived at a friend’s dock and phoned the World Bird Sanctuary, who dispatched a pair of animal technicians to examine the eagle. The eagle, a female, appeared sick and looked to be in a bad way. The technicians agreed to take her back to the sanctuary for observation. They credited Loida and Spencer for their actions, saying if the pair hadn’t found the eagle when they did, she surely would have died along the riverbank. Unfortunately, the eagle did not make it through the night. Loida said sanctuary staffers told him the following morning that the eagle likely died of avian flu. Roger Holloway, executive director and CFO of the World Bird Sanctuary, said members of the Missouri Department of Conservation picked up the eagle carcass and will run tests to confirm the cause of death. Holloway said MDS has already confirmed cases of avian flu in the area, so it would not be unexpected to discover it was the culprit. He said we should expect a couple more months of the illness in our area as birds migrate with the changing seasons.
Venom harvesting raises fears over toads -- People in search of treatments for certain ailments are putting increasing pressure on populations of the Sonoran desert toad — a Southwestern species whose venom is harvested for its psychedelic properties, The New York Times reported.“I saw why they call this the ‘God molecule’ after I got a full central nervous system reset,” said former Navy Seal Marcus Capone, who found relief from his intense depression and anxiety through the active ingredient in the venom, 5-Meo-DMT.That pushed Capone — who now runs a toad venom treatment center — into an ethical quandary: whether to turn to the toad itself for relief, or the array of easy-to-manufacture synthetic alternatives.While synthetics are effective in reducing stress, according to a study from the National Institutes of Health, many devotees refuse to use them — adding to the pressures on the wild toads. "There’s a perception of abundance, but when you begin to remove large numbers of a species, their numbers are going to collapse like a house of cards at some point,” Robert Villa of the Tucson Herpetological Society told the Times.
Using CRISPR to turn off genes in corn and rice to improve crop yields --A team of researchers affiliated with a large number of institutions in China and one in Germany has found that turning off a certain gene in corn and rice can lead to improvements in crop yields. In their paper published in the journal Science, the group describes mapping the genomes of both plants as a way to search for genes associated with grain yield using CRISPR gene editing to improve yields in test crops. As the planet continues to warm, scientists around the world are increasingly concerned about the ability of farmers to grow enough food to feed an ever-growing populace. Prior research has suggested that some of the land now used to raise crops may become less fruitful. Researchers are therefore looking for ways to increase crop yields. In this new effort, the researchers mapped the genomes of corn and rice, two of the biggest global food crops, and then searched their genomes for genes related to grain yield. They found 490 pairs of genes that appeared to serve similar functions in both plants. They narrowed down the genes to just two—one from corn and one from rice. They found that both of them produced a type of protein that regulated the number of grains a given plant could produce. They then used the CRISPR gene editing technique to turn off these two genes. Then they planted test crops using the seeds with the edited genes and measured the average yield. In looking at their yield numbers, the researchers found the plants with modified genes produced more grains per plant than control groups. They saw yield increases of 10% in the corn and 8% in the rice. They also studied the genetically modified plants to see if they could spot any other changes, specifically those that might make have a negative impact on plant growth and found none. They suggest their technique provides a reasonable approach to increasing crop yields and posit that the modified plants could be mixed with wild varieties to create new species that might be more resistant toclimate change.
Key Ingredient in Phosphate Fertilizer Subject of Environmental Group's Lawsuit Against EPA - The EPA failed to assess potential harm to endangered species when setting water-quality standards for the heavy metal cadmium, a new lawsuit filed by the Center for Biological Diversity on Tuesday alleges. Cadmium is used in the production of and is found in phosphate fertilizers. In a complaint filed with the U.S. District Court for the District of Arizona, the environmental group asked the court to declare EPA in violation of federal law for not completing an endangered species consultation when, in 2016, it adopted freshwater chronic criteria for cadmium under the Clean Water Act. The lawsuit asks the court to vacate the criteria and remand them back to EPA. According to the lawsuit, the application of phosphate fertilizer releases 33% to 56% of the total anthropogenic cadmium to the environment. "Cadmium is often detected in runoff from urban and industrial areas, and rivers are a major secondary source of cadmium to the ocean," the lawsuit said. "As of 2007, cadmium had been identified at 1,014 of the 1,669 most serious hazardous waste sites on the national priorities list. Of these 1,014 sites, cadmium was identified in surface waters at 354 sites, and in ground water at 675 sites." Fertilizer contains cadmium because phosphate rock is used as a key feedstock in fertilizer production. According to the Pacific Northwest Pollution Prevention Resource Center, cadmium is taken up by and stored in plants, accumulates in soil during a period of time, or leaches into groundwater or is carried into surface waters through irrigation runoff. The lawsuit alleges EPA weakened water-quality criteria and then approved the adoption of the criteria in at least 18 states. "EPA took this action without consulting with the services as required by Section 7 of the ESA," the lawsuit said. "This is a clear violation of EPA's obligations to engage the services in consultation to ensure EPA's action 'is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of habitat of such species.'" According to federal law, if a listed species or critical habitat is present, EPA is required to analyze the effects of a proposed action. "If the agency concludes, in a biological assessment, that the action is 'not likely to adversely affect' listed species and the service lawfully concurs in writing, then the consultation process is completed," the lawsuit said. "Conversely, if the action is 'likely to adversely affect' listed species, the agency must enter into 'formal consultation' with the services, a more extensive and protective process to consider the action's impacts." A biological opinion is considered to be the most important aspect of a formal consultation, the lawsuit said.
Bayer Warns Retailers of Glyphosate Production Disruption- Agrichemical giant Bayer is alerting retail partners the company may not be able to fill some glyphosate contracts this spring, due to a supplier's manufacturing problem. According to letters sent from the company that DTN has obtained, Bayer is declaring this a "force majeure" event, a term used to describe an uncontrollable event that prevents a party from fulfilling a contract. The situation could leave some farmers who are awaiting glyphosate deliveries on shaky ground. The letters, sent out late last week, are signed by Udo Schneider, global head of active ingredient manufacturing for Bayer. They state an undisclosed supplier of a key raw material for glyphosate production experienced a "mechanical failure" at its manufacturing plant. "As of now, given the supplier notification, we expect repairs of this production line to take around three months," Schneider wrote. "As a result of this force majeure event, Bayer's ability to supply its customers with glyphosate or glyphosate-containing products as agreed upon in certain agreements or under accepted purchase orders has been impacted," the letter added. A Bayer spokesperson confirmed in an email to DTN the letters are legitimate and are the result of a supplier's manufacturing problem, "which may have some short-term impacts on our production of the active ingredient to manufacture glyphosate." The Bayer statement stressed the situation should be temporary. "Our supplier is on track to restore production, we've sourced additional materials and made other mitigation efforts to help best manage this situation," Bayer statement read. "We expect any impact to be marginal in terms of our annual glyphosate production." The situation comes at a particularly challenging time for farmers as they approach the spring spray season, as glyphosate and other ag chemicals were already in extremely tight supply, with skyrocketing prices.
First Quarter ’22 Cattle & Ranch Report - Michael Smith -Green grass is growing finally down south as some rainfalls are being received east of the Colorado River, not that Colorado River, the other one that moves through Austin, and has very little to do with it’s namesake. Grass growing in the spring brings on the grazing and let’s the ranchers get off the expensive feed. Now is also the time to sow sorghum for the herds to clear in the next few months. Net, net it’s still an expensive business to be in.As the ranchers eyed the beginning of this year, a reduction had been discussed in the total herd population. A culling of 800,000 was expected to drive farmgate prices up to actually cover costs, as the packers have gotten record bounties, the ranchers have enjoyed none of higher prices. The supply adjustment ended up being a little over three million culled. Total herd population is now 91.9 million with nine of that in the dairy barn.The USDA headcount for beeves is now 2% lower than where we were last year. There are quite a few reasons for this:
- Ranchers are barely making money on the herds due to pricing pressures from the processors
- Lack of grazable fields out west due to considerable drought west of the Mississippi
- Feed prices are up 7% from just a few months ago, and likely to continue to rise further
- Transport prices have shot up due to increase in diesel costs
We’ve also seen considerable slow downs at the auctions that feed the system. At this point last year 394,000 head were moved in a week, this year only 288,000 were moved on the 10th of March, a considerable decline. Auction prices have also responded in kind with Carl Hermann of the Caldwell Livestock Commission calling a higher strike price recently. This time last year 400 pound prime steers were auctioned for $1.81 per pound, the March 9th moves for the 400 pound class are now $1.97 per pound. This is around a $62 increase per calf head in my area year over year. Most auction reports are notated in the hundreds of pound per last week’s range ledger, which is now higher still:Feed prices have gone up $40 a ton in the past six months. Given that each beeve will consume around 25 pounds of feed per day, an operation such as the J.D. Simplot Company in Idaho with 150,000 head to feed just saw their daily feed bill go up $1,875 a day.
Londoners urged to avoid 'unnecessary car journeys' after mayor triggers high pollution alert -— Mayor of London Sadiq Khan has issued a high pollution alert for the U.K. capital, telling those with lung and heart problems to "avoid physical exertion" for its duration. In a statement, authorities said London was experiencing "imported pollution from the continent alongside a build-up of local emissions." The high pollution alert was issued Tuesday and also covers March 23 and 24. It is the first since August 2020. "I'm urging Londoners to look after each other by choosing to walk, cycle or take public transport, avoiding unnecessary car journeys, stopping engine idling and not burning wood or garden waste, all of which contributes to high levels of pollution," Khan said. He added that the above was "particularly important in order to protect those who are more vulnerable to high pollution." Globally, air pollution is a serious problem. The World Health Organization states that 4.2 million deaths happen each year "as a result of exposure to ambient (outdoor) air pollution." Air pollution in London has become a major talking point in recent years. Earlier this month, it was announced that Khan had asked Transport for London to consult on making the city's Ultra Low Emission Zone London-wide from 2023. The ULEZ was expanded last October to cover a quarter of London and is in operation 24 hours a day, seven days a week aside from Christmas Day. Under the ULEZ, most vehicles that don't meet a specific set of emissions standards have to pay a daily charge of £12.50 (around $16.53). The charge for non-compliance is £160, although this is cut to £80 if paid in 14 days. The ULEZ runs alongside the Congestion Charge zone, which is in central London only and costs £15 a day. London also has a Low Emission Zone, which applies to heavy vehicles over certain weights that don't meet its standards. These vehicles are not required to pay the ULEZ. Authorities have described the LEZ as covering "most of Greater London."
Spring Outlook: Drought to expand amid warmer conditions - NOAA issued its U.S. Spring Outlook today and for the second year in a row, forecasters predict prolonged, persistent drought in the West where below-average precipitation is most likely. NOAA’s Climate Prediction Center — part of the National Weather Service — is also forecasting above-average temperatures for most of the U.S. from the Desert Southwest to the East Coast and north through the Midwest to the Canadian border from April to June.“NOAA’s Spring Outlook helps build a more weather and climate ready nation by informing local decision makers and emergency managers of this spring’s hazardous weather, such as extreme drought,” said NOAA Administrator Rick Spinrad, Ph.D. “NOAA’s seasonal outlooks provide advanced warning of the conditions to come, enabling communities to make preparations that boost their resilience to these hazards.”“Severe to exceptional drought has persisted in some areas of the West since the summer of 2020 and drought has expanded to the southern Plains and Lower Mississippi Valley,” said Jon Gottschalck, chief, Operational Prediction Branch, NOAA’s Climate Prediction Center. “With nearly 60% of the continental U.S. experiencing minor to exceptional drought conditions, this is the largest drought coverage we’ve seen in the U.S. since 2013.”Short-term drought recently developed in a region stretching from North Carolina southward through parts of Florida. Dry conditions will bring an elevated risk of wildfires across the Southwest and southern Plains and north to the Central Plains, especially when high winds are present. Drought conditions in the Southwest are unlikely to improve until the late summer monsoon rainfall begins.More than half of the U.S. is predicted to experience above-average temperatures this spring, with the greatest chances in the Southern Rockies and Southern Plains. Below-average temperatures are most likely in the Pacific Northwest and southeast Alaska.Above-average precipitation is most likely in portions of the Great Lakes, Ohio Valley, mid-Atlantic and the west coast of Alaska, while below-average precipitation is forecast for portions of the Central Great Basin, Southwest, Central and Southern Rockies and Central and Southern Plains, eastward to the Central Gulf Coast.There is a minor-to-moderate flood risk throughout much of the eastern half of continental U.S., including the Southeast, Tennessee Valley, lower Mississippi Valley, Ohio Valley, and portions of the Great Lakes, upper Mississippi Valley, and middle Mississippi Valley. An above-normal ice breakup and flood potential is also present in Alaska.“Due to late fall and winter precipitation, which saturated soils and increased streamflows, major flood risk potential is expected for the Red River of the North in North Dakota and moderate flood potential for the James River in South Dakota,” said Ed Clark, director, NOAA’s National Water Center.Spring snowmelt in the western U.S. is unlikely to cause flooding.
As it enters a third year, California’s drought is strangling the farming industry - Westside Elementary opened its doors nearly a century ago here in the San Joaquin Valley, among the most productive agricultural regions on earth. As recently as 1995, nearly 500 students filled its classrooms. Now 160 students attend and enrollment is falling fast. This was where the children of farmworkers learned to read and write, often next to the children of the farm owners who employed their parents. But the farms are also vanishing, as hundreds of thousands of acres of rich soil are left unplanted each year.The hard truth here, the one that fundamentally shapes the lives of those in the valley, is that water is disappearing. So is a way of life, a core of California economic culture, and a place that provides a nation struggling under the rising rate of inflation with a quarter of its food. “This is getting progressively worse each year,” said Baldomero Hernandez, the principal of Westside Elementary, who has lived in this hot, hazy valley for more than six decades. “And it is all because of a lack of water.”California’s drought is intensifying as it enters a third year, and along with much else here in the San Joaquin, the hope that a wet end to 2021 would bring more water has disappeared, too. The same sentiment holds across much of the parched American west.After a rainy and snow-filled December, the state endured its driest start to a year in at least a century. The end-of-year storms that raised the level of state reservoirs and brought a bounty of essential snow to the Sierra Nevada and Cascade ranges are a distant memory.A survey this month found that the year’s historically dry start has resulted in a snowpack more than 60 percent below average. Not a single major reservoir is filled to its average for this time of year. The one that serves the water district here, the nation’s largest by area, is less than half full as the state’s wet season ends this month.Wind and wildfire have been more common than rain this year. Less than half an inch of rain fell one day last week on Sacramento, the capital 180 miles north of here through the valley, to break a record 66-day streak without precipitation during winter months.The whiplash has prompted the federal Central Valley Project, the vast Depression-era system of pumps, aqueducts and reservoirs that provides much of this region’s surface water, to declare a second straight year of no water deliveries. The announcement means farmers across the valley must rely on depleted groundwater supplies and what they have been able to store.Last week, Gov. Gavin Newsom (D) announced an additional $22.8 million in aid for what his office called “an immediate drought emergency.” The state, too, announced earlier this year that it would provide only 15 percent of its scheduled water deliveries, which primarily serve residential customers in Southern California. On Friday, given the withering recent weather, state water officials cut deliveries to 5 percent.
Key Colorado River reservoir has lost 4 percent of its storage capacity since 1986: report -Lake Powell, a key reservoir in the Colorado River Basin, has lost 4 percent of its storage capacity since 1986, according to a new report from the U.S. Geological Survey (USGS) and the Bureau of Reclamation.The loss is largely due to a buildup of sediments that have been continuously transported by the Colorado and San Juan rivers into the reservoir, according to the report. Monday’s storage capacity update follows previous such evaluations from 1986 and 1963, representing a 6.79 percent loss since the earliest survey.The Colorado River system — which includes both the nation’s largest reservoir, Lake Mead, and Lake Powell, the second largest — provides water to approximately 40 million people, irrigates 5.5 million acres of agriculture and has the capacity to produce more than 4,200 megawatts of electricity from hydropower.“The Colorado River system faces multiple challenges, including the effects of a 22-year-long drought and the increased impacts of climate change,” Assistant Interior Secretary for Water and Science Tanya Trujillo said in a statement.Lake Powell is located behind Glen Canyon Dam, extending just south of the Utah-Arizona border along the southern edge of Grand Staircase Escalante National Monument.Its total storage capacity is now 25,160,000 acre-feet, according to surveys conducted by the USGS in 2017 and 2018.That total represents a decrease of 1,833,000 acre-feet, or just under 7 percent, from 1963 capacity, and a decline of 1,049,000 acre-feet, or 4 percent, from 1986 capacity, the report found. The average annual loss from 1963 to 2018 amounts to about 33,270 acre-feet per year. While Lake Powell began steadily filling with water in 1963 and eventually became a popular destination for recreation, the reservoir has been facing serious challenges since the early 2000s, the authors warned in the report’s abstract. “Severe drought and increases in water demand have resulted in a significant drop in reservoir elevation and stored water, prompting a heightened level of interest in the current state and future of Lake Powell,” they added.
500 million people in Africa remain 'water insecure': UN report - Some 500 million people across 19 African nations remain water insecure, according to the first-ever United Nations assessment of water security across the continent. The assessment, released on Monday, indicated that apart from Egypt, all countries in Africa had water security scores below 70 — on a security scale of 0 to 100 — while only 13 of the 54 nations reached a modest level of security in recent years. Nineteen African nations had water security levels below the U.N.’s threshold of 45, with Somalia, Chad and Niger faring the worst, according to the report, published on the eve of World Water Day, by the U.N. University’s Canada-based Institute for Water, Environment and Health. Despite having made commitments regarding water security improvements as part of the U.N.’s Sustainable Development Goals in 2015, just 29 African nations have made some progress over the past three to five years, while 25 have made none at all, the authors found. The U.N. defines water security as a population’s capacity to ensure access to sufficient amounts of water deemed suitable “for sustaining livelihoods, human well-being, and socio-economic development, for ensuring protection against water-borne pollution and water-related disasters, and for preserving ecosystems in a climate of peace and political stability.” “Overall levels of water security in Africa are low,” lead author Grace Oluwasanya, a water scientist at the institute, said in a statement. “Not a single country let alone a subregion have at present achieved a state that can be seen as ‘model’ or even ‘effective’ stage of water security.” While the authors acknowledged that the assessment’s conclusions are limited due to the “very poor” data availability on water security-related issues, like access to drinking water and sanitation, they said that the provides some “preliminary but obvious conclusions.” The countries identified as doing the best thus far were Egypt, Botswana, Gabon, Mauritius and Tunisia, but even these nations only achieved modest absolute levels of water security, the authors warned. To draw their conclusions, the authors relied on 10 indicators to quantify the water security data, according to the report. The first of these indicators was access to drinking water, which ranged from 99 percent in Egypt to 37 percent in the Central African Republic. The continent’s average basic drinking water service is 71 percent, which leaves “behind some 29 percent of the total population,” or 353 million people, the authors found. The second indicator was access to sanitation, for which Seychelles scored the best at 100 percent and Chad and Ethiopia were most challenged, with under 20 percent access. Third was access to hygiene, such as hand-washing, which was greatest in the North African region — an average of 67 percent — and worst in West Africa, where Rwanda and Liberia had less than 10 percent access and where Chad and the Central African Republic suffered from the highest diarrhea-related deaths, according to the report. A fourth indicator was per capita water available, which in general was the highest in Central Africa, while half of North African countries were deemed “absolutely water scarce.” West, central and southern African countries were also experiencing a decline in water availability, due to their population growth, the authors found. Water use efficiency — lowest in North Africa and highest in Central Africa — was the fifth indicator, with improvements in Africa as a whole occurring largely due to initiatives in Tunisia, Gambia, Burkina Faso, Rwanda and Uganda. The sixth indicator was water infrastructure, which the authors deemed best in the southern Africa sub-region, and worst in east Africa. Average water storage capacity rose by only 3 percent across the entire continent over the past five years, according to the report.
Destructive tornadoes hit Texas and Oklahoma, U.S. (videos) Several destructive tornadoes ripped through parts of Texas and Oklahoma on March 21 and 22, 2022, during a violent severe weather outbreak that's now shifting east. One person was killed and more than a dozen injured. The Storm Prediction Center has so far confirmed 19 tornadoes in Texas and one on the Texas - Oklahoma border on March 21. Severe weather outbreak is shifting across the Lower Mississippi Valley and the central Gulf Coast States today, March 22, with some threats continuing into tonight. Tornadoes, some of which should be strong, and potentially widespread damaging winds will be the most impactful hazards, NWS warns. Excessive rainfall with training storm cells will bring the threat for flash, urban, and river flooding.1Several tornadoes were reported along the Interstate 35 corridor on March 21, particularly in the Austin suburbs of Round Rock and Elgin, and close to Dallas-Fort Worth. Two unconfirmed tornadoes caused damage in the Lake Texoma area of northern Texas and southern Oklahoma.2 The first significant tornado touched down just after 16:00 LT near Jacksboro, northwest of Fort Worth, Texas.3 It ripped through Jacksboro High School and caused some damage to the elementary school.The extent of debris closed several roads and a local hospital. Several other buildings and at least 60 homes were damaged.City manager Bert Cunningham said the worst damage was east of the town, with as many as four entrapments reported. Four people suffered minor injuries, Emergency Manager Kelly McNabb told the Associated Press.Grayson County Office of Emergency Management Director Sarah Somers said a 73-year-old woman died when the tornado hit the community of Sherwood Shores, TX.2 Ten other storm-related injuries have been reported in the county about 145 km (90 miles) north of Dallas and near the state’s border with Oklahoma.Another tornado touched down near Round Rock, TX - one of the worst affected areas by a violent outburst of severe weather yesterday. The twister was caught on several local television cameras, including the KVUE Kalahari camera which took a direct hit:The tornado turned multiple cars, destroyed roofs of numerous homes and businesses.Powerlines were downed east of Austin and at least one home was destroyed near Elgin. Local media reported three injuries and three rescued by the city's police chief.
Large tornado hits New Orleans, causing extensive damage, Louisiana (videos) A destructive wedge tornado ripped through parts of New Orleans, Louisiana Tuesday night, March 22, 2022, causing extensive damage, killing at least one person, and leaving several others injured. This raised the number of fatalities related to the severe weather outbreak affecting the Deep South over the past few days to 2. Severe storms with the potential for damaging winds and brief tornadoes can be expected across the Southeast today. Strong to severe storms will be possible into the Ohio Valley and southern Mid-Atlantic. Some storms may produce locally heavy rain and flash flooding.The tornado touched down at approximately 19:35 CDT in a New Orleans suburb and then moved east across the Mississippi River into the Lower 9th Ward of New Orleans and parts of St. Bernard Parish before moving northeast. It was on the ground for about 15 minutes.St. Bernard Parish appears to have taken the brunt of the storm. This is where the fatality and injuries were reported but officials are yet to give details.1The New Orleans Fire Department has requested a major EMS response following the tornado. The damage was said to be significant in parts of Lower Ninth Ward and nearby suburb Arabi.2A Fox 8 New Orleans report from the area shows immense structural damage, overturned cars, and downed power lines.The tornado and the associated storm were a part of the same system that hit parts of Texas and other south-central states this week, leaving at least 1 fatality and more than a dozen people injured.2"The same storm system which brought widespread severe weather and heavy rainfall the past couple of days across the Deep South will continue into the Eastern U.S. today, although the severe and flash flood threat should wane somewhat as the environment becomes less favorable," NWS forecaster Santorelli noted on March 23.3 Even still, heavy rainfall is possible along the front across the Southeast and Mid-Atlantic today, with WPC highlighting this with a marginal to slight risk for excessive rain/flash flooding.
New Orleans multivortex tornado was strongest on record to hit city - The deadly and destructive tornado that struck eastern New Orleans on Tuesday night was confirmed as an EF3 on the 0 to 5 Enhanced Fujita scale for tornado intensity, the National Weather Service reported Thursday. Its peak winds reached 160 mph, making it the strongest tornado to strike the city on record. The tornado was on the ground for 11.5 miles, between 7:21 and 7:38 p.m. local time, the Weather Service’s damage survey determined. It reached a maximum width of 320 yards. The twister produced its most severe damage near Arabi in St. Bernard Parish, La. where one person died and at least two people were injured. “It was a very narrow, intense tornado with two areas of concentrated EF3 damage,” the Weather Service wrote. It described one house “swept off its raised foundation with all walls and the roof destroyed” and another that held together but was “shifted about 50 yards to the north and rotated about 90 degrees.” A tornado threw a house 30 feet. A teen was rescued from the rubble. The strength of the tornado’s winds surpassed the EF3 that struck just a few miles to the north of Arabi on Feb. 2, 2017, previously New Orleans’ strongest on record. That tornado, which damaged hundreds of homes and injured dozens of people, had peak winds of 150 mph. Tuesday’s tornado appeared to contain multiple vortexes, with at least one additional funnel orbiting around a primary wedge-shaped cone. In the wake of the tornado, many took to social media or to websites to learn more about “multivortex.” It’s exactly what it sounds like — a tornado with smaller whirls, or vortexes, within it. There’s an age-old expression in meteorology: “Spin begets spin.” Large, rotating low-pressure systems tend to have smaller eddies of low pressure within them, and the same can be true with powerful tornadoes. Advertisement The multivortex nature of some tornadoes is the reason that some of the damage left behind is erratic, irregular and seemingly random. It’s because of the compounding effects of wind. If you have a 90 mph “subvortex” rotating around a 70 mph “main vortex,” a narrow swath will get a double-whammy, 160 mph wind. Conversely, someone in a sweet spot where the subvortex’s winds are opposing those of the main funnel might see winds of 20 or 30 mph. That’s why one house may be obliterated with a neighboring one undamaged.
150 homes significantly damaged, 1 killed, but Arabi residents vow to endure after tornado - Alyssa Wineski stood at her kitchen island Wednesday morning, the sun beaming down on her from where the ceiling and southern wall of her Arabi home used to be. But Wineski knew that she and her family had made it through the powerful tornado that tore through their Benjamin Street neighborhood Tuesday night with the thing that mattered most: their lives. “Though everything seems to be falling apart and we have no roof and our things are destroyed, I'm so grateful to be alive,” she said. “Because my husband and my son and I barely made it to safety, we lost a friend next door ... so, we're just happy to be alive.” That friend, Connor Lambert, a 25-year-old who died of multiple blunt-force injuries when his house was obliterated, was the one confirmed death during the EF3 tornado that cut Arabi in two before crossing the water and plowing through New Orleans East. Eight others were injured enough to require hospital attention, Gov. John Bel Edwards said. The winds of up to 165 mph left a trough of destruction that residents could only begin to grasp when the sun rose up Wednesday: trees and utility poles knocked over, homes with their roofs torn off, overturned cars and school buses. State Fire Marshal Butch Browning estimated that more than 150 homes along a two-mile swath had suffered significant or catastrophic damage. “When you see it in the light of day ... ” Friscoville resident Michelle O’Neill said, her voice trailing off. “There are no words.”“It’s just stuff,” O’Neill said of her losses. “It can be replaced.” The push and pull of disaster and recovery has become all too common in a parish where some of the homes still bear the spray painted “X” mark of Hurricane Katrina. “To see our community that’s been destroyed so many times before,” Wineski said. “We’re all people who have gone through Katrina — we went through the flood in Denham Springs — we’ve all been through horrible events but this is not anything we thought we’d ever experience in our entire lives.”
Warming oceans will significantly alter how sound travels underwater -- Climate change will significantly alter how sound travels underwater, potentially affecting natural soundscapes as well as accentuating human-generated noise, according to a new global study that identified future ocean "acoustic hotspots." These changes to ocean soundscapes could impact essential activities of marine life. In warmer water, sound waves propagate faster and last longer before dying away. "We calculated the effects of temperature, depth and salinity based on public data to model the soundscape of the future," said Alice Affatati, an bioacoustics researcher at the Memorial University of Newfoundland and Labrador in St. John's, Canada, and lead author of the new study, published today in Earth's Future, AGU's journal for interdisciplinary research on the past, present and future of our planet and its inhabitants. It is the first global-scale estimate of ocean sound speed linked to future climate. Two hotspots, in the Greenland Sea and a patch of the northwestern Atlantic Ocean east of Newfoundland, can expect the most change at 50 and 500 meter depths, the new study projected. The average speed of sound is likely to increase by more than 1.5%, or approximately 25 meters per second (55 miles per hour) in these waters from the surface to depths of 500 meters (1,640 feet), by the end of the century, given continued high greenhouse gas emissions (RCP8.5). "The major impact is expected in the Arctic, where we know already there is amplification of the effects of climate change now. Not all the Arctic, but one specific part where all factors play together to give a signal that, according to the model predictions, overcomes the uncertainty of the model itself," said author Stefano Salon, a researcher at the National Institute of Oceanography and Applied Geophysics in Trieste, Italy. The ocean soundscape is a cacophony of vibrations produced by living organisms, natural phenomena like waves and cracking ice, and ship traffic and resource extraction. Sound speed at 50 meters depth ranges from 1,450 meters per second in the polar regions to 1,520 meters per second in equatorial waters (3,243 to 3,400 miles per hour, respectively). Many marine animals use sound to communicate with each other and navigate their underwater world. Changing the sound speed can impact their ability to feed, fight, find mates, avoid predators and migrate, the authors said.
Scientists Shocked as Polar Temperatures Soar 50 to 90 Degrees Above Normal - Alaska Native News -Scientists expressed shock and alarm this weekend amid extreme high temperatures near both of the Earth’s poles—the latest signs of the accelerating planetary climate emergency.Temperatures in parts of Antarctica were 50°F-90°F above normal in recent days, while earlier this week the mercury soared to over 50°F higher than average—close to the freezing mark—in areas of the Arctic.Stefano Di Battista, an Antarctic climatologist, tweeted that such record-shattering heat near the South Pole was “unthinkable” and “impossible.”“Antarctic climatology has been rewritten,” di Battista wrote.The joint French-Italian Concordia research station in eastern Antarctica recorded an all-time high of 10°F on Friday. In contrast, high temperatures at the station this time in March average below -50°F.Jonathan Wille, a researcher studying polar meteorology at Université Grenoble Alpes in France,told The Washington Post that “this event is completely unprecedented and upended our expectations about the Antarctic climate system.”“This is when temperatures should be rapidly falling since the summer solstice in December,” Wille tweeted. “This is a Pacific Northwest 2021 heatwave kind of event,” he added, referring to the record-breaking event in which parts of Canada topped 120°F for the first time in recorded history. “Never supposed to happen.”Walt Meier, a senior research scientist at the National Snow and Ice Data Center in Boulder, Colorado, told USA Today that “you don’t see the North and the South [poles] both melting at the same time” because “they are opposite seasons.”“It’s definitely an unusual occurrence,” he added.
Large ice shelf thought to be stable in East Antarctica collapses - A massive ice shelf in eastern Antartica collapsed, scientists said on Friday, marking the first time an ice shelf has done so in the region.The 460-square mile wide ice shelf, which was roughly the size of New York City and helped keep the Conger and Glenzer glaciers from warmer water, collapsed between March 14 and March 16, Woods Hole Oceanographic Institute ice scientist Catherine Walker told The Associated Press.University of Minnesota ice scientist Peter Neff said the collapse was worrying because eastern Antartica holds five times more ice than western Antartica, and if the whole region were to melt, it could raise sea levels across the globe more than 160 feet, according to the AP.Scientists had long thought that the area had not been impacted heavily by climate change and was stable, according to the wire service, but Neff said the collapse of the ice shelf brought that belief into question.The Glenzer-Conger ice shelf has been shrinking since the 1970s, Neff noted. Walker added that it rapidly began losing ice in 2020, according to the AP.“The Glenzer-Conger ice shelf presumably had been there for thousands of years, and it’s not ever going to be there again,”
Intense earthquake swarm under São Jorge volcano, Azores - An intense earthquake swarm is shaking the Manadas volcanic fissure system in the NW part of the Sao Jorge Island (population 8 200), Azores, Portugal. The last eruption of this volcano took place in 1808. According to the Center for Seismovolcanic Information and Surveillance of the Azores (CIVISA), the swarm started at 17:19 LT (16:19 UTC) on March 19. Three earthquakes were registered over the next 2 minutes, with magnitudes ranging from 2.8 to 2.9. The first earthquakes were felt with maximum intensity IV/V (Modified Mercalli Scale) in the parish of Manadas, with intensity IV in Urzelina and Norte Grande, and with intensity III in Calheta.1 Over the next 24 hours, more than 700 earthquakes were recorded in the region. All had low magnitudes and only 48 were felt, CIVISA said. Head of CIVISA, Rui Marques, said that Manadas volcanic fissure system, which coincides with the main volcanic cones on the island, is still active and now registers a release of energy that was not common in recent years.2 "All the earthquakes felt in São Jorge since Saturday are of tectonic origin," Marques said, adding that the largest earthquake was M3.2 at 01:43 UTC on March 20. The quake was felt by the populations of São Jorge and the island of Pico. "We are still evaluating the behavioral pattern of this seismic crisis, which is now in a phase of lower energy release," Marques said. The seismic events are now progressing toward the village of Velas. Image credit: EMSC "The current seismic swarm makes many remember the earthquake swarms that preceded the 2021 eruption on La Palma in the neighboring Canary Islands," said Dr. Tom Pfeiffer of the VolcanoDiscovery.3 Geological summary The linear São Jorge Island is 54 km (33 miles) long and only 6 km (3.7 miles) wide. It was formed by fissure eruptions beginning in the eastern part of the island. The western two-thirds of dominantly basaltic São Jorge contains youthful, fissure-fed lava flows resembling those on neighboring Pico Island. Lava effused from three locations above the south-central coast during 1580, producing flows that reached the ocean. In 1808 a series of explosions took place from vents along the south-central crest of the island; one of the vents produced a lava flow that reached the southern coast.
Phreatomagmatic eruption at Taal volcano, Alert Level raised to 3, Philippines -The Philippine Institute of Volcanology and Seismology (PHIVOLS) has raised the alert status of Taal volcano from Alert Level 2 (increasing unrest) to Alert Level 3 (magmatic unrest) after a phreatomagmatic eruption at 23:22 UTC on March 25, 2022 (07:22 LT, March 26).The eruption was short-lived, followed by a nearly continuous phreatomagmatic activity that generated plumes 1.5 m (4 900 feet) above the crater, accompanied by volcanic earthquakes and infrasound signals.According to the Tokyo VAAC, volcanic ash was continuously observed in satellite imagery rising up to 3.3 km (11 000 feet) a.s.l. at 05:20 UTC on March 26, moving W at 28 km/h (17 mph).In view of the above, DOST-PHIVOLCS raised the Taal's alert status from Alert Level 2 to Alert Level 3."This means that there is magmatic intrusion at the Main Crater that may further drive succeeding eruptions," the Institute said.PHIVOLCS strongly recommends Taal Volcano Island and high-risk barangays of Bilibinwang and Banyaga, Agoncillo and Boso-boso, Gulod and eastern Bugaan East, Laurel, Batangas Province be evacuated due to the possible hazards of pyroclastic density currents and volcanic tsunami should stronger eruptions subsequently occur.The public is reminded that the entire Taal Volcano Island is a Permanent Danger Zone (PDZ), and entry into the island as well as high-risk barangays of Agoncillo and Laurel must be prohibited.
Team finds that recent Tonga volcano eruption caused significant space plasma disturbances on a global scale -The recent eruption of Tonga's Hunga Tonga-Hunga Ha'apai volcano, at 04:14:45 UT on Jan. 15, was recently confirmed to have launched far-reaching, massive global disturbances in the Earth's atmosphere. Using data recorded by more than 5,000 Global Navigation Satellite System (GNSS) ground receivers located around the globe, MIT Haystack Observatory scientists and their international partners from the Arctic University of Norway have observed substantial evidence of eruption-generated atmospheric waves and their ionospheric imprints 300 kilometers above the Earth's surface over an extended period. These atmospheric waves were active for at least four days after the eruption and circled the globe three times. Ionospheric disturbances passed over the United States six times, at first from west to east and later in reverse. This volcanic event was extraordinarily powerful, releasing energy equivalent to 1,000 atomic bombs of the size deployed in 1945. Scientists have known that explosive volcanic eruptions and earthquakes can trigger a series of atmospheric pressure waves, including acoustic waves, and that they can perturb the upper atmosphere a few hundred kilometers above the epicenter. When over the ocean, they can trigger tsunami waves, and therefore upper-atmospheric disturbances. Results from this Tonga eruption have surprised this international team, particularly in their geographic extent and multiple-day durations. These discoveries ultimately suggest new ways in which the atmospheric waves and the global ionosphere are connected. A new study reporting the results, led by researchers at MIT Haystack Observatory and the Arctic University of Norway, was published March 23 in the peer-reviewed journal Frontiers in Astronomy and Space Sciences. The authors believe the disturbances to be an effect of Lamb waves; these waves, named after mathematician Horace Lamb, travel at the speed of sound globally without much reduction in amplitude. Although they are located predominantly near Earth's surface, these waves can exchange energy with the ionosphere through complex pathways. As stated in the new paper, "prevailing Lamb waves have been reported before as atmospheric responses to the Krakatoa eruption in 1883 and other geohazards. This study provides substantial first evidence of their long-duration imprints up in the global ionosphere."
Moderately strong M1.4 solar flare erupts from AR 2974 - (video, graphics) A moderately strong solar flare measuring M1.4 at its peak erupted from Active Region 2974 at 05:26 UTC on March 25, 2022. The event started at 05:02 and ended at 05:50 UTC. The eruption was associated with a Type II Radio emission at 05:14 UTC, with an estimated velocity of 959 km/s. Type II emissions occur in association with eruptions on the Sun and typically indicate a coronal mass ejection is associated with a flare event.Additionally, a Type IV Radio Emission was registered at 05:22 UTC. Type IV emissions occur in association with major eruptions on the Sun and are typically associated with strong coronal mass ejections and solar radiation storms.The eruption caused a short-lived R1 Radio Blackout from eastern Africa and the Middle East to Japan and Australia. Analysis of this event is still in progress. There is a possibility of a glancing blow around March 28.
Stratospheric sulfur after the Chicxulub impact may have extended climate change, contributing to mass extinction - While the popular Netflix movie "Don't Look Up" has raised public consciousness to the potential catastrophic effects of asteroid impact to planet Earth, new research sheds light on how the Chicxulub impact 66 million years ago resulted in extinction of 75 percent of animals on Earth, including the dinosaurs. A large asteroid, approximately 10 kilometers in diameter, struck Mexico's northern Yucatán peninsula, an impact that ejected material roughly equivalent to an area the size of Connecticut and more than twice as tall as Mt. Everest, redistributing it over the globe. "The impact blast and fallout ignited widespread fires, which together with rock dust, soot and volatiles ejected from the crater, blotted out the sun globally in an impact winter that may have lasted years, resulting in the extinction," says Christopher Junium, an associate professor of Earth and Environmental sciences who leads the Geobiology, Astrobiology, Paleoclimate, Paleoceanography research group in the College of Arts and Sciences at Syracuse University. Scientists have long implicated fine particles of sulfate in the stratosphere as the primary agent of massive climate change and resulting mass extinction, but were uncertain as to the fate of the sulfur. "There has been uncertainty regarding how much reached the stratosphere where its effects on climate would have been greatly magnified," says Junium. Outcrop location containing the K-Pg boundary event deposits in Rosebud, Texas along Darting Minnow Creek, a tributary of the Brazos River. Credit: James Witts In research published this month in Proceedings of the National Academy of Sciences, a team from Syracuse University, the University of St Andrews in Scotland, the University of Bristol in England and Texas A&M University links high levels of stratospheric sulfur to the impact and its location, which was rich in the sulfate mineral gypsum. .
Companies must disclose emissions information under new SEC plan — Companies will need to reveal detailed information about their greenhouse gas pollution under a new U.S. Securities and Exchange Commission plan, portending a major shift in how corporations must show they are dealing with climate change. For the first time ever, the agency plans to require businesses to outline the risks a warming planet poses to their operations when they file registration statements, annual reports or other documents. Some large companies will have to provide information on emissions they don’t make themselves, but come from other firms in their supply chain. The proposal released on Monday sets up a major clash with industry lobbyists and Republican politicians who argue the regulations are outside the SEC’s jurisdiction. Liberal lawmakers, environmental advocates and the SEC, however, say mom-and-pop investors need the information to make informed decisions. “Over the generations, the SEC has stepped in when there’s significant need for the disclosure of information relevant to investors’ decisions,” SEC Chair Gary Gensler said in a statement. “Today’s proposal would help issuers more efficiently and effectively disclose these risks.” The SEC would also require that auditors or other experts review the climate disclosures for large- and medium-sized companies. The requirements would be phased in over time. Climate activists will likely cheer the agency’s decision to require larger companies to disclose some of their so-called Scope 3 emissions, which are generated by other firms in their supply chain or customers using their products. That information, which business groups say is very hard to quantify, wouldn’t be subject to an audit. Some companies, including oil giant Exxon Mobil Corp., have already begun disclosing those emissions voluntarily. Hester Peirce, who opposed the plan as the agency’s only Republican commissioner, said the proposal would ultimately end up costing investors. “Society is in big trouble if we are looking to SEC lawyers, accountants, and economists to dictate how companies should address climate change,” said Peirce, who in a symbolic protest turned off her camera during the virtual meeting, saying that she was trying to reduce her carbon footprint. The release of the proposal follows months of internal debate among the agency’s Democrats over how far to extend the disclosure requirements. Ultimately, the regulator settled on using the longstanding but vague concept of “materiality” to determine what information must be disclosed, a term that the agency hopes could make the rule less vulnerable to legal challenges.
Occidental plans 70 plants to capture carbon from air by 2035 — Occidental Petroleum Corp., the shale giant backed by Warren Buffett, plans to build 70 carbon capture facilities around the world by 2035 that will each remove as much as 1 million tons per year of the greenhouse gas directly from the atmosphere. Construction on the first, $1 billion so-called direct air capture plant in the Permian Basin of West Texas is expected to start in the second half of this year, with its startup slated for late 2024, Houston-based Occidental said in a presentation to investors Wednesday. Mounting pressure from investors has led several major oil producers to lay out plans to help slow down climate change by offsetting some of the emissions from their operations and the fossil fuels they produce with projects like wind farms and carbon capture plants. When fully built, the plant billed as the world’s largest DAC project, will remove the equivalent of the emissions from about 215,000 cars from the atmosphere every year, Occidental said. Occidental also is investing $100 million this year to develop three carbon sequestration hubs by 2025. The company said it’s on track to secure more than 100,000 net acres this year for these sequestration hubs, including for multiple sequestration sites on the Gulf Coast. Chief Executive Officer Vicki Hollub told investors Wednesday that she expects the company’s low carbon business will ultimately become as big as its legacy chemicals business.
Australian high school students denounce major parties at climate rallies - Yesterday, thousands of Australian school students, along with workers and other young people attended rallies across the country to protest the inaction of governments on climate change. More than 20 School Strike 4 Climate events were held in Australia yesterday, as part of a global youth demonstration with rallies in more than 600 locations worldwide. Some 2,000 took part in Sydney, with similar numbers in Melbourne. Several hundred attended in the regional working-class city of Newcastle in New South Wales. The young people expressed grave concerns, about not just climate change, but the ongoing COVID-19 pandemic, the growing threat of nuclear war and the overall social crisis caused by capitalism. By contrast, the official speakers at the rallies raised none of these broader political questions. Instead, the organisers attempted to channel the protesters’ anger and frustration into criticisms of Prime Minister Scott Morrison as an individual. Futile appeals to Morrison were combined with the promotion of illusions in Labor and the Greens. This was sharply expressed by a last minute change of venue for the Sydney demonstration to the prime minister’s residence, Kirribilli House. .
Latinos have an air pollution crisis — we demand cleaner cars -For too many Latino communities in the United States, exposure to dangerous air pollutants represents a daily threat to our health.While Latinos create proportionately less pollution than white people, Latino children are roughly three times more likely than non-Hispanic white children to live in a county where air pollution levels exceed federal air quality standards. Nearly one-third of Latino children live in counties where hazardous air pollutant concentrations exceed a 1-in-10,000 cancer risk level. To tackle this air pollution crisis in our communities, we need strong clean cars standards that will cut dangerous tailpipe pollution that will reduce exposure to dangerous air pollutants in our communities. At the same time, we need investments in electric vehicle infrastructure to lower our dependence on fossil fuels, save energy, as well as support economic growth.In the first year of the Biden administration, we have made key progress toward these aims. Last month, President Biden announceda commitment from automakers to invest in producing electric vehicles, which could account for up to half of U.S. sales by 2030. In December, the Environmental Protection Agency (EPA) announced its final rulemaking to create stronger standards for cars that are manufactured from 2022 through 2026.. In February, the Biden administration announced a one-two punch of electric vehicle (EV) infrastructure implementation that will streamline the transition to clean cars, and that gives teeth to existing White House commitment to build out a network of 500,000 public EV chargers nationwide.The Departments of Transportation and Energy announced that they’ll make $5 billion available over the next five years to help states create a network of electric vehicle charging stations along designated Alternative Fuel Corridors. These actions represent an important move toward making both EV charging and new manufacturing jobs accessible to all, and will address a key road bump: A 2020 survey conducted by Consumer Reports found that the No. 1 concern holding people back from choosing an electric vehicle is access to public charging stations. This survey was not segmented by race, but given that charging deserts disproportionally impact majority non-white and lower-income neighborhoods, we can safely assume that lack of access to public charging infrastructure is a major concern for an even higher proportion for drivers who are people of color. Our communities urgently need ongoing commitment to equitable access to clean cars, infrastructure and jobs. We owe it to our communities to stay engaged and keep applying pressure to the EPA’s next round of rulemaking around clean cars and electric vehicle infrastructure needed to create just transition to clean cars. This hands-on-the-wheel advocacy will make for a smooth ride as the U.S. drives toward achieving energy and climate justice for all.
How the World’s Richest People Are Driving Global Warming --It’s the bedrock idea underpinning global climate politics: Countries that got rich by spewing greenhouse gasses have a responsibility to cut emissions faster than those that didn’t while putting up money to help poor nations adapt. This framework made sense at the dawn of climate diplomacy. Back in 1990, almost two-thirds of all disparities in emissions could be explained by national rankings of pollution. But after more than three decades of rising income inequality worldwide, what if gaps between nation states are no longer the best way to understand the problem? There’s growing evidence that the inequality between rich and poor people’s emissions within countries now overwhelms the country-to-country disparities. In other words: High emitters have more in common across international boundaries, no matter where they call home. Analysts from the World Inequality Lab, which is led by the Paris School of Economics and University of California at Berkeley recently put forward an alternative assessment focusing more on varying measures of consumer income than gross domestic product. After a generation of poorly distributed gains from globalization, it turns out that personal wealth does more than national wealth to explain the sources of emissions. Climate progress means first curbing the carbon output of the wealthier among us.Researchers at WIL drew on a range of data, from diet to car ownership, stock market investments and global trade to estimate individual carbon output. The top 10% of polluters – about 770 million people, roughly the population of Europe – are the climate equivalent of the world’s wealthiest decile who earn more than $38,000 a year, according to Oxfam. The trend is clear: Emissions generally rise with wealth. The richest 1%— the more than 60 million people earning $109,000 a year—are by far the fastest-growing source of emissions. They live all over the world, with about 37% in the U.S. and more than 4.5% each in Brazil and China. Far higher up the income distribution, the emissions increase exponentially. The single-most polluting asset, a superyacht, saw a 77% surge in sales last year. An 11-minute ride to space, like the one taken by Amazon founder Jeff Bezos, is responsible for more carbon per passenger than the lifetime emissions of any one of the world’s poorest billion people, according to WIL. One-tenth of all flights departing from France in 2019 were on private aircraft. In just four hours, those individually-owned planes generate as much carbon dioxide as an average person in the European Union emits all year. Four-fifths of the people on the planet never get on an airplane in their entire lifetime, according to market analysis by Boeing.
Congress earmarks climate grants for rich, white areas --Members of Congress used earmarks to steer millions of dollars to affluent, largely white communities through a federal climate-mitigation program that is supposed to prioritize helping disadvantaged communities, an E&E News analysis shows. The earmarks, included in the $1.5 trillion fiscal 2022 spending plan signed by President Biden last week, direct spending in a Federal Emergency Management Agency grant program that FEMA recently redesigned to stress environmental justice. FEMA is aiming to give more of its climate-mitigation grants to underserved and at-risk communities, saying they are disproportionately affected by intensifying storms, heat waves, flooding and other effects of climate change. Advertisement But lawmakers directed FEMA to give millions of dollars in grants to some of the richest and whitest communities in their districts. Earmarks were included in the annual spending package for the first time since 2011. Rep. Seth Moulton (D-Mass.) got $2.25 million for Newburyport to rebuild a coastal retaining wall that protects the city’s downtown and a waterfront boardwalk. A city of 18,000 on Massachusetts’ exclusive North Shore, Newburyport has a median household income of $111,000 and a population that is 93 percent non-Hispanic white, according to census figures. Rep. Vern Buchanan (R-Fla.) got $350,000 for Longboat Key to elevate a flood-prone roadway. The town of 7,500 people on the Gulf Coast south of Tampa has a median household income of $108,000 and a population that is 95 percent white. The median household income nationwide is $65,000 and the U.S. population is 60 percent white. Press officers for both Moulton and Buchanan did not respond to a request for comment. Other lawmakers defended their earmarks for affluent, largely white towns, saying the funding will help some disadvantaged areas. Rep. David Price (D-N.C.) said in a statement that his $2.175 million earmark for Wake Forest to repair a reservoir dam will protect both the town and downstream communities from flooding. Wake Forest, a town of 48,000 people in eastern North Carolina, has a median household income of $100,000 and is 70 percent white, though the downstream communities are less affluent and more diverse. Lawmakers included a total of 68 earmarks worth $154 million for FEMA’s climate-grant program in the Homeland Security spending bill. The program, called Building Resilient Infrastructure and Communities, or BRIC, has $1 billion to give this year to states and localities for projects that build long-term resilience to hazards including flooding, wildfire and storms. The BRIC program is highly competitive and central to the federal effort to address climate change, which raises questions about the fairness of earmarked projects. FEMA received applications this year seeking a total of $4.2 billion in BRIC grants — more than four times as much money as the agency has available to distribute. Earmarks mean BRIC “is not a competitive program anymore, so you’re not rewarding projects based on their merit and the criteria that are established every year,” said Carlos Martín, an expert on disaster policy at the Brookings Institution. “Places that don’t need the resources and are exerting power on their congressional delegation,” Martín said of affluent communities that won BRIC earmarks. Laurie Schoeman, national director for resilience and disaster recovery at Enterprise Community Partners, said the earmark process often benefits well-resourced communities that have the political clout to influence lawmakers. “A lot of communities that get more earmarks are often communities that have higher capacity to administer and apply for program funding,” Schoeman said. FEMA revised its selection process for BRIC grants last year after the agency faced criticism for giving most of the money in 2021 to affluent coastal states such as California, Maryland and New Jersey. The largest single grant last year was a $50 million award to Menlo Park, Calif., a rich Silicon Valley city that is home to Facebook headquarters. The new process, effective this year, adjusts the scoring system that ranks grant applicants and gives points to projects that benefit disadvantaged communities. FEMA has a broad definition of a “disadvantaged community” that includes not just low-income areas but also areas with high housing, energy or transportation costs, and areas facing disproportionate impacts from climate change.
What happens to used solar panels? DOE wants to know - The Department of Energy released an action plan last week intended to help the United States launch a comprehensive system for handling and recycling solar panels, which some studies have suggested could make up a tenth of all electronic waste in coming decades. The Solar Energy Technologies Office (SETO) announced a new target to bring the cost of recycling solar panels to about $3 per panel by 2030, a threshold that would make the practice economic for the first time.That follows an earlier DOE goal to try to halve the price of solar power by decade’s end. By 2035, solar could contribute 37 to 42 percent of the grid’s power, in line with the Biden administration’s goal of a carbon-free grid by that year, according to the office, which is part of DOE’s Office of Energy Efficiency and Renewable Energy (EERE) (Energywire, Sept. 9, 2021).The new recycling target would mean a cost reduction of “more than half,” DOE’s solar researchers estimated. It also would make recycling roughly as economic as sending old panels to landfills, a process that costs roughly $1 to $5 per panel before transportation costs are factored in, according to previous research from the National Renewable Energy Laboratory (NREL). “As we accelerate deployment of photovoltaic systems, we must also recognize the pressing need to address end-of-life for the materials in a sustainable way,” said Kelly Speakes-Backman, EERE’s principal deputy assistant secretary, in a statement. “We are committed to ensuring that the recovery, reuse, recycling, and disposal of these systems and their components are accessible, low-cost and have minimal environmental impact.” To reach the target, the solar office is aiming to fill a knowledge gap about what happens to solar panels after they reach the end of their useful lives. “Little is known about the actual state and handling of [photovoltaic end-of-life panels],” including the amount of panel waste being generated, how owners go about decommissioning their panels, who handles the waste and how transportation works, DOE’s plan said. At least one thing is clear, though, for the solar industry: Figuring out how to recycle old panels — or reuse parts like the precious metals often contained in them — is a looming challenge. By the end of this decade, about 8 million tons of solar modules could arrive in landfills globally, according to an NREL study published in 2020. By 2050, panels could make up 10 percent of all electronic waste, according to the lab. That level of waste could undermine solar’s “green” credibility and squander an opportunity to repurpose metals that could be reused in as many as 2 billion new panels, the study found (Energywire, July 20, 2020).
Biden Administration Drafting Order to Invoke Defense Production Act for Green Energy Storage Technology -THE BIDEN ADMINISTRATION is drafting an executive order invoking the Defense Production Act to alleviate shortages of key minerals needed for the technology to store clean energy. The act, which would bolster the manufacturing capacity of electric vehicle producers in particular, indicates that the administration is open to using executive power to achieve progressive policy goals as Congress remains reluctant to pass key parts of his green energy agenda. The order would declare that “ensuring robust, resilient, and sustainable domestic industrial base to meet the requirements of the clean energy economy is essential to our national security,” according to a draft of the document that remains in the “pre-decisional” phase. That reasoning follows a renewed push from the administration on its climate change priorities in light of shocks in the oil and gas market following Russia’s invasion of Ukraine. The order would specifically says “domestic mining, beneficiation, and value-added processing of strategic and critical materials from sustainable sources for the production of large capacity batteries for the automotive, e-mobility, and stationary storage sectors is essential to national defense.” The Intercept has reached out to the White House for comment. Several senators sent President Joe Biden a letter on Wednesday asking him to use authorities such as those contained in the Defense Production Act, which significantly expands the president’s authority to unilaterally alter domestic manufacturing policy in times of crisis, to “support and increase manufacturing capacity and supply chain security for technologies that reduce fossil fuel demand and fuel costs, such as electric heat pumps, efficient electric appliances, renewable energy generation and storage, and other clean technologies.” The letter — signed by Democratic Sens. Ed Markey and Elizabeth Warren of Massachusetts, Martin Heinrich of New Mexico, Cory Booker of New Jersey, and Jeff Merkley of Oregon — encourages Biden to make the U.S. less dependent on oil drilling abroad while simultaneously supporting climate goals: “Producing efficient electric products and exporting those goods to the E.U. and other foreign markets would help many countries lower their dependency on fossil fuels, and thereby strengthen their own energy security.” It’s the latest example of progressives in Congress urging the president to use his considerable authority to achieve policy victories. In a release earlier this month, the Congressional Progressive Caucus outlined a substantial agenda that could be achieved with the swipe of Biden’s pen. That list included utilizing the Defense Production Act to bolster the production of green energy technology. The oil industry is also using the Russian invasion of Ukraine as an opportunity to push back on Biden’s energy policies and lobby for increased production. In a meeting with oil and gas executives on Tuesday, JPMorgan Chase CEO Jamie Dimon pitched the White House on his own Marshall Plan, Axios reported, to increase energy production in the West and thereby shore up the U.S. and Western Europe’s energy independence from petrostates like Russia. Dimon’s suggestions at the meeting — at which Biden was present, Axios reported — included more liquefied natural gas facilities in Europe. Energy Secretary Jennifer Granholm also invoked the Marshall Plan in comments earlier this week. “I think it’s a moment for us to ask at this point in our history, what is going to be our version of the Marshall Plan for clean and secure energy in 2022 and beyond?”
Manchin, leaders tout battery plant coming to W.Va. (AP) — Programs to re-train coal miners and reinvigorate West Virginia’s suffering workforce have been proposed before. Democratic U.S. Sen. Joe Manchin said Friday many have been a disappointment because there were no jobs.“All that ended up being was basically an extension of unemployment benefits because no jobs came because there’s no factories,” Manchin said. The senator said that’s changing with the announcement of a new electric battery plant coming to the state this year. The energy startup SPARKZ is partnering with the United Mine Workers of America to recruit and train dislocated miners to be the factory’s first production workers.“Now, we’re seeing the rubber hit the road,” Manchin said. “That makes a difference.” Energy Secretary Jennifer Mulhern Granholm and Interior Secretary Deb Haaland joined Manchin and UMWA representatives at Marshall University’s Robert C. Byrd Institute to discuss workforce development opportunities.Granholm announced a $5 million training initiative, the first in the nation to focus on battery workers. The funds will be split among five U.S. sites, and she hinted that West Virginia is likely to be a recipient. “I think you’ll be well-positioned, I’ll just say that,” she said. The energy secretary said the steps are necessary to ensure that the U.S. is “energy independent” and not relying on countries like China for the supplies. “We should be building the full supply chain here,” she said. UMWA International Secretary-Treasurer Brian Sanson said although workforce training has been offered to the state’s workers before, West Virginia hasn’t seen most of the benefits. “In the past, we’ve spent a lot of money retraining workers to go out of state to do other jobs,” he said. “That’s one of the biggest problems.”
FERC slows consideration of climate impact of new gas projects — U.S. regulators voted on Thursday to seek comments on two policy statements they issued last month that provide guidance regarding the certification of interstate natural gas pipelines and consideration of greenhouse gas (GHG) emissions in natural gas project reviews. Federal Energy Regulatory Commission (FERC) Chairman Richard Glick said that two guidelines the panel approved last month to consider GHG, environmental justice and landowner issues before approving LNG terminals and other gas projects would now be considered "drafts", according to a Reuters report. “In light of concerns that the policy statements created further confusion about the Commission’s approach to the siting of natural gas projects, the Commission decided it would be helpful to gather additional comments from all interested stakeholders, including suggestions for creating greater certainty, before implementing the new policy statements,” Glick said. In February, the Commission issued an update to its 1999 Certificate Policy Statement and issued an interim policy statement focused on the Commission’s assessment of the impact of a project’s GHG emissions. The concern regarding the policies surrounded the lack of guidance from FERC on how to go about achieving the new benchmarks. In essence, the guidelines required that GHG and “environmental justice” be considered during the approval process for natural gas pipelines. Following this amendment, President and CEO of the Interstate Natural Gas Association of America (INGAA) Amy Andryszak released a statement in support of the reconsideration. “INGAA is pleased that FERC heard the tremendous concerns expressed by natural gas customers and operators and took bipartisan, unanimous action to designate the two new certificate policy statements as draft rather than final statements, and to apply the revised policies only to project applications filed after the Commission finalizes the statements,” Andryszak said. “FERC’s decision to revisit the statements with additional comments will hopefully provide further clarity and predictability for a timely natural gas infrastructure certification process. Finally, we are encouraged that the commission voted to certificate three natural gas projects during todays’ meeting.” Under the new designation, the draft guidelines on projects will not apply to pending projects until FERC issues any final guidance, the panel said. Comments on the guidelines will be due by April 25, with reply comments due on May 25.
Ultimate No-Growth Industry: Electricity Generation in 2021 Rose to, Well, 2007 Levels, Eagerly Awaits Demand from EVs By Wolf Richter . Electricity generation in the US overall has been a stagnant business since 2005 despite economic growth and despite population growth, and despite the arrival of EVs in ever larger (but still small) numbers.There were variations from year to year based on how hot the summers were and how cold the winters, and how bad the recessions were – the Financial Crisis and the pandemic recession. But since 2005, the amount of electricity that was generated for end users has remained in the same narrow band, except in 2009, during the Financial Crisis when generation dropped below the range, as demand from the manufacturing and industrial sectors collapsed.In 2021, the amount of electricity generated from all sources – natural gas, coal, nuclear, wind, solar, hydro, geothermal, biomass, and others – bounced back from the 2020 drop, to 4.16 million gigawatt hours, according to EIA data. This was where it had been in 2019 – and, well, in 2007!This is the no-growth business electric utilities are in, and only price increases can produce revenue growth. But this wasn’t always the case: electric utilities used to be in a steady growth business, as you can see on the left side of the chart.The electric utility industry has been hoping for years that EVs would stimulate demand for their product (electricity).And EVs are increasing demand a little, but at this point not enough to make up for the declining demand that resulted from investments by utility customers – residential, commercial, and industrial – in better thermal insulation and more efficient electrical equipment such as LED lights and HVAC systems. In addition, especially during the Great Recession, some manufacturing activity was offshored, and that demand for electricity never came back. But the mix of how this electricity was generated changed dramatically.In 2021, the price of US natural gas exploded, so to speak. In the prior years, the spot price of natural gas at the Henry Hub traded in a range between roughly $1.75 to $3.00 per million Btu. But in 2021, natural gas prices began to spike and punched through $5 per million Btu, spiking into the double-digits briefly. Even at this moment, the spot price at the Henry Hub is at $5.10.With natural gas prices having doubled, power generators that still had coal-fired power plants started to shift some generation to their coal power plants, which caused the price of coal to shoot higher too, reducing the incentive for the shift.And this shift of some generation from natural gas to coal in 2021 caused power generation from natural gas (blue line in the chart below) to dip, and generation from coal (black) to rise, reversing briefly the long-term trend where generation from coal is getting replaced by generation from natural gas and other sources.In 2021, the share of total electricity generated by:
- Natural gas (blue) = 37.9%
- Coal (black) = 21.6%
- Nuclear (green) = 18.7%
- Wind, utility-scale solar, rooftop solar, and geothermal (red) = 13.5%
- Hydro (yellow) = 6.3%
- Petroleum liquids, petroleum coke, other gases, biomass (purple) = 2.1%
The chart below shows the amount of electricity generated by source (not “capacity,” but actual electricity generated and used) over the past 20 years:
Bluefield company receiving $3M develop coal-based building materials -A Bluefield business that focuses on the use of coal in developing building materials is receiving almost $3 million in funding.Sen. Joe Manchin, D-W.Va., made the announcement last week during a visit from two U.S. Cabinet members to the state: U.S. Secretary of Energy Jennifer Granholm and U.S. Secretary of the Interior Deb Haaland.The business is X-Mat Carbon Core Composites, located in the Commercialization Station on Bluefield Avenue, and the Florida-based company and partners “will construct a prototype structure to test coal-derived building materials including roof tiles, siding panels, bricks, and blocks. The project will produce a detailed design for a carbon-based building and update the techno-economic analysis to improve the maturity of the technology as it moves closer to a demonstration phase.”The (Department of Energy) DOE funding is more than $2.2 million with other funding about $700,000. This project was one of many around the state receiving grants from the more than $210 million in funding available to West Virginia this year through the bipartisan infrastructure bill.“I was honored to welcome my friends Secretary Granholm and Secretary Haaland to West Virginia to discuss the ongoing work of the Interagency Working Group on Coal and Power Plant Communities as well as the tremendous investments made possible through the Bipartisan Infrastructure Law,” Manchin said. “At every stop, we heard from West Virginians who reminded us of the enormous sacrifices our coal communities have made to keep the lights on and power our nation.”Manchin, who is Chairman of the Senate Energy and Natural Resources Committee, said he was “especially excited about the new initiatives and developments we announced to help diversify and strengthen the West Virginia economy by creating new and good-paying jobs and revitalizing our communities.” According to the DOE, the project will produce “high-strength, lightweight building materials made from domestic coal waste. The waste will be sourced from active coal preparation facilities or existing waste storage structures and converted into building materials that are lighter, less bulky and fire-resistant, for use in residential, commercial and infrastructure applications.”
Coal's a 'stupid investment' and we're 'sleepwalking to climate catastrophe': UN chief Guterres - The U.N. Secretary General issued a stark warning Monday, saying the planet had emerged from last year's COP26 summit in Glasgow with "a certain naïve optimism" and was "sleepwalking to climate catastrophe." In remarks delivered to The Economist's Sustainability Week via video link, Antonio Guterres sketched out a picture of where he felt the world stood when it came to tackling global warming. He noted that while COP26 had seen positive developments related to issues such as cutting methane emissions, tackling deforestation and mobilizing private finance, significant challenges remained. "Keeping 1.5 alive requires a 45% reduction in global emissions by 2030 and carbon neutrality by mid-century," he said. "That problem was not solved in Glasgow. In fact, the problem is getting worse." Guterres' reference to 1.5 relates to the Paris Agreement's target of limiting global warming "to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels." The Paris Agreement was reached at the COP21 climate change summit in December 2015. More than six years on, it would appear that, for Guterres, a huge amount of work still needs to be done. "According to present national commitments, global emissions are set to increase by almost 14% in the 2020s," he said. "Last year alone, global energy-related CO2 emissions grew by 6% to their highest levels in history. Coal emissions have surged to record highs. We are sleepwalking to climate catastrophe." On Russia's invasion of Ukraine and the wide-ranging effects this could have, Guterres offered up an equally stark assessment. He said that "the fallout from Russia's war in Ukraine risks upending global food and energy markets, with major implications for the global climate agenda." "As major economies pursue an 'all-of-the-above' strategy to replace Russian fossil fuels, short-term measures might create long-term fossil fuel dependence and close the window to 1.5 degrees." "Countries could become so consumed by the immediate fossil fuel supply gap that they neglect or knee-cap policies to cut fossil fuel use. And this is madness: addiction to fossil fuels is mutually assured destruction." Guterres' comments come at a time when several major economies, including the European Union, are trying to find ways to reduce their reliance on Russian hydrocarbons. Last week, the International Energy Agency said speed limits on highways should be cut by at least 10 kilometers per hour (6.2 mph) to help lower oil demand. The recommendation was part of a wider 10-point plan published by the Paris-based organization.
Coal to crypto: The gold rush bringing bitcoin miners to Kentucky | Thomson Reuters Foundation Long Reads -In a ravine deep in the Appalachian mountains, Warren Rogers stands on the ruins of an abandoned coal-washing plant that used to prepare hundreds of tons of the fuel a day for transport through the tiny town of Belfry, Kentucky.His construction crews have been putting in 10 to 12-hour shifts through the winter, retrofitting the old site to power a new kind of extractive operation: mining the digital currency bitcoin."We're trying to digitize coal," said Rogers, the chief strategy officer of Blockware Solutions, a bitcoin mining giant that is expanding rapidly in eastern Kentucky.Over the past year Rogers, a former venture capitalist, has been crisscrossing Appalachia, on the hunt for new bitcoin mining sites - and the power to run them."We own a money-printing machine," Rogers said, gazing at a tangle of power lines which descend the steep hills and connect to a pair of rusted old buildings, where his team is installing rows of Chinese-made bitcoin-mining computers."We're building our own Fort Knox," he told the Thomson Reuters Foundation.When the planned construction is done, the facility will create up to three bitcoins per day - worth over $100,000, all the while sucking more power than all the houses in Belfry combined, based on estimates from Blockware Solutions.
Inside the international push to turn a bankrupt rural Washington newsprint mill into a crypto capital | Seattle Times -Nearly a year after a bankruptcy trustee told a federal judge that Allrise Capital represented the best chance for about 140 workers to get their jobs back at a paper mill in Usk, Pend Oreille County, the California-based company that owns it hasn't produced a single roll of newsprint.Rather than refitting the factory to make cardboard and rehiring the workers as advertised, the venture capitalists instead crave as much cheap electricity as they can get for a different kind of venture.Allrise Capital, and its CEO, Ruslan Zinurov, have partnered with a major Chinese tech company, Bitmain, to convert the town of about 1,200 people into what they foresee will be the cryptocurrency mining capital of the nation. "This is an American company called Allrise that has partnered with a Chinese company, the biggest name in bitcoin mining, and they are trying to invest in America," former plant manager Todd Behrend said. "This is a great story about bringing Chinese jobs to the United States."Allrise has secured initial approval for 100 megawatts of power from the Bonneville Power Administration for what was the Ponderay Newsprint site. Allrise last year outbid the Kalispel Tribe at a bankruptcy auction for $18.1 million. Deane Osterman, executive director of natural resources for the Kalispel Tribe, said its leaders don't necessarily object to the cryptocurrency mining operation, but they want more information."We don't understand, like most folks, the crypto-mining business," Osterman said. "Who are these people? How are they going to do business? Everything is so rapidly changing in that space, it's hard to get up to speed."About 90 shipping containers, the metal boxes used to move freight by ship or truck, have arrived, with more showing up daily. They are packed with Bitmain-designed electronics used for cryptocurrency mining, Behrend said. The company eventually plans to bring in 143 of the "modular-data centers" that would operate on the first 100 megawatts. Instead of about 140 workers employed by the mill, Behrend said, the company expects to hire about 40 employees to manage cryptocurrency mining. "As much as I'd love the jobs back, I don't know that it does the county any good" to force a company "to limp along into something that doesn't pencil out," County Commissioner John Gentle said.The mill produced huge rolls of paper, called newsprint, that were used by Quebec-based Resolute Forest Products and five major U.S. newspaper publishers."That plant has kind of propped up this county for three decades," Gentle said. "It was just a few years ago we were staring at the end of life for newsprint. We were in denial."While Gentle says he understands the blockchain process, he said he has a lot to learn about mining for bitcoin. But he didn't mention until asked in an interview that his wife, Kimberly Gentle, was hired four months ago by one of the biggest cryptocurrency mining companies in the world. Steve Wright, 64, recently retired CEO for the BPA, said the power contemplated by Allrise, up to 600 megawatts, "is a massive amount of electricity."The 600 megawatts could power two former Kaiser Aluminum Mead smelters operating at full capacity, he said."It would be the largest industrial loads in the Northwest,'" he said, "and the largest industrial loads since the aluminum industry left the Northwest."
Hochul could follow fracking precedent in setting crypto mining moratorium in New York - — Gov. Kathy Hochul has a clear legal path to establish a moratorium on permits for cryptocurrency mining operations like Greenidge Generation’s plant in Dresden, according to a report issued today by Columbia Law School’s Sabin Center for Climate Change Law. Gov. Kathy Hochul could impose a moratorium on certain cryptocurrency facilities by following a 2010 precedent the state set in addressing hydrofracking, the Sabin Center report said.Hochul could simply follow the 2010 precedent set by then-governor David Patterson in addressing high-volume hydrofracking, the report’s author, Jacob Elkin, wrote.Patterson ordered a moratorium on fracking permits, pending the completion of a generic environmental impact statement for the gas drilling industry under the supervision of the state Department of Environmental Conservation.A similar moratorium for the crypto industry, Elkin said, “would support pausing new permits and permit renewals for cryptocurrency facilities pending the development of a GEIS.”The Sabin Center paper comes just 10 days before the DEC’s deadline to rule on Greenidge’s application to renew its Title V air permit. “This decision is a crucial test for Gov. Hochul’s commitment to New York’s climate law,” said Eric Weltman of Food and Water Watch.When Greenidge applied for its air permit six years ago, it never mentioned plans to convert from a plant that supplied power intermittently to the electric grid to a full-time cryptocurrency mining operation that creates far more greenhouse gasses.Then in 2019, the legislature passed the Climate Leadership and Community Protection Act, which requires the state to cut ghg emissions by 40 percent by 2030 (from a 1990 base) and to make even deeper cuts after that.Greenidge now operates under an air permit that expired in September. That permit allows it to emit 641,878 tons of ghg emissions a year. While the company isn’t seeking to raise that limit in the renewal application, it acknowledged in August that its annual emissions totaled 1.05 million tons — even before its rapid buildup of Bitcoin mining machines in recent month. In recent weeks, Greenidge has been installing hundreds of Bitcoin mining rigs.Under a loophole in state energy law, Greenidge uses “behind-the-meter” energy it generates from burning fracked gas imported from Pennsylvania to power specially designed computer “rigs.”Using an energy-intensive process nicknamed “proof-of-work,” those rigs validate blockchain transactions and earn Bitcoin profits for Greenidge.Environmental groups have voiced concern that other old, inefficient power plants could copy Greenidge’s formula, sending state ghg totals soaring. New York is already home to roughly 20 percent of U.S. cryptocurrency mining operations.
Bitcoin Miners Want to Recast Themselves as Eco-Friendly - The New York Times - Along a dirt-covered road deep in Texas farm country, the cryptocurrency company Argo Blockchain is building a power plant for the internet age: a crypto “mining” site stocked with computers that generate new Bitcoins.But unlike other Bitcoin mining operations, which consume large quantities of fossil fuels and produce carbon emissions, Argo claims it’s trying to do something environmentally responsible. As Peter Wall, Argo’s chief executive, led a tour of the 126,000-square-foot construction site one morning this month, he pointed to a row of wind turbines a few miles down the road, their white spokes shining in the sunlight.The new facility, an hour outside Lubbock, would be fueled mostly by wind and solar energy, he declared. “This is Bitcoin mining nirvana,” Mr. Wall said. “You look off into the distance and you’ve got your renewable power.”Facing criticism from politicians and environmentalists, the cryptocurrency mining industry has embarked on a rebranding effort to challenge the prevailing view that its electricity-guzzling computers are harmful to the climate. All five of the largest publicly traded crypto mining companies say they are building or already operating plants powered by renewable energy, and industry executives have started arguing that demand from crypto miners will create opportunities for wind and solar companies to open facilities of their own.The effort — partly a public-relations exercise, partly a genuine attempt to make the industry more sustainable — has intensified since last spring, when China began a crackdown on crypto mining, forcing some mining operations to relocate to the United States. A trade group called the Bitcoin Mining Council also formed last year, partly to tackle climate issues, after Elon Musk criticized the industry for using fossil fuels. Crypto mining refers to a verification and currency creation process that is essential to the Bitcoin ecosystem. Powerful computers race one another to process transactions, solving complex mathematical problems that require quintillions of numerical guesses a second. As a reward for this authentication service, miners receive new coins, providing a financial incentive to keep the computers running. But as digital assets have become more popular, the amount of power necessary to generate Bitcoin has soared. A single Bitcoin transaction now requires more than 2,000 kilowatt-hours of electricity, or enough energy to power the average American household for 73 days, researchers estimate. To achieve that, some miners are reviving broken-down coal plants, or using low-cost natural gas to power their computers. Last month, a study in the journal Joule found that Bitcoin mining worldwide may be responsible for about 65 megatons of carbon dioxide a year, comparable to the emissions of Greece.According to the study, the Bitcoin network’s use of green energy sources also dropped to an average of 25 percent in August 2021 from 42 percent in 2020. (The industry has argued that its average renewable use is closer to 60 percent.) That’s partly a result of China’s crackdown, which cut off a source of cheap hydropower. But it reflects fundamental economic incentives, too, said Alex de Vries, one of the authors of the Joule study. Renewable energy is an intermittent power source — the sun shines only part of the day, and wind speeds fluctuate considerably.
Ohio Supreme Court ruling could mean the end of Lake Erie's Icebreaker wind farm project - The Ohio Supreme Court is expected to hand down a decision soon on whether the proposed Icebreaker wind farm in Lake Erie can go forward.The project is being challenged by two lakeshore residents who believe the giant blades pose too great a risk to migrating birds.Back in 2011 WKSU joined a crew of engineers heading out onto Lake Erie with a dream.We docked at the century old Five Mile Crib, the water intake crib, off shore to check the array of wind gauges.Blowing across fifty miles of lake, the unobstructed breeze from the north was what Icebreaker's planners called 'clean wind', an untapped energy resource.LEEDCo, the Lake Erie Energy Development Corp., had hoped the six turbine pilot project would be the first off-shore wind farm in American waters.Now, bogged down by lawsuits, slowed by regulators and starved for state support, Icebreaker is nearly sunk.LEEDCo last year lost its last full-time employee, prompting board member and Port of Cleveland CEO Will Friedman to step up to keep the project afloat.“It's still alive," he said, "still working on the same objective, which is to bring Icebreaker to fruition.”But Friedman said the headwinds are formidable.“There’s just not much appetite for renewable projects in Ohio.”A decade ago, with its manufacturing might and renewable energy incentives, Ohio was poised to be a leader in wind development.That has changed.GOP lawmakers have since passed prohibitive restrictions on land-based wind farms, removed the renewable mandates, and given leaders at the county level the power to veto renewable projects.That’s on top of the $60 million corruption scandal in the statehouse which includes former chief regulator, Sam Randazzo, who’s under investigation for receiving millions in bribes from a coal and nuclear utility.Surprisingly, all of this isn’t what’s brought Icebreaker to a standstill. It’s two ordinary citizens who love the lake. “I’m a lifelong Clevelander, grew up in Euclid, lived in Cleveland Heights and have lived in Bratenahl now for 25 years,” said Susan Dempsey, one of two plaintiffs challenging Icebreaker. Dempsey and Bratenahl neighbor Robert Maloney successfully challenged Icebreaker all the way to the Supreme Court arguing that the state erred in granting permits to build the turbines without fully documenting how they might impact migrating birds and bats.“Our position is that we should be doing whatever we can to protect those waters and the diverse environmental ecosystem that makes up the Great Lakes.” Dempsey is upfront that early in their fight an Ohio coal baron picked up the legal tab. “We were actually fortunate to have received assistance, but we received absolutely no direction from Murray Energy or Robert Murray,” she said. Robert Murray died in 2020, and Dempsey says they’ve had no further assistance. The Port Authority’s Will Friedman says he is working to keep Norwegian partner Fred. Olsen Renewables engaged eight years after they signed-on to build and operate the turbines.“They still have an interest," he said, "so they’re still there.”He’s also gotten an extension from the U.S. Department of Energy to use the remaining $37 million in grant funding towards the $175 million price tag.Friedman says the irony is that even if Icebreaker is never built, the Great Lakes will likely see wind turbines.He says New York this summer will start leasing submerged land in Lake Erie to wind developers with the full weight of that state's support behind them.
Chernobyl Exclusion Zone radiation monitoring system not working, firm says - Ukraine's state nuclear operator announced on Monday that the automated radiation monitoring system in the Chernobyl Exclusion Zone is not functioning amid Russia's ongoing invasion of the country.Ukrainian nuclear operator Energoatom said in a Telegram message that there was not any data on "the current state of radiation pollution in the Exclusion Zone, which makes it impossible to adequately respond to threats of deterioration of radiation situations in the Exclusion Zone," according to NBC News.Energoatom also noted that fire services intended to extinguish potential forest fires were not operating. "There is a high probability that in the spring and summer the intensity of forest fires in the Exclusion Zone may reach the maximum possible limits, which will lead (in the absence of any fire measures) to almost complete burning of radioactively contaminated forests in the Exclusion Zone and, consequently, to significant deterioration of radiation in Ukraine and throughout Europe," the nuclear operator added.The Chernobyl nuclear power plant on Sunday at last allowed some workers to go home after about 600 hours inside the facility amid Russia's unprovoked incursion. About 300 people had been held there since Moscow's attacks began on Feb. 24.On Sunday, 64 people were sent home after they “heroically performed their professional duties and maintained the appropriate level of safety” and were replaced by 46 “employee-volunteers.” Earlier this month, power was restored to the plant after Russian forces reportedly knocked it off the energy grid.
Could Russia's invasion of Ukraine revive U.S. uranium mining? - Uranium mining in the United States could be on the verge of a revival. Think of it as one component of this country’s supply chain problems. As the U.S. seeks to decarbonize in response to climate change, the Biden administration has been confronted with the fact that the technologies needed to build a low-carbon economy in many cases require metals — like nickel, lithium and cobalt — that are in short supply domestically and controlled by adversarial nations, like China and Russia. A similar situation is currently playing out with uranium, a radioactive metal key to making fuel for nuclear reactors. The U.S. dependence on foreign sources leaves the nuclear energy sector vulnerable to geopolitical conflict — like Russia’s war against Ukraine. Russia supplies 20 percent of the low-enriched uranium used to power U.S. reactors and is the lead supplier of fuel-ready uranium to the world market. While the U.S. does import a lot of its uranium supply from other nations, like Canada and Australia, its partial reliance on Russian supplies can already be seen with spiking fuel costs. When the Biden administration floated sanctions on Russia’s state-owned atomic company, Rosatom State Nuclear Energy Corp., the price of uranium shot to roughly $60 — a high not reached in more than a decade. Experts recently told E&E News that if sanctions are imposed on Russian imports, that move could further raise the cost of low-enriched uranium for nuclear power plants globally, leaving U.S. utilities vulnerable to more wild fluctuations. “They’re using it [uranium] as a geopolitical weapon against the United States of America, and we have the ability to be more self-sufficient,” said Mark Chalmers, president and CEO of the largest U.S. uranium mining company, Energy Fuels Resources Corp. Now, U.S. uranium miners say they see an opportunity to make some money helping the nation fight back against Russia. That would mean restarting idle mines, rebooting an industry in the U.S. that dramatically shrank in recent years when uranium prices were low. It’s unclear how many uranium mines in the United States are currently in operation. The World Nuclear Association estimated that only one U.S. mine, Nichols Ranch in Wyoming, produced uranium in 2020, the most recent year analyzed by the industry group. Exactly how long it would take to ramp up uranium production is also unclear, as are the state and federal regulatory hurdles.
Is Ohio AG Dave Yost counting on FirstEnergy execs to take the 5th in his civil suit? - cleveland.com- Why is Ohio Attorney General Dave Yost asking to proceed with his lawsuit against FirstEnergy? Would witnesses exercise their Fifth Amendment right and decline to answer questions that could be self-incriminating? We’re talking about how a jury could infer the worst on Today in Ohio. Listen online here. See the automated transcript at the bottom of the post.
Judge gives lawyers 24 hours to identify FirstEnergy execs who ordered political bribes - Further scuttling a proposed settlement for FirstEnergy’s shareholders, a federal judge demanded their lawyers, within 24 hours, answer his question about which company officials ordered what has been described as the largest political bribery scheme in Ohio history. Both FirstEnergy and its shareholders were on the cusp of a settling the shareholders’ derivative lawsuit, announcing an agreement in February pending judicial review. It calls for FirstEnergy’s insurers to pay the company $180 million for damages incurred in the scandal. The proposed settlement also would force out six members of the board of directors when their terms expire and require corporate reforms related to “political and lobbying activities.” U.S. District Judge John R. Adams, however, has refused to approve anything until plaintiffs’ counsel answer one critical question: Who at FirstEnergy ordered the $64 million in political bribes? Adams threatened to hold plaintiff’s attorney Jeroen Van Kwawegen in contempt for ducking the question earlier this month. Adams’ March 11 threat ranged from professional sanctions to removal of their role as attorneys for the shareholders. On Tuesday, Adams gave plaintiffs “one final opportunity” to answer his question in a sworn affidavit by noon Wednesday. In his order, Adams emphasized the public’s interest in the case: FirstEnergy, a publicly traded company, admitted to bribing public officials. The public cannot trust or even evaluate any corporate reforms from FirstEnergy if the company is allowed to leave such gaping holes in the plotline, he said. “It is not only the trust of FirstEnergy that must be rebuilt,” Adams wrote. “This bribery scheme has undoubtedly shaken whatever trust that Ohioans may have had in the political process used by their elected officials. The public has a right to know how it is that the political process was so easily corrupted.”
Attorney gives names behind alleged bribes in Ohio statehouse scandal (AP) — A federal judge on Tuesday ordered attorneys for investors in utility giant FirstEnergy Corp. to reveal who from the company paid bribes in an alleged $60 million scheme to win a legislative bailout for two Ohio nuclear plants. U.S District Court Judge John Adams told the lawyers he wanted the names by noon on Wednesday, saying “the public has a right to know how it is that the political process was so easily corrupted.” In a filing, former CEO Charles Jones and former VP Michael Dowling were accused by the attorney representing investors of orchestrating the payments. The order stems from a proposed settlement of lawsuits filed by shareholders on behalf of FirstEnergy against board members and top executives in the wake of allegations that the company paid out bribes to win the $1 billion bailout for the nuclear plants operated at the time by a wholly-owned FirstEnergy subsidiary.Adams ended a hearing earlier this month when FirstEnergy’s lead attorney refused to say who at the company was responsible for paying the bribes — he would only say it was a senior executive and that he could not disclose the name while the settlement was pending.The attorney representing the investors involved with the settlement said last week that publicly disclosing the names could be harmful to FirstEnergy and its related criminal and civil cases. The attorney previously said they would be willing to provide the information as long as it wasn’t released publicly.The proposed settlement of a number of lawsuits calls for FirstEnergy’s insurer to pay the company $180 million less attorney fees on behalf of board members and company executives. Other provisions include an agreement that six longtime board members not stand for reelection at FirstEnergy’s next shareholder meeting.Adams has said he wants to know why the settlement was reached without depositions from current and former FirstEnergy officials and why no effort had been made to force former company executives to return millions in compensation. None of the company’s executives have been charged in the investigation, but FirstEnergy in July said it would pay a $230 million criminal penalty as part of a deferred prosecution agreement with the U.S. Department of Justice. Ohio House Speaker Larry Householder, four associates and a dark money group were indicted in July 2020 on federal racketeering conspiracy charges for their roles in the bribery scandal. Federal authorities say the $60 million from FirstEnergy was used to get Householder supporters elected to help him win passage of the bailout legislation and to prevent bailout opponents from placing a referendum on the Ohio ballot.
FirstEnergy’s CEO and SVP ordered $64 million bribery scheme, shareholders say - FirstEnergy’s CEO and senior vice president “devised and orchestrated” a $64 million bribery scheme to pay a top legislative leader and utility regulator in exchange for official action, according to a sworn declaration Wednesday from shareholders’ lawyers who are suing the company.While CEO Charles “Chuck” Jones and senior vice president for external affairs Michael Dowling were both suspected central characters in the operation — both were fired after initial FBI arrests in the case and matched identifying details in court documents — Wednesday’s filing marks the first time the two were personally identified.The company’s shareholders filed a derivative lawsuit, alleging the bribery operation and subsequent legal and political fallout damaged FirstEnergy and violated company policy. Lawyers for the shareholders said the pre-trial exchange of evidence would have shown Jones and Dowling as the engines of the payments.FirstEnergy as a company entered into a deferred prosecution agreement with the U.S. Department of Justice last summer. In it, the company admitted to a $60 million payment to a nonprofit secretly operated by former GOP Speaker of the House Larry Householder, and another $4.3 million payment to the state’s top utility regulator, Sam Randazzo. However, the company didn’t specify which executives ultimately controlled the payments.Householder has pleaded not guilty to a charge of racketeering and awaits trial set for January. Two of his alleged co-conspirators have pleaded guilty and await sentencing. Randazzo has not been charged with a crime.The shareholders’ declaration specifies Jones as “executive 1” and Dowling as “executive 2” in the deferred prosecution agreement. The arrangement calls for FirstEnergy to cooperate with prosecutors, admit to a roughly 40-page statement of facts, and pay a $230 million penalty to possibly avert a criminal charge of wire fraud.Attorneys representing Jones and Dowling did not respond to emails Wednesday.“While we can’t comment on the court filing today, FirstEnergy continues to take steps to rebuild trust with stakeholders and position the company for the future,” said company spokeswoman Jennifer Young. “This includes, among other proactive steps, strengthening the leadership team, enhancing its compliance program, implementing more robust oversight of government affairs engagement, and resolving multiple regulatory proceedings.”FirstEnergy said it paid the bribes to help pass House Bill 6 in 2019, a sweeping energy policy overhaul worth an estimated $1.3 billion to the company. The legislation bailed out nuclear plants owned at the time by a company subsidiary, effectively guaranteed company revenues at a high level via a “decoupling” provision, gutted requirements that it generate renewable energy, and others.The disclosure adds new heat to Gov. Mike DeWine, who appointed Sam Randazzo to the PUCO and signed HB 6 within hours of lawmakers passing it.For instance, Jones and Dowling met with Randazzo on Dec. 18, 2019, to discuss payments to him and his candidacy for a seat on the state Public Utilities Commission of Ohio, according to FirstEnergy. That same day, DeWine and Lt. Gov Jon Husted dined together at a Columbus restaurant.
Cuyahoga County has more than 300 orphan oil and gas wells that may need plugging - The Ohio Department of Natural Resources has been busy letting contracts to plug orphan oil and gas wells across the state in recent years, including a number in Cuyahoga County, and business should pick up even more with a shot of federal money on the way. The wells aren’t just found in the countryside, but in backyards, beneath parking lots, near schools and under roads. “We’ve plugged them on the banks of Lake Erie,” said Jason Simmerman, well program engineer with the ODNR’s Division of Oil and Gas Resources Management. One of the wells, plugged in late 2017, was located 5 feet from a home in Westlake. It was discovered during landscaping of the front yard and after methane was smelled in the basement, Simmerman said. It’s not clear when the well was dug as is the case with most of the 330 documented orphan wells in Cuyahoga County that have yet to be plugged. An orphan well is one that is not only inactive but has no owner of record to assume responsibility. In most cases, the wells were abandoned before 1965, which is when the state created the Division of Oil and Gas Resources Management and started regulating the industry. Many of the wells go back to the days of John D. Rockefeller and Standard Oil. They could have been used for industrial or agricultural purposes or perhaps just to heat a home. Many are in rural areas, perhaps discovered by a farmer working his fields or a hunter traipsing through the forest, said division spokesman Adam Schroeder. “We really do rely on Ohio citizens to help us find these wells,” he said. But orphan wells are also found in populated areas, such as Westlake or Cleveland, although those wells may have been drilled when the area around them was more rural, and then only to go unnoticed or ignored when construction went up around them. Elsewhere in Greater Cleveland, the state has documented 423 orphan wells in Medina County, 389 in Lorain County, 121 in Summit County, 95 in Lake County, 29 in Portage County and eight in Geauga County. The state created its orphan well program in 1976 and it has since been funded by a severance tax on the extraction of oil and gas. Activity has picked up considerably since 2018 with passage of House Bill 225, which provided more money to plug orphan wells. Of the nearly 20,000 orphan wells documented by the state, it is ready to plug 1,053 of them. The pace of work is expected to pick up considerably now that the state has a huge influx of funding heading its way. Plugging the wells is “good from both a climate and a public health perspective,” said Nolan Rutschilling interim managing director of energy policy for the Ohio Environmental Council. Even if a well is buried or partially buried it still could be leaking methane, which is a far more potent greenhouse gas than carbon dioxide, he said, although it doesn’t remain in the atmosphere as long. “In addition to methane, benzene leaks out from the wells and that is really bad for folks with asthma and has negative effects on lung development in children,” Rutschilling said. If a well presents an immediate risk, perhaps due to a strong leak of oil and gas, it will be plugged on an emergency basis, Schroeder said. Otherwise, the wells are graded and prioritized, with some in close proximity to each other lumped together in a single contract.
Ohio's fracking industry - boon as promised or something less? - — A Cleveland State University report in 2012 predicted that Ohio’s then-growing fracking industry would add 66,000 direct and indirect jobs and $5 billion a year to the state’s economy by the end of 2014.Predictions only grew from there. A decade later with operations spread out across the eastern side of the state to cash in on shale drilling’s economic potential, many numbers are in. But they are fuzzy and tell different stories from different viewpoints. And like many things perceived political, the industry’s successes and failures depend largely on who is doing the explaining.There are more than 3,600 permits to operate such wells in Ohio. One estimate tied more than 200,000 jobs to the industry, directly or indirectly, though the state acknowledges that count is exaggerated. And Ohio ranks sixth in the country for natural gas production and 13th for oil production. Yet environmental concerns remain. For people who live there, the industry did bring jobs and money.. “There was an influx into the economy that would have never happened. But some opponents of the industry’s proliferation in Ohio and surrounding states have said any job growth would likely be short-lived. Sean O’Leary, a senior researcher at the environmental and public policy think tank Ohio River Valley Institute, said that after drilling is completed, it takes fewer workers to extract gas and oil. “And so as the industry gets more mature, it requires fewer and fewer employees,” O’Leary said.Ohio has 81 wells permitted for the Marcellus shale and 3,591 permits for the Utica shale as of March 12. Most are listed as active and producing, according to the Ohio Department of Natural Resources.There are also 226 active underground injection wells that companies use to store brine, the liquid waste produced after blasting underground shale with water, according to 2020 numbers from ODNR.Wells produced 180.2 million barrels of oil and 12.5 billion thousand cubic feet of gas from 2010 to 2020, according to ODNR. Companies also injected at least 142.5 million barrels of brine.During that time, the amount of severance tax – 10 cents per barrel of oil and 2.5 cents per thousand cubic feet of natural gas – grew nearly every year. In fiscal year 2011, the state collected $11.6 million from that tax, which also includes payments for coal and other mining operations. Last year, that number was more than five times higher – at $63 million – with all but about $5 million coming from natural gas, according to the Ohio Department of Taxation.Backers of such operations also like to boast that the industry directly and indirectly supports 208,000 jobs. And a study by researchers at CSU’s Maxine Goodman Levin College of Urban Affairs, done at the behest of the state’s economic development arm JobsOhio – said the industry directly and indirectly involving shale pumped $90.6 billion into the economy between 2012 and the first half of 2020. The state, by comparison, had a $695 billion total economy in 2020.But take some of the numbers that backers push with a grain of salt, say detractors. For example, the 208,000 jobs number was pulled out of a Department of Jobs and Family Services report from 2019. It counts every person the U.S. Census Bureau codes in its surveys as working both in the drilling field and the sectors supporting it.That includes, say, truck drivers, who haul a lot more than fracking materials. So there are more workers in that number than just those tied to oil and gas.
Gulfport Energy Discusses Merger With Rival Ascent Resources - Gulfport Energy Corp. has discussed merging with rival oil and gas explorer Ascent Resources, according to people familiar with the matter, as U.S. energy companies consider pairing up amid rebounding commodity prices. Gulfport and Ascent have discussed a transaction that would value the combined company at about $8 billion, said one of the people, who asked to not be identified because the matter isn’t public. Ascent management would run the company under one structure they’ve discussed, this person said. No deal is imminent and the companies could opt to not proceed with a merger, the people added. Gulfport rose 4% to close at $87.08 in New York trading Friday, giving the Oklahoma City-based company a market value of about $1.9 billion. Closely held Ascent Resources is backed by private equity firm First Reserve. Oil and gas explorers are increasingly looking to pair up as oil prices surge. PDC Energy Inc. agreed to buy Great Western Petroleum for $1.3 billion in February while Oasis Petroleum Inc. agreed to a $6 billion combination with Whiting Petroleum Corp. this month. Gulfport and Ascent are both active in the natural-gas rich Utica Shale of Ohio. Gulfport emerged from bankruptcy last year.
'Drill, buddy, drill!!!!' Inside FERC's $40M Rover fine - Tunneling under the Tuscarawas River was not going well. It was early April 2017, and construction on the Rover pipeline across Ohio had just begun. At a worksite near Canton, Ohio, a drilling device was stuck, probably caked with mud. And drilling fluid that should circulate back to the surface was instead disappearing underground.So the night foreman of a contractor crew started adding diesel fuel to the mix to lubricate the drill and get it unstuck, according to an enforcement report from the Federal Energy Regulatory Commission. Other workers followed his lead.It’s an old trick. It was also against the law.The drilling fluid — about 2 million gallons of it — later surfaced in a pristine wetland across the river. The mud was at least a foot and laced with the toxic fuel.Now, FERC is seeking a $40 million fine from Rover’s developer, Energy Transfer LP (Energywire, Dec. 17, 2021). In its report issued late last year, agency enforcement staff said the company fostered a speed-justifies-the-means attitude and passed it on to its roughly 12,000 contract employees, all the way to the laborers in the mud pits.“These violations were the product of a corporate culture that favored speed and construction progress over regulatory compliance that Rover pressed upon its contractors,” FERC’s enforcement staff wrote.Energy Transfer has blamed “a rogue employee” of a contractor for adding the diesel. In a filing this week, the company argued it cannot be held liable for the actions of its contractor.“What the Report does reveal,” company attorney William Scherman wrote in the filing this week, “is a stunning rush to judgment in a desperate attempt to blame the innocent for the alleged deliberate misdeeds of third parties multiple steps removed from those who stand charged.”Rather than pressure to speed up drilling, the filing suggested the contract crew was in disarray because of interpersonal problems, including rumors that another foreman was “having an affair with the wife” of one of his workers.Either way, critics say, the failures laid out by FERC investigators show the agency has little ability to prevent environmental damage once it approves a project.It took four years of investigation before the agency sought the $40 million fine last December. That case appears likely to be tied up in litigation for months or longer. Meanwhile, the pipeline has been pumping gas for more than three years, netting at least $1.4 billion. For Energy Transfer, critics say, the $40 million fine will simply be the cost of doing business.
Cleanup continues for oil spill at Oswego Harbor — Oil spill cleanup operations at Oswego Harbor have “greatly diminished signs” of the polluting agent, according to Oswego Harbor Generating Station officials. Cleanup efforts are still ongoing at Oswego Harbor after an underground oil pipe coming from the Oswego Harbor Power Station spilled “No. 6 fuel oil” into Lake Ontario earlier this month. Plant personnel — alongside officials from Mayor Billy Barlow’s office and the Oswego Fire Department, members of the U.S. Coast Guard, and State Department of Environmental Conservation (DEC) officials — continue to assess the source of the leak, as well as the volume of oil that spilled into the harbor, an Oswego Harbor Generating Station spokesperson said. So far, cleanup crews have deployed booms to contain the spread of the contaminant, as well as remove any visible traces of oil utilizing special sponges, the spokesperson said. No. 6 fuel oil, according to the National Oceanic and Atmospheric Administration (NOAA), is a “ dense, viscous oil produced by blending heavy residual oils with a lighter oil (often No. 2 fuel oil) to meet specifications for viscosity and pour point.” Information materials on oil spills provided by NOAA indicate that the fuel usually spreads into thick, dark, colored slicks that can contain large amounts of oil. An investigation is underway to determine the amount of fuel spilled, DEC officials said.
Eastern Shore Natural Gas pipeline expansion approved by Sussex County Council - The expansion of a natural gas facility in Sussex County clears its final hurdle in Delaware. The Sussex County Council voted 4 to 1 this week to approve a pipeline capacity expansion at Eastern Shore Natural Gas’ (ESNG) Bridgeville facility. Councilman John Rieley cast the lone “no” vote citing the pipelines’ location, “I love natural gas. I absolutely think it’s the right thing to do - to expand the plant. I just wish it wasn’t there - in that particular location. I’ve often used the example of - you don’t want to put a leather tanning factory in the middle of a residential neighborhood, which seems pretty intuitive. I have to be honest, this strikes me a little bit too close to that type of scenario. And I’m going to vote “no.” The plan has faced criticism by community members and environmental advocates. But Matt Parker - ESNG’s engineering manager - says the proposed facility and trucks involved will be 1,300 feet away from Phillis Wheatley Elementary School, and almost 1,100 feet away from the schools’ playground, “There’s no gas processing that takes place at this facility. So truck offloading and above grade piping are approximately 800 feet from the nearest residence, it’s over 1,000 feet from the playground at Phillis Wheatley Elementary School and 1,300 feet away from the school structure itself.” ESNG claims those distances are safe since the gas is only offloaded and not treated or processed. Parker noted that the proposed facility has three offload points with an approximate 18 trucks coming and going on a daily basis. The project still needs approval from the Federal Energy Regulatory Commission.
Plans for Gibbstown LNG terminal on hold - Plans to build New Jersey’s first terminal to export liquefied natural gas took a step back when the developer of a plant where natural gas would be turned into liquid agreed not to build it under a current permit. Bradford County Real Estate Partners said it wouldn’t have time to build the plant at Wyalusing, Pennsylvania before its air-quality permit expires in July. As part of a court settlement last week, the company will let that permit expire and apply for a new one if it decides to revive the project. That settlement came after three environmental groups in Pennsylvania challenged the project which would export liquefied natural gas from a new terminal on the Delaware River at Gibbstown in Gloucester County to overseas markets where the price of natural gas is much higher than in the U.S. Gas would be pumped from the abundant Marcellus Shale field in northeastern Pennsylvania to the Wyalusing plant. It would then be shipped via train or truck about 175 miles to a former DuPont explosives-manufacturing site at Gibbstown where it would be loaded onto ocean-going tankers. Construction of the dock has been approved by the Delaware River Basin Commission but is on hold from March 15 to Sept. 15 to protect migratory fish, including the endangered Atlantic sturgeon, to comply with permit conditions set by the Army Corps of Engineers. The project also faces a possible study of its environmental impacts by the federal government if the Federal Energy Regulatory Commission decides in a current review that it has jurisdiction. Any such review would add another delay. The project is fiercely opposed by environmentalists who say it would encourage more production of climate-warming natural gas by fracking, expose residents along the route to the risk of catastrophic explosions, and subject residents near the terminal to round-the-clock truck and train traffic. “This is a great victory for the environment and people’s health because the liquefaction plant is highly polluting and would spur new fracking to feed the LNG trains to Gibbstown, causing more pollution and health harms,” said Tracy Carluccio, deputy director of the environmental group Delaware Riverkeeper Network. While the project appears to be on hold at both ends of the route, it has not been abandoned by New Fortress Energy, parent of the Bradford County group, and of Delaware River Partners, which heads construction of the Gibbstown terminal. New Fortress told the Federal Energy Regulatory Commission that it plans to ship the liquefied gas to Gibbstown from the proposed Wyalusing plant, or from unspecified “third-party liquefaction facilities.”
Ohio Chamber wants Michigan pipeline to remain open – The Ohio Chamber of Commerce has joined the legal fight to keep a Michigan pipeline open, urging a U.S. district court to rule against Gov. Gretchen Whitmer as gas prices continue to rise across the country. The Ohio Chamber, along with five other business organizations that include the U.S. and Canadian chambers of commerce, filed a friend of the court brief in federal court supporting Enbridge’s ongoing attempt to keep the Line 5 pipeline open. U.S. District Court Judge Janet Neff is expected to rule any day on whether the case will be heard in state or federal court. The Ohio Chamber believes closing the pipeline under the Straits of Mackinac could be disastrous for consumers and developing U.S. oil production, rather than limiting it, should be the focus. “At a time when the national average for gas is over $4.30 per gallon, policymakers need to look for ways to drive up oil production domestically and in North America. That is why the Ohio Chamber continued our legal efforts to stop Michigan’s governor from single-handedly stifling oil production in our state,” Ohio Chamber President and CEO Steve Stivers said. “The Line 5 pipeline is a critical part of reducing America’s demand for Russian oil because it accounts for 43 percent of the Great Lakes’ refinery capacity and transports half a million barrels of crude oil per day.” Whitmer revoked a land use agreement in 2020 that allowed Enbridge to operate the pipeline, which has been stuck in legal disputes since then. Refineries in Toledo produce 30% of the gasoline and 35% of the diesel used in Ohio, according to the chamber, which added limiting production at the state’s refineries could drive up fuel prices by 10%. Ohio officials said closing the line would cause a significant disruption in the supply chain, which serves as a source of jet fuel for several regional and international airports, particularly in Cleveland and Detroit. It also could affect 20,000 Ohio jobs. Ohio lawmakers, Gov. Mike DeWine and Lt. Gov. Jon Husted also have pressured Michigan to allow the pipeline to remain open. Consumers throughout the Midwest may face up to a combined $5.9 billion annual spike in gas and diesel costs if Whitmer is successful in shuttering the Enbridge Line 5. Over the next five years, the cost could exceed $23.7 billion in additional transportation costs across the region. The estimates come from a study conducted by Consumers Energy Alliance.
Republicans Renew Criticism Of Efforts To Shut Key Oil Pipeline Amid Energy Crisis -Republicans have renewed pressure on the State of Michigan to reverse course on its attempts to shut down Line 5, an operational oil pipeline that supplies much of the Midwest with energy.The GOP leaders argued that Democratic Michigan Gov. Gretchen Whitmer should halt her effort to shutter the pipeline in light of the Ukraine crisis which has threatened a “global oil supply shock.” Since Russia invaded neighboring Ukraine, oil prices skyrocketed above $100 per barrel, touching $120 per barrel at one point, and gasoline prices have hit record levels nationwide.“Let’s get real, the last thing this nation needs is to choke off even more domestic energy production which will push gas prices even higher,” Michigan Rep. Fred Upton, the top Republican on the House Energy and Commerce Subcommittee on Energy, told the Daily Caller News Foundation. “Yes, Line 5 needs to be replaced. Shutting it down, however, would cause real economic havoc.”“Proceeding with replacement rather than shutting it down is the proper safe approach to protect the Great Lakes and our consumers,” he continued. Line 5, which was built in 1953, carries about 540,000 barrels of oil and gas per day from Canada to Michigan, according to the pipeline’s operator, Enbridge. The pipeline provides energy to several Midwestern states, including Michigan, Pennsylvania, Ohio and Indiana. The pipeline transports 4.2-7.8 million gallons of refined products to Michigan per day, including the majority of the state’s propane supply. Shutting Line 5 would lead to refineries in Michigan, Ohio and Pennsylvania receiving about 45% less crude oil leading to a 14.7-million-gallon-per-day shortage of gas, diesel and jet fuel in the region, according to Enbridge. But in late 2020, Whitmer revoked a 1953 easement allowing Enbridge to operate pipelines in the state after asking the company to halt operations over environmental concerns. Enbridge then filed a federal lawsuit against Whitmer, arguing that the authority to regulate international pipelines was given to the federal government.“Line 5 is absolutely essential for not only northern Ohio, but also for Michigan,” Republican Ohio Rep. Bob Latta, a member of the House Energy and Commerce Committee, told the DCNF in an interview. “When you look at it, it’s over 540,000 barrels of product that goes through it a day and it has a $5 billion economic impact into our area.”
Ohio Lt. Gov blasts Michigan Gov. Whitmer for 'unreasonable, irresponsible' effort to shut down oil pipeline - Republican Ohio Lt. Gov. Jon Husted is calling out Michigan Gov. Gretchen Whitmer for her efforts to shut down a major oil pipeline that carries Canadian oil across the Midwest. Whitmer, a Democrat, contends that Enbridge Energy’s Line 5 poses a risk of a "catastrophic" oil spill in the Great Lakes. She and Michigan Attorney General Dana Nessel have launched legal challenges to close the pipeline built in 1953 that moves oil through northern Wisconsin and Michigan to refineries in Ontario.The ongoing Line 5 dispute is getting renewed focus at a time of high gas prices, a ban on Russian oil imports and efforts to boost oil and gas supplies domestically. Husted said Michigan needs to end its legal effort to shut off a friendly source of energy from the Canadian pipeline. Whitmer's actions threaten Ohio's economy and could deliver more pain at the gas pump, the Republican said."With what’s going on with Russia and Ukraine, I think the world is learning right now that we can't be dependent on other nations for the supply of our oil and gas who are adversarial to us," Husted told Fox News Digital in an interview. "We can work with nations who are allies — in this case, with Canada and Line 5 — but Michigan is being unreasonable and irresponsible with their actions."Ohio Lt. Gov. Jon Husted is calling out Michigan Gov. Gretchen Whitmer for her efforts to shut down the Line 5 oil pipeline that supplies crude oil to Ohio refineries. (Governor Jon Husted's office)The Russia-Ukraine war, however, hasn’t prompted the Whitmer administration to end its pipeline fight. Nessel, the Michigan AG, recently said she hopes the Biden administration would be more "vocal" on shutting down the pipeline and contends that the impact on Michigan gas prices would be "incredibly minimal.""I do wish that the Biden administration would be even a fraction as vocal about the importance of shutting down Line 5 as Justin Trudeau and his government have been about, you know, maintaining a pipeline that has outlasted its lifespan by, you know, two times," Nessel reportedly told the Royal Oak Area Democratic Club in March. The increased consumer energy prices have signaled to Whitmer a need to develop alternatives to oil, rather than become more dependent on fossil fuels, her office claimed.
Pro-Line 5 businesses, critics argue whether legal fight should be in federal court - Dueling court filings in recent days pit certain business interests against others in the legal fight between Michigan’s governor and Enbridge over the Canadian company’s Line 5 pipeline. Amicus briefs filed a few days apart last week in federal court by the Great Lakes Business Network and a group of six large chambers of commerce argue opposing sides of the battle between Gov. Gretchen Whitmer and the energy transportation company. The governor wants Enbridge’s countersuit tossed out of federal court after she dropped her case to halt the flow of Line 5. Whitmer opted to instead support the pending case state Attorney General Dana Nessel filed against the company, also meant to halt the pipeline’s use. Representatives from the chambers argued to keep Enbridge’s case in federal court as a matter of national energy policy, while the business network officials want state authorities to shut down Line 5 because of the oil spill risk it poses to freshwater in the Great Lakes. “At a time of geopolitical uncertainty, energy security has taken on a renewed importance. Given the current disruptions to energy supplies and rapid increases in prices at the pump, we need to be firing on all cylinders to provide consumers with safe and reliable access to a menu of energy sources,” said Mark Agnew, Canadian Chamber of Commerce senior vice president of policy and government relations. The U.S. Chamber joined Canada’s in the brief filing, along with state chambers from Michigan, Ohio, Pennsylvania, and Wisconsin. The briefs are the latest blows in the bout over the fate of the section of Enbridge’s Line 5 pipeline that runs beneath the waters of the Straits of Mackinac between the Upper and Lower peninsulas as a shortcut for the Canadian company. The segment is a section of the pipeline that daily moves about 23 million gallons of crude oil and natural gas from Alberta oil fields to petrochemical refineries in Sarnia, Ontario, picking up some fuel from northern Michigan along the way. The chambers argue only the federal government can make interstate oil pipeline decisions, but that’s just not true, said Bentley Johnson, federal government affairs director for the Michigan League of Conservation Voters. He said the location of the disputed section of pipeline in the water is what makes it inherently unsafe and as a result, a state matter. “Enbridge could put every pipeline safety measure available to the industry on Line 5 and it would still be an unacceptable threat to our state to have it sitting on the bottom of the Great Lakes, vulnerable to ship anchors and other threats. The State of Michigan has the legal and moral duty and obligation to protect these water resources that they manage in the public trust, and so the case belongs in state court, to be decided by state judges and decision-makers,” he said. The brief filed by the business network – a collection of tourism and freshwater-dependent companies across Michigan – argues any underwater Line 5 rupture would devastate the economy across the Great Lakes Basin. Further, it contends such an ecological disaster would have far larger negative effects than any economic hardship Enbridge would experience should it lose its shortcut through Michigan.
Big Oil in the Mackinac Straits Is a Disaster Waiting to Happen --“Native American sovereignty supersedes Big Oil’s authority.” This was the thought that occurred to me as I made my way home from Lansing, through the Mackinac Straits, the body of water that connects Lake Michigan to Lake Huron, last month. I had just made a presentation to the Mackinac Straits Corridor Authority (MSCA) as part of the Indigenous community’s ongoing battle to shut down a 1950s-era oil pipeline built and operated by the Canadian company Enbridge. Given the volume of water that passes through the straits and the direction of the currents in the area, the University of Michigan Water Center has determined that the Mackinac Straits are the very worst place in the Great Lakes for an oil spill to happen. The pipeline should not be there at all, but now Enbridge wants to go even further, blasting a new underground tunnel beneath the straits to replace the existing underwater pipeline. A broad coalition of Michiganders have come together to oppose Line 5, including Michigan Governor Gretchen Whitmer and Attorney General Dana Nessel.The MSCA was created by the state’s former Republican Governor Rick Snyder during his last days in office as a rubber-stamp organization to legitimize Enbridge’s interests. So we were not surprised when the authority granted Enbridge permission to move forward on the project. But a storm is coming. An elder woman from my tribe once recounted an Anishinaabek prophecy to me: A black snake would come to our land and try to poison our waters—but would end up uniting our people as never before. This has come to pass. In an unprecedented action, all 12 federally recognized tribes in Michigan came together to write a joint letter to President Joe Biden, arguing that Enbridge’s black snake under the straits violates treaties that the United States made with us, as sovereign nations, when it forced us to cede our land. The Standing Rock movement woke me up—as it did so many Native people of my generation. The following year, I returned to Michigan, and worked as a visual artist and musician in Detroit. I soon became increasingly interested in the water that surrounds us in the Great Lakes region. After all, the Anishinaabek first migrated here from the east hundreds of years ago because of a prophecy that requires us to protect the water.
Enviros say GOP, oil industry are using high gas prices to fearmonger about pipeline shutdowns ⋆ Gas prices have soared in recent weeks amid inflation and the Russian invasion of Ukraine, with some Democrats raising concerns about price gouging.Although they’re starting to drop, many Republicans and oil companies are still using gas prices to criticize Democrats President Joe Biden and Gov. Gretchen Whitmer for efforts to shut down oil pipeline projects.This is not the first time GOP lawmakers have focused on gas prices to make the case against the decommissioning of Line 5 and other pipelines. But when gas prices reached a record average high of $4.33 per gallon on March 11, the highest since 2008, that argument has ramped up.On his first day in office, Biden revoked the Keystone XL pipeline extension permit, which would have transported tar sands oil across three states — Montana, South Dakota and Nebraska. In Michigan, Whitmer and Attorney General Dana Nessel have been working to stop the Canadian-owned Line 5 pipeline in the Straits of Mackinac.Right-wing media has been a key place for pro-pipeline arguments. In the fall, as Line 5 lawsuits between Enbridge and the state of Michigan played out, GOP lawmakers, conservative figures and media ramped up the pro-pipeline rhetoric and put a highly politicized lens on the debate, as the Advance previously reported.Those include a tweet from GOP gubernatorial candidate Ryan Kelley, claiming that “Biden and his progressive leftist agenda [are] taking aim at Line 5” (despite Biden still not taking a public stance on the pipeline); and remarks from groups and lawmakers in office slamming both Biden and Whitmer over Line 5. That rhetoric has reemerged as gas prices took off. “Whitmer wants higher gas prices,” is the title of a Wall Street Journal editorial last week. Arguing that a Line 5 shutdown would raise costs at the pump for Midwesterners, the editorial heavily cites a newstudy from Consumers Energy Alliance (CEA) that claims Midwesterners will spend “at least $23.7 billion more on gasoline and diesel” in the five years following a shutdown.The nonprofit Consumers Energy Alliance is a front group for the energy industry that pushes pro-oil and gas messaging in the United States, according to SourceWatch.Enbridge spokesperson Ryan Duffy, referring to the CEA report, said it is “clear that a shut-down of Line 5 would only add to the current disruption of the energy market, and would hurt small businesses and the hard-working families in Michigan and throughout the region, at a time when they can least afford it.” But environmentalists say the attempt to connect currently high gas prices with these pipeline shutdowns is nothing more than empty rhetoric.“What’s been alarming to me is how that report is being picked up as fact,” said Beth Wallace, National Wildlife Federation (NWF) Great Lakes campaign manager, “whereas several other reports that use sourcing and facts and regional dynamics are being brushed off.”
Illinois AG files suit against Marathon over crude oil spill | ksdk.com— The Illinois Attorney General is suing an oil company after more than 160,000 gallons of crude oil leaked into Cahokia Creek. When a leak was identified in the Marathon Pipe Line near Edwardsville, Illinois, Virginia Woulfe-Beiley was initially satisfied with the response. "Illinois regulators took really swift action containing and determining the cause of the leak,” said Virginia Woulfe-Beiley. However, the Sierra Club-Piasa Palisades member said she was shocked when she found out more than 160,000 of crude were spilled into Cahokia Creek. "My first thoughts really went to public safety, clean air, clean water, and the wildlife in our area,” said Woulfe-Bailey. "Unfortunately, we have seen a number of animals that have had to be treated for exposure to the pipeline release,” said Andrew Armstrong, Chief of the Environmental Bureau of the Illinois Attorney General’s Office. That's why the Illinois Attorney General's Office is stepping in. "It's a very serious case in terms of the amount of the release,” said Armstrong. “That's why our office is acting so quickly." A lawsuit filed against Marathon Pipe Line in Madison County Court alleges multiple violations of the Illinois Environmental Protection Act. "This amount of oil can create fumes that can threaten public health,” said Armstrong. “Certainly it has already impacted the environment and the surrounding river and wetlands." A Marathon spokesman says the company has already removed more than 5,300 cubic yards of contaminated soil along with more than 11,000 barrels of oil and water. "We need to see a complete and total cleanup of the release,” said Armstrong. “We need to make sure that Marathon is taking all actions it can to prevent all future releases in our state." "We're hoping that it's a long time before we see anything else like this,” said Woulfe-Beiley. “We have to stay vigilant." As part of its lawsuit, the state of Illinois is seeking civil penalties of $50,000 for each violation of the Illinois Environmental Protection Act and Illinois Pollution Control Board regulations, as well as an additional penalty of $10,000 for each day of each violation
Cleanup of big Edwardsville oil spill continues, but pipeline concerns persist - An oil spill in Edwardsville unleashed an estimated 165,000 gallons of crude oil into Madison County waterways earlier this month. It’s among the largest local spills on record — but for residents near the spill site, it wasn’t clear at first that anything was wrong. The first local observation started with a smell. On March 11, the Edwardsville Fire Department alerted residents on Facebook to “multiple calls this morning for an odor of natural gas in the air.” But it wasn’t natural gas. Instead, it was an oil spill from Marathon Petroleum, which maintains a 75-mile pipeline that runs for part of its length parallel to Cahokia Creek. On Wednesday’s St. Louis on the Air, Edwardsville resident Toni Oplt recalled detecting the smell but not knowing what it meant: One of her neighbors believed that a work crew was tarring a road. Days later, another complained the smell was giving her headaches. Oplt is an environmental activist, a member of the Sierra Club and chairperson for the Metro East Green Alliance. She argues Edwardsville could have done more to alert residents to the environmental disaster taking place inside its borders. Although the city did share the alert and updates from its Fire Department to its main Facebook group, officials didn’t reach out to those directly affected. Said Oplt, “For people like myself, for community members, it becomes a long series of questions that don't get answered.” Cahokia Creek and the bike trail alongside it are frequented by nature lovers and young people during the warmer months, Oplt said. She’s concerned about health effects. On March 12, one day after the spill was first reported, Oplt snapped a photo from the trail where it passes over the creek — the picture shows a sheen of oil sliding across the water’s surface. In a statement to St. Louis on the Air, Marathon Petroleum said that its crews are continuing to work along the area of the spill near the Cahokia Creek. The statement added that the spill is being “monitored 24 hours a day for impacted wildlife and audible deterrent is being used to keep any animals from entering the affected area.” In an earlier statement, the company claimed it had already recovered between 2,200 and 3,000 barrels of oil that had spilled from the pipeline, KMOV reported. Hannah Flath, communications coordinator for Sierra Club Illinois, cautioned that Marathon’s recent actions appear limited to the short-term problems raised by the spill. “The Metro East area, and really Illinois more broadly, is unfortunately at risk for these incidents because of the network of pipelines underneath the ground,” she said. “We are of course at the center of the country, which makes us home to more miles of fossil fuel pipelines and most other states, putting our communities at risk.” On Monday, the St. Louis Post-Dispatch reported on “the web of pipelines that crisscross the St. Louis region” — and the prevalence of oil spills. Reporters Bryce Gray and Janelle O’Dea revealed the numbers behind the incidents: 432 combined spills in Missouri and Illinois since 2020, 72 resulting in spills of 1,000 gallons or more; 36 spills exceeded 10,000 gallons, while 13 — not including the recent Edwardsville spill — exceeded 100,000 gallons. Flath said those numbers raise a bigger issue about the pipelines running beneath our feet. It’s not just about keeping them well-maintained and less likely to spill, she said, “but also to ultimately do whatever we can to end our reliance on these pipelines.” “Down the road, we need to think about not just this spill,” Oplt said. “We need to think about the next one.”
Amazon's NKY cargo hub spills 1,700 gallons of jet fuel — The Kentucky Energy and Environment Cabinet says a mechanical failure caused a jet fuel spill at Amazon Inc.’s air cargo hub at CVG Airport in Hebron, Ky., but the March 15 spill was contained before it caused environmental damage. An incident report from the Cincinnati/Northern Kentucky International Fire Department said Amazon mechanics initially estimated the spill at between 15,000 and 16,000 gallons of jet fuel. But Amazon later informed the airport that the spill was 1,700 gallons, or 13% of the fuel tank that had a defective valve. “The incident was handled in accordance with our approved environmental containment and remediation plans and at no point did it present any safety concerns to personnel or operations at our facility,” said Amazon spokeswoman Alisa Carroll. John Mura, spokesman for the environmental cabinet, said the spill was contained. “The fire department flushed the material into the drainage system that leads to an oil-water separator,” Mura said. “An environmental contractor pumped out the spillage and there is no indication that water ways were impacted.” James McCloud, environmental inspector on Kentucky’s emergency response team, said it was one of the largest fuel spills he could recall at CVG in the last several years.
Jury boosts landowners' compensation for Bent Mountain property taken by Mountain Valley Pipeline - A jury ordered Mountain Valley Pipeline to pay $523,327 Thursday for a prime piece of Bent Mountain real estate that it took, against the owners’ wishes, using its power of eminent domain. The company building a natural gas pipeline first offered about $119,000 for an eight-acre easement through the 560-acre tract. After the Terry family refused to sell, Mountain Valley took possession of a 125-foot-wide right of way and quickly began cutting trees on land that includes old-growth forests, meadows and the headwaters of Bottom Creek. Four years later, company attorneys argued this week that the Terrys deserved $151,850 for their loss. The jury saw it differently, awarding most of the $570,000 the family had sought. The verdict in Roanoke’s federal court came after four days of often conflicting testimony from appraisers who were asked to put a price on land that has been with the Terry family for seven generations. “I think it was a great thing for the jury to do,” said Frank Terry, who lives in a circa-1890 farmhouse on property that he jointly owns with his brother and sister, John Coles Terry and Elizabeth Terry Reynolds. “I don’t want them on my property, and if I could I’d keep them off,” Terry said of construction crews building the deeply controversial project that slices through the rural heart of the New River and Roanoke valleys. Joe Sherman, a Norfolk attorney who represented the family, told the jury that the only measure of justice would be to award just compensation, or the difference between the fair market value of the land before and after it was condemned for the pipeline. “The Terrys can’t stop this project,” he said. “That’s been decided. So their only remedy is money.” Jurors were asked to sort through the work of four different appraisers, who offered widely different values and accounting methods in testimony that was both dry and sometimes contentious. Joseph Thompson, a Roanoke appraiser hired by Mountain Valley, said he found the property to be worth $1.2 million before the taking. The pipeline easement reduced the value by 12%, he testified, which worked out to a just compensation figure of about $150,000. The Terrys countered with an initial assessment of $1.9 million and a diminution of 30%. That put just compensation at $570,000, Sherman told the jury. In 2017, after proposing a 303-mile pipeline that would run through West Virginia and Southwest Virginia, Mountain Valley began to approach landowners in its path. About 85% of the property owners agreed to sell their land, the company says. Those who did not – including the owners of about 300 parcels in Southwest Virginia – were sued by Mountain Valley, which had the power of eminent domain on its side. Over the years, eminent domain has traditionally been used for government projects to take private land for a public good, such as the construction of highways. But the Natural Gas Act gives private companies like Mountain Valley the authority to condemn land for pipelines when there is a determination of public necessity, which the Federal Energy Regulatory Commission found in 2017. U.S. District Judge Elizabeth Dillon ruled the company had the right to immediate possession of the land in early 2018. Tree cutting began shortly afterward, and Mountain Valley was allowed to work out just compensation for the owners in the years that followed.
With construction at a standstill, Mountain Valley Pipeline looks for solutions -Adding a splash of yellow to the drab winter landscape, dozens of excavators and bulldozers sit in rows on a gravel lot, idled by the latest stop in construction of the Mountain Valley Pipeline. Developers had hoped the equipment would be in the field by now, finishing work on a natural gas pipeline that was supposed to be done four years ago. But on a mild afternoon last week, crews loaded one of the excavators onto a tractor-trailer bound for a different construction job, one with more promise. Mountain Valley — which lost two permits this year to a federal appeals court that has repeatedly struck down its government-issued approvals — is facing the greatest danger of collapse since the $6.2 billion infrastructure project was authorized in 2017. While construction remains at a standstill, efforts to revive the pipeline continue on several fronts: Attorneys for Mountain Valley have asked the full 4th U.S. Circuit Court of Appeals to reconsider decisions by a three-judge panel, which in late January struck down a permit allowing the pipeline to pass through the Jefferson National Forest and the following week invalidated an opinion from the U.S. Fish and Wildlife Service that work would not jeopardize endangered species. U.S. Sen. Joe Manchin of West Virginia is calling for legislative or executive action to advance the project. The 303-mile pipeline will start in the Mountain State before passing through the Roanoke and New River valleys. And with Russia’s invasion of Ukraine tightening the global energy market, supporters of Mountain Valley say it’s needed more than ever for a steady supply of natural gas. Seeking legal relief A federal appellate court based in Richmond — and in particular, three judges on the 15-member court — has been perhaps the sharpest thorn in the side of a joint venture of five energy companies that make up Mountain Valley Pipeline LLC. Chief Judge Roger Gregory and judges Stephanie Thacker and James Wynn have presided over 12 cases in which environmental groups challenged permits issued to Mountain Valley and the Atlantic Coast Pipeline, a similar project that was canceled in 2020 as legal problems mounted. “That panel’s record speaks for itself,” pipeline attorneys wrote in a recent court filing, stating that all but two of the 12 contested permits have been vacated or stayed over the past four years. On March 11, a petition filed by Mountain Valley asked the full Fourth Circuit to consider the decisions of the three-judge panel in a rare proceeding known as an en banc hearing. “The consequences of the panel’s actions are grave,” the petition states. “Its errors have trapped Mountain Valley and the agencies in a perpetual loop, ordered to redo work that was neither arbitrary nor capricious, knowing that revised analysis will yet again be subject to inappropriately aggressive review.”
EPA eyes new rule for gas-fired power plants - EPA Administrator Michael Regan confirmed earlier this month that his agency plans to focus on gas-fired power in its updated carbon rule for new power plants. But how to do it raises a barrage of legal and technological questions that will have implications for how — and whether — the United States can decarbonize its power grid. The forthcoming rule would replace a 2015 standard that’s still on the books and covers carbon from new coal and new gas power plants. While the Obama-era rule effectively mandates that new coal-fired units reduce emissions through partial carbon capture and storage, its requirements for gas are lax enough to be met easily by most new builds. EPA data shows that the average existing gas combined cycle power plant in 2020 emitted 865 pounds of CO2 per megawatt-hour. The Obama-era rule allows it to emit 1,000 pounds of CO2 per MWh. Now EPA is preparing to ask gas plants to do more. Regan told an audience at CERAWeek by S&P Global in Houston two weeks ago that EPA would release a white paper this spring on “readily available” mitigation techniques for new natural gas combustion turbines, followed by a public comment period, final paper and draft rule later this year. Instead of laying out policy, he said, the paper “frames the public dialogue on approaches to reduce climate pollution from new gas-fired units.” EPA told E&E News that the paper would be out in the next few weeks. In starting with a white paper, EPA is adding at least one step to its usual rulemaking process. Typically, the agency would roll out a so-called advanced notice of proposed rulemaking to signal its intent to regulate and collect information on technologies and measures that should form the basis for a rule. But EPA has started work on this as it awaits a Supreme Court decision that could make regulating for climate change harder, at least until Congress passes a new law. While the new power plant carbon rule isn’t the focus of West Virginia v. EPA, an expansive decision in that case could curtail the agency’s regulatory authority in ways that would affect it. “It may not want to antagonize the Supreme Court,” he said. Utility experts say a new gas plant rule that seeks to limit carbon beyond what could be accomplished through simple heat-rate improvements on-site likely would be based either on co-firing of gas with a lower-carbon fuel like hydrogen or on carbon capture and storage, called CCS. Both options present their own challenges. And experts say that a rule based on them might have broader implications for the power system if they make new gas plants less competitive and shift the industry toward reliance on older gas and new renewables.
19 states appeal FERC natural gas policies --The "Commission cannot wield jurisdiction over activities such as upstream development of natural gas wells or downstream combustion of natural gas by utilities or end-users, all of which exceeds the Commission’s authority," the appeal said.Nineteen states are challenging two natural gas policies recently established by the Federal Energy Regulatory Commission, arguing that the changes infringe on states' rights to pursue the energy resources of their choice.Led by Louisiana Attorney General Jeff Landry (R), the states appealed FERC policies last week that they say prioritize concerns about climate change over the commission's obligation to ensure energy is reliable and available at a reasonable cost.Alabama, Alaska, Arizona, Arkansas, Florida, Georgia, Idaho, Kansas, Kentucky, Mississippi, Missouri, Nebraska, Ohio, Oklahoma, South Carolina, Utah and West Virginia joined Louisiana in signing on to the request for rehearing. Texas also filed a similar request of its own. All proposed natural gas pipelines and export facilities will be subject to the new policies, inflicting "major new costs and uncertainties" for project developers and potentially depriving states of tax revenue from the projects, the states charged. Some of the signatories produce significant volumes of oil and gas.
FERC retreats on gas policies as chair pursues clarity -The Federal Energy Regulatory Commission has rolled back sweeping new policies for large natural gas projects, including a framework for assessing how pipelines and other facilities contribute to climate change, weeks after prominent lawmakers panned the changes. In a decision issued unanimously at the commission’s monthly meeting yesterday, FERC will revert back to its long-standing method for reviewing natural gas pipeline applications — while opening changes announced in February to feedback rather than applying them immediately. The commission also signed off on three new natural gas pipelines, one of which will pump more natural gas into New York state in a project described by utilities as essential for reliable gas service. While the policy changes issued in February were intended to update and improve the agency’s approach for siting new gas projects, the commission has concluded that the new guidelines “could benefit from further clarification,” said FERC Chair Richard Glick. “I’m all for providing further clarity, not only for industry but all stakeholders in our proceedings, including landowners and affected communities,” said Glick, a Democrat who supported the initial changes. In a pair of orders condemned by the commission’s Republican members, FERC’s Democratic majority voted last month to advance new policies altering the commission’s process for reviewing new natural gas projects (Energywire, Feb. 18). One of the policies expanded the range of topics included in FERC’s reviews of interstate pipelines, adding new consideration for environmental and social issues. It explained that the commission would consider four major factors before approving a project: the interests of the developer’s existing customers; the interests of existing pipelines and their customers; environmental interests; and the interests of landowners, environmental justice populations and surrounding communities. The other policy was an “interim” plan for quantifying natural gas projects’ greenhouse gas emissions. It laid out, for the first time, how the agency would determine whether new projects’ contributions to climate change would be “significant,” and encouraged developers to try to reduce their greenhouse gas emissions. Environmental advocates had praised the changes, with some saying the new policies were long overdue for an agency that has historically signed off on nearly all the natural gas projects that have come before it, with little consideration of climate change impacts. But natural gas companies said the changes would chill investments in new pipelines and gas export terminals at a time when some foreign policy experts have called for shipping more gas to Europe. Sen. Joe Manchin (D-W.Va.), chair of the Senate Energy and Natural Resources Committee, called the policies a threat to national security and energy independence.
Federal regulators pulls back plan to assess climate impact of gas pipelines (AP) — Amid pushback from industry and lawmakers in both parties, federal energy regulators on Thursday scaled back plans to consider how natural gas projects affect climate change and environmental justice. The Federal Energy Regulatory Commission said a plan to consider climate effects will now be considered a draft and will only apply to future projects. Industry groups and key lawmakers had criticized a proposal approved last month to tighten climate rules, saying it was poorly timed amid a push for increased natural gas exports following Russia’s invasion of Ukraine.Senate Republican Leader Mitch McConnell called the climate policy “baffling,” while Senate Energy Committee Chairman Joe Manchin, D-W.Va., said the agency’s “reckless decision to add unnecessary roadblocks” to approval of natural gas projects “puts the security of our nation at risk.”“At a time when we should be looking for ways to expedite the approval of these important projects, the (energy) commission has chosen on a purely partisan basis to do the exact opposite,” McConnell wrote in a letter Thursday, hours before the panel backtracked on the climate proposal. Climate activists accused FERC of bowing to political pressure, a claim FERC Chairman Richard Glick denied. “I’m not going to do anything for political purposes,” he told reporters, adding that he and other commissioners have had discussions with numerous pipeline and natural gas companies since the panel approved the climate policy last month. Industry leaders told them the policy changes “raise additional questions that could benefit from further clarification,” Glick said. At a Feb. 17 meeting, the energy commission approved policy statements directing officials to consider how pipelines and other natural gas projects affect climate change and environmental justice. The statements were approved on a 3-to-2 vote along party lines, with Glick and two other Democratic commissioners supporting the policy changes and two Republicans opposed.The panel said at the time that the new guidance would take effect immediately and apply to pending and future gas projects. The panel voted unanimously Thursday to step back from that commitment, which is now labeled as a draft and would apply only to projects filed after FERC finalizes the policy statements. The commission said it will seek further public comment before making a final decision. In a related development, FERC approved three natural gas projects that have been pending before the panel for months. Two of the projects will expand gas production in the U.S. Gulf Coast, while the third is located in New York State. One of the projects will connect with an export terminal in Louisiana for liquefied natural gas.The U.S. sharply increased LNG exports to Europe in the runup to the Ukraine war and is looking for ways to “surge” LNG supplies to Europe to help reduce the European Union’s dependence on Russian gas, said Jake Sullivan, President Joe Biden’s national security adviser.The EU imports 90 percent of the natural gas used to generate electricity, heat homes and supply industry, with Russia supplying almost 40 percent of EU gas and a quarter of its oil.
API comments on SEC proposed climate disclosure rule - American Petroleum Institute (API) Senior Vice President of Policy, Economics and Regulatory Affairs Frank Macchiarola issued the following statement in response to the Securities and Exchange Commission’s (SEC) proposed climate disclosure rule. “The U.S. oil and natural gas industry has a long history of sustainability reporting, and achieving greater comparability and transparency across those efforts is a leading priority. We are concerned that the Commission’s sweeping proposal could require non-material disclosures and create confusion for investors and capital markets. As the Commission pursues a final rule, we encourage them to collaborate with our industry and build on private-sector efforts that are already underway to improve consistency and comparability of climate-related reporting.”
Will Russia-Ukraine Crisis Prompt Biden Administration Reset for Natural Gas and Oil Policy? - The backdrop of the Russia-Ukraine conflict could be an opportune time for the Biden administration to improve the United States’ oil and gas investment climate and bolster domestic energy security, the North Dakota Petroleum Council (NDPC) and other industry organizations told NGI. dg6 NDPC’s Brady Pelton, vice president, said that Biden “has not really been a supporter of the fossil fuel industry” and has “soured up investors in the oil and gas plays and put them at a disadvantage.” Pelton, whose organization represents oil and gas industry players in the Dakotas and the Rocky Mountain region, said the administration “from Day 1, pre-Day 1, has been so focused on eliminating the oil and gas industry.” Pelton’s comments on behalf of NDPC echo those from across the U.S. oil and gas industry, which has criticized the administration for taking actions such as halting leasing on federal land, suspending leasing in Alaska’s Arctic National Wildlife Refuge, and trying to cancel a Gulf of Mexico lease auction that a federal judge later invalidated.. In response to Russian hostilities in Ukraine, the Biden administration and Congress have taken steps to make the United States off-limits to Russian natural gas and crude oil. Actions have included Biden’s executive order banning imports of Russian oil, liquefied natural gas (LNG), and coal as well as a legislative ban making its way through Congress. “The Biden administration has immense power today to change the narrative,” Pelton said. In North Dakota, for instance, Pelton said the administration could work on approving federal drilling permits. “We have about 1,000 wells that aren’t being drilled because of a halt to leasing” in the Bakken Shale, he said. Although many of the wells would be drilled on privately owned land, Pelton said that federal approval would be needed when a nexus – in this case an extension into federal land via horizontal directional drilling – exists. “When you have a well that’s located on private, non-federal land with a lateral that extends into a unit that has federal minerals in it, a federal permit is needed,” he explained. “I think that expanding the ability to produce those wells would have a great impact,” said Pelton. “It would also send a great message to the market that this administration supports the development of domestic natural resources.” Along those lines, the Alaska Oil and Gas Association’s Kara Moriarty, CEO, told NGI the Russia-Ukraine conflict and its effects convey another message: the United States needs to be “truly energy independent. “The demand for oil and gas remains, and America has plentiful resources,” she said. “We just need the right investment and regulatory framework to deliver these energy sources to the market and consumers.” Texas Oil and Gas Association’s Todd Staples, president, said the Russia-Ukraine situation “should help reset American priorities and recognize that American oil and natural gas are produced in more environmentally responsible ways than in any other country in the world.” Staples said the high fuel costs U.S. motorists are paying at the pump highlight “the importance of domestic energy production,” with consumers “feeling the repercussions of canceled pipeline projects, delayed approvals for permits and the discouragement of additional expansion, poor decisions exacerbated by the war. “The administration calling on foreign countries to increase production…, rather than encouraging local jobs and local investment, had a chilling effect on expansion,” he said. The Ohio Oil and Gas Association (OOGA) backs Biden’s move to curb Russian imports, but the action represents “only one small part of the solution,” OOGA’s Mike Chadsey, public relations director, told NGI. “Our call to the White House is to unleash American energy by restarting the federal leasing program, approve the permits that have already been filed, and approve the delayed or canceled pipeline projects,” he said. “
U.S., EU reach LNG supply deal to cut dependence on Russia — The U.S. and the European Union will push to boost supplies of liquefied natural gas to European countries by the end of 2022 in a bid to begin to displace some Russian gas, a political framework that now leaves companies to sort out the details. Under the agreement, Europe will get at least 15 billion cubic meters of additional LNG supplies by the end of the year, though it’s not clear where it will come from. Member states will also work to ensure demand and facilities to take in up to 50 billion cubic meters of American fuel until at least 2030. The aim is to work with international partners to help the continent wean itself off Russian gas, which accounts for about 40% of Europe’s needs. “We’re coming together to reduce Europe’s dependence on Russian energy,” U.S. President Joe Biden said at a joint press conference with European Commission President Ursula von der Leyen, who added that 15 billion cubic meters this year “is a big step in that direction.” Europe is trying to diversify its energy sources in a bid to starve Russia of the revenues it needs to fund the war in Ukraine. But that’s a mammoth task. Russia ships about 150 billion cubic meters of gas to Europe via pipelines every year, and another 14 billion to 18 billion cubic meters of LNG. That means any disruptions to flows of pipeline gas from Russia would hard to cope with. “It’s a start, but relatively small compared to the overall supplies from Russia,” said Jonathan Stern, a research fellow at the Oxford Institute for Energy Studies. “All contributions will be welcome but the task is huge.” Details of the 15 billion cubic meters are vague. Contracts have not been signed for the full volume, U.S. National Security Advisor Jake Sullivan said. It will come from “a variety of sources,” and not just the U.S., he said. “We believe that we’ve identified the sources to be able to hit that target,” Sullivan told reporters on Air Force One on Friday. The U.S. has expanded the number of countries that can receive gas from its own terminals, worked already to divert existing orders and also had Biden engage with other countries, including Qatar, he said. “So when you put all of those pieces together, we feel quite confident that we’ll hit our mark,” Sullivan said. The issue is critical as Russia is the EU’s biggest gas supplier. The EU also relies on the country for the biggest share of its coal and oil imports, and has struggled to shift its energy policy away from Moscow. The details of how the plan works is now in the hands of energy companies, with American LNG shippers and German buyers set to meet next week in Berlin to hash out possible deals. “While gas is still a substantial part of the energy mix, we want to make sure that the Europeans do not have to source that gas from Russia,” Sullivan said. The U.S. has already been providing more LNG to Europe, with shipments doubling to record 4.4 billion cubic meters in January and a similar level in February. Supplying another 15 billion cubic meters could be feasible as long as Europe continue to pay a premium to cargoes compared to Asian buyers. A significant boost to global LNG supplies will only come from 2025, when new projects are scheduled to come online. It’s also unclear whether the supplies would be coming from additional production or from cargoes being redirected from other regions. Currently, European buyers are competing with Asian countries for the world’s limited supply of LNG cargoes.
API welcomes Biden administration's LNG agreement with EU -American Petroleum Institute (API) President and CEO Mike Sommers and Energy Workforce & Technology Council CEO Leslie Beyer said their associations welcome the announcement by President Biden and European Commission President von der Leyen establishing a joint task force to help increase U.S. LNG exports to Europe and reduce their dependency on Russian natural gas. “We welcome the president’s focus on expanding U.S. LNG exports to our European allies during this crisis, and we applaud the administration’s continued leadership in ensuring a unified international response to maximize pressure on Russia through additional sanctions,” Sommers said. During recent months, American producers have significantly expanded LNG shipments to allies, establishing Europe as the top US LNG export destination, he said. “With effective policies on both sides of the Atlantic, we could do even more to support Europe’s long-term energy security and reduce their reliance on Russian energy,” Sommers said. “We stand ready to work with the administration to follow this announcement with meaningful policy actions to support global energy security, including further addressing the backlog of LNG permits, reforming the permitting process, and advancing more natural gas pipeline infrastructure.” “We welcome the call for more exports of LNG to Europe and for increased domestic production," Beyer said. "Our industry is ready to help fill the gap as the world continues to shun Russian oil and gas." U.S. production is on the rise and can continue to ramp up, but the Administration must pullback excessive regulatory hurdles, and support and encourage long-term investment in domestic oil and gas production and infrastructure, Beyer said. "We were encouraged by FERC’s actions yesterday to approve three pending applications and to hold off on implementing detrimental policies on applications until the policies are finalized. Rapid increases in domestic production won’t happen overnight, but we are confident that the industry can step up and satisfy the energy needs of the U.S. and our allies."
Drillers say there are still questions overhanging Biden LNG deal with Europe - Oil and gas producers said Friday's announcement that the Biden administration pledged to dramatically increase the amount of liquified natural gas to make up for Russian gas has a number of questions still be resolved, including how the pipelines and export terminals required will be built as smoothly and as quickly as possible. Shale companies have long looked to LNG, a form of natural gas that comes out of the Marcellus and Utica that can be shipped overseas, as a potential global market. That's certainly occurred in recent years, when LNG exports from the United States has gone from 3 billion cubic feet/day to 13 billion cubic feet/day in short order. But LNG exports are at capacity, both in pipeline capacity and export terminals. The gas is in the ground and could be produced, but drillers say it's difficult without being able to take it to market. That would require building more pipelines and export terminals, although regulatory and legal climates haven't favored either lately. The Biden administration's agreement with the European Commission calls for an additional 1.5 billion cubic feet of LNG exports to the European Union in 2022 alone and a potential for 5 billion cubic feet per year of additional LNG a year until 2030 while retaining climate-change goals. But the details remain murky, as does how producers will provide LNG. There's the capability — and more importantly the economical raw material — but not immediately on tap."It's unclear frankly whether they are talking about doubling or tripling LNG exports to Europe in the next decade," said Hardy Murchison, CEO of Encino Energy, the second-largest producer of natural gas in Ohio and the fourth-largest privately owned shale company in the U.S. "Whatever scale it's on, the next step is we're going to have to hold them to it, and that means we're going to have to get some infrastructure built." Encino, an 11-year-old company that purchased Chesapeake Energy's large stake in the Ohio Utica in 2018, is a major LNG producer. About 70% of Encino's gas production goes down to the Gulf Coast and becomes LNG through a deal with Cheniere Energy, the Houston-based global leader in LNG. Murchison said that carrying out the plan requires a lot more infrastructure, including pipelines to the East Coast, Gulf Coast and elsewhere, as well as export terminals along the U.S. East and West coasts and import terminals in western Europe. But he said the industry isn't looking for handouts, just to allow the markets to work naturally. The infrastructure spend would be born by the companies themselves, producers have said, as long as there's a guarantee of the market. Anne Bradbury, CEO of the American Exploration and Production Council trade group for shale drillers,, said that regulatory agencies need to put in place policies to support LNG exports. “In recent months, U.S. producers have significantly expanded LNG shipments to our European allies. With an abundance of natural gas in the Marcellus and Utica shales, Pennsylvania is the second-largest producer of natural gas and a key energy exporter," . "We could do even more to support Europe’s long-term energy security and reduce their reliance on Russian energy with effective policies, such as addressing the backlog of LNG permits, reforming the permitting process and expanding natural gas pipeline infrastructure.
Rice: European LNG agreement important first step - EQT Corp. CEO Toby Z. Rice on Friday welcomed the Biden administration's agreement with western Europe to increase exports of liquified natural gas from the U.S. as a first step toward helping to boost allies' energy security and the American economy.Rice was, well before the energy crisis and Russia's invasion of Ukraine, was one of the chief advocates of LNG on the global stage and the Marcellus and Utica shale's role. Rice earlier this month unveiled a wide-ranging proposal for the industry to boost natural gas production by 50 billion cubic feet per day of natural gas by an additional 50 or so rigs around the country — but especially in Appalachia. Rice and EQT made the case that dramatically increasing the industry's LNG production made sense on the world stage as well as in lower energy costs in the U.S. The Biden administration, in a deal with the European Commission, committed to increasing LNG exports from the United States to Europe by about 1.5 billion cubic feet per day in 2022 beyond the roughly 13 billion cubic feet of LNG that the U.S. exports around the world now. The long-term goal is about 5 billion cubic feet/day additional of LNG exports to Europe by 2030, which producers say is achievable as long as the regulatory and legal climates for pipelines and export infrastructure turn favorable. Pipelines in particular have been difficult to build. In an interview with the Business Times, Rice said that the company's analysis finds that there's the ultimate potential of 50 billion cubic feet per day of LNG that could be produced with the resources on hand. He called the administration's commitment announced Friday "a big step" toward the longterm goal. "The actions today validate the things we've been saying. I think people need to look at this as the political sign that natural gas is going to be play a key role in our energy future," Rice said. "What's really great is the moves today to help unleash US LNG are consistent with the administration's climate ambitions. As we've articulated (in the EQT plan), U.S. LNG is the biggest green initiative on the planet." That's because not only could LNG replace the Russian natural gas imports to western Europe, but it also would displace international coal production whose emissions are warming the planet from places like Asia. Just the new coal production that has come into operation outside the U.S. has led to higher greenhouse gas emissions despite progress on that front, from lower emissions from fossil fuels as well as renewables."That has the impact of wiping out all the emissions reductions from wind and solar in the United States" in the past 15 years, he said."International coal is a heavyweight problem and you need a heavyweight solution, and U.S. LNG is that solution," he said.But Rice also stressed that this was a first step that would need to be followed up by actions that allow the market and the industry, along with its investors, to feel confident that the market is big enough and long-lasting enough to make the big investment commitment that would be required for pipelines and export terminals.
TN Pipeline Bill Controversy: Who would determine where pipelines are built? -– Soon the state of Tennessee could decide if a pipeline shows up in your backyard and your local government could have little to no say. That’s because a bill proposed in the state legislature would prohibit counties and cities from stopping a pipeline from being built and leave that decision to the state. The bill (HB 2246/SB 2077) being guided by GOP lawmakers is moving to limit the ability for localities to decide if a pipeline should run through their communities. “It preempts political subdivisions of this state from taking any action to restrict, prohibit or otherwise impair the development and implementation of the types of the sources of energy that may be used, delivered, or converted or supplied,” said Sen. Ken Yager (R-Kingston) during committee. Yager, who is sponsoring the Senate version, is using this bill to take aim at local governments like Shelby County which fought against a pipeline that would have run through a primarily Black neighborhood. “We’ve actually had one of our political subdivisions try to use the power of ordinance to stop and did stop a pipeline,” Yager said. It’s a controversial issue that could lead to environmental concerns, as well as significant changes to all counties, according to an environmental lawyer who testified on Capitol Hill. “If it passed, it would affect every county commission, city government, school board, and local water authority in all 95 counties, and it would tell each of those local governments that when out of state companies want to run high-pressure crude oil petroleum or methane gas pipelines through their communities, local government will have no say about where that infrastructure is placed,” said George Nolan, an attorney for the Southern Environmental Law Center. Democrats say local control over pipelines is proper and shouldn’t be usurped by state government. “When you want to put something as serious as a pipeline with such high pressure that if something happens it will absolutely devastate the community—that is not something you should have to appeal to the state,” said Sen. Raumesh Akbari (D-Memphis).
Bill to override local control of pipelines spurs statewide backlash – On March 2, a seemingly innocuous bill in the Tennessee General Assembly proposed a study on energy infrastructure, but an amendment to remove local government’s ability to regulate fossil fuel infrastructure threw up red flags with legislators, local government officials and environmental groups. The bill was advancing quickly, and before a Senate committee meeting scheduled on March 15 , those critical of the bill met with Rep. Kevin Vaughan, R-Collierville, to discuss possible amendments. Almost immediately, Vaughan addressed the crowd that the conversation before them was not about debating fossil fuels but “the best way to have one community not be able to derail projects outside its jurisdictional boundaries,” he said. Despite those intentions, Vaughan’s bill, HB2246 and its Senate companion, SB2077, attracted controversy across the state, especially from Memphis and Shelby County officials who spent more than a year making attempts to protect communities from unwanted fossil fuel infrastructure. “Two weeks ago I was a Marxist and a socialist in my email and now I’m a genocidal shill for the oil company. I’m somewhere in the middle,” said Vaughan. Although SB2077/HB2246 would affect local governments statewide, Memphis residents and officials allege the bill directly targets Memphians’ fervent fight against the now-defunct Byhalia Pipeline, a 49-mile natural gas pipeline that was proposed to run through a historically Black Memphis neighborhood. Memphis communities protested against Texas-based Plains All American Pipeline and Valero Energy Corporation’s efforts to use eminent domain to acquire private property needed to finish building the pipeline, and the movement received national attention as a fight against environmental racism, after primarily Black and impoverished communities were labeled by pipeline officials as the “path of least resistance.” Justin J. Pearson, a founder of Memphis Community Against the Pipeline–now Memphis Community Against Pollution–read a prepared statement and said the legislation had been crafted behind closed doors and sprung on unsuspecting Tennesseans. And due to the ambiguity of the bill, Pearson added that local governments have sought guidance from him and others over what the bill intended to do. Pearson concluded that he, environmental advocates and local government officials were concerned about the consequences of unhindered business interests and that everyone had a right to be concerned.
Williams, Context Labs to Verify Natural Gas Emissions Data in Haynesville, Beyond - - Tulsa-based Williams has selected Context Labs technology to provide end-to-end emissions data for certified natural gas that it transports, with utilization now underway in the Haynesville Shale. Context’s decarbonization as a service (DaaS) technology is used to verify the emissions profiles and capture the progress of greenhouse gas (GHG) mitigation across the natural gas value chain. The DaaS technology leverages asset grade data-generated continuous satellite and sensor emissions monitoring to provide analyses and decarbonization solutions to customers.Context also is working with BP Energy Partners LLC, which is one of a group of strategic investors that also includes Equinor Ventures, KPMG LLP, Shamrock Ventures, Neglected Climate Opportunities LLC and i(x) investments.Williams has integrated its assets and third-party emissions monitoring data with the first implementation in the Haynesville. The midstream giant earlier this month more than doubled its footprint in the East Texas/Northwest Louisiana play via agreements with Quantum Energy Partners. At the time, CEO Alan Armstrong said the deal would help prove up “what an important role natural gas can play in reducing emissions, lowering costs and providing secure, reliable energy here and around the world.”The partnership with Context is the latest move in advancing Williams’ energy transition strategy. The midstreamer also has announced deals with Gas Technology Institute and joined the Collaboratory for Advancing Methane Science, which is sharing best practices.Though its primary focus remains natural gas, with more than 30,000 miles of pipeline in North America, Williams also is looking to commercialize innovative technologies, markets and business models to support less emissions. The company is developing hydrogen, along with carbon capture, utilization and storage, solar andrenewable natural gas projects.
Natural Gas Futures, Cash Prices Eke Out Gains Even as Output Climbs, Demand Ebbs -- Natural gas prices trended lower much of Monday as production increased and forecasts showed light weather-driven demand across most of the Lower 48. Still, futures crept back into positive territory in afternoon trading amid the persistent global supply pressures amplified by Russia’s war in Ukraine. The April Nymex gas futures contract settled at $4.900/MMBtu, up 3.7 cents. May rose 3.2 cents to $4.934. NGI’s Spot Gas National Avg. climbed 5.0 cents to $4.285, led higher by gains in West Texas. Bespoke Weather Services said that, despite a round of spring storms early this week and the potential for chilly low temperatures in the Midwest and Northeast by the weekend, forecasts broadly showed overall mild conditions and “rather weak” domestic demand. Gas-weighted degree days are expected to run below normal over the next two weeks, the firm said. “The pattern exhibits a warm lean, especially in the near term, though some high-latitude blocking is projected in the medium range,” Bespoke said. This blocking “is not as significant this time of year, compared with back in winter, but is enough to take the pattern closer to normal, with more variability as we head into early April.” At the same time, production climbed back to about 95 Bcf on Monday, according to Bloomberg’s estimate, after hovering around 93 Bcf most of last week amid maintenance work and the lingering effects of freeze-offs early in March. “Dry gas production is showing a rebound to two-week highs,” said EBW Analytics Group senior analyst Eli Rubin. “The combination of warming weather and favorable intra-month trends suggest further gains may be coming over the next seven to 10 days.” Demand for U.S. exports of liquefied natural gas (LNG), however, remain elevated amid Russia’s invasion of Ukraine and Europe’s related race to “wean itself off of cheap Russian pipeline gas” in protest of the war, Rubin said. LNG feed gas volumes topped 13 Bcf most of March so far, holding near record levels amid the conflict, now in its fourth week.
-U.S. natgas jumps near 6% on cooler forecast, record LNG exports (Reuters) - U.S. natural gas futures climbed almost 6% to a near seven-week high on Tuesday on forecasts for cooler weather and higher heating demand next week than previously expected. That price increase also came as global demand for gas to replace Russian fuel after its invasion of Ukraine keeps U.S. liquefied natural gas (LNG) exports near record highs and European gas prices about six times over U.S. futures. U.S. front-month gas futures rose 28.7 cents, or 5.9%, to settle at $5.187 per million British thermal units (mmBtu), their highest close since Feb. 2. The U.S. market remains mostly shielded from much higher global prices - European gas traded around $31 per mmBtu on Tuesday - because the United States has all the fuel it needs for domestic use, and the country's ability to export more LNG is constrained by limited capacity. The United States is already producing LNG near full capacity. So, no matter how high global gas prices rise, it will not be able to export much more of the supercooled fuel. Data provider Refinitiv said average gas output in the U.S. Lower 48 states was on track to rise to 93.3 bcfd in March from 92.5 bcfd in February as more oil and gas wells return to service after freezing earlier in the year. That compares with a monthly record of 96.2 bcfd in December. With cooler weather coming, Refinitiv projected average U.S. gas demand, including exports, would rise from 95.8 bcfd this week to 99.6 bcfd next week. The forecast for next week was higher than Refinitiv's outlook on Monday. The amount of gas flowing to U.S. LNG export plants rose to 12.78 bcfd so far in March from 12.43 bcfd in February and a record 12.44 bcfd in January. The United States has the capacity to turn about 12.7 bcfd of gas into LNG. The rest of the gas flowing to the plants is used to operate the facilities. Gas stockpiles in Western Europe (Belgium, France, Germany and the Netherlands) were about 37% below the five-year (2017-2021) average for this time of year, according to Refinitiv. That compares with inventories about 17% below normal in the United States.
U.S. natgas futures hit 7-week high on cooler forecasts -(Reuters) - U.S. natural gas futures edged up to a seven-week high on Wednesday on forecasts for cooler weather and higher heating demand over the next two weeks than previously expected. That price increase also came as global demand for gas to replace Russian fuel after the country's invasion of Ukraine keeps U.S. liquefied natural gas (LNG) exports near record highs and European gas prices about seven times over U.S. futures. U.S. front-month gas futures rose 4.5 cents, or 0.9%, to settle at $5.232 per million British thermal units (mmBtu), putting the contract on track for its highest close since Feb. 2 for a second day in a row. The United States is already producing LNG near full capacity. So, no matter how high global gas prices rise, it will not be able to export much more of the supercooled fuel. European gas jumped about 15% to around $37 per mmBtu on Wednesday after Russia demanded payment for gas in roubles. Before Russia's Feb. 24 invasion of Ukraine, the United States worked with other countries to ensure gas supplies, mostly from LNG, would keep flowing to Europe. Russia has provided around 30% to 40% of Europe's gas, which totaled about 18.3 billion cubic feet per day (bcfd) in 2021. Russia is the world's second-biggest gas producer, after the United States. Data provider Refinitiv said average gas output in the U.S. Lower 48 states was on track to rise to 93.2 bcfd in March from 92.5 bcfd in February as more oil and gas wells return to service after freezing earlier in the year. That compares with a monthly record of 96.2 bcfd in December. With cooler weather coming, Refinitiv projected average U.S. gas demand, including exports, would rise from 96.4 bcfd this week to 102.6 bcfd next week. Those forecasts were higher than Refinitiv's outlook on Tuesday. Even though it will be cooler next week, meteorologists forecast U.S. weather will remain at near normal levels through at least early April, which should keep heating demand low enough to allow utilities to inject gas into storage this week - about a week earlier than usual.
US natural gas inventories slip less than expected but price surge continues - US natural gas in storage dropped by less than expected in what might be the final draw of the heating season, yet Henry Hub futures continue to build on recent gains as the summer and winter strips sail higher above $5/MMBtu. Storage fields withdrew 51 Bcf for the week ended March 18, according to data released by the US Energy Information Administration on March 24. Working gas inventories decreased to 1.389 Tcf. US storage volumes now stand 366 Bcf less than the year-ago level of 1.784 Tcf and 293 Bcf less than the five-year average of 1.744 Tcf. The withdrawal was weaker than the 62 Bcf draw expected by an S&P Global survey of analysts. Responses to the survey were wide, as they have been much of the current shoulder season, ranging from from 50 to 96 Bcf withdrawal. It was less than the five-year average pull of 62 Bcf but more than the 29 Bcf draw reported in the corresponding week in 2021. The only EIA storage region to report a net injection during the week was the Pacific. The region is also the closest to the five-year average at a 9% deficit. Supply issues have caused extreme price volatility in the region during high demand periods of summer over the past several years. However, adequate supply for the upcoming summer might keep that in check this year. SoCal Gas demand has been flat this winter from last winter at 2.8 Bcf/d, according to data by S&P Global Commodity Insights. Receipts, however, have jumped roughly 120 MMcf/d winter over winter to 2.7 Bcf/d. The stronger receipts and flat demand throughout the whole of the winter allowed injections to average 62 MMcf/d, over 100 MMcf/d lower year on year from last winter. This expanded year-on-year gains to 17 Bcf by March 11, when inventories fell to 71 Bcf. Since March 11, the region has flipped to only net injections, suggesting March 11's 71 Bcf is the low of this season. NYMEX Henry Hub April contract surged 15 cents to $5.37/MMBtu following the EIA's storage report release on March 24. The summer strip, April through October, jumped 14 cents to $5.46/MMBtu. The 2022-23 winter strip, November through March, added 12 cents to $5.53/MMBtu. Henry Hub futures across the board have climbed steadily over the past week. A forecast by S&P Global calls for a 50 Bcf injection for the week ending March 25. This would be a dramatic departure from the average for the week, which is a 23 Bcf withdrawal.
With Bulls on Extended Parade, Natural Gas Futures Post Fifth Consecutive Gain; Cash Cruises - Natural gas futures forged higher on Friday, as they did every day of the week, fueled by the uncertainty of war in Ukraine and the related prospects of long-term demand for U.S. liquefied natural gas (LNG). The April Nymex gas futures contract settled at $5.571/MMBtu, up 17.0 cents day/day. May advanced 16.5 cents to $5.611. Futures were up nearly 15% for the week.Cooler weather patterns expected early in the next few days boosted cash prices. NGI’s Spot Gas National Avg. surged 57.5 cents to $5.275.As Russia’s war against Ukraine raged into a second month, the Europe Union (EU) hastened efforts to wean its member countries from Kremlin-backed natural gas. European countries, reliant on Russian gas, have expressed worry that Russia’s relentless bombing of Ukraine could damage pipelines in the country through which gas flows to the continent.More broadly, the EU views energy ties to Russia as security vulnerabilities, and the United States shares that and economic concerns with Europe.Against that backdrop, the Biden administration and EU leaders on Friday announced a joint goal to send an additional 15 billion cubic meters of LNG to EU countries in 2022 – about 1.5 Bcf/d — with “expected increases going forward,” according to the White House. The United States will also maintain “an enabling regulatory environment with procedures to review and expeditiously act upon applications to permit” additional LNG export capacity for energy security purposes.Friday’s futures advance coincided with “a wave of headlines” about the deal, Bespoke Weather Services noted, though the firm emphasized the pact is not a panacea for Europe. U.S. exporters have already operated near capacity throughout the war – above 13 Bcf most days – and would need a few years to ramp capabilities substantially. As such, Bespoke said, it “simply means a higher percentage of our current LNG exports may be sent to Europe, as opposed to other places,” Bespoke said. Australia and other LNG exporters may also ship more to Europe.The shift away from Russia may mean sustained lofty gas prices in Europe, Biden and EU leaders acknowledged. They noted that countries on the continent would still have to outbid buyers in Asia and elsewhere to secure shipments of the super-chilled fuel.“Eliminating Russian gas will have costs for Europe,” Biden said Friday in televised remarks. “But it’s not only the right thing to do from a moral standpoint, it’s going to put us on a much stronger strategic footing.”
U.S. natgas hits 8-wk high on cooler forecasts, record LNG exports (Reuters) - U.S. natural gas futures climbed about 3% to an eight-week high on Friday on forecasts cold weather next week will cause utilities to pull gas out of storage to meet an increase in heating demand. Analysts said those utilities likely injected gas into storage this week because the weather was mild and heating demand low. U.S. prices also gained on Friday as rising global demand for gas to replace Russian fuel after Russia's invasion of Ukraine keeps U.S. liquefied natural gas (LNG) exports near record highs and European gas prices about seven times over U.S. futures. Front-month gas futures rose 17.0 cents, or 3.1%, to settle at $5.571 per million British thermal units (mmBtu), their highest close since Jan. 27. That also puts the contract up for a fifth day in a row for the first time since January, and kept it in technically overbought territory with a relative strength index (RSI) over 70 for a third day in a row for the first time since September 2021. For the week, the front-month was up about 15%, its biggest weekly gain since January. Last week, the contract gained about 3%.
US Natural Gas Drilling Activity Unchanged as Oil Patch Notches Further Gains - The U.S. natural gas rig count went unchanged at 137 during the week ended Friday (March 25), while a week of strong growth in Texas accompanied continued activity gains in the oil patch, according to updated figures from Baker Hughes Co. (BKR). U.S. oil-directed rigs increased by seven overall for the period, helping to lift the combined U.S. rig count to 670, up 253 rigs from its year-earlier total of 417, according to the BKR numbers, which are partly based on data from Enverus. Land drilling increased by five units domestically, while the Gulf of Mexico added two rigs to end the period with 14 overall. Horizontal and vertical rigs each increased by four, partially offset by a one-rig decline in directional units.The Canadian rig count, meanwhile, dropped 36 units overall for the period, ending at 140, versus 81 in the year-ago period. Declines included 27 oil-directed rigs and nine natural gas-directed units.Broken down by major drilling region, the Cana Woodford saw a net decline of four rigs week/week, with the Utica Shale dropping one unit. The Permian Basin, meanwhile, added three rigs for the period to grow its total to 319. The Eagle Ford Shale, the Granite Wash, the Haynesville Shale and the Williston Basin each added one rig to their respective totals during the period, the BKR data show.Counting by state, Texas recorded a net gain of six rigs overall for the period, while Louisiana added two rigs week/week. Pennsylvania and North Dakota added one rig apiece, while Alaska, New Mexico and Ohio each recorded one-rig declines for the period, according to BKR.The Energy Information Administration (EIA) in its latest Weekly Petroleum Status Report said U.S. crude production was flat in the week-earlier period. Output for the week ended March 18 held at 11.6 million b/d, even with the prior week and a month earlier, EIA said.The steady domestic supply output comes despite intensifying global supply worries surrounding Russia’s invasion of Ukraine.jeremiah.shelor@naturalgasintel.com
US Natural Gas Production Growth Said Pricey; Efficiencies Needed in Pipeline Permitting - Infrastructure constraints and a slow pace of project approvals have hampered natural gas production growth, but rising output is coming – albeit at a slower pace and higher price, industry executives said earlier this month in Houston. Goldman Sachs’ Samantha Dart, head of natural gas research, said dry gas growth was the “single biggest contributor” of domestic growth in 2018-2019. However, bottlenecks have once again emerged after an earlier buildout in Appalachia, where the Marcellus and Utica shales accounted for 34% of all U.S. output in the first half of 2021.The constraints, combined with a difficult political environment for building pipelines to move supply to demand centers, mean the gas market “can’t really count on that to drive growth significantly at really low prices,” Dart said on a panel at CERAWeek by S&P Global. “You have to go to the next best guy. That’s going to be Haynesville producers.”However, investors in public exploration and production (E&P) firms continue to push for free cash flow generation, with little reward for “fast growth,” according to Dart. “So you get growth, but you don’t get it at the same pace as before. You don’t get it from the same region as before. And you don’t get it at the same prices as before, in our view.”Chesapeake Energy Corp. CFO Mohit Singh, who shared the panel with Dart, said drilling a well essentially exposes a company to a long duration project against the backdrop of fluctuating commodity prices. This is a topic of an “ongoing, intellectual debate” within the Oklahoma City-based E&P. For now, Chesapeake plans to “keep our head down,” staying within budget and delivering the volumes it has promised.The E&P has set its sights on the Eagle Ford, Haynesville and Marcellus shales this year, with 85% of its capital spending directed to the “highest return opportunities” in those plays. Mingh last month noted that Chesapeake would continue to chase any opportunity to fill any available pipeline capacityin the Marcellus. The company also would jump at the chance to grow volumes if circumstances arose. Williams’ Chad Zamarin, senior vice president (VP) of Corporate Strategic Development, said infrastructure projects need to be permitted more efficiently in order to ease constraints. While Appalachian bottlenecks have been ongoing, pipeline capacity is expected to tighten in the Permian Basin in the next few years. Some estimates put the region maxed out on gas capacity as early as next year, with no new projects announced. Williams canceled its planned Constitution Pipeline to move Appalachian gas after an arduous eight-year battle to gain approval. Proposed in 2012, the 124-mile pipeline would have carried 650 MMcf/d from Pennsylvania. Williams, citing regulatory delays, also received a two-year extension to build and place into service its proposed Northeast Supply Enhancement Project.
Help Is On Its Way - How Much More LNG Can The U.S. Send To Europe? -U.S. LNG exports are at an all-time high, driven primarily by new capacity online or commissioning, but the existing terminal fleet has also been pushing production to the max as offtakers, particularly in Europe, hunt for every spare molecule they can find. Every single terminal in the U.S. set a new monthly export record in either December or January. But is it enough? With the ongoing and tragic war in Ukraine threatening energy security and reliability in Europe, where gas storage inventories are already running low, the focus increasingly turns to LNG to replace at least some of the gas it typically imports from Russia. It sounds great in theory, and in the long term more LNG capacity will be added, but for now, we’re stuck with the infrastructure we’ve got, putting a ceiling on both how much Europe can take and how much exporters, including the U.S., can send. In today’s RBN blog, we look at the potential for incremental LNG exports from the U.S. to Europe to help offset Russian gas.In our recent blog, You Don’t Own Me, we provided a primer on European gas markets and the European Commission’s (EC) new plan to reduce the European Union’s (EU) Russian gas imports by two-thirds (or 10 Bcf/d) by the end of this year, an extremely tall order as Russia has been supplying about 45% of Europe’s natural gas. Of course, not all of the Russian gas being replaced is expected to come from LNG — that’s not remotely possible given existing infrastructure. But the plan calls for 50 billion cubic meters (Bcm) more LNG, which is equal to about 1,765 Bcf, or around 519 additional LNG cargoes. [Prior to the EC’s announcement, the International Energy Agency (IEA) laid out a similar but less-aggressive plan, which calls for about half that level of additional LNG imports.] You Don’t Own Me goes into some of the potential pitfalls of the EC plan, like connectivity within Europe to distribute the imported LNG, but putting that aside and taking the EC at its word about what European import terminals can handle, can European buyers even get their hands on an additional 500 cargoes this year? Or even an additional 200, per the IEA plan?Most of the world’s LNG supply is produced in the U.S., Australia, and Qatar [see Three’s (Not Always) a Crowd], with the U.S. surpassing the other two for the first time this winter. More importantly for increasing exports to a very specific market (in this case, Europe), the U.S. LNG sector also is the source with the greatest destination flexibility. Further, the U.S. is the closest of the three major suppliers from a days-on-the-water perspective to where the bulk of the cargoes land in Northwest Europe. Between the contract flexibility and proximity of U.S. offtake, many of the additional cargoes Europe will likely need to come from the U.S. The question is, how much more U.S.-produced LNG can be delivered to Europe this year.
LNG projects in the Gulf of Mexico boosted as Russian gas alternative - Two years ago, the American liquified natural gas (LNG) company Tellurian was in free fall: Its stock price collapsed, it laid off 40 percent of its staff, and suspended a key project in Louisiana. Now, executive chairman Charif Souki says investors "are lining up at the door to ask me: 'Can we finance your project?'" At the annual CERAWeek energy conference in Houston, Souki told AFP that LNG projects have been boosted by the renewed emphasis on energy independence after Russia's invasion of Ukraine. "Global market demand and the desire of the Europeans to divest from their reliance on Russian gas... those are all positive market signals, which will obviously help stimulate those projects and get them moving towards final investment decisions," On March 8, the United States banned all imports of LNG, petroleum and coal from Russia, and has for years encouraged its European allies to decrease their dependence on their eastern neighbor. Eight LNG terminals operate in the United States, pumping out 14 billion cubic feet (400 million cubic meters) per day, and fourteen other terminals have already been approved by the Federal Energy Regulatory Commission (FERC). That's the case for Driftwood LNG, Tellurian's future liquefaction plant and export terminal, south of Lake Charles, Louisiana. Stalled for a year and a half, the company will finally break ground on the massive project next month. Once completed, the site will be able to export 3.6 billion cubic feet per day. Charif said that "in principle, we should be able to provide LNG in 2026" to the oil companies Shell, Vitol and Gunvor. The Gulf Coast will see plant construction accelerate in the coming months: Five projects have already been approved by FERC in Louisiana, with seven more in Texas and Mississippi. Since its first exports in 2016, the Gulf Coast has become a key hub for global LNG shipments. A network of pipelines connects the states' ports to gas fields across the country, from the Permian and Haynesville basins in the south to the Marcellus, the country's largest onshore reserve, in the northeast. Once the gas arrives on the coast, it is liquified and transferred onto LNG tankers, most of which head off to Europe.
North Platte Deepwater Project, Gulf of Mexico, US -- The North Platte oil field is planned to be developed in 1,300m-deep waters of the Gulf of Mexico, about 275km offshore Louisiana, US. Norwegian oil and gas company Equinor holds 40% non-operating interest in North Platte. TotalEnergies (Total), a French oil and gas company and the operator of the project, held the remaining 60% interest in the deepwater oil field. Cobalt International Energy (Cobalt) had 60% operating interest in the North Platte discovery. Total, which had held the remaining 40% interest, acquired an additional 20% interest from Cobalt for $339m, as part of the latter’s bankruptcy auction sale, in March 2018. Equinor joined as a partner by acquiring Cobalt’s remaining 40% interest in North Platte. The front-end engineering and design (FEED) for the project was launched in December 2019. The North Platte deepwater oil development project spans four blocks in the Garden Banks area of the US Gulf of Mexico. Total and Cobalt discovered the oil field by drilling an exploratory well to a total depth of 10,520m (34,500ft) in December 2012. The discovery well intercepted several hundred feet of net oil pay and a number of high-quality intervals in the Lower Tertiary sandstones of the Wilcox Formation. The field was subsequently appraised by three appraisal wells and three sidetracks. North Platte is considered a high-quality asset, both in terms of porosity and permeability, with the thickness of the reservoir exceeding 1,200m in several locations. The deepwater oil field is planned to be developed by drilling eight wells from two subsea drilling facilities and tying back the subsea wells to a new, lightweight semi-submersible floating production unit (FPU) through two production loops. The FPU will be designed to accommodate additional tie-ins in future. Valaris DS-11 drillship will be utilised to perform development drilling for the project. The drillship will be upgraded with the installation of a 20,000 pounds-per-square-inch (psi) well control equipment before starting drilling at the high-pressure oil field. The North Platte oil field is expected to produce 75,000 barrels of oil per day (bpd) at plateau level. The output will also include associated gas.
Oil and gas groups call out Biden: 'We would love to produce more, bring gas prices down' --Oil and gas industry representatives blasted President Biden Wednesday for blaming companies for the gas price surge. "Which is it? You can’t blame Putin and us at the same time. The bottom line is we are not price makers, we are price takers. We suffer from low prices and then we have higher prices. That is based on the price of oil globally," Western Energy Alliance President Kathleen Sgamma told "Fox & Friends." Sgamma said that demand for oil has risen and there are "various factors" that go into the price of oil, including the fallout from Russia's invasion of Ukraine."But we are not setting that price. We would love to produce more in the United States and help to bring those prices down."At first, Biden blamed Russia for spike in gas prices. Recently, the commander-in-chief cast blame on U.S. energy companies. President Biden posted a tweet on March 16th claiming oil and gas companies were padding their profits at the expense of hardworking Americans."Oil prices are decreasing, gas prices should too," the president tweeted. "Last time oil was $96 a barrel, gas was $3.62 a gallon. Now it's $4.31. Oil and gas companies shouldn't pad their profits at the expense of hardworking Americans."Independent Petroleum Association of America Executive Vice President Dan Naatz said gas and oil companies are "frustrated" with the Biden administration’s "relentless assault" on American oil and natural gas producers over the past year."Increased regulations, talk of taxes, our members get frustrated when the administration, Jen Psaki just seem to say, now that we are facing an energy crisis, go out and produce like the snap of a finger. It is just not possible and as we face this relentless attack, we will have to do a lot of work. And you want to start a dialogue with the administration to address the challenges," he told host Ainsley Earhardt. The trade groups sent a letter to the White House Friday criticizing the administration's "deep hostility" toward oil and gas companies and their workers.
Producing and exporting more US gas helps Putin - Vladimir Putin’s horrific war against the Ukrainian people has all of us talking about how to prevent him—and other fossil fuel autocrats—from holding the global economy hostage as he funds his war machine. In response, the fossil fuel industry is attempting to convince lawmakers and the public that the solution is more fossil fuels.This is a lie. Increasing our economy’s dependence on fossil fuel increases our exposure to fossil fuel volatility. The industry doesn’t want to export U.S. supply to Europe for humanitarian reasons—it wants more access to a higher priced market. Fossil fuel executives and the conservative politicians they bankroll want to exploit a tragic situation for profit. Americans deserve the truth. The truth is, there is only one solution: doubling down on our transition to clean, cheap American-made energy.Putin’s power comes from the world’s dependence on fossil fuels. Russia is a petrostate, and fossil fuels are funding Putin’s war crimes. Putin created market turmoil by reducing gas flows to the EU by 25 percent from levels one year ago and, as he expected, European methane gas prices surged more than 400 percent. U.S. oil and gas companies claim the solution is more production. But we can’t build those assets quick enough to displace Russian supply. Design and construction times are measured in years, not hours. According to industry analysts, it typically takes four to five years to build new export terminals. And let’s be honest: Russia would love nothing more than for the U.S. to become more economically dependent on a commodity that empowers Russian oligarchs. Our citizens, and indeed the world, deserve a foreign policy that puts the interests of the United States over those of Vladimir Putin. Moreover, the U.S is already the world's leading exporter of liquefied natural gas. Our gas exports have grown rapidly since the first LNG cargo was shipped from the lower 48 states in 2016. And the U.S. will remain the world’s largest exporter through 2022, according to the U.S. Energy Information Agency.President Biden’s recent announcement means that every operating LNG export terminal can export its full capacity. As Energy Sec. Granholm explained this week, "the U.S. is exporting every molecule of liquified natural gas that we can to alleviate supply issues in Europe." To suggest we can flip a switch and create more export capacity is deceptive. The only LNG export terminal currently under full construction will not be online until 2024.Even fossil fuel investors are not eager to build new gas export terminals. Of the 21 proposed U.S. export terminals, 18 appear to lack direct project finance, and “[n]o proposed US LNG export terminals reached final investment decisions (FIDs) or advanced to the construction phase in 2021.” LNG investments have been characterized as “fundamentally unsustainable . . . in light of cleaner, more economically viable renewable energy alternatives.” Conversely, investments in renewable energy generate roughly three times more direct and indirect jobs than comparable investment in fossil fuels. The U.S. can create 25 million new jobs by 2035 by investing in projects that cut carbon pollution using existing technologies. Building a 90% clean grid can support more than 500,000 jobs each year, many of which are family-sustaining union jobs. And renewable energy plus battery storage is increasingly cheaper than gas, and, unlike fossil fuels, consumers can count on predictably low costs over time. Producing and exporting gas from the U.S. also is really bad for the climate, because gas is just as dirty as coal, if not dirtier. For this reason, the International Energy Agency has cautioned, meeting our climate goals to limit global warming to 1.5°C requires that “no new [gas] fields or export projects are developed[.]” Finally, exporting U.S. gas to international buyers drives up domestic energy prices for all of us, with some Americans seeing increases of more than 90 percent. So long as our country depends on this volatile fossil fuel, Americans will continue to be subject to wild price fluctuations.
Louisiana oil companies face challenges trying to ramp up production: 'We're doing all we can' - – Oil prices continue to jump as European Union nations consider joining the United States in the ban on Russian energy. There's a new pressure to increase U.S. oil production, but experts in the industry say it's not that simple. "It's not just turning a switch like they think," said Mike Moncla, the president of the Louisiana Oil & Gas Association. Companies need rigs to get wells back online and produce more oil, but many had "stacked" or stored their rigs as they weren't in use. "Oil companies are doing all they can to get rigs back out, but when metal stacks, in this humid, south Louisiana environment, you get rust," Moncla said. Many companies stacked rigs when they were no longer needed. This can lead to rust and engine problems when it's time to get the rig back up and running. Moncla said fixing a rig can take between $75,000 to $125,000. "It's hard to afford to fix all these rigs when you don't know how long this is going to last," Moncla said. "We were all struggling to stay alive a year ago." (Fox News) The U.S. oil industry has faced a downturn over the past several years after Saudi Arabia flooded the market and the COVID-19 pandemic decreased demand for gas. Many companies declared bankruptcies or downsized. Therefore, business owners not only need money to repair equipment; they also need workers. "Years ago, we had 633 employees, just seven years ago," Moncla said. "We got all the way down to 150 and today we're back up to 300."
Oil Workers Don't See Higher Pay as Prices Surge, Consider Switching Fields - Most oil workers around the world have yet to cash bigger paychecks despite the run up in crude prices, with many ready to leave the oil patch. Less than a third of surveyed oilfield employees report receiving a pay bump in the past year, while another 21% said pay was actually cut. That’s according to the latest Global Energy Talent Index released by recruiting firms Airswift and Energy Jobline. The good news: A little more than half of those workers say they expect to get a boost in pay sometime in the next 12 months.
US Oil Inventory Unexpectedly Plummeted Last Week As Pressures Mounted - Oil supply strains are already hitting the US harder than expected. The country's commercial crude oil inventory dropped by 2.5 million barrels to 413.4 million barrels last week, the Energy Information Administration said Wednesday. The total supply now sits roughly 13% below the five-year average for this time of year, meaning oil is in unusually short supply. The print also falls extremely short of economists' expectations. Experts surveyed by Bloomberg projected a 114,000-barrel increase in supply through the week. The 2.5-million-barrel decline doesn't just blow their forecasts out of the water, it also marks the largest one-week drop in oil supply in a month. Wednesday's inventories data sparked the latest upswing in oil prices. West Texas Intermediate crude — the US's benchmark for oil prices — gained as much as 6.2% on Wednesday as traders digested the huge miss in US inventories. Brent crude — the international oil benchmark — also rose on the news, trading as much as 6.8% higher to $122.34 per barrel. Gas supply is also under pressure. Motor gasoline inventories slid by 2.9 million barrels last week and now sit at the bottom end of the five-year average for this time of year. The declines extend a broad, months-long slump in US oil and gas supply and leave overall oil and petroleum product inventory at extremely tight levels. The report adds even more gloom to an already bleak outlook for US gas prices. Russia's invasion of Ukraine drove crude prices sharply higher as investors feared the conflict would curb production. The Biden administration's ban on Russian energy commodity imports including crude oil and natural gas lifted prices higher still in early March. Crude has since retraced some of its surge, but prices remain at historically high levels. The plateauing of crude prices has kept gas pricier at the pump. The US average gas price edged slightly lower to $4.237 per gallon on Wednesday, according to AAA. While that's down from yesterday's level and the week-ago reading, it still sits near record highs and $1.36 higher than the year-ago average. Several factors stand to boost crude prices even higher in the coming months. While the US and UK already announced plans to cut themselves off from Russian crude, the EU is still mulling whether to take such action. Doing so would likely drive prices to record highs and further pressure supply in the US.
US oil, gas rig count drops one to 780 on week; Eagle Ford growth strongest: Enverus - S&P Global - The US oil and gas rig count shed one rig in the week ended March 23, leaving 780, energy analytics and software company Enverus said March 24, with the Eagle Ford Shale now at its highest level since March 2020. The week ended March 23 was also the first time the total domestic rig count recorded a loss since the end of 2021. So far in 2022, the rig count is up 73 rigs. Still, oil rigs gained three rigs to 609, while rigs chasing gas dropped by four to 171. Most basins moved little in either direction, while three basins did not change at all. The Eagle Ford, located in South Texas moved up the most, as the former gained two rigs to 68. The SCOOP-STACK in Oklahoma and the Permian Basin of West Texas/New Mexico dropped the most at two each. That left the Permian with 328 and the SCOOP-STACK with 42. Otherwise, the Williston Basin mostly in North Dakota/Montana, and the Marcellus Shale, mostly in Pennsylvania and West Virginia, moved by one each but in different directions. The Williston was up one rig to 35, while the Marcellus lost a rig for a total of 40. Three basins -- the Haynesville Shale of East Texas/Northwest Louisiana, the DJ Basin mostly in Colorado and the Utica Shale largely in Ohio -- stood still rig-wise. That left the Haynesville at 71, the DJ at 18 and the Utica at 14. The week ended March 23 is the fourth consecutive week Haynesville has been at 71 rigs. It reached 73 the week ended February 23 and was again at 71 the week before that. Previously, Haynesville drilling activity had not been in the 70s for at least three years. So far in March, the rig count has gained 20 rigs and another 19 rigs in February, but added 34 in January. Many analysts had expected the gains to slow but the level of growth so far in 2022 has been brisk. But, as Evercore ISI analyst James West notes, upstream operators' strict capital discipline, coupled with labor, equipment and materials shortages, make a North American "accelerated oil supply response [to any potential global shortages] ... unlikely." "We believe that the bottleneck for further US production growth will be the availability of frac [hydraulic fracking] fleets," West said. "US frac utilization is quickly approaching 90%. We believe there are approximately 240-250 frac spreads deployed in the market out of a potential 265 that the industry can potentially deploy." For the week ended March 18, the Primary Vision US frac count stood at 266. By contrast, the pre-coronavirus pandemic frac count was 324. "US completion activity is having its seasonal dip in March, which will start to shift higher as we approach April, Mark Rossano, energy analyst for Primary Vision, said. "The spring is a period of accelerating activity that will carry us through the summer until we start to see a slowdown in September/October," Rossano said in his most recent Primary Vision blog post March 18. "We have seen activity remain strong in the Anadarko [Basin of Oklahoma] while the Haynesville has slowed down a bit, which is 100% normal for this time of year."
Shale drillers foresee ‘world of hurt’ in Biden’s green economy— U.S. shale drillers are incurring record labor and equipment costs so they can cash in on the highest oil prices in 14 years. They say one of the reasons they’re not doing more is because of President Joe Biden’s perceived hostility to the traditional energy industry. Even as the Biden administration urges oil companies to boost production to offset the absence of Russian cargoes, many executives told Federal Reserve Bank of Dallas researchers they’re worried about investing in new shale wells because of the president’s long-term goal of phasing out fossil fuels. “The current administration will only hurt energy companies, driving up prices and severely affecting the middle guy that drives the economy,” one unidentified respondent said in the Dallas Fed’s quarterly energy survey released on Wednesday. “We are in for a world of hurt for the next three years.” Russia’s invasion of Ukraine — and the oil-market disruption that ensued — heightened tensions that already were simmering between the White House and oil CEOs who accuse the federal government of slow-walking drilling permits and overly onerous regulation. Their line of work is risky enough without having to worry that a new law or presidential decree may make some facet of their business obsolete or illegal, they say. But that hasn’t stopped drillers in the Dallas Fed’s territory that covers Texas and parts of New Mexico and Louisiana from pushing oilfield activity up 31% during the first three months of this year while increasing hiring, hours worked and wages, the survey found. In recent weeks, the Biden administration has accused the oil industry of leaving thousands of federal drilling permits untapped while questioning if some in the industry are gouging consumers with gasoline prices around $4 a gallon. “The talk about price gouging is tiresome,” said another respondent. “Discussion of federal leases and those leases being unused without an honest discussion about all the constraints and regulatory issues to drill is also unhelpful.” RELATED NEWS ///
Shale companies drilling more, but oil output growing little - American frackers are raising the number of drilling rigs in oil fields by more than 20%, but don’t expect a similarly sized increase in production.Though the number of active U.S. oil-directed rigs has grown by roughly one-fifth in the past six months, much of the new activity is to make up for a depleted inventory of wells drilled before the pandemic, executives said. Frackers brought the best of those online last year instead of drilling new ones and will have to drill more than usual this year to offset those lost wells.Following calls by the Biden administration and others to raise production and help quell rising oil prices following Russia’s invasion of Ukraine, shale executives have pointed to a number of bottlenecks that limit their ability to increase production quickly this year, including supply-chain issues, wary investors and limits to their remaining drilling inventory.Another significant constraint is the loss of thousands of ready-to-go wells, known as drilled but uncompleted wells, or DUCs, which companies had amassed last decade, then used up to survive the pandemic. Those wells could have helped speed the industry’s response to high oil pricesby several months, executives and analysts said.Diamondback Energy Inc., one of the largest oil producers in the Permian Basin of West Texas and New Mexico, has added seven drilling rigs to the five it had working during the pandemic—not to increase production but because it needed to drill more to maintain output. It had brought scores of DUCs into production since mid-2020.“The industry has now worked off all of the voluntary DUCs," said Diamondback President Kaes Van’t Hof, referring to wells companies intentionally left dormant.Mr. Van’t Hof said about 40% of about a $300 million increase in the company’s planned spending for the year is to compensate for its depleted inventory of DUCs, while another half of that increase will cover oil field cost inflation. Even with the additional spending, Diamondback expects to produce about the same amount of oil and gas.Smaller, private oil companies that have been more aggressive in increasing oil field activity and production over the past year might have to slow down as costs rise and finding labor remains a challenge, executives said.“Even if oil jumps to $200 a barrel today, there’s nothing more that can easily be done," said Manish Raj, chief financial officer at private oil producer Velandera Energy Partners LLC in Louisiana. Mr. Raj said many drilling contractors his company recently contacted have said their rigs are fully booked through the end of 2022. U.S. oil prices surged to the highest levels since 2008 following Russia’s invasion of Ukraine, but have eased lower since then, to $104.70 per barrel as of Friday. Executives and analysts said they expect U.S. oil production to grow between about 6% and 9% this year.
Gas prices are high. Oil CEOs reveal why they're not drilling more - The US oil industry doesn't appear to be in any rush to come to the rescue of Americans struggling with high gas prices. Oil company CEOs say Wall Street is to blame. Fifty-nine percent of oil executives said investor pressure to maintain capital discipline is the primary reason publicly traded oil producers are restraining growth, according to a Federal Reserve Bank of Dallas survey released Wednesday. For years, the boom-to-bust oil industry spent lavishly to fund all-out production growth. US oil output skyrocketed, keeping prices low. Yet sustaining profits proved elusive. Hundreds of oil companies went bankrupt during multiple oil price crashes, leading investors to demand more restraint from energy CEOs. Today, oil companies are under enormous pressure from Wall Street to return cash to shareholders through dividends and buybacks, instead of investing in badly needed supply. "Discipline continues to dominate the industry," an executive from an oilfield services firm told the Dallas Fed in the survey. "Shareholders and lenders continue to demand a return on capital, and until it becomes unavoidably obvious that high energy prices will sustain, there will be no exploration spending." US output is down even as prices skyrocket Although US oil supply is expected to rise in the coming months, it remains well below pre-Covid output. That's despite the fact that oil prices have spiked to levels unseen since 2008. The United States produced 11.6 million barrels per day in the week ending March 18, according to the US Energy Information Administration. That's down 10% from late 2019. Prices, on the other hand, have surged. US crude oil closed at $114.93 a barrel Wednesday, up 88% from the end of 2019. Current prices are well above the $56 per barrel average that oil companies told the Dallas Fed they need to profitably drill. Larger companies said they need per barrel prices of just $49 to turn a profit. Yet oil executives and investors don't want to add so much supply that it causes another glut that crashes prices. And shareholders want companies to return excess profits in the form of dividends and buybacks, not reinvest them in increasing production. One executive surveyed pointed to the staggering losses suffered by shareholders in recent years. The energy sector, comprised largely of oil-and-gas firms, was easily the worst performer last decade. "Investors dumped huge funds into shale drilling only to discover that when oil prices dropped, very little value existed at the end of the day," the executive said.
Top shale oil boss warns US can't replace any Russia shortfall - The head of the US’s biggest shale oil operator said the country would be unable to replace crude supplies from Russia this year, even as he backed calls for a global embargo on its energy exports.Scott Sheffield, chief executive of Pioneer Natural Resources, joined a broadening group of politicians calling for sanctions against Russia to be extended to its oil industry in response to Moscow’s invasion of Ukraine.But he acknowledged such a move could send crude prices soaring, with US producers unable to plug the supply gap quickly. West Texas Intermediate crude was $112 a barrel on Friday, 90 per cent higher than a year ago.“The only way to stop Putin is to ban oil and gas exports,” Sheffield told the Financial Times in an interview on Friday. "[But] if the western world announced that we’re going to ban Russian oil and gas, oil is going to go to $200 a barrel, probably — $150 to $200 easy.”Both Democratic and Republican politicians have called in recent days for a US embargo on Russian oil, including Nancy Pelosi, the Speaker of the Democrat-controlled House. The White House has resisted, fearing the impact of such a move on US energy prices.Joe Manchin, the Democratic senator from West Virginia, has also called for sanctions, and said on Thursday that American companies “can basically produce whatever needs to be produced”.But Sheffield said America’s shale oil patch — hampered by supply chain constraints and demands from Wall Street that operators use their oil price windfall to pay dividends rather than drill more wells — would take many months to sharply boost output.US oil production is currently 11.6mn barrels a day, well below its pre-pandemic peak near 13mn b/d. Pioneer, based in Texas, has previously disclosed plans to increase oil production by no more than 5 per cent this year.Shale regions such as western Texas would increase output by about 700,000 b/d this year, Sheffield said, and the growth rate could double to 1.4mn b/d in 2023 and 2024. But replacing lost Russian supplies would require a “global co-ordinated effort,” he said.“We can’t change this year,” Sheffield said, referring to shale operators’ output plans.“I’m talking about a two- to three-year plan,” he said. “Because US shale, even if somebody adds a [drilling] rig . . . it takes six to eight months to get first production. There’s labour shortages, there’s frack fleet shortages, there’s rig shortages, there’s sand shortages.”
In Texas, calls to boost U.S. oil production run into hard realities | The Texas Tribune -Labor shortages, supply chain issues, hesitant financial backers and a frosty relationship with the Biden administration have limited how much Texas oil and gas companies are ramping up production.— After Russia invaded Ukraine last month and the U.S. and major energy companies boycotted Russian oil and gas, some politicians quickly called for cranking up American energy production to fill the void. A Republican member of Congress attended President Joe Biden’s State of the Union address earlier this month wearing a shirt emblazoned with “Drill baby drill.” U.S. Rep. Filemon Vela, a Democrat from Brownsville, tweeted, “Save Ukraine! Unleash American Oil and Gas!” And U.S. Rep. August Pfluger, R-San Angelo, who represents the heart of Texas’ oil patch, has printed red, white and blue baseball caps with an oil pump jack next to the words “Midland over Moscow.” “The energy producers of [West Texas] and America are READY to produce the energy our nation and allies need!” Pfluger wrote on Twitter. But in Texas’ Permian Basin — the nation’s most productive oil region and the place that would have to lead any jump in U.S. production — people in the industry, energy analysts and local leaders say there’s no quick or easy way to make that happen. Cranking up production requires more workers, materials and money, and people in the industry say they’re facing the same labor shortages and supply chain issues that have plagued countless businesses throughout the COVID-19 pandemic. On top of that, they say Wall Street investors have become more hesitant about pouring money into fossil fuels, and the Biden administration’s policies are hampering the oil and gas industry. “It’s hard to get pipe, sand, crews for drilling rigs, truck drivers,” said Mike Oestmann, CEO of Tall City Exploration, a company that drills oil wells in West Texas and has two active rigs that drill 32 wells per year combined. He said the scarcity of supplies, equipment and people “is unlike anything I’ve ever seen.” He said frac sand — a key ingredient in the hydraulic fracturing process — has been particularly hard to find due in part to labor shortages, even though much of the supply comes from Texas. The price of steel has increased so much that supply shortages make it hard to get pipe for drilling wells, he added. Oestmann said his company has no plans to add more drilling rigs, but even if it did, he said it probably wouldn’t be able to find the supplies to do so. “And I talked to a guy yesterday — a bigger company than us — trying to ramp up his operation to six rigs, and he goes, ‘I don’t know if I can get all the things I need to do that,’” Oestmann said. John Volke, CEO of Crew Support Services — a company that houses oil field workers in temporary quarters known as “man camps” — says his company has filled every one of its 1,500 beds in the Permian. “Every one of our clients are trying to hire 20 to 40 people — field hands, labor for rigging pipe,” Volke said. “I don’t know where these people went to work, Amazon?”
Sand for fracking is now 3 times as expensive as it was last year, and it's one of several reasons US oil production isn't increasing - - With Russian oil on the international blacklist due to the invasion of Ukraine, the world is seeking a replacement for as many as 4.5 million barrels per day. Indeed, analysts at Rystad energy consultancy estimate that global trade of crude is down by an average of 1.5 million barrels per day since the beginning of Russia's assault on its Eastern European neighbor. Nearly a month on, crude oil is trading at over $110 per barrel, a price which has historically motivated oil companies to ramp up production, but the output of US drillers hasn't appeared to move significantly. One of the key reasons actually predates the war in Ukraine: the special sand required for hydraulic fracturing (frac sand) in shale oil production has gotten a lot more expensive. Frac sand is made of silica crystals processed from pure sandstone, with a small grain size and round shape that allows natural fluids like oil and water to pass between them. At a drilling site, sand is mixed with water and special chemicals, then injected into the ground at high pressure to break up shale to release and pump out the oil inside. That material now costs between $40 and $45 per ton, Rystad Energy analyst Ryan Hassler told Axios — nearly 185% higher than last year. Two years ago, sand prices were in the teens. While some of the frac sand used by drillers in Texas and New Mexico is sourced locally, a lot is actually shipped in from Wisconsin via rail. In either case, shortages of labor and transportation capacity have been complicating drillers' efforts since at least early February, according to Reuters. "We can't get enough sand," Tall City Exploration CEO Michael Oestmann told the wire service last month. "We're running less than the number of (fracking) stages we could pump in a day because we've run out of sand every day." On top of those logistical challenges, investors are urging caution and "capital discipline" after large numbers of speculative companies went out of business in the previous boom-and-bust cycle. Economists at the Dallas Federal Reserve project that whatever additional capacity US producers can develop will take a minimum of six months, and that's if everything works perfectly. But even if US shale oil producers do manage to step up production, it may not be sufficient to replace what is missing, since shale oil is a much lighter crude compared with Russia's heavier oil. Ultimately it's not clear how US producers — much less the rest of the world — is going to bridge the gap left by Russia's continued exclusion from the oil market.
Occidental to spend 5% of 2022 capital on Permian carbon removal plant - U.S. oil and gas producer Occidental Petroleum Corp. will spend roughly 5% of its 2022 capital budget to start construction of an industrial-scale direct air carbon capture plant in the Permian Basin of Texas and New Mexico. The company will combine decades of experience in using carbon dioxide to boost oil production with new technology and chemistry that will pluck carbon directly from the atmosphere and store it underground. Occidental's 2022 capital budget is $4.1 billion at the midpoint, executives told analysts on a March 23 conference call. The company plans to spend between $100 million and $300 million this year on the plant, which it estimated will eventually cost roughly $800 million. President and CEO Vicki Hollub told analysts that tax credits in the $1.2 trillion infrastructure bill that President Joe Biden signed Nov. 15, 2021, plus the evolution of voluntary and involuntary carbon offsets have created an opportunity for Occidental. The company expects the voluntary carbon reduction market to reach $50 billion by 2030. Occidental already has customers, including aircraft-maker Airbus SE and e-commerce services provider Shopify Inc., lined up to buy carbon credits from the new plant when it begins operation. "When is it going to happen and how is it going to happen? I think there's bipartisan support for that," Hollub said. "And for us to achieve the goals that President Biden has set out for our climate mitigation, it's going to require some acceleration." The Permian Basin direct air capture plant will be hooked into Occidental's existing network of carbon dioxide pipes and storage caverns. This could establish a carbon removal hub that can be replicated across the world, executives said. The plant will initially be able to remove 500,000 tonnes of carbon per year from the atmosphere, with a planned expansion to 1 million tonnes per year. While it is building the Permian plant, Occidental will be leasing land around the country for more carbon sequestration hubs, CFO Robert Peterson said. "Sequestration hubs, which will be located in the U.S., support our direct air capture and point source capture development by serving as an accessible location for the safe and economical storage of CO2 in saline formations." Occidental is looking outside the Permian Basin for a location for its second carbon hub. It would like to build more than 70 direct air capture plants around the world, executives said.
Methane survey from small plane finds more pollution, waste (AP) — A pollution survey using sensors on small airplanes to detect methane emissions across a major U.S. oil and natural gas production zone points to greater releases of the potent climate-warming gas than previous estimated by other methods, according to results published Wednesday.Underwritten by philanthropists and the fossil fuel industry, the study examined emissions from October 2018 through January 2020 across New Mexico’s portion of the Permian Basin, one of the world’s largest sources of oil and natural gas that extends into West Texas. The study estimated that methane emissions are equivalent to roughly 9% of the overall gas production in the surveyed area. That’s more than double the rate in several previous studies of the Permian Basin and national estimates by the U.S. government of natural gas lost to leaks and releases.“The bad news is that emissions in this time and this region were as high as they are,” said Evan Sherwin, co-author of the study and a research fellow at Stanford University’s department of energy resource engineering. “The good news is it was only about 1,000 sites out of 26,000 active wells. ... It’s just a few percent that were emitting during this extensive study.” The study arrives during a pivotal period for efforts by government regulators and industry to measure and rein in greenhouse gas emissions from oilfield infrastructure. For more than a decade, government auditors have warned that bad data was blinding regulators to the amount of greenhouse gases being pushed into the atmosphere by the oil and gas industry’s flaring and venting. The U.S. Environmental Protection Agency has proposed new regulations to eliminate venting at both new and existing oil wells and require companies to capture and sell gas whenever possible.
Exxon is mining bitcoin in North Dakota as part of its plan to slash emissions - ExxonMobil, the top oil and gas producer in the U.S., is piloting a project to mine bitcoin in North Dakota, according to people with knowledge of the matter.For over a year, Exxon has been working with Crusoe Energy Systems, a company based in Denver, said the people who asked not to be named because details of the project are confidential. Crusoe's technology helps oil companies turn wasted energy, or flare gas, into a useful resource.Similar to ConocoPhillips' mining scheme in North Dakota's Bakken region, Exxon is diverting natural gas that would otherwise be burned off into generators, which convert the gas into electricity used to power shipping containers full of thousands of bitcoin miners. Exxon launched the pilot in late January 2021 and expanded its buildout in July.While Exxon hasn't talked publicly about its work in the space, Eric Obrock, a 10-year veteran at the company, said on his LinkedIn profile that from February 2019 to January 2022, he "proposed and led the first successful commercial and technical demonstration of using Bitcoin Proof-of-Work mining as a viable alternative to natural gas flaring in the oil patch."Obrock's title on his profile is NGL industry outlook advisor, referring to the natural gas liquids market. Obrock told CNBC through a LinkedIn message that he's been advised that he can't speak to the media on this topic. Exxon didn't respond to a request for comment.Exxon's bitcoin project isn't really about making money from the cryptocurrency. Rather, the company has pledged to reduce emissions as part of an industrywide effort to meet higher environmental demands. In early March, Exxon joined other oil companies in committing to the World Bank's "Zero Routine Flaring by 2030" initiative introduced in 2015.The type of crypto mining arrangement it's pursuing with Crusoe reduces CO2-equivalent emissions by about 63% compared with continued flaring.Exxon's bitcoin mining work in North Dakota was first reported byBloomberg, which said the company is also considering similar pilots in Alaska, the Qua Iboe Terminal in Nigeria, Argentina's Vaca Muerta shale field, Guyana and Germany.
Petroleum expert discusses the 'Big Oil Windfall Profits Tax' — The oil and gas industry is something many West Texans know and love. Recently, the industry has been getting a lot of national attention since gas prices skyrocketed. Some leaders in Washington D.C. are trying to give Americans relief at the pump by taxing oil and gas companies. Sen. Sheldon Whitehouse (D., R.I.) and Rep. Ro Khanna (D., Calif.) are the two lawmakers that have introduced the "Big Oil Windfall Profits Tax." The act would put a 50% tax, on the price difference between the current cost of a barrel of oil and the average cost for a barrel between the years of 2015 and 2019. Kirk Edwards, former Chairman for the Permian Basin Petroleum Association, said that this tax would not be appropriate because it seems like a one-size-fits-all solution and not focused state by state. "They think it's easy to say 'let's just put this on the gasoline tax' and increase it, like in California, that is what they have done," said Edwards. "So many of their initiatives in that state are paid by putting it on the gasoline. When you compare, gas is up to $7 a gallon versus $4 a gallon in Texas." Edwards said gas prices seem to be hurting everyone's wallets lately, but the reason why goes beyond just the oil and gas industry. "People are seeing high gasoline prices and blaming it on oil and gas companies making huge profits off that," said Edwards. "The oil price is up but what people have to realize is that oil companies sell the oil to refiners, and the refiners are what make it into gasoline. Everybody gets the same prices out of the refinery, but what happens from there is where people take it to their service stations and can mark it up as high as they want." Edwards told NewsWest 9 that gasoline is not the only thing that is expensive right now. "We are having inflation in everything," said Edwards. "We are having inflation in everything from refrigerators, to wood, to homes, and in every aspect we see. You can't just blame the oil and gas industry for prices going up when we see it across the board." It is important to note that as of right now, the bill has only been introduced and it is making its way to the Ways and Means House Committee.
The Oil and Gas Industry is Using the War in Ukraine to Profit and Push Its Interests – DeSmog -- When Russia invaded Crimea, the EU and United States issued a joint statement stressing the importance of promoting U.S. liquefied natural gas (LNG) exports for Europe. It was 2014 and “American gas” would save Europe from being dependent on Russian gas imports. Eight years later, Russia again invaded Ukraine on February 24. Europe still imports more than 40 percent of its gas from Russia, and the American fossil fuel industry is still pushing the U.S. government to implement policies that “ensure long-term American energy leadership and security,” as the American Petroleum Institute wrote in a February 28 letter to the U.S. Department of Energy.“It’s time to change the course and return America to its dominant role in global energy,” read another letter that Republican members of the Senate Committee on Energy and Natural Resources sent to President Joe Biden several days later. These are just two examples of the wider trend of the fossil fuel industry and its allies “using the crisis as a proxy to expand U.S. energy exports,” said Julieta Biegner, U.S. campaign and communications officer for Global Witness. “We’ve seen a PR blip of executives and representatives [from the fossil fuel industry] claiming that the U.S. can come to Europe’s rescue.”Ukrainian environmental lawyer and climate change strategist Svitlana Romanko calls this “peace washing.” Many fossil fuel companies are doing it today, she explained, and “the profits that they are making are really huge.”In Europe, oil and gas companies are profiting off higher energy prices, and in the United States, Big Oil CEOs are “billions of dollars richer” than they were at the start of the Biden administration. Since the war “became inevitable,” they have sold shares in their companies worth millions of dollars, a recent analysis found. And now they are using windfall profits to get richer. As a result, members of Congress have proposed a windfall profits tax on Big Oil, an idea supported by a new campaign, Stop the Oil Profiteering. The proceeds of a windfall tax would be used to provide relief from higher gas prices. Not only are Western fossil fuel companies cashing in on this global crisis — which is not new — they also “played a critical role in getting Putin to this point,” Jamie Henn, director of Fossil Free Media, said. “There’s no way that Putin would be in the position he is to launch this terrible war and invasion, if it wasn’t for the profits that come from fossil fuels,” Henn added. “And that’s the terrible irony of this moment — that oil and gas companies helped create this crisis.” BP, Exxon, Shell, Equinor, Eni — many of the major fossil fuel companies — have all had long-standing stakes in Russian gas. It took pressure from the whole world seeing Putin’s “horrific international law and human rights abuse,” Romanko said, for most of them to publicly announce they would pull out of their stakes in Rosneft, Gazprom, or other joint ventures. According to Climate Investigations Center founder and director Kert Davies, continued involvement was a “reputational risk” too big even for these companies.
DNR releases details of two more Line 3 aquifer breaches - The Minnesota Department of Natural Resources has released details of more groundwater leaks caused by the construction of the Line 3 oil pipeline last year.The DNR has completed its investigation of three sites where crews installing the pipeline breached underground aquifers, causing uncontrolled — and unauthorized — flows of groundwater.State regulators previously identified one of the three locations, near Enbridge’s Clearbrook terminal. In January 2021, crews installing the replacement pipeline dug deeper than planned, piercing the top layer of an aquifer under pressure.Enbridge reported that flow was stopped nearly a year later, after releasing at least 50 million gallons of groundwater.The DNR now says a second breach occurred around Aug. 2 near LaSalle Creek in Hubbard County, and released about 9.8 million gallons of groundwater before Enbridge reported it had stopped the flow four months later.A third breach was identified around Sept. 10 near the Fond du Lac Band of Lake Superior Chippewa reservation in St. Louis County, when groundwater began welling up as crews removed sheet piling after finishing construction on that stretch of pipeline.The DNR said Enbridge has substantially slowed — but not completely stopped — that leak, which has resulted in the release of nearly 220 million gallons of groundwater. The agency said the breach potentially could affect nearby Dead Fish Lake, an important wild rice water for the Fond du Lac Band.State regulators ordered Enbridge to stop the groundwater flows and restore the sites. The company already has paid more than $3 million for the violations, and could face additional penalties. The DNR said it has investigated whether other aquifer breaches occurred along the Line 3 route, but has not confirmed any other breach sites. The agency said it will complete its final assessment following the spring thaw.
Climate groups sue Interior Department over controversial Black Friday report on oil and gas leasing - Several climate and conservation groups are suing the US Department of the Interior to get more information about the department's November review of its oil and gas leasing program -- a report that was widely criticized for sidestepping the program's impact on the climate crisis. Represented by the Western Environmental Law Center, the groups -- Montana Environmental Information Center, Center for Biological Diversity and WildEarth Guardians -- filed multiple Freedom of Information Act requests last year to access correspondence between federal officials on the drafting of the report. They received documents in two responses from bureaus within DOI, including the Bureau of Ocean Energy Management, but they were redacted, Barbara Chillcott, a senior attorney at the Western Environmental Law Center, told CNN. Chillcott estimated that of the documents provided so far, about 75% of the information has been redacted. Interior released its long-awaited review of drilling on federal lands and oceans on Black Friday last year. The review recommended an increase in leasing fees and consideration of environmental concerns in leasing decisions. But the report largely sidestepped the issue of climate change and didn't recommend a halt to new oil and gas leasing -- a promise President Joe Biden campaigned on. "The climate crisis is a public issue; these are public agencies," Taylor McKinnon, senior public lands campaigner at the Center for Biological Diversity, told CNN. "We want to see communications, we want to see those drafts, we want the public to be able to understand why and how the administration backpedaled from its climate promise in federal oil and gas leasing."Climate groups roundly criticized the report for not doing enough to address climate change. "From our perspective, the report really fell flat in terms of meeting the needs of addressing the climate crisis and seemed to be unresponsive to President Biden's executive order on tackling the climate crisis," Chillcott said. "It was a big disappointment for us. The word comprehensive does not come to mind whenever I think of that report." An Interior Department spokesperson declined to comment on the lawsuit. The government has 30 days from the complaint to file a response. Chillcott said she was hopeful the environmental groups could eventually prevail, given US Attorney General Merrick Garland recently issued new FOIA guidelines pushing agencies to be more transparent.
Rich countries must end oil and gas production by 2034, report says - The Washington Post - Rich nations must end oil and gas production within 12 years to give the world a shot at meeting the goal of the Paris agreement — and to give poor countries a “fair chance” to replace their lost income from fossil fuels, according to a report by the Tyndall Centre for Climate Change Research at the University of Manchester released late Monday. The report looked at the global carbon budget — the amount of carbon that the world can afford to emit without blowing past 1.5 degrees Celsius (2.7 degrees Fahrenheit) of global temperature rise, the more ambitious goal of the 2015 Paris accord. Advertisement It found that to have a 50 percent chance of meeting this target, developed countries must phase out oil and gas production by 2034. Developing countries would have until 2050 to end their production. “This is what the science is clearly telling us. It's a bit of basic arithmetic. That's all it is,” Kevin Anderson, a co-author of the report and a professor of energy and climate change at the University of Manchester, told The Climate 202. Anderson co-authored the report with Daniel Calverley, an independent climate researcher. Their work was commissioned by the International Institute for Sustainable Development, a think tank focused on sustainability. The researchers classified each country by its capacity to maintain a vibrant economy without revenue from oil and gas. Their main findings were:
- “Highest capacity” countries with average non-oil gross domestic product per person of $50,000 must end production by 2034, with a 74 percent cut by 2030. They include theUnited States, United Kingdom, Canada and Australia.
- “High capacity” countries with average non-oil GDP of nearly $28,000 must end production by 2039, with a 43 percent cut by 2030. They include Saudi Arabia, Kuwaitand Kazakhstan.
- “Medium capacity” countries with average non-oil GDP of $17,000 must end production by 2043, with a 28 percent cut by 2030. They include China, Brazil and Mexico.
- “Low capacity” countries with average non-oil GDP of $10,000 must end production by 2045, with an 18 percent cut by 2030. They include Indonesia, Iran and Egypt.
- “Lowest capacity” countries with average non-oil GDP of $3,600 must end production by 2050, with a 14 percent cut by 2030. They include Iraq, Libya and South Sudan.
IEA Releases 10-Point Plan to Curb Oil Use: The U.S. Is Unlikely to Follow Much – If Any – of It -- Jerri-Lynn Scofield --The International Energy Agency (IEA) last week released A 10-Point Plan to Cut Oil Use. Many of the steps seem to be no more than common sense – and would not prove unduly difficult to implement. And Asian and European countries are expected to follow at least some of these recommendations.Alas, the U.S. is not expected to comply with any provisions. Now, to be sure, skyrocketing oil and gasoline prices may independently cause U.S. households to curb their fossil fuelconsumption. Many can’t afford to do otherwise.The IEA, founded in 1974 by seventeen countries – mainly from Europe, but also including Japan and the United States – was intended to counteract the activities of Organization of the Petroleum Exporting Counties (OPEC). The IEA now has thirty-one members, and as Motherboard reports , has “the goal of “cooperation on a variety of issues” relating to energy supply including a “collective emergency response mechanism” that ensures a “stabilizing influence” during times of energy crises.”The report addresses some cursory measures to increase supply – which I won’t consider in this post. Instead, I’ll examine the proposed measures the IEA has put forward to reduce demand for oil. Per the IEA report: Another way to help balance the market and reduce the pain caused by high oil prices is to bring down demand. Following Russia’s invasion of Ukraine, the IEA’s March Oil Market Report lowered its forecast for global oil demand in 2022 by 950 thousand barrels a day (kb/d) because of the expected impacts of higher prices and weaker GDP growth. But this would still leave the oil market very tight, with upward pressure on prices likely to remain in an uncertain geopolitical environment.Further reductions in demand are possible in the near term, however, through actions by governments and citizens. The world’s advanced economies together account for around 45% of global oil demand, and most of them are members of the IEA. Demand restraint (see annex) is one of the emergency response measures that all IEA member countries are required to have ready as a contingency at all times – and that they can use to contribute to an IEA collective action in the event of an emergency.In view of this and the potential emergency the world is facing, the IEA is proposing 10 immediate actions that can be taken in advanced economies to reduce oil demand before the peak demand season. We estimate that the full implementation of these measures in advanced economies alone can cut oil demand by 2.7 million barrels a day within the next four months, relative to current levels.1 The analysis in this report focuses on the potential effect of these measures in advanced economies, but their adoption in more countries would further increase their impact. Ensuring local and regional coordination of their implementation would maximise the impact. [IEA Report, pp. 5-6].
Ukraine crisis forces world to confront its oil and gas addiction (Thomson Reuters) - As the war in Ukraine highlights the perils of relying on Russian fossil fuels, France has been fast-tracking efforts to wean households off oil-fired heating, insulate their homes better and swap petrol and diesel cars for electric. Climate policy discussions in recent years have focused on phasing out coal - the most carbon-polluting fuel - but the Ukraine crisis is pushing some governments to confront their ongoing addiction to oil and natural gas, too. "Whatever the obstacles before us, the transition to a world without fossil fuels is more than ever the safest and most effective way to guarantee our future and our energy sovereignty," French ecological transition minister, Barbara Pompili, told reporters last week. With energy shipments disrupted and prices skyrocketing, the war has made switching away from oil and gas even more urgent, Pompili said at the launch of a 10-point plan to cut oil use from the International Energy Agency (IEA). France aims to end the use of oil to heat buildings by 2030, boosting subsidies to make choosing heat pumps or biomass boilers a more affordable choice for lower-income families. But as countries hurry to shore up their energy supplies in uncertain times, U.N. Secretary-General Antonio Guterres warned that some might be tempted to "neglect or knee-cap policies to cut fossil fuel use". That would be "madness", he said on Monday, adding that short-term measures could create long-term fossil fuel dependency and shut the small window for limiting global warming to 1.5 degrees Celsius, the most ambitious international goal. Guterres wants wealthy governments to put an end to coal production and use by 2030, with less-developed countries following suit by 2040. But global deadlines for phasing out oil and gas have yet to receive much attention, in the interests of richer nations that want to keep powering their economies with those fuels, climate scientist Kevin Anderson told the Thomson Reuters Foundation. A new report co-authored by Anderson, energy and climate change professor at Britain's University of Manchester, says there is no room for any nation to boost oil and gas output if the world is to have a 50% chance of staying below 1.5C of warming. The effort required to cut production must be shared fairly, the report says, with poorer countries given longer to replace the income they receive from oil and gas, in line with its greater importance to their economies.The report, released on Tuesday, calculates that rich countries - including the United States, Britain, Norway, Canada, Australia and the United Arab Emirates - must end oil and gas production by 2034 and cut it by about three-quarters by 2030, to stay on track for the 1.5C target.Those least able to make a so-called “just transition” away from fossil fuels, such as Iraq, Libya, Angola and South Sudan, should be given until 2050 to end output, as doing so abruptly could threaten their political and economic stability.
Biden, allied leaders discuss new round of oil reserve release— The U.S. and other major economies this week discussed oil supply and the potential for another round of releases, President Joe Biden’s top national security aide said, raising the prospect of new government intervention to ease supply strains. National Security Advisor Jake Sullivan said oil prices a nd tapping emergency stockpiles were discussed in sessions Thursday in Brussels, where Biden met with NATO, Group of Seven and EU counterparts. It came up in particular with the G-7, and it was a “major topic of conversation,” he said. “This was not just about talking; it was about thinking about the steps we can take,” Sullivan said, before signaling there could be an announcement in the near future. “I will not steal the thunder of of the administration on that issue.” The U.S. has in recent months announced releases from the Strategic Petroleum Reserve in a bid to curb oil price increases. Russia’s invasion of Ukraine last month, and ensuing sanctions, sent the price of crude soaring. Prices eased earlier this month before resuming their climb again. Sullivan spoke after Biden announced a separate pact, with the EU, to try and ease Europe’s dependence on Russian natural gas exports. The U.S. is aiming to coordinate a boost of non-Russian gas supply this year, while Europe is pledging a de facto minimum purchasing level to encourage increased U.S. production.
Bitcoin Miners Eyeing Argentina's Natural Gas Cash Cow - British company FMI Minecraft is working on a project to mine the cryptocurrency Bitcoin using natural gas from Argentina’s Vaca Muerta.The project would be in the Zapala free trade zone in the province of Neuquén and source gas from the Vaca Muerta, or ‘Dead Cow’ shale formation.“Vaca Muerta is great because there are more than 20 producers of good quality gas,” FMI partner Eduardo Meyer told NGI. The mining operation would initially involve 100 MW of gas-fired power, which would be expandable to 250 MW. Meyer said Argentina has “good suppliers of turbines and generators, and human resources.” He added, “there is a big oil and gas scene in Argentina.”The project would expand local gas transport capacity, provide jobs, and all suppliers would be local, Meyer said. “Our plan is to work with the local university to create a service hub to fix mining machines.”With China outlawing cryptocurrency, most Bitcoin mining is done in North America, but that market has become saturated, Meyer said. Natural gas for power is cheap in Argentina and the free trade zone makes the project attractive.Bitcoin mining is the process through which specialized computers verify bitcoin transactions. The process allows miners to add “blocks” of the distributed public ledger, aka the blockchain, on which transactions are recorded. “Mining is the way we can make the network safe and secure,” Meyer said. “By doing so the miner receives an incentive as the network mints a new bitcoin as payment to the miner.”The key to the success of a project is access to the mining machines, which mainly come from China and are backlogged, Meyer said. The other essential component is energy.The mining process is highly energy intensive. In the course of the last year, Bitcoin mining consumed 204 TWh, as much energy as the country of Thailand, according to a study by technology analysis platform Digiconomist.
The Future of Oil-Soaked Eider Ducks in Suðureyri Uncertain - A week has passed since an oil spill was reported in the town of Suðureyri in Northwest Iceland. Over the past days, residents have set up makeshift facilities to clean affected eider ducks – and have managed to save almost two dozen birds since last weekend. An expert with with the Natural Science Institute of the Westfjords believes that these efforts may only serve to protract the birds’ suffering, Fréttablaðið reports.Over 9,000 litres of diesel oil spilt into Suðureyri harbour on Thursday, March 3. The leak, which originated from a reserve tank owned by the power company Orkubú Vestfjarða – and which was buried in snow – was discovered by residents the following morning.They could smell it.“I still smell like diesel oil, despite having showered twice since yesterday,” Auður Steinberg, a resident in Suðureyri, stated in an interview with Vísir last Sunday.The oil found its way into a pond near the local swimming pool – which was subsequently closed alongside the elementary school – and from there into the harbour. It wasn’t until Monday, three days after the leak was reported, that hoses were submerged in water to try to prevent the leak from spreading.Although there was less soil pollution than initially suspected, hundreds of eider ducks were badly affected by the leak. Many of them fled the harbour, where they commonly spend their nights, onto nearby roads and neighbourhoods.In an interview with RÚV on Wednesday, eider duck expert and Suðureyri resident Einar Mikael Sverrisson described the conditions as “nightmarish.” According to Einar, “there were hundreds of birds that needed help.”He got to work right away.Having converted baiting facilities into a bird-rescue centre, Einar and his neighbours had, as of yesterday, managed to save nineteen out of the twenty-eight birds that they had collected last weekend. “But over a hundred birds remain, completely helpless, most of them already dead,” Einar told Fréttablaðið in another interview yesterday. He predicts that hundreds of birds will perish over the coming weeks and months if nothing is done.’
Oil Spill in Westfjords Cleaned Up - The diesel oil that leaked from a reserve tank into Suðureyri harbour, in the Westfjords, has now been cleaned up, RÚV reports. The location will be monitored to determine whether there is still contamination once the snow melts. Over 9,000 litres of diesel oil spilt into Suðureyri harbour on Thursday, March 3, more than two weeks ago. The leak, which originated from a reserve tank owned by the power company Orkubú Vestfjarða – and which was buried in snow – was discovered by residents the following morning. The oil found its way into a pond near the local swimming pool, and from there into the harbour. It wasn’t until three days after the leak was reported that hoses were placed in the water to try to prevent the leak from spreading. The oil was particularly harmful to local birdlife: hundreds of eider ducks died or had to be put down as a result of the oil, though some were saved thanks to locals’ efforts. Sigríður Kistinsdóttir, team leader of pollution prevention at the Environment Agency of Iceland, says cleaning of the pond and harbour has gone well and will be completed this weekend. Stormy weather has also helped disperse the oil, she added. A town meeting will be held in Suðureyri this week, where representatives of Orkubú Vestfjarða and the Westfjords Public Health Authority will be present. Residents and others involved in the clean-up efforts can attend.
Geopolitical Tensions on Europe’s Southwestern Flank Threaten to Exacerbate EU’s Natural Gas Shortages -For the first time in 42 years Spain has decided to support Moroccan claims to sovereignty over Spain’s former colony, Western Sahara. In the process it risks alienating its largest natural gas provider, Algeria, which fiercely opposes Morocco’s territorial claims.On Friday, Spain’s foreign minister, José Manuel Albares, called a proposal launched by Rabat in 2007 to grant Western Sahara limited autonomy “the most serious, realistic and credible” initiative for resolving a decades-long dispute over the vast Saharan territory. This threatens to open up a whole new geopolitical can of worms at the worst possible time for Europe’s energy-starved markets.For decades Spain, like most countries, had supported the idea of holding a referendum to resolve the territorial integrity of Western Sahara — which was agreed as part of the 1991 ceasefire and is also strongly supported by Algiers. As such, this represents a sea change in policy.But Spain is caught between a rock and a hard place in its relations with the neighboring North African countries of Morocco and Algeria. On the one hand, it depends on Algeria for almost half of the natural gas it consumes. However, Algeria — like the United Nations — supports the right of the Sahrawi people to self-determination. On the other hand, Morocco, which took over the lion’s share of Western Sahara after Spain relinquished the colony in 1975, controls a key gateway for African migrants trying to reach Europe via Spain.Like Erodgan’s Turkey, Morocco is not afraid of using that power as leverage. In May 2021, Rabatwithdrew all of its border guards from a breakwater separating the Moroccan city of Fnideq with Ceuta, one of two Spanish enclaves in northern Morocco, after Moroccan intelligence had discovered that Braham Gali, the secretary general of the Sahrawi nationalist movement, the Polisario Front, had been treated in a Spanish hospital after contracting COVID-19. Within just a few hours some 1,500 African migrants crossed the water into Ceuta, according to Spanish authorities. Rabat also recalled its ambassador to Spain in protest. Spain’s foreign minister, José Manuel Albares, suggested on Friday that working with Morocco to tackle migration from sub-Saharan Africa was more important that Spain’s energy dependence on Algeria. “We want to strengthen cooperation in the management of migration flows in the Mediterranean and the Atlantic,” Albares said.
Russia used 'soft power' to influence EU policies and anti-fossil fuel efforts -U.S. policymakers are finally realizing that Russia may have been covertly funding U.S. environmental organizations to shape public opinion and policies – especially energy and anti-fossil fuel policies – to Russia’s liking and benefit. Such Russian skullduggery has long been an open secret in Europe. I recently wrote about U.S. efforts to identify and expose Russian anti-fossil fuel activities. In 2017, former chairman of the House Committee on Science, Space, and Technology Lamar Smith (R-Texas) and Rep. Randy Weber (R-Texas), who was chairman of the Subcommittee on Energy, sent a letter to then-Treasury Secretary Steve Mnuchin revealing a possible covert funding scheme. Now, Rep. Bill Johnson (R-Ohio) and other members of Congress are calling for investigations. Europe got a head start in exposing Russian actions. In 2016 four researchers with the Brussels-based Wilfried Martens Centre for European Studies published “The Bear in Sheep’s Clothing: Russia’s Government-Funded Organizations in the EU,” identifying various ways Russia tried to influence European Union policies. That report states: “This paper sheds light on organisations operating in Europe that are funded by the Russian government, whether officially or unofficially…. Their number and activities have been growing, but their financing is often complex and hidden from the public eye.” Notice the part about financing being “complex and hidden from the public eye.” Russia doesn’t want EU officials, the public and other countries (e.g., the United States) to know what it’s up to. Echoes of Russia’s EU efforts were exposed in the Smith-Weber letter. The Martens Centre paper says Russia’s influence peddling is an example of “soft power,” which it defines as a “broad range of methods and institutions that the Russian government is using to influence decision-makers and public opinion in the EU.” In 2012 Russian President Vladimir Putin described soft power as “a matrix of tools and methods to reach foreign policy goals without the use of arms but by exerting information and other levers of influence,” according to the paper.By trying to turn public opinion and policy against fossil fuel production, especially fracking, Russian oil and natural gas producers would face less competition, allowing them to charge higher prices, realize greater profits and make Europe even more dependent on Russian oil and gas. Mission accomplished! Unlike the United States, Europe never embraced fracking. The Smith-Weber letter exposes similar Russian efforts to launder money intended to fund anti-fracking efforts in the United States. They write, “This scheme allows money originating from foreign countries like Russia to funnel money through Bermuda-based shell companies to environmental groups in the United States with the aim of disrupting the U.S. energy industry.” And their letter names names.
Why Biden can't help Europe rid itself of Russian gas - -The European Union wants the United States’ help in kicking its addiction to Russian natural gas. But President Joe Biden faces big limits in what he can promise when he visits the continent this week. Europe’s main request is more liquefied natural gas from the U.S., whose output of the fuel has surged over the past five years. But American gas exporters are already shipping their LNG overseas nearly as fast as they can, with little new capacity due to come online during the next two years. And Biden cannot command the activities of private oil and gas companies — who will typically sell their product wherever in the world they can fetch the highest price. “Governments don’t make deals” when it comes to directing U.S. oil and gas resources to specific nations, “You don’t have government-to-government oil companies.” That means the United States may not be able to do much to immediately ease the energy crunch for European states that are seeking to cut their imports of natural gas from Russia by two-thirds this year in response to Vladimir Putin’s invasion of Ukraine. Russian gas shipments to Europe reached 5.5 trillion cubic feet of gas in 2020, up more than 25 percent from a decade ago. The energy crisis for America’s cross-Atlantic allies is still forcing a shift in policies for the Biden administration, which had come into office pledging to drive a transition away from fossil fuels and toward clean energy. Republicans and European leaders alike are pushing the White House to use U.S. energy production as a way to help Germany and other countries reduce their dependency on Moscow. “Hopefully, we are beyond [European dependence on Russia] and producing more energy to provide them by next winter,” Republican Alaska Sen. Dan Sullivan said in an interview. The issue is expected to be a central topic when Biden visits Europe to attend a NATO summit and a European Council meeting scheduled for Thursday. The White House’s senior adviser for energy security, Amos Hochstein, and members of the State Department’s Bureau of Energy Resources are expected to accompany him, a person familiar with the plans said.
Biden and Europeans to announce major plan to redirect gas to Europe — President Biden and European leaders are expected to announce a major initiative to direct shipments of liquefied natural gas to Europe during his visit to Brussels this week, part of a broader effort to help reduce Europe’s dependence on Russian energy, according to three U.S. officials familiar with the plan. The announcement, a dramatic effort to deprive Russia of leverage as it continues to batter Ukraine, would mark an unusual move to reorder the world’s energy flow — a shift that could have an impact long after the war is over. It comes as European officials have asked the United States to do more to help them cut their reliance on Russia for oil and natural gas. Biden is also expected to use his stop in Brussels on Thursday and Friday — where he is meeting with NATO, the Group of Seven and the European Council — to announce additional sanctions against Moscow, as well as a crackdown on evasions of the current sanctions. The sanctions are expected to hit numerous members of Russia’s parliament, defense companies and subsidiaries, and additional sectors of its economy, according to two people familiar with the matter, who spoke on the condition of anonymity to describe matters not yet made public. They cautioned that planning was fluid and subject to change. Taken together, the expected actions by America and Europe amount to an escalation of the sweeping push by a U.S.-led coalition of democracies to punish and deter Russia as it pursues its war against Ukraine. The past four weeks have seen a nearly unprecedented coalescence of democratic countries to impose costs on a belligerent foe and provide aid to its victim. The initiative to ship liquefied natural gas, or LNG, whose details have yet to be finalized, will come Friday when Biden meets with European Commission President Ursula von der Leyen in Brussels before departing for Poland. Advertisement Speaking to European Union lawmakers in Brussels on Wednesday, von der Leyen said that all E.U. members “can contribute in reducing our dependency on Russian gas” and said it was a topic she planned to take up with Biden on the first day of his visit Thursday. “Tomorrow, I will discuss with President Biden how to prioritize LNG deliveries from the United States to the European Union in the coming months,” von der Leyen said. “We are aiming at having a commitment for additional supplies for the next two winters.”
Why the U.S. Can’t Quickly Wean Europe From Russian Gas - The New York Times — President Biden announced Friday that the United States would send more natural gas to Europe to help it break its dependence on Russian energy. But that plan will largely be symbolic, at least in the short run, because the United States doesn’t have enough capacity to export more gas and Europe doesn’t have the capacity to import significantly more.In recent months, American exporters, with President Biden’s encouragement, have already maximized the output of terminals that turn natural gas into a liquid easily shipped on large tankers. And they have diverted shipments originally bound for Asia to Europe.But energy experts said that building enough terminals on both sides of the Atlantic to significantly expand U.S. exports of liquefied natural gas, or L.N.G., to Europe could take two to five years. That reality is likely to limit the scope of the natural gas supply announcement that Mr. Biden and the European Commission president, Ursula von der Leyen, announced on Friday.“In the near term there are really no good options, other than begging an Asian buyer or two to give up their L.N.G. tanker for Europe,” said Robert McNally, who was an energy adviser to former President George W. Bush. But he added that once sufficient gas terminals were built, the United States could become the “arsenal for energy” that helps Europe break its dependence on Russia.Friday’s agreement, which calls on the United States to help the European Union secure an additional 15 billion cubic meters of liquefied natural gas this year, could also undermine efforts by Mr. Biden and European officials to combat climate change. Once new export and import terminals are built, they will probably keep operating for several decades, perpetuating the use of a fossil fuel much longer than many environmentalists consider sustainable for the planet’s well-being.For now, however, climate concerns appear to be taking a back seat as U.S. and European leaders seek to punish President Vladimir V. Putin of Russia for invading Ukraine by depriving him of billions of dollars in energy sales.The United States has already increased energy exports to Europe substantially. So far this year, nearly three-quarters of U.S. L.N.G. has gone to Europe, up from 34 percent for all of 2021. As prices for natural gas have soared in Europe, American companies have done everything they can to send more gas there. The Biden administration has helped by getting buyers in Asian countries like Japan and South Korea to forgo L.N.G. shipments so they could be sent to Europe.The United States has plenty of natural gas, much of it in shale fields from Pennsylvania to the Southwest. Gas bubbles out of the ground with oil from the Permian Basin, which straddles Texas and New Mexico, and producers there are gradually increasing their output of both oil and gas after greatly reducing production in the first year of the pandemic, when energy prices collapsed.But the big problem with sending Europe more energy is that natural gas, unlike crude oil, cannot easily be put on oceangoing ships. The gas has to first be chilled in an expensive process at export terminals, mostly on the Gulf Coast. The liquid gas is then poured into specialized tankers. When the ships arrive at their destination, the process is run in reverse to convert L.N.G. back into gas.A large export or import terminal can cost more than $1 billion, and planning, obtaining permits and completing construction can take years. There are seven export terminals in the United States and 28 large-scale import terminals in Europe, which also gets L.N.G. from suppliers like Qatar and Egypt.Some European countries, including Germany, have until recently been uninterested in building L.N.G. terminals because it was far cheaper to import gas by pipeline from Russia. Germany is now reviving plans to build its first L.N.G. import terminal on its northern coast.
The US wants to send more gas to Europe, but has almost none to spare — Europe has a Russia-sized hole in its natural gas supply, and the US wants to help fill it. Today (March 25), US officials agreed to supply the EU with an additional 15 billion cubic meters of liquified natural gas by the end of 2022, to offset imports from Russia. It’s a nice political gesture, as Europe scrambles for any way to stop paying Vladimir Putin’s government hundreds of millions of dollars per day for gas. But it only accounts for about 10% of Russian gas exports to Europe. And there’s one other little problem: The US is already exporting nearly every drop of LNG it can.Global LNG demand was already surging prior to the Ukraine conflict as countries everywhere seek to lower than reliance on coal. US exporters have been racing to bring more shipping terminals online for the last few years, and in December 2021 finally surpassed Qatar and Australia as the world’s top LNG exporter. In February, US LNG exports hit a record of 13.3 billion cubic feet per day, the first time that all seven US terminals were fully docked by tankers at once. Once the most recently completed new terminal, Calcasieu Pass in Louisiana, is fully operational by the end of this year, total US export capacity will be 13.9 bcf/d. It takes years to build new LNG export infrastructure, so it’s not clear how the US can meet its near-term promise to Europe other than talking Asian customers like China and Japan into reselling some of their American LNG to Europe. Longer-term, European buyers are already signing advance contracts for US LNG that won’t be delivered until 2025 or later. Europe will also need to expand its import terminal infrastructure. No matter what happens in the coming weeks in the Ukraine conflict, Europe is preparing to make its shift away from Russian gas permanent.
Europe Can Survive Throughout Summer Without Russian Gas - If Russian gas flows to Europe were interrupted now, Europe would have enough gas to last it through the end of this winter and the following summer without having to curtail demand, energy consultancy Wood Mackenzie said on Friday.European gas storage levels will likely be within the five-year range by the end of this winter, thanks to mild weather, more arrivals of liquefied natural gas (LNG) and sustained imports from Norway, according to WoodMac.If Russian flows continue, the European Union (EU) and the UK will end this winter’s heating season with 27 billion cubic meters (bcm) of gas in storage, which is a level within the five-year range.Although energy exports are not part of the sanctions against Russia currently, there is a risk that Moscow could stop flows as a countermeasure to intensifying sanctions over the Russian invasion of Ukraine. While this winter and the summer could be easier for Europe without Russian gas, some demand curtailments in the 2022-2023 winter will be inevitable, according to WoodMac’s Filippenko.Higher natural gas imports from Norway and Algeria, more LNG, slowing the phase-out of coal, and delaying maintenance shutdowns on nuclear power plants could also free up some gas for the power generation sector, perhaps as much as 13 bcm until the end of October 2022, according to Wood Mackenzie.The EU is overhauling its energy strategy following the Russian invasion of Ukraine, and the European Commission unveiled last week a plan to make Europe independent from Russian fossil fuels well before 2030, starting with gas. The EU will seek to diversify gas supplies, speed up the roll-out of renewable gases, and replace gas in heating and power generation—all this can reduce EU demand for Russian gas by two-thirds before the end of the year, the Commission says. In addition, the Commission will propose that by October 1, gas storage in the EU has to be filled up to at least 90%.
Germany seals gas deal with Qatar to reduce dependence on Russia -- "The energy supply constraints resulting from the Russian invasion of Ukraine and the increased prices created by big oil companies has highlighted how important it is to ensure that Michigan is not overreliant on one source and has energy independence to protect Michiganders’ pocketbooks and our state’s economic security," Bobby Leddy, Whitmer's press secretary, told Fox News Digital in a statement. Germany and Qatar have reached a long-term energy partnership, a German official has said, as Europe’s biggest economy seeks to become less dependent on Russian energy sources.Russia is the largest supplier of gas to Germany and German economy minister Robert Habeck has launched several initiatives to lessen Germany’s energy dependence on Russia since it invaded its neighbour Ukraine. Qatar’s Emir Sheikh Tamim bin Hamad Al Thani met Habeck on Sunday and the two discussed ways to enhance bilateral relations, particularly in the energy sector, the Emiri court said in a statement.A spokesperson for the German economics ministry in Berlin confirmed on Sunday that a deal had been clinched.“The companies that have come to Qatar with (Habeck) will now enter into contract negotiations with the Qatari side,” the spokesperson said.In a statement, Qatar said that for years it had sought to supply Germany but discussions never led to concrete agreements.Qatar said it agreed with Germany that “their respective co mmercial entities would re-engage and progress discussions on long term LNG supplies”.Habeck also met Qatari Minister of State for Energy Affairs Saad Sherida al-Kaabi in Doha, where they discussed energy relations and cooperation between Qatar, one of the world’s top natural gas exporters, and Germany, and ways to enhance them, according to a statement from al-Kaabi.In late February, German Chancellor Olaf Scholz announced the construction of two new terminals for liquefied natural gas in response to what some critics said was Germany’s over-reliance on Russian gas. The terminals are to be located in Brunsbuttel and Wilhelmshaven in northern Germany.Following Russia’s invasion of Ukraine, Germany put on hold the Nord Stream 2 gas pipeline project designed to bring Russian natural gas directly to Germany via the Baltic Sea. Germany intends to phase out its nuclear power production by the end of this year, leaving observers questioning how Europe’s biggest economy will fulfill all of its energy needs.
Schlumberger suspends new investment and technology deployment in Russian operations— Russian refiners are trimming their output, exacerbating a shortfall in European diesel supply, Gunvor Group Chief Executive Officer Torbjorn Tornqvist said. “This is a global problem but for Europe it’s very hard because Europe is so short” of diesel, Tornqvist said at the Financial Times Commodities Global Summit. Diesel is still flowing from Russian refineries to Europe but the trade is becoming more problematical. Shipping companies, banks and buyers are shying away from dealing with Russian energy products in what is being termed “self-sanctioning,” following Russia’s invasion of Ukraine. “That will force Russian refiners to cut back, in fact we already see that,” said Tornqvist. “What does that mean? It means more crude oil will need to be exported instead of the products, and we believe that is not possible and will lead to cutbacks in Russian production.” European diesel stockpiles are expected to fall to the lowest level since 2018 this month, according to an Energy Aspects presentation. Some 500,000 tons of Russian diesel exports are at risk in March, the analyst said, leave “physical supply tighter than ever.” Diesel prices in Europe have surged in recent weeks. Earlier in March, gasoil futures traded on the Intercontinental Exchange jumped to a record as fears of supply disruption from Russia, Europe’s largest supplier, compounded an already tight market. Heating oil prices in Germany were up more than 50% week-on-week through March 14, according to data compiled by Bloomberg
Russia Sanctions Collateral Damage: Diesel Shortage Risk Worsening, EV Batteries by Yves Smith - Forgive me for what amounts to news snippets,but the Russian sanctions induced energy squeeze looks to be bearing down on Europe and the US even faster that most sources anticipated. First are diesel shortages, which we had warned about virtually from the get go. Russian gas is heavier than either fracked gas or Saudi light sweet crude. Heavier means more long chain hydrocarbons which are more energy dense. Lighter grades can be used to make diesel…but that’s at the expense of the gas which you presumably also wanted to have.We had pointed out that diesel shortages are so imminent that the IEA is recommending aggressive energy conservation measures now, like more work at home, more ride-sharing, cutting air travel, so as to reduce the severity of the crunch they expect to kick in over the next four months.The news on the diesel front is only getting worse. From the first of two germane stories on OilPrice, an overview called Europe Faces Systemic Diesel Supply Crunch: Europe risks being exposed to a “systemic” deficit of diesel supply that could worsen and even lead to rationing of fuel, the top executives of the world’s largest independent oil traders said on Tuesday….“This is a global problem but for Europe it’s very hard because Europe is so short” of diesel, Gunvor CEO Torbjorn Tornqvist said at the Financial Times Commodities Global Summit as carried by Bloomberg.Europe’s diesel shortage is worsening as Russian oil refiners have started to cut back on refinery throughput, Tornqvist added.Diesel stocks globally were already low even before the Russian invasion of Ukraine, but the shortage has now been exacerbated by the lower global diesel supply from Russia.In the highly volatile global energy markets since Russia’s war in Ukraine began, even the biggest traders are exposed to rising margin calls. The possibility of a derivatives shock blowing back to the physical market is a new angle, but after the LME canceled a full day of nickel trades so as not to blow up the exchange or too many big fish, do not underestimate the extreme measures that will be taken to keep perceived-to-be-too-critical-to-fail institutions and players alive. A more specific wrinkle on the diesel squeeze story, mentioned in the piece above, is Russia Cuts Refinery Output As Diesel Shortage Worsens:Diesel stocks globally were already low even before the Russian invasion of Ukraine. According to estimates from Reuters’ John Kemp, diesel fuel stocks in Europe are at their lowest since 2008, and 8 percent—or 35 million barrels—lower than the five-year average for this time of the year.In the United States, the situation is graver still. There, diesel fuel inventories are 21 percent lower than the pre-pandemic five-year seasonal average, which translates into 30 million barrels.In Singapore, a global energy trade hub, diesel fuel inventories are 4 million barrels below the seasonal five-year average from before the pandemic.On top of exacerbating a global diesel supply crunch, the sanctions against Russia are also likely to force Russian firms to shut in some crude oil production, analysts say. Russia will have to shut in some of its oil production as it will not be able to sell all the volumes displaced from European markets to other regions, with Russian crude production falling and staying depressed for at least the next three years, Standard Chartered said earlier this month.So the perceived need to stay well away from anything Russian, even when it’s energy and other commodities that the sanctions were originally designed to carve out, is going to create quite a bit of pain. Yet even though this impact is widely acknowledged in the business press, there seems to be no will to do anything about it. RT has a new story about how damage to a key pipeline to Europe is going to make the energy crunch worse over the next three weeks, if not longer. The pipeline operators made dutifully sincere noises about how sorry they were and how they would get everything fixed up as soon as possible. The article also said that the pipeline would be back to its old delivery level by the third quarter, so not to worry. But it is instructive to note the peculiar sensitivity about oil delivered via Russian tankers, versus the lack of much revulsion about gas and oil sent through pipelines.
TotalEnergies to stop purchasing oil, petroleum products from Russia - French energy giant TotalEnergies said Tuesday that it will stop buying Russian oil and petroleum products by the end of this year as well as suspend activities in the country amid Russia’s war on Ukraine. The company said it has committed to 'act responsibly' and strictly comply with European sanctions with regard to its business in Russia given the worsening situation in Ukraine. It will now procure oil and gas for European countries from Poland and Saudi Arabia. 'TotalEnergies has unilaterally decided to no longer enter into or renew contracts to purchase Russian oil and petroleum products, in order to halt all its purchases of Russian oil and petroleum products as soon as possible and by the end of 2022 at the latest,' it said. The company will terminate contracts with the Druzhba pipeline from Russia for oil supply to the Leuna refinery in eastern Germany and replace it with oil imports from Poland. For the gasoil shortfall in Europe, it will import petroleum products from the Satorp refinery in Saudi Arabia and other continents. The company rebuffed accusations of 'complicity in war crimes' for continuing projects in Russia and said they were 'unfounded.' It clarified that TotalEnergies does not operate any oil and gas fields or any liquefied natural gas (LNG) plants in Russia. It is, however, a minority shareholder in several non-state-owned Russian companies, including Novatek (19.4%), Yamal LNG (20%), Arctic LNG 2 (10%) and TerNefteGaz (49%), and is a 20% partner in the Kharyaga joint venture operated by Zarubezhneft.
Russian oil seeps into global market to ease supply fears for now --Millions of barrels of Russian oil are still finding a way to buyers almost a month after the country first invaded Ukraine, tempering concerns that a sanctions backlash would all but choke off supply and cause the market for physical cargoes to overheat.India’s oil refiners grabbed multiple cargoes of Russia’s flagship Urals crude this month, potentially supplanting the Middle Eastern varieties they normally purchase from Abu Dhabi and Iraq. Meanwhile, China’s private processors are still thought to be targeting their favored cargoes from the east of Russia -- likely at knock-down prices.Since Russia invaded Ukraine late last month, the market has been twisting on two vital questions: how much crude will Moscow end up selling, and where? There's been a buyers' strike across swaths of Europe in response to the invasion, but what's less clear is how much other regions -- especially Asia, the top demand center -- will purchase. "Russian barrels must look tempting," said John Driscoll, chief strategist at JTD Energy Services, adding that his view is that measures against the country will nonetheless curb buying of its crude over time. "Resourceful traders may explore ways to move cargoes -- the Chinese won't be intimidated by U.S. sanctions, and will remain the largest importer of Russian crude. India is the next one to watch." At least for now, what’s going on with the buying and selling of non-Russian oil suggests traders are becoming less fraught about the threat of supply shortages, even if trading the nation’s barrels isn’t risk-free, and spreads on Brent oil point to a market that remains incredibly tight by historical standards. At the moment, there are no sanctions directly prohibiting purchases but there are worries about what steps might ultimately be taken if the war drags on. Financing, insuring and shipping of Russian petroleum have also become much more complicated by the measures that the west has taken.
Oil prices jump again on Russia-Ukraine fears, as IEA calls for cut in energy usage - Oil prices jumped even higher on Monday after Russia-Ukraine talks appeared to yield no sign of progress, and markets continued to fret over tight supply — sparking a call by the International Energy Agency to reduce oil demand. Crude futures were up more than 3% on Monday morning during Asia trading — international benchmark Brent crude was at $111.46, and U.S. futures at $108.25. Oil prices have been volatile in recent weeks – soaring to record highs in March before tumbling more than 20% last week to touch below $100. They jumped again in the latter half of last week to rise above that level. In a note on Monday, Mizuho Bank said two factors were pushing oil prices higher: lingering Russia-Ukraine uncertainty as well as hopes that China's latest Covid impact could be less dire than anticipated amid expectations of easing restrictions. The key hub of Shenzhen partially opened up Friday, as five districts were allowed to restart work and resume public transportation, Reuters reported. Ukrainian and Russian officials have met intermittently for peace talks, which have so far failed to progress to key concessions. Still, Ukrainian President Volodymyr Zelenksyy has called for another round of talks with Moscow. "If these attempts fail, that would mean that this is a third world war," Zelenskyy told CNN's Fareed Zakaria in an interview that aired Sunday morning. "The breakdown of peace talks between Russia and Ukraine saw crude oil prices extend their rebound on Friday," "However, it failed to offset the losses earlier in the week, with Brent crude ending down more than 4%." The industry's apparent inability to fill any potential gap has seen calls for consumption to be reduced. Meanwhile, tight supply continued to worry markets, sparking a call by the International Energy Agency (IEA) on Friday for "emergency measures" to reduce oil usage. The Russia-Ukraine war has led to worries over supply disruptions as a result of U.S. sanctions on Russian oil and gas. The U.K. and European Union also said they would phase out Russian fossil fuels. Russia supplied 11% of global oil consumption and 17% of global gas consumption in 2021, and as much as 40% of Western European gas consumption in the same period, according to statistics from Goldman Sachs. European Union governments are set to meet U.S. President Joe Biden this week as the EU considers an oil embargo on Russia over the unprovoked invasion of Ukraine. The Commonwealth Bank of Australia warned Monday that oil prices have fallen below recent peaks because markets are still largely pricing oil by "assessing the likelihood of a diplomatic solution to the Ukraine conflict." "Physical shortages, linked to current sanctions on Russia, though will eventually play a more dominant role in oil price determination,"
Crude extends rally as market eyes EU sanctions on Russian energy - Crude futures extended their rally in midday US trading March 21 as the possibility of EU sanctions on Russian oil raised supply concerns. At 1550 GMT, NYMEX April WTI was up $5.17 at $109.87/b and ICE May Brent was $6.43 higher at $114.36/b. The foreign ministers of Lithuania and Ireland said March 21 that it was time for the EU to start looking at sanctions on Russian oil, according to a Reuters report. Current EU sanctions packages have refrained from targeting the energy sector. "Looking at the extent of the destruction in Ukraine right now, it's very hard to make the case that we shouldn't be moving in on the energy sector, particularly oil and coal," said Irish Foreign Minister Simon Coveney, according to a report from the news agency. "[The market] is starting to see this growing belief that eventually the EU is going to be put in a position where they will have to ban Russian energy supplies," "this drastic measure will really hurt the Russian economy, and you will see this market subject to some potentially severe disruptions in the near future." NYMEX April RBOB traded 13.35 cents higher at $3.3723/gal and April ULSD was up 23.23 cents at $2.8304/gal. The US has already imposed a ban on Russian oil imports, and further sanctions against Moscow are expected to be announced later this week. A drone attack perpetrated by Yemeni Iran-aligned Houthi rebels on the Yasref oil facilities in Saudi Arabia over the weekend added to supply risks. According to media reports, the attack had resulted in a temporary decrease in output at the refinery, but there were no casualties. "The assault on Yasref facilities has led to a temporary reduction in the refinery's production, which will be compensated for from the inventory," the company said. Falling COVID-19 cases in China have eased investor fears of infections spiraling out of control in the world's second largest economy. The country's National Health Commission reported 1,656 locally transmitted cases March 19, down from 2,157 the previous day. "Falling new cases underscored the country's prompt and stringent measures, including lockdowns and mass tests, in containing the rapid spread of the virus. This may help boost investor confidence amid the country's most severe viral outbreak since 2020," Chinese authorities had imposed restrictions across nearly 20 provinces and municipalities in recent weeks in a bid to contain the outbreak. The areas of Guangdong, Shandong, Jilin and Shanghai, which are among the epicenters of the COVID-19 outbreak this time, accounted for around 30% of China's oil consumption in 2021, data from S&P Global Commodity Insights showed. The lockdowns had prompted concerns of demand destruction that weighed on crude prices during the week ended March 18.
S. Arabia will not take responsibility for global oil supply disruptions: foreign ministry - Saudi Arabia will not take any responsibility for global oil supply shortages in light of the attacks on its oil facilities from Iranian-backed Houthis in Yemen, the kingdom's foreign ministry said on Monday. The statement stressed 'the importance of the international community realizing the gravity of Iran's continued behavior of equipping the Houthis with the technology of ballistic missiles, and unmanned aerial vehicles (UAV).' It also confirmed that the Houthis have targeted the kingdom's oil, gas and refined products facilities that have affected its production capability and ability to fulfill its commitments, resulting in serious consequences for the upstream and downstream sectors. The ministry urged the international community to take responsibility for preserving energy supplies given that the attacks are undermining 'the security and sustainability of energy supply to global markets.' Early Sunday, the Saudi-led coalition said air defenses had intercepted a ballistic missile and nine drones fired by Houthi rebels towards Saudi Arabia. A coalition statement said the rebel drones targeted a water desalination plant in Al-Shaqeeq, a facility run by Aramco in Jazan, a power station in the southern Dhahran al Janub city, a gas station in Khamis Mushait, and an Aramco plant in Yanbu. The coalition also said it had intercepted and destroyed three drones that targeted economic facilities. Yemen has been engulfed by violence and instability since 2014, when Iranian-aligned Houthi rebels captured much of the country, including the capital Sanaa. The conflict has created one of the world's worst man-made humanitarian crises, with nearly 80% of the country, or about 30 million people, in need of humanitarian assistance and protection and more than 13 million are in danger of starvation, according to UN estimates.
Crude jumps more than 7% as EU mulls Russian oil ban - Oil prices soared more than 7% on Monday, with global benchmark Brent crude climbing above $115 a barrel, as European Union nations considered joining the United States in a Russian oil embargo and after a weekend attack on Saudi oil facilities. Brent rose 7.12% to end the day at $115.62, while U.S. West Texas Intermediate (WTI) crude futures settled 7.09%, or $7.42, higher at $112.12. European Union governments will consider whether to impose an oil embargo on Russia over its invasion of Ukraine as they gather this week with U.S. President Joe Biden for a series of summits designed to harden the West's response to Moscow. "It could be the precipice for global trouble supply-wise," Ukraine defied a Russian demand that its forces lay down arms before dawn on Monday in Mariupol, where hundreds of thousands of civilians have been trapped in a city under siege and already laid to waste by Russian bombardment. With little sign of the conflict easing, the focus returned to whether the market would be able to replace Russian barrels hit by sanctions. "Optimism is seeping away about progress in talks to achieve a ceasefire in Ukraine and that's sent the price of oil on the march upwards," Over the weekend, attacks by Yemen's Iran-aligned Houthi group caused a temporary drop in output at a Saudi Aramco refinery joint venture in Yanbu, feeding concern in a jittery oil products market, where Russia is a major supplier and global inventories are at multi-year lows. Saudi Arabia on Monday said it would not be responsible for any global oil supply shortages after these attacks, in a sign of growing Saudi frustration with Washington's handling of Yemen and Iran. The latest report from the Organization of the Petroleum Exporting Countries and allies including Russia, together known as OPEC+, showed some producers are still falling short of their agreed supply quotas. Oil prices were also sensitive to talk of Hong Kong lifting COVID-19 restrictions, which could increase demand, and in response to the growing list of U.S. companies retreating from Russia - including Baker Hughes, ExxonMobil, Shell, and BP.
Oil Prices Retreat As EU Splits On Russian Embargo - Crude oil prices gave up early gains to turn lower on Tuesday after reports emerged that European Union foreign ministers are split on whether to join the United States in banning Russian oil.Brent crude futures dropped 1.4 percent to $113.88 per barrel, while WTI futures were down 1.9 percent at $107.86.Targeting Russian energy exports is a divisive choice for the 27-nation EU, which relies on Russia for 40 percent of its gas."The question of an oil embargo is not a question of whether we want or don't want (it), but a question of how much we depend on oil," German Foreign Minister Annalena Baerbock told reporters.Meanwhile, reports emerged that Ukrainian President Volodymyr Zelensky was prepared to discuss a commitment from Ukraine not to seek NATO membership in exchange for a ceasefire, the withdrawal of Russian troops and a guarantee of Ukraine's security. The prospect of a sharper hike in U.S. interest rates and concerns over demand arising from a surge in Covid-19 cases in China also prompted traders to book profits after strong gains in recent sessions.
Oil climbs on supply fears after Saudi oil facility attack, Russian oil ban risk - Oil prices rose sharply on Tuesday on escalating investor jitters over supply shortages due to an attack on Saudi oil facilities, coupled with EU plans to impose an embargo on Russian oil exports. International benchmark Brent crude was trading at $118.56 per barrel at 0633 GMT for a 2.54% gain after closing the previous session at $115.62 a barrel. American benchmark West Texas Intermediate (WTI) traded at $112.55 per barrel at the same time for a 2.34% increase after the previous session closed at $109.97 a barrel. Early Sunday, the Saudi-led coalition said air defenses had intercepted a ballistic missile and nine drones fired by Houthi rebels towards Saudi Arabia. A coalition statement said the rebel drones targeted a water desalination plant in Al-Shaqeeq, a facility run by Aramco in Jazan, a power station in the southern Dhahran al Janub city, a gas station in Khamis Mushait, and an Aramco plant in Yanbu. Saudi Arabia said it would not take any responsibility for global oil supply shortages in light of the attacks on its oil facilities from Iranian-backed Houthis in Yemen.
U.S. crude, fuel stockpiles fall as demand jumps - EIA (Reuters) - U.S. crude oil and fuel stockpiles fell last week as demand jumped, the Energy Information Administration said on Wednesday, further exacerbating tight world supplies following Russia’s invasion of Ukraine. Commercial crude inventories fell by 2.5 million barrels in the week to March 18 to 413.4 million barrels, even as the United States released 4.2 million barrels from its Strategic Petroleum Reserves (SPR), a signal of strong demand from both U.S. refineries and international buyers. Both gasoline and distillate stocks fell in the most recent week while product supplied - a rough proxy for demand - jumped 400,000 barrels per day (bpd) to 21.1 million bpd. U.S. gasoline stocks fell 2.9 million barrels to 238 million barrels, while distillate inventories , which include diesel and heating oil, decreased 2.1 million barrels. “Draws across the board constitute a very bullish report, especially given we tapped the SPR in this report. Refiners are storming back with utilization and the crack spreads have been terrific. It should give consumers some relief that there is supply being manufactured,” Oil prices extended their gains after the data, with U.S. crude trading $5.88, or 5.4%, higher on the day at $115.13 a barrel by 10:55 a.m. EDT (1455 GMT), while Brent rose by $6.40, or 5.6%, to $121.89. Prices have been surging in recent days once again as the world confronts a sharp drawdown in available supply due to heavy sanctions on Russia from the United States and its allies.
Major Russian pipeline fully halts oil exports, sending crude prices higher - Oil exports from a crucial pipeline on Russia’s Black Sea coast were fully halted on Wednesday, pushing crude prices higher amid fears that Moscow would interrupt energy supplies just as US president Joe Biden arrives in Europe to discuss the war in Ukraine. The Caspian Pipeline Consortium, the Moscow-headquartered group running a pipeline linking Kazakh oilfields with Russia’s Novorossiysk port, said on Wednesday that it was shutting down all three units used to load oil from the more-than-1,500km artery on to tankers, blaming storm damage. “The loading is fully stopped due to objective reasons because of abnormal storms,” said Nikolay Gorban, CPC’s chief executive, on Wednesday. “We have found some damage that does not allow [us] to operate the single point moorings further safely.” Gorban said two of the terminal’s three mooring units had suffered “critical” damage and were completely inoperable. A third was awaiting an inspection, but divers could not survey the damage until the storm cleared, he said. He added that any repair work would be delayed by western companies’ unwillingness to supply parts. Biden this month prohibited investments by US companies in Russia’s energy sector and banned on imports of oil from the country. The full closure comes as EU leaders prepare to discuss deeper sanctions on Moscow for its decision to invade Ukraine. The full shutdown on Wednesday came less than a day after Moscow said it would partially shut the infrastructure to assess storm damage to the port’s single point moorings. Florian Thaler, chief executive of OilX, an oil tracking firm, said repairs could be relatively simple, but “political problems may lengthen and actually worsen any shutdown”. The latest move will halt the export of 1.4mn barrels a day of oil, higher than the 1mn a day expected from the partial shutdown on Tuesday. Brent crude, the international oil marker, rose by 5 per cent to more than $121 a barrel on Wednesday. Gorban said the pipeline could continue to pump oil to the coast for another day, but with no way of exporting the crude the storage tanks at Novorossiysk would be filled by the end of Thursday, prompting a total closure of the pipeline. The CPC mainly ships oil produced in Kazakhstan by companies including Chevron and ExxonMobil, as well as some Russian crude from fields along the route. Chevron said earlier on Wednesday that exports from its Tengiz field continued uninterrupted. Exxon did not immediately respond to a request for comment. Thaler said about 10 per cent of the CPC’s oil could be shipped through another pipeline between Baku, in Azerbaijan, and Ceyhan, in Turkey. However, some production in Kazakhstan may have to be idled until the CPC reopened. According to the CPC, 213 of the 585 tankers loaded from the pipeline in 2021 went to Italy. Another 41 went to Spain, 39 to France and 26 to the US. The US import ban exempts oil produced in Kazakhstan, which accounts for roughly 90 per cent of the pipeline’s flows.
Oil jumps in volatile trade amid CPC pipeline disruption - Oil prices rose in volatile trading on Wednesday, supported by disruption to Russian and Kazakh crude exports via the CPC pipeline. Brent crude futures were up $6.35, or 5.5%, at $121.80 a barrel. U.S. West Texas Intermediate (WTI) crude futures rose $5.72, or 5.2%, to $115 a barrel. The market remains on edge over the ripple effect of heavy sanctions on Russia, the world's second-largest crude exporter, after its invasion of Ukraine. The oil market has been volatile for weeks, and after a sharp drop last week, crude futures in recent days have been steadily advancing due to uncertainty over current supply. Russia on Tuesday warned of a drop in oil exports via the Caspian Pipeline Consortium (CPC) of up to 1 million barrels per day (bpd), or 1% of global oil production, because of storm-damaged berths. CPC exports stopped fully on Wednesday and repairs will take at least one and a half months, according to a port ship agent. "Prices are primarily rising on the loss of CPC Blend crude exports out of Novorossiisk, which accounts for about 1.3 million barrels per day of exports, adding further bullish fuel to the fire as the drop in Russian crude exports finally appears underway," said Matt Smith, lead oil analyst for the Americas at Kpler. U.S. President Joe Biden is set to announce more Russian sanctions when he meets with European leaders on Thursday in Brussels, including an emergency meeting of NATO. Russia refers to the invasion, which is now a month old, as a "special operation." European Union member countries remain split on whether to ban imports of Russian crude and oil products, but this might change once short-term contracts run out. "You'll know at the end of April what the total loss of Russian oil is," said Trafigura's Ben Luckock, at the FT Commodities Global Summit. He said it was possible that oil could reach $200 a barrel. Plunging crude stockpiles in the United States, the world's biggest oil consumer, added to the apprehension around supply. U.S. crude stocks fell by 2.5 million barrels for the week ended March 18, federal data showed, compared with expectations for a modest increase. Production remained flat at 11.6 million barrels per day for the seventh straight week. Evidence of concern about supply can be seen in the market structure, where front-month prices are trading at a heavy premium to following months, as buyers scramble to secure supplies. "I think you will see record backwardation and you will see $150 a barrel this summer," Luckock said. The one bit of supportive news from the report was the second straight increase in inventories at the Cushing, Oklahoma hub, the delivery point for U.S. crude futures contracts, where stocks rose by 1.2 million barrels.
Oil climbs 5% after Russia warns of prolonged pipeline outage - Oil prices rose sharply Wednesday after Russia warned a major oil pipeline could be out of service for more than a month due to storm damage, amplifying supply shortfalls caused by the war in Ukraine. News of the outage helped drive US oil prices nearly 5% higher to $114.60 a barrel in recent trading. Brent crude, the world benchmark, jumped 5.2% to $121.50 a barrel. The Caspian Pipeline Consortium, a system that carries oil from West Kazakhstan and Russian oil producers to the Black Sea, said in a statement Tuesday that an inspection revealed damage to a marine terminal. The group said some operations are being temporarily suspended to make repairs. A Russian energy official, quoted by Russian state news agency TASS, said Tuesday that the repair of the marine terminal near the Black Sea port of Novorossiysk could take six weeks to two months and may shrink oil exports by about 1 million barrels per day. "This is a rather serious timeframe," Pavel Sorokin, Russia's deputy energy minister, was quoted as saying by TASS. He added that a heavy storm damaged at least one of the three oil loading facilities and assessments are ongoing. The Russian government and Chevron own stakes in the Caspian Pipeline Consortium, which carries oil out of landlocked Kazakhstan. Chevron did not respond to a request for comment."This is quite a significant supply shock,"
Global diesel shortage pushes oil prices higher: Kemp - Chartbook: https://tmsnrt.rs/3qtkzbh (Reuters) - Worsening diesel shortages in the United States and the rest of the world are intensifying upward pressure on petroleum prices and threaten to recreate the conditions that led to the record price spike in 2008. U.S. distillate fuel oil inventories, the category including diesel, fell by 2 million barrels to 112 million barrels last week, according to high-frequency data from the U.S. Energy Information Administration (EIA).Distillate stocks have declined in 52 of the last 79 weeks by a total of 67 million barrels, and are at the lowest for the time of year since 2014 and before that 2008 (“Weekly petroleum status report”, EIA, March 23).Distillates have emerged as the tightest part of the oil market: U.S. inventories are 20% below the pre-pandemic five-year average for 2015-2019 compared with deficits of 11% in crude and 1% in gasoline.If stocks move in line with seasonal patterns over the last ten years, inventories are expected to drop to a low of 104 million barrels before the middle of the year, which would make them as tight as they were in 2008.In the reasonable worst case scenario, however, stocks could deplete to as little as 93 million barrels, which would be critically low and lead to explosive upward pressure on prices.Similar distillate shortages have emerged in Europe and Asia as the rapid recovery in consumption after the pandemic has outrun increased output of crude oil and refinery production of diesel.By the end of February, Europe’s distillate stocks had already fallen to the lowest seasonal level since 2008. Singapore’s stocks are currently at the lowest seasonal level since 2006.Middle distillates such as diesel and gas oil are primarily used in freight transport, manufacturing, farming, mining, and oil and gas extraction, making them the most cyclically sensitive part of the oil industry.Synchronised global expansion in North America, Europe and Asia has created an acute shortage much as it did in 2007/2008.In consequence, distillate pries are leading the entire oil market higher, with upward pressure on diesel prices spilling over into the adjacent market for gasoline and the upstream market for crude.In the United States, the average on-road price of diesel has climbed by 61% over the last year compared with a 47% rise in gasoline prices, according to the EIA.In 2008, distillate shortages helped to push crude to an inflation-adjusted peak over $187 per barrel around the middle of the year, after distillate stocks hit abnormal seasonal lows a few months earlier.Russia is a major exporter of middle distillates as well as distillate-rich residual fuel oil and crude, primarily to countries in Europe.Russia accounted for 29% of Europe’s imported crude oil and 39% of its imported products in 2020, according to BP (“Statistical review of world energy”, BP, 2021).Futures markets have anticipated a possible disruption by pushing distillate prices to an enormous premium over crude.Front-month European gas oil futures prices are trading at a premium of $46 per barrel over Brent, up from $15 before the invasion and less than $4 a year ago.In real terms, current gas oil prices of around $167 per barrel are already in the 97th percentile for all months since 1990, though still well below the inflation-adjusted peak of $226 in 2008.Ultra-high prices are a signal to refiners to maximise crude processing and distillate production, and to consumers to reduce diesel use as much as possible, to rebuild depleted inventories.
‘Wakey, wakey. We are not going back to normal business in a few months’: A top hedge-fund manager says crude oil prices could hit $250 this year - Energy industry experts are warning oil prices could double from current levels to $250 per barrel this year amid an ongoing international boycott of Russian energy supplies. There simply aren’t sufficient supply alternatives available outside of Russia, according to Pierre Andurand, who runs Andurand Capital Management and is known as one of the top hedge fund managers in the energy sector. “Wakey, wakey. We are not going back to normal business in a few months,” Andurand said on Wednesday at the FT’s Commodities Global Summit in Lausanne, Switzerland. “I think we’re losing the Russian supply on the European side forever.” The price of Brent crude oil, the international benchmark, rose as high as $139 per barrel after Russia’s invasion of Ukraine caused the six-largest disruption in oil’s supply since WWII. And despite a subsequent pullback, prices have begun to climb again in the past week, rising nearly 20%. On Thursday, Brent crude was back to trading near $120 a barrel, as renewed fears of a disruption in energy supplies from Russia continue to shake the market. Andurand isn’t the only top commodities expert predicting oil prices will soar to record highs. Doug King, the chairman of RCMA’s Merchant Commodity Fund, said at the FT Commodities Global Summit this week that he also believes oil prices could move as high as $250 a barrel this year. “This is not transitory. This is going to be a crude supply shock,” he said. Oil prices have experienced volatile trading since Russia invaded Ukraine, but things could get far worse if the E.U. decides to follow the U.S. in banning Russian oil imports. The E.U. buys roughly a quarter of its oil and more than 40% of its natural gas from Russia. Russian President Vladimir Putin’s decision to force "unfriendly" countries, including the U.S., E.U., U.K., and Japan, to settle energy transactions in rubles, rather than in U.S. dollars or euros, has also added to fears that Russia may be willing to retaliate for sanctions by restricting energy exports. Russian authorities also closed an oil pipeline that carries over 1% of global oil demand on Wednesday, citing storm damage. “If a weather-related ‘accident,’ it is certainly a convenient one from Moscow’s standpoint,” Bob McNally, head of consultancy Rapidan Energy Group, told the Financial Times on Wednesday.
Brent Tops $120 on Russia Choking Off Pipeline, Stock Draws - -- Oil futures nearest delivery settled Wednesday's session sharply higher, with both U.S. and international crude benchmarks spiking more than 5%. The gains came after Russian officials warned the Caspian Pipeline Consortium pipeline sustained extensive damage from storm-like conditions over the Black Sea, potentially removing up to 1 million barrels per day (bpd) or 1% of oil supply from the global market for two months, while larger-than-expected declines in U.S. commercial crude and petroleum product inventories lent additional support. Russia announced on Tuesday it throttled throughput on the major pipeline that carries crude oil from Kazakhstan's Tengiz oilfields along the Caspian Sea to ports on the Russian coastline of the Black Sea. According to Russian officials, part of a marine port sustained severe damages that could take 1-1/2 to 2 months to repair given "current market conditions," an apparent reference to recent Western sanctions. The pipeline's capacity is about 1.4 million bpd, and accounts for transporting about 2.5% of global seaborne oil trade and around two-thirds of Kazakhstan's oil exports, making it a vital artery for the country's economy. Refiners in the Mediterranean and Western Europe are the largest buyers of CPC Blend, with refiners in Italy, the Netherlands, France, and Turkey being the largest buyers of the grade last year. Millions of barrels of Russian oil are still finding a way to buyers despite the reluctance of U.S. and European companies to deal with Russian cargos, according to traders and analysts. Some suggest Russian oil exports "have gone underground" as the market adjusts to new risks in dealing with Russian oil. So far, combined exports of crude and products appear to be running at normal levels, with Baltic port activity at 1.55 million bpd and the Black Sea at 325,000 bpd. Much of this oil might be going into storage from where it could be resold to refiners, bypassing reputational risk and sanctions. Others suggest that Russian oil exports will collapse by 2 million to 3 million bpd in coming weeks as Western companies shun any dealings with oil shipments from the sanctioned country. Chaos in global supply chains is unlikely to ease anytime soon, according to Federal Reserve Chair Pro Tempore Jerome Powell, who gave a pivotal speech this week in front of the National Association of Business Economics, citing COVID-related shutdowns in China and the blockade of Ukraine's Back Sea ports of Mariupol and Odessa. With Moscow's war raging in Ukraine, exporters and logistics firms are now forced to find new transportation routes that would avoid combat zones and Russia's massive landmass. Further supporting the oil complex, U.S. total oil and petroleum products stocks fell 6.7 million bbl in the week ended March 18 to the lowest inventory level since November 2014 at 1.136 billion bbl. Included in the draw was a 2.5 million bbl decline in commercial crude oil inventories that now stand more than 13% below the five-year average. Domestic refiners increased run rate last week by a larger-than-expected margin to 91.1% of capacity, while processing 276,000 bpd more crude from the previous week. Surprisingly, domestic oil production once again showed no response to $100 bbl oil prices, stalling near 11.6 million bpd since the start of February. At this production rate, domestic oil output is still below its 13 million bpd record high reached before the pandemic. Gasoline inventories declined 2.9 million bbl in the reviewed week compared with expectations for inventories to have been drawn down by 1.5 million bbl. Distillate stocks fell 2.1 bbl to 112.1 million bbl, and are now about 17% below the five-year average, EIA data shows. Demand for distillate fuels increased 812,000 bpd from the prior week to 4.516 million bpd. On the session, NYMEX May West Texas Intermediate futures advanced $5.66 per bbl to settle a tad below $115 at $114.93 bbl, and ICE May Brent futures rallied to $121.60 per bbl, up $6.12 since Tuesday's settlement. NYMEX April RBOB futures registered a 10.80-cent gain for a $3.4387-per-gallon settlement, and April ULSD futures spiked 25.06 cents or 6% to $4.1148 per gallon.
Oil Futures Steady After CPC Closure, Eurozone Growth Slows -- Oil futures nearest delivery moved mixed in early trade Thursday, with both U.S. and international crude benchmarks stalling near 14-year highs as investors assess implications from the disruption of the Caspian Pipeline Consortium network on global supply balances, with the closure of the infrastructure threatening to remove up to 1 million bpd of crude oil from an increasingly tightening global oil market. Kazakhstan Energy Minister Bulat Aqchulaqov said on Thursday that closure of the CPC pipeline could last up to six weeks due to ongoing repairs at the Novorossiysk export terminal that allegedly sustained extensive damages from storm-like conditions this week. The pipeline's capacity is estimated at 1.4 million bpd and accounts for two-thirds of Kazakhstan total oil exports, making it a vital artery for the country's economy. Organization of the Petroleum Exporting Countries pegged Kazakhstan oil production close to 2 million bpd at the start of the year after antigovernment protests briefly shuttered operations at the country's major oil fields of Tengiz and Kashagan. The timing of the shutdown is curious considering European governments are in discussions this week over sanctioning Russian oil exports in response to Moscow's aggression in Ukraine. U.S. President Joe Biden landed in Brussels on Wednesday for an emergency summit among North Atlantic Treaty Organization that will address Russia's invasion of Ukraine. So far, combined Russian exports of crude and products appear to be running at normal levels, with Baltic port activity at 1.55 million bpd and the Black Sea at 325,000 bpd. Much of this oil might be going into storage from where it could be resold to refiners, bypassing reputational risk and sanctions. Others suggest that Russian oil exports will collapse by 2 to 3 million bpd in coming weeks as Western companies shun any dealings with oil shipments from the sanctioned country. Offsetting losses for the oil complex, Energy Information Administration said U.S. total oil and petroleum products stocks fell 6.7 million bbl in the week-ended March 18 to the lowest inventory level since November 2014 at 1.136 billion bbl. Included in the draw was a 2.5 million bbl decline in commercial crude oil inventories that now stand more than 13% below the five-year average. Domestic refiners increased run rate last week by a larger-than-expected margin to 91.1% of capacity, while processing 276,000 bpd more crude from the previous week. Near 7:45 AM ET, NYMEX May West Texas Intermediate futures slipped $0.35 bbl to trade near $114.56 bbl, and ICE May Brent futures traded near $121.32 bbl, down $0.31. NYMEX April RBOB futures fell 2.33 cents to $3.4154 gallon, and April ULSD futures advanced 2.83 cents to $4.1431 gallon.
Oil prices fall as U.S., allies consider further oil stock release - Crude prices fell on Thursday as the United States and its allies discussed a possible further coordinated release of oil from storage to help calm energy markets in the wake of Russia's invasion of Ukraine. Benchmark Brent fell by $1.99, or 1.6% to $119.61 a barrel. U.S West Texas Intermediate (WTI) was down $2.10, or 1.8%, at $112.82 a barrel. "With respect to the emergency stockpiles, these are ongoing discussions and all those tools are certainly on the table," U.S. energy secretary Jennifer Granholm said at a news conference at the headquarters of the International Energy Agency in Paris. IEA Executive Director Fatih Birol said IEA countries were united in seeking to radically reduce Russian oil and gas imports. Further adding to bearish sentiment, officials of the Organization of the Petroleum Exporting Countries (OPEC) have expressed to the EU their unease about a proposed ban on Russian oil, OPEC sources said. Trading was volatile though. Earlier in the session WTI and Brent rose by around $2 a barrel on lingering supply concerns including reports that crude exports from Kazakhstan's Caspian Pipeline Consortium (CPC) terminal had completely halted following storm damage. Investors were also waiting to see how Western sanctions will be tightened on Russia over its invasion of Ukraine. Commerzbank analyst Carsten Fritsch said sanctions were unlikely to have a major impact on the oil market because they "will probably not include an oil embargo by the EU, as a number of countries that are heavily depend on Russian oil — such as Germany — have opposed this." Thursday's price fall was capped by a drop in U.S. crude in the Strategic Petroleum Reserve (SPR), which fell to the lowest level since May 2002, the U.S. Energy Information Administration (EIA) said on Wednesday. Adding to concerns about available supply, slow progress in talks on a deal between world powers and Iran over Tehran's nuclear work means prospects for Iranian crude returning to the market have been pushed back. "Unless Iran is allowed back to the market quickly it is hard to see how further price increase, potentially above the recent peaks, can be avoided," PVM oil broker Tamas Varga said.
Oil slides 2% as EU fails to boycott Russian crude - Crude prices slid 2 per cent on Thursday (Mar 24) after the European Union (EU) could not agree on a plan to boycott Russian oil and on reports that exports from Kazakhstan's Caspian Pipeline Consortium (CPC) terminal could partially resume. European Union leaders are set to agree at a 2-day summit starting on Thursday to jointly buy natural gas as they seek to cut reliance on Russian fuels, with some saying they would not comply with Moscow's demand to buy oil and gas using roubles. But EU countries remain divided on whether to sanction Russian oil and gas directly, a move already taken by the United States. Brent futures fell US$2.57 or 2.1 per cent to settle at US$119.03 a barrel, while US West Texas Intermediate (WTI) crude fell US$2.59 or 2.3 per cent to settle at US$112.34. On Wednesday, both benchmarks closed at their highest since Mar 8. Russia's invasion of Ukraine on Feb 24 has prompted the EU to pledge to slash reliance on Russian fossil fuels by hiking imports from other countries and quickly expanding renewable energy. The North Atlantic Treaty Organization (Nato) offered Kyiv new military assistance and assigned more troops to its eastern flank as London and Washington imposed fresh sanctions on Moscow. But without an EU embargo of Russian oil, Commerzbank analyst Carsten Fritsch said sanctions were unlikely to have a major impact on the oil market. As the EU remains split on imposing outright bans on Russian oil, analysts at Rystad Energy said India and China could import more Russian barrels to boost their refined products output. The United States and its allies, meanwhile, were discussing a possible further coordinated release of oil from storage to help calm oil markets. Also weighing on crude prices, the dollar strengthened for the fourth time in 5 sessions. A stronger dollar makes oil more expensive for holders of other currencies. Oil prices fell further after ICE increased margins for May Brent crude futures by 19 per cent effective Mar 25, the third margin update this year. Trading was volatile for both crude benchmarks, which rose to fresh 2-week highs early in the session on lingering supply concerns including early reports that crude export loadings were suspended at Kazakhstan's CPC terminal following storm damage. But 4 sources familiar with the matter said oil exports via the CPC pipeline will partially resume on Thursday. "Reports that the CPC pipeline would return was a big relief to the market," Crude prices drew some support from the drop in US crude in the Strategic Petroleum Reserve (SPR) to the lowest level since May 2002. US crude at the Cushing storage hub in Oklahoma fell in the week to Mar 22, traders said, referring to a report from data provider Genscape. US government data has shown stockpiles there rising for the past 2 weeks. Canada said it has capacity to increase oil and natural gas exports by up to 300,000 barrels per day in 2022 to help improve global energy security.
Oil Falls as CPC Pipeline Restarts, EU Avoids Oil Sanctions -- Oil futures nearest delivery fell more than 2% early Friday in reaction to reports suggesting the Caspian Pipeline Consortium network partially resumed operations at the Black Sea terminal after a successful inspection of a single port mooring (SPM-1) revealed limited damage to the loading infrastructure, easing concern that a prolonged disruption of Kazakhstan oil exports would exacerbate a shortfall of available supplies on the global oil market. Oil loadings at the Novorossiysk export terminal on the Black Sea resumed sooner-than-expected, according to Kazakhstan's energy minister Bulat Aqchulaqov, who indicated that one of the three moorings at the site sustained little damage from an alleged storm. Earlier this week, Russian officials argued that it could take up to six weeks to fix damaged infrastructure at the port that processes up to 90% of Kazakhstan oil exports. The CPC pipeline has a 1.4 million bpd capacity that carries crude oil from oilfields in central Asia to export terminals on the Black Sea. A prolonged disruption of the CPC pipeline could have forced Kazakhstan to shutter producing wells because of limited storage capacity that could have inflicted long-lasting damage to the country's production capacity. European leaders this week decided against sanctions on Russian oil and gas exports as part of a response to Moscow's aggression in Ukraine -- a decision that could have removed up to 3 million bbl in daily crude exports from Russia. Speculation had been building for weeks that a potential ban on Russian oil could in fact be implemented after some European leaders voiced support for the embargo. Countries that are less dependent on Russian oil, such as Sweden, Ireland, and the Czech Republic, view an oil ban as an option while some of the bloc's largest importers, like Germany and Netherlands, remain opposed to the idea. . The United States and European Union inked a deal on Thursday that would deliver an additional 15 billion cubic meters of liquified natural gas to the bloc, part of efforts to ease the region's reliance on Russian energy supplies. Near 7:30 a.m. ET, NYMEX May West Texas Intermediate futures fell more than $2 bbl to $110.22 bbl, and ICE May Brent futures declined to $117 bbl, also down $2 on the session so far. NYMEX April RBOB futures fell 2.72 cents to $3.3625 gallon, and April ULSD futures dropped back 4.38 cents to $4.1096 gallon.
Oil rises to over US$120/barrel after attack on Saudi facilities - Crude prices rose more than 1 per cent to over US$120 a barrel on Friday, as traders reconciled the impact of a missile attack on an oil distribution facility in Saudi Arabia with a possible release of oil reserves by the United States. Brent crude settled up US$1.62, or 1.4 per cent, to US$120.65 a barrel and US West Texas Intermediate (WTI) crude ended US$1.56, or 1.4 per cent higher, at US$113.90. Both had dropped US$3 earlier. Both benchmarks notched their first weekly gains in three weeks - Brent rose more than 11.5 per cent and WTI gained 8.8 per cent. Yemen's Houthis said they launched attacks on Saudi energy facilities on Friday and the Saudi-led coalition said Aramco's fuel distribution station in Jeddah had been targeted by an attack, but that a fire in two tanks at the facility had been brought under control. Saudi Arabia said it will not hold responsibility for any shortage of oil supplies in global markets caused by Houthi attacks on its oil facilities. The Iran-aligned Houthi movement that has been battling a coalition led by Saudi Arabia for seven years launched missiles on Aramco's facilities in Jeddah and drones at Ras Tanura and Rabigh refineries, the group's military spokesman said. "The market, which was already shunning Russian oil supplies, has another thing to worry about with Houthi attacks potentially impacting Saudi Arabia's production," said Andrew Lipow, president of Lipow Oil Associates in Houston, noting that the Houthi attacks were becoming more frequent. The attack comes just five days after the Houthi group fired missiles and drones at Saudi energy and water desalination facilities, causing a temporary drop in output at a refinery. With global stockpiles at their lowest since 2014, analysts have said the market remained vulnerable to any supply shock. The Biden administration is considering another release of oil from the Strategic Petroleum Reserve that, if carried out, could be bigger than the sale of 30 million barrels earlier this month, a source said. The US oil rig count, an early indicator of future output, rose seven to 531 this week, its highest since April 2020, as the government urged producers to boost output in the wake of Russia's invasion of Ukraine. Even though the oil rig count has climbed for 19 straight months, the increases have been small and slowed down recently because many companies focus on returning money to investors rather than boosting output and are facing supply constraints. Oil prices slipped earlier in the session as exports from Kazakhstan's CPC crude terminal partially resumed and the EU held off on imposing an embargo on Russian energy as members remained split on the issue.
Oil Settles Up this Week with Saudi Arabian Facilities Under Attack -Oil posted its first weekly gain in three weeks as the European Union continued to debate how it can decrease its reliance on Russian exports and Saudi Arabian energy assets came under attack. Futures in New York gained $9.20 this week, the second biggest dollar gain since 2011. Oil reversed its losses earlier in Friday’s session as Yemen’s Houthi rebels claimed responsibility for a series of attacks on Saudi Aramco facilities, including an oil storage site in Jeddah. Saudi Arabia warned this week that crude supplies are at risk, and called on the U.S. to do more to counter attacks from the Iran-backed rebels. The attack on Aramco facilities is likely to cause some short-term operational disruptions, and may temporarily reduce Saudi supply, said Rohan Reddy, a research analyst at Global X Management, a firm that manages $2 billion in energy-related assets. “The broader geopolitical issues that continue in the country could lead to lingering supply reductions, and put upside pressure on oil prices.” Oil is up this week as the war in Ukraine continues to roil an already tight commodities market. The U.S. and U.K. have moved to bar Russian oil in response to the invasion and many energy firms are also choosing to shun the nation’s crude. Yet buyers in China and India appear to be soaking up some of those barrels. Russia is now aiming to ship the largest amount of its flagship Urals crude in almost three years next month, dangling a supply carrot to oil refineries in Europe who face surging energy prices. EU industrial powerhouse Germany has said it plans to quickly wean itself off Russian fossil fuels, though warned an immediate embargo is not possible because of the damage it would cause to Europe’s biggest economy. The task will be difficult, especially without decreasing Germany’s demand at the same time. Austria also said it won’t agree to an embargo of Russian oil and gas, calling the ban “unrealistic” for the country. West Texas Intermediate for May delivery rose $1.56 to settle at $113.90 in New York. Brent for May settlement rose $1.62 to settle at $120.65 a barrel. Oil markets remain backwardated, a bullish pattern marked by higher prices for near-term barrels than those further out. Brent’s prompt spread -- the difference between its two nearest contracts -- was $3.28 a barrel on Friday, up from 41 cents at the start of the year. Initial margins have also surged, adding to trading costs and compounding the retreat by traders.
Yemen's Houthis claim attack on Aramco facility after reports of a huge fire in Saudi city of Jeddah - A huge plume of smoke could be seen above an oil facility in the Saudi city of Jeddah on Friday, according to multiple media reports, with Yemen's Houthi group claiming they had attacked a Saudi Aramco site with missiles. The Associated Press cited videos of a raging fire at an oil depot, saying the location of the blaze was near the North Jeddah Bulk Plant — which is southeast of the city's international airport. Meanwhile, a Reuters source said a Saudi Aramco facility had been hit. A Formula One auto race is due to take place in Jeddah this weekend. The Iran-backed Houthis claimed they were behind the strike with a military spokesperson adding that they had also used drones to hit the Ras Tanura and Rabigh refineries, according to Reuters. The additional strikes could not be confirmed. Brent crude settled 1.36% higher at $120.65 per barrel, while U.S. West Texas Intermediate crude added 1.39% to end the day at $113.90. Both had traded in negative territory earlier in the session. A spokesperson for Saudi Aramco was not immediately available for comment when contacted by CNBC. On Sunday morning, Saudi authorities confirmed an attack on Aramco facilities last weekend, with Houthi rebels using missiles and drones to target at least six sites across the kingdom, including an Aramco fuel depot and a liquefied natural gas plant. "There were no injuries or fatalities, and no impact on the company's supplies to customers," Aramco CEO Amin Nasser said Sunday on an earnings call. The Houthis have carried out thousands of cross-border missile and drone attacks into Saudi Arabia in the years since Riyadh launched its aerial assault on Yemen, which has killed tens of thousands of Yemenis. Aramco suffered a major attack on its facilities in 2019, when strikes on the Abqaiq and Khurais facilities cut off roughly half the kingdom's oil production in one day. Abqaiq, in Saudi Arabia's eastern province, is the world's largest oil processing facility and crude oil stabilization plant with a processing capacity of more than 7 million barrels per day. Khurais is the second-largest oil field in the country with a capacity to pump around 1.5 million bpd.
Saudi Aramco's full-year profit more than doubles on soaring oil prices -Saudi Arabian oil giant Aramco reported blowout full-year earnings on Sunday, posting a more than doubling in year-on-year net profit to $110 billion. Aramco's 2021 net income increased by 124% to $110 billion in 2021, compared to $49 billion in 2020, citing higher crude oil prices, stronger refining and chemicals margins, and the consolidation of its chemicals business, SABIC's, full-year results. The numbers were in line with expectations, with analysts surveyed by Reuters forecasting net income of $109.7 billion for the full year. Aramco shares on the Saudi Tadawul Exchange rose almost 4% in Sunday trading after the result. Aramco benefitted from surging oil prices during 2021, with international benchmark Brent crude rising above $80 a barrel by the end of the year, up roughly 50% for the 12-month period. Supply shortages added to a complex slew of factors driving major uncertainty across the energy and commodity complex, even before Russia's invasion of Ukraine. "Although economic conditions have improved considerably, the outlook remains uncertain due to various macro-economic and geopolitical factors," It comes after the IEA warned that the oil market was heading for its "biggest supply crisis in decades" as Russian sanctions hit and buyers shun its exports. "We see healthy oil demand. Unfortunately there is shrinking global spare capacity, combined with low inventories and a lack of investment," Nasser said on an earnings call Sunday. He also blamed "a transition plan that is totally unrealistic" for the current pricing dynamic. The result and earnings call also came just hours after Saudi authorities confirmed another attack on Aramco facilities on Sunday, with Houthi rebels using missiles and drones to target at least six sites across Saudi Arabia, including an Aramco fuel depot and a liquefied natural gas plant. "There were no injuries or fatalities, and no impact on the company's supplies to customers," Nasser said. "We were able to restore operations rapidly, while ensuring reliability of supply to our customers." Aramco also declared a fourth quarter dividend of $18.8 billion, to be paid in the first quarter of 2022. The dividend is covered by a rise in free-cash flow to $107.5 billion in 2021, compared to $49.1 billion in 2020. The profit figures are a stark contrast from the company's 2020 earnings, which saw a 44% drop on the previous year due to demand collapse brought on by the coronavirus pandemic. The company also said it would invest to increase crude oil production capacity to 13 million barrels per day by 2027, expand its liquid to chemical production, and look to increase gas production by more than 50% by 2030. Aramco has also said it wants to achieve net-zero Scope 1 and Scope 2 greenhouse gas emissions across its wholly-owned operated assets by 2050. Scope 1 refers to direct emissions from sources owned or controlled by the company, while Scope 2 covers indirect emissions from the generation of purchased power consumed by the company. s. Capital expenditure in 2021 was $31.9 billion, an increase of 18% from 2020, primarily driven by increased activities in relation to crude oil increments, the Tanajib Gas Plant and development drilling programs. Aramco expects 2022 capital expenditure to be approximately $40-50 billion, with further growth expected until around the middle of the decade.
Russia is considering selling its oil and gas for bitcoin as sanctions intensify from the West - Faced with stiffening sanctions from Western countries over its invasion of Ukraine, Russia is considering accepting bitcoin as payment for its oil and gas exports. In a videotaped news conference held on Thursday, the chair of Russia's Duma committee on energy said in translated remarks that when it comes to "friendly" countries such as China or Turkey, Russia is willing to be more flexible with payment options. Chair Pavel Zavalny said that the national fiat currency of the buyer — as well as bitcoin — were being considered as alternative ways to pay for Russia's energy exports. "We have been proposing to China for a long time to switch to settlements in national currencies for rubles and yuan," Zavalny said in translated comments. "With Turkey, it will be lira and rubles." He didn't stop with traditional currencies. "You can also trade bitcoins," he said. Bitcoin is up close to 4% over the last 24 hours to about $44,000. The price of the cryptocurrency spiked around the time that news reports of Zavalny's remarks first crossed. The energy chair also doubled down on President Vladimir Putin's promise on Wednesday to require "unfriendly" countries to pay for gas in Russian rubles. Putin's announcement sent European gas prices soaring over worries the move might aggravate an energy market already under pressure. "If they want to buy, let them pay either in hard currency, and this is gold for us, or pay as it is convenient for us, this is the national currency," Zavalny said, in comments that echoed the president's warning from the day before.
Russia will only accept rubles for gas deliveries to Europe: Putin - President Vladimir Putin said Wednesday Russia will only accept payments in rubles for gas deliveries to “unfriendly countries,” which include all EU members, after Moscow was hit by unprecedented sanctions over Ukraine. “I have decided to implement a set of measures to transfer payment for our gas supplies to unfriendly countries into Russian rubles,” Putin said during a televised government meeting, ordering the changes to be implemented within a week. He said Russia will stop taking payments in currencies that have been “compromised.” “Russia will continue supplying gas in the volumes fixed in earlier contracts,” Putin added. Putin also described as “illegitimate” the freezing of Russia’s assets abroad. He said the United States and the European Union have declared a “real default” on their obligations to Russia. “Now everyone in the world knows that obligations in dollars can be defaulted,” Putin said. Immediately after the announcement, the ruble strengthened against the US dollars and the euro.
Some Additional Comments on the Russian Counter-Sanction of Requiring Gas Payments in Roubles - Lambert and I noticed that the news flow today seems peculiarly, erm, flaccid. That seems peculiar since the geopolitical-fault-lines testing war in Ukraine is still on, and NATO and the G7 had a summit in Brussels yesterday, plus we have the new elephant in the room of the Russian only-rouble-payments-for-gas-if-you-whacked-our-banks counter-sanction.Normally big players have some press set pieces ready to launch after major meetings, as foretold by Reuters: Biden’s Brussels trip to highlight new Russia sanctions, NATO posture plans. Japan was also set to announce additional sanctions and actually will, according to Nikkei:Japanese Prime Minister Fumio Kishida promised to impose high tariffs on Russian imports on Thursday as the leaders of the Group of Seven nations gathered here to turn up the diplomatic and economic pressure on Moscow.It turns out this centerpiece is ending Russia’s most favored nation status, which the countries that participated in the economic sanctions pledged to implement, so moving forward with that measure isn’t exactly a new sanction. However, Japan is barring exports to Russian defense-related companies and of luxury goods, and will try to prevent cryptocurrencies from being used to evade sanction.But according to Nikkei the US did add to its Russian sanctions, although it’s not surprising that the press didn’t tout them, since they are symbolic: The U.S. also announced a wave of fresh sanctions Thursday against Russian lawmakers, defense companies and individuals including the head of Sberbank, Russia’s largest bank.Nikkei confirmed no big actions were taken at the summits:The first face-to-face G-7 summit since Russia’s invasion of Ukraine served to showcase unity against Moscow. But the bloc’s joint statement includes no specific proposals for new responses or additional sanctions. It is unclear whether the meeting alone can alter Russian President Vladimir Putin’s behavior. So one has to wonder what happened, since the intent of a session like this is to convey resolve. Was it that the leaders got realistic briefings on how the war is going? Or did Russia’s gas counter-sanction rearrange the agenda? As far as the Russia gas-only-for-roubles counter-sanction, a lot of the commentary, particularly from officials, was not well informed. But this one at Reuters was an eye-opener: Asked whether the United States would allow European nations that cannot manage without Russian gas to process payment in roubles without finding themselves in a breach of sanctions, a White House official said Washington was consulting with its allies.So much for national sovereignty.The Wall Street Journal reports that the US is happy to take advantage of the gas price squeeze taking steps to reduce the impact of the economic war it set off: U.S. to Boost Gas Deliveries to Europe Amid Scramble for New Supplies. But the IEA had already pointed out that Europe was going to need to do a lot of energy belt-tightening over the next four months alone. And I have yet to see any energy expert indicate that it is possible for Europe to plug its energy hole in anything less than a few years, let alone the even bigger gap set to open up for countries who refuse to authorize payments in roubles.
Michael Hudson Talks with the Saker About the Russian Counter-Sanction of Paying for Its Gas With Roubles Originally published at Vineyard of the Saker: Following Putin’s announcement about selling gas for Rubles only to hostile nations, I decided to reach out to Michael Hudson and ask him (my level, primitive) questions. Here is our full email exchange:
- Andrei: Russia has declared that she will only sell gas to “hostile countries” for Rubles. Which means that to non-hostile countries she will continue to sell in Dollars/Euros. Can these hostile countries still purchase gas from Russia but via third countries?
- Michael Hudson: There seem to be two ways for hostile countries to buy Russian gas. One seems to be to use Russian banks that are not banned from SWIFT. The other way would indeed seem to be to go through what looks to develop as a formal or informal third-country bank or exchange. India and China would seem to be the best positioned for this role. U.S. diplomats will be pressing India to impose its own sanctions on Russia, and there is a strong pro-U.S. constituency there. But even Modi sees the obvious superior benefits of benefiting from India’s geopolitical position with Russia and China’s Belt and Road Initiative relative to whatever the U.S. has to
- Back in the 1960s the West dealt with the Soviet Union using barter deals. Arranging this barter became a big banking business. Barter is the typical “final stage” of the deterioration of a credit economy into a money economy that breaks down. Over the medium term, a new international financial organization needs to be created as an alternative to the dollarized IMF to handle such intra-bloc transactions in today’s new multipolarizing world.
- Andrei: These hostile nations would pay extra for that service, but they would not have to get Rubles. Is that even possible?
- Michael Hudson: Presumably Russia would not absorb the added bank costs of avoiding U.S. sanctions. It would simply add them on to the price, after setting the price at which it hopes to end up with – preferably at the original “old” ruble/euro or ruble/dollar exchange rate, not the post-attack depreciated rate.
- Andrei: Question: Do you believe that the EU will agree to pay Roubles or will they take the total loss of 40% of their energy?
- Michael Hudson: They will pay – or be voted out of office. If they WERE to cut their energy imports from Russia, the distress-price of gas would soar and there would be drastic shortages disrupting the economy. Energy is productivity and GDP. For Russia, of course, this is an opportunity to make the break now instead of later – and leave NATO to take the blame for the interruption of supply. So if I were Russia, I would not be in a hurry to help solve the foreign-payment problem. The same goes for non-oil raw materials, from neon to palladium to titanium, nickel and aluminum.
- Andrei: So far, this applies only to natural gas. Do you believe that Russia will extend this to petroleum, wheat and fertilizers and, if yes, what will the effect from this be for the world economy?
- Michael Hudson: All Russian exports are affected by these currency controls, because all bank transfers are sanctioned in the way discussed above. Russia has no use for dollars or euros, because these can be grabbed. It needs to have complete control over whatever monetary assets it receives, now that past norms of international law and financial policy no longer apply.
Japan unsure how Russia will handle energy payments sold to ‘unfriendly’ nations - Japan does not know how Russia will handle the required ruble payments for its energy sold to “unfriendly” countries, the finance minister said on Thursday. Japan accounted for 4.1 percent of Russia’s crude oil exports and 7.2 percent of its natural gas exports in 2021. “Currently, we’re looking into the situation with relevant ministries as we don’t quite understand what is (Russia’s) intention and how they would do this,” Finance Minister Shunichi Suzuki said in a parliament session. The government will also coordinate with Japanese companies to collect information about the move, Chief Cabinet Secretary Hirokazu Matsuno told a Thursday news conference. Russia’s President Vladimir Putin said on Wednesday his country would seek payment in rubles for gas sales to “unfriendly” countries in retaliation for Western sanctions against its invasion of Ukraine. Russia has put Japan on its “unfriendly” nation list along with the United States, European Union member states, and others. Japan has revoked Russia’s most-favored nation trade status, banned exports of certain goods to the country and frozen assets of about a hundred Russian individuals, banks and other organizations after the invasion, which Moscow calls a “special military operation. Suzuki said the government would closely monitor the “side effects” of the sanction measures on the Japanese economy and financial markets and continue to take appropriate steps in coordination with the Group of Seven (G7) and the international community. On Wednesday, Japan’s Prime Minister Fumio Kishida said he planned to announce further sanctions against Russia at an upcoming G7 meeting in Brussels.
China to release enough emergency oil reserves to meet its own needs -China will release enough oil to meet the country's needs from its strategic reserves, a foreign ministry spokesman said without commenting on the country’s role in the US-led initiative of a coordinated emergency stock sale from major oil consumers, according to international media reports on Wednesday. Speaking at a press conference, Zhao Lijian said 'the Chinese side will organize a release of crude oil from state reserves according to its own actual needs,' adding that details of the sale would be publicized as soon as possible. His remarks came one day after US President Joe Biden announced his much-expected oil sale from the Strategic Petroleum Reserves (SPR) to provide additional market supply and lower crude prices. The US Department of Energy will release 50 million barrels of oil from the SPR, the largest petroleum stockpile in the world used for emergencies. While 32 million barrels will be exchanged over the next several months, 18 million barrels will be accelerated from a previously authorized sale by Congress, according to the White House. The move is a coordinated effort, a first of its kind, along with other major energy-consuming nations, including China, India, Japan, the Republic of Korea and the UK 'to maintain adequate supply as we exit the pandemic,' the White House said.
Ukraine war ripples to Yemen where no funds mean no food - Russia’s war on Ukraine has sent wheat prices soaring. U.N. agencies have cut food aid. As famine looms, Yemeni parents face the worst choice: save one sick child or feed another. (Thomson Reuters) - Ali's brittle legs stuck out awkwardly from a gray onesie that hung off him, although it was meant for his age. At three months old, the Yemeni infant has already spent a third of his life fighting to keep it.Ali was treated for acute malnutrition free of charge at the run-down Sadaqah public hospital in the southern port city of Aden. But the fragile lifeline extended to him and millions of hungry Yemeni children may snap soon."You have a perfect storm gathering on the horizon," warned Philippe Duamelle, spokesman for the United Nations agency for children (UNICEF).Russia's invasion of Ukraine in February has sent global wheat and fuel prices skyrocketing just months after cash-strapped United Nations agencies cut food aid to 8 million Yemenis.Further cuts are expected, as donor countries on Wednesday pledged only $1.3 billion of the $4.2 billion requested in humanitarian assistance to Yemenis over the next year.That could threaten the international aid that helps Yemeni hospitals keep their lights on, stock their medicine cabinets, and subsidize transport for patients from far-flung provinces – like Ali's family, who traveled more than 480 km to reach Aden."We need more, not less. But we have reached a level where we need to start scaling down," Duamelle told the Thomson Reuters Foundation."This is insane. This is just insane."UNICEF predicts that 19 million Yemenis will need food assistance by the end of 2022 - an increase of 2 million from the beginning of the year.
Sudan erupts as millions in Africa go hungry due to Ukraine war and sanctions on Russia - Thousands of workers and students took to the streets in cities across Sudan in protest at rocketing food and fuel prices. Food prices are 100 to 200 percent higher than they were a year ago and inflation stands at 250 percent. In the capital Khartoum last week, the protesters were met with tear gas and stun grenades as they came within 200 metres of the presidential palace. The mass protests follow the sharp dive in the value of the Sudanese pound in the last month, as the military junta ended its fixed currency policy, and take place alongside ongoing strikes by teachers and railway workers in Atbara over their abysmally low salaries. According to the United Nation’s World Food Programme (WFP), nearly half of Sudan’s 44 million people will face hunger this year as a result of the military’s ouster of Prime Minister Abdalla Hamdouk last October (prompting international financial institutions to suspend billions of dollars in crucial budget aid), the war in Ukraine and sanctions imposed on Russia. The WFP says that about 20 million people are likely to be at “emergency” or “crisis” levels of “acute food insecurity,” double 2021’s figure. The situation has worsened dramatically due to soaring global grain prices, the shortage of foreign currency and drought in some parts of the country, fueling the escalating protest movement demanding an end to military rule. Like many countries in Africa, Sudan sourced about 35 percent of its wheat imports in 2021 from Russia and Ukraine and now must find an alternative supplier demanding far higher prices. Last year Russia and Ukraine accounted for nearly one third of the world’s grain exports, one fifth of its corn trade and almost 80 percent of sunflower oil production. According to the US Department of Agriculture, world wheat supplies will tighten, with exports from Russia and Ukraine likely to be 7 million tonnes smaller than expected before the war. Following the US/NATO-provoked war, exports from Russia and Ukraine have virtually ground to a halt because of sanctions imposed by Washington and the European powers on Russia’s banks, shipping and airlines and Ukraine’s ban on the exports of grain and other food products to prevent a domestic humanitarian crisis. The northern Black Sea ports, where some of the most destructive fighting is taking place and through which most of Russia and Ukraine’s grain exports are shipped, have closed, while flight bans are causing cargo planes to divert around Russian airspace. This has exacerbated already-rising food prices due to pandemic-related supply chain problems and deepened poverty. The northern Black Sea area exports at least 12 percent of the world’s traded food calories, while 45 percent of Ukraine’s exports—Ukraine has one-third of the world’s most fertile soil—are agricultural-related. As some of Ukraine’s exports are used for animal feed, the export ban and disruptions are likely to impact livestock. Farmers fleeing the fighting and the war’s destruction of infrastructure and equipment threaten April’s planting season. According to the International Monetary Fund (IMF), the price of wheat increased 80 percent between April 2020 and December 2021 as the pandemic took hold, sending food prices to their highest levels since the 1970s. Wheat prices have jumped 37 percent and corn 21 percent so far in 2022. Wheat futures are 80 percent higher than six months ago, and corn is up 58 percent. Twenty-three of Africa’s 54 countries depend on Russia and Ukraine for more than half the imports of one of their staple goods. Some countries are even more reliant: Sudan, Egypt, Tanzania, Eritrea and Benin import 80 percent of their wheat and Algeria, Sudan and Tunisia more than 95 percent of sunflower oil from Russia and Ukraine. They too are seeing higher prices across the board, exacerbating hunger under conditions where most African elites provide no social safety net.
Ukraine Latest: More Shortages; Misunderstanding Russian Strategy? by Yves Smith - Even though we aspire to give a decent overview of the Ukraine-Russia state of play in Links, I thought to highlight some topics here. The Financial Times alone provides two new stories on shortages. One, which just broke, is Vitol chief warns of diesel rationing following Russian supply disruption: The head of Vitol, the world’s largest independent oil trader, has warned of a “systemic” shortage of diesel in Europe stemming from potential disruption to Russian supplies, which could lead to fuel rationing. He said that the shift to more diesel consumption over petrol on the continent had helped to create shortages of the fuel.“The thing that everybody’s concerned about will be diesel supplies. Europe imports about half of its diesel from Russia and about half of its diesel from the Middle East,” said the chief of Switzerland-based Vitol. “That systemic shortfall of diesel is there.”Note that we have been warning of diesel shortages. The rest of the story suggests refineries could produce more diesel at the cost of lowering the amount of other products generated; shipbrokers remain optimistic that other refiners will fill the gap. But that does not fully solve the problem of diesel demand, when filling that need is effectively diverting supply from other uses.The Financial Times also warns of food shortages in the Middle East. These if anything seem to be coming faster than expected: Since the start of March, flour has disappeared from the shops and the price of bread has increased by 70 per cent. “Supermarkets are hoarding basic goods, then selling them at higher prices,” said Hamieh. Even before the Ukraine crisis, Lebanon was in the grip of a financial meltdown; its currency has lost more than 90 per cent of its value since 2019. With more than 70 per cent of its wheat imports coming from Ukraine, consumers have been dealt a further blow. As a discerning reader can tell, Lebanon is such a train wreck that it can’t serve as a poster child for the Middle East as a whole; I’ve heard horror stories from a Lebanese friend. And Ukraine separately was the most exposed: But distress is on the march in the region. Again from the Financial Times:The UN International Fund for Agricultural Development said the impact of rising food prices and crop shortages was already being felt in the Middle East and north Africa….With the exception of the oil-exporting Gulf states, most Arab countries have weak economies, wide budget deficits and rely on subsidised food and energy….Governments across the region have sought to contain the knock-on effect by attempting to procure more food supplies from other producers in Europe, rationing and imposing export bans on staples including flour, pasta and lentils. Lebanon has allocated all its flour supplies to bread production, and the government has also increased the price.Grain and energy importers such as Egypt, Tunisia and Morocco will find their budgets under bigger strain as they spend more on imports and subsidies, say economists. Another potential issue is steel. The southeast area of Ukraine is industrialized. Reader Dave in Austin pointed out that steel production in particular was more important than many might assume: Just east of the river is the Azov Steel plant now owned by Arcelor Mittel. Before the revolution Mariupol was a village. The city grew up around the Azovstal steel plant built in the 1930s, apparently the first such plant in the USSR. The plant took iron billets from further north in the Donetsk, remelted them in one of six coal-fired blast furnaces, and produced steel plate and sheet. The Kalmius River provided the water. Arcelor Mittel purchased the plant after the Soviet era. I’m no expert on the steel industry, but this looks like the Pittsburgh plants along the Monongahela or River Rouge near the end; old-style coal-fired reheat blast furnaces outmoded by modern electrical melting systems. The NYT headline that the plant was “Destroyed” seems to be the usual Uk-Hysteria. Dave considered the idea that if the US refused to relent and relax sanctions on Russia, that it holding these steel operations could become another pain point for Europe and add to the tensions between the two camps.
Ukraine conflict: Putin lays out his demands in Turkish phone call - Turkey has positioned itself with great care to be the go-between with Russia and Ukraine - and this seems to be paying off. On Thursday afternoon, President Vladimir Putin rang the Turkish President, Recep Tayyip Erdogan, and told him what Russia's precise demands were for a peace deal with Ukraine. Within half an hour of the ending of the phone call, I interviewed Mr Erdogan's leading adviser and spokesman, Ibrahim Kalin. Mr Kalin was part of the small group of officials who had listened in on the call. The Russian demands fall into two categories. The first four demands are, according to Mr Kalin, not too difficult for Ukraine to meet. Chief among them is an acceptance by Ukraine that it should be neutral and should not apply to join Nato. Ukraine's President Volodymyr Zelensky has already conceded this. There are other demands in this category which mostly seem to be face-saving elements for the Russian side. Ukraine would have to undergo a disarmament process to ensure it wasn't a threat to Russia. There would have to be protection for the Russian language in Ukraine. And there is something called de-Nazification. This is deeply offensive to Mr Zelensky, who is himself Jewish and some of whose relatives died in the Holocaust, but the Turkish side believes it will be easy enough for Mr Zelensky to accept. Perhaps it will be enough for Ukraine to condemn all forms of neo-Nazism and promise to clamp down on them. The second category is where the difficulty will lie, and in his phone call, Mr Putin said that it would need face-to-face negotiations between him and President Zelensky before agreement could be reached on these points. Mr Zelensky has already said he's prepared to meet the Russian president and negotiate with him one-to-one. Mr Kalin was much less specific about these issues, saying simply that they involved the status of Donbas, in eastern Ukraine, parts of which have already broken away from Ukraine and stressed their Russianness, and the status of Crimea. Although Mr Kalin didn't go into detail, the assumption is that Russia will demand that the Ukrainian government should give up territory in eastern Ukraine. That will be deeply contentious. The other assumption is that Russia will demand that Ukraine should formally accept that Crimea, which Russia illegally annexed in 2014, does indeed now belong to Russia. If this is the case, it will be a bitter pill for Ukraine to swallow. Nevertheless, it is a fait accompli, even though Russia has no legal right to own Crimea and actually signed an international treaty, after the fall of Communism but before Vladimir Putin came to power, accepting that Crimea was part of Ukraine.
Zelensky says Ukrainian political parties linked to Russia to be banned - Ukrainian President Volodymyr Zelensky said on Sunday that 11 political parties in his nation that are linked to Russia will be banned, The Washington Post reported.In a speech posted online, Zelensky said that Ukraine's National Security and Defense Council agreed to suspend the activities of the parties. “Given the full-scale war waged by the Russian Federation and the ties of some political structures with this state, any activity of a number of political parties during the martial law is suspended,” Zelensky said during his address. Zelensky also said in his address that the country’s Justice Ministry was “instructed to immediately take comprehensive measures to ban the activities of these political parties in the prescribed manner,” according to the Post.“Any activity of politicians aimed at splitting or collaborating will not succeed,” Zelensky added. “But it will get a tough response.” The 11 banned parties included the Opposition Platform-For Life, Shariy Party, Nashi, Opposition Bloc, Left Opposition, Union of Left Forces, State, Progressive Socialist Party of Ukraine, Socialist Party of Ukraine, Socialists Party and Volodymyr Saldo Bloc, according to Axios. During a Sunday interview with CNN’s Fareed Zakaria, Zelensky warned of the possibility of a third world war happening if negotiations fail to end Russia's invasion of Ukraine. “Unfortunately, our dignity is not going to preserve the lives, so I think that we have to do any format, any chance, so in order to have ... the possibility of talking to Putin. But if these attempts fail, that would mean ... a third world war,” Zelensky told Zakaria.
NATO official says Russia-Ukraine war 'rapidly approaching' stalemate: report - The war between Russia and Ukraine is nearing a stalemate, with neither side nearing victory or willing to give in, according to a NATO intelligence official.Speaking to NBC News, the unnamed NATO official said, “If we’re not in a stalemate, we are rapidly approaching one."“The reality is that neither side has a superiority over the other," they added.According to the official, Belarus, a close Moscow ally, may soon launch an attack on Ukraine or allow Russia to position nuclear weapons on its soil. Belarus allowed Russian soldiers to amass along its border with Ukraine prior to the start of the invasion on Feb. 24. “The Belarusian government is preparing the environment to justify a Belarusian offensive against Ukraine and the imminent deployment of Russian nuclear weapons in Belarus," they said.While Ukraine has been able to prevent Russian soldiers from taking major cities, including the capital city of Kyiv, Russian President Vladimir Putin is also unwilling to admit defeat, the NATO official told NBC.“So what happens when you have these two forces then grinding on each other in this way? The loss of life and the damage is going to be quite severe,” said the official. “Neither side here can win. Neither side will capitulate.”The invasion of Ukraine has now entered its fourth week, with nearly a thousand civilians reported killed, millions more having fled the country, and more than 10 million forced to leave their homes. The Pentagon said last week that Russian forces were stalled in their invasion, despite their ongoing bombardment of cities like Kharkiv and Mariupol.
Russia says shopping center targeted in Kyiv housed rockets |The Ukrainian shopping center destroyed Sunday by Russian shellingwas intentionally targeted because it was storing rockets, a Russian official said Monday.The Russians, who hit the Kyiv shopping center with long-range weapons, killing at least eight people, identified the location as both a rocket storage facility and a reloading station for the Ukrainians,according to Reuters.“High-precision long-range weapons on the night of March 21 destroyed a battery of Ukrainian multiple rocket launchers and a store of ammunition in a non-functioning shopping center,” Russian Defense Ministry spokesman Igor Konashenkov told reporters.“The areas near the shopping centre were used as a large base for storing rocket munitions and for reloading multiple rocket launchers,” Konashenkov added.He also shared a video with reporters, claiming that it was evidence of the Ukrainian military using the center for weapons storage.The spokesman placed blame on Ukraine for the civilian deaths. “We would like to again remind Western media: We have given complete evidence showing that the Kyiv nationalistic regime has used civilian objects in residential areas of Kyiv and in other cities as artillery and rocket system firing positions,” Konashenkov said.
Zelensky: 100K trapped in Mariupol under 'inhumane conditions' -Ukrainian President Volodymyr Zelensky said in his latest video address that nearly 100,000 people are trapped in Mariupol under “inhumane conditions."“No food, no water, no medicine. Under constant shelling, under constant bombing,” Zelensky said, according to CNBC.Zelensky noted that the country has been attempting to deliver humanitarian aid to Mariupol for the past week and has tried to get people in the city evacuated."Almost all our attempts, unfortunately, are disrupted by the Russian occupiers. By shelling or deliberate terror,” he added.Nearly 50 to 100 Russian bombs have hit Mariupol daily, according to The Wall Street Journal, leaving 80 to 90 percent of the city destroyed.Earlier this week, Ukraine denied Russian requests to surrender Mariupol and Ukrainian troops were able to successfully destroy a Russian patrol boat, the Journal noted.Despite that gain, Russia has continued to take a toll on Mariupol, gaining control of two steel plants in the city.“Russian troops are turning Mariupol into rubble, killing Mariupol residents and bombing the plants,” the owner of the plants, steel magnate Rinat Akhmetov said, according to the Journal. “Under no circumstances will these plants operate under Russian occupation.”However, Zelensky said on Tuesday that “very difficult” negotiations are ongoing between Ukraine and Russia.“Step by step, we are moving forward,” he said, according to CNBC.
Officials say 300 dead in Russian airstrike on Mariupol theater -Around 300 people were killed when Russia bombed a theater in the Ukrainian city of Mariupol that hundreds of people were using as a shelter, officials said on Friday, citing eyewitnesses, The Associated Press reported.The news outlet noted that it was unclear how eyewitnesses had come to those figures or if the site had finished being excavated by emergency workers. A Ukrainian official said last week that over 100 people had been rescued following the Russian bombing of the theater, which had the words “children” written on either side of it.The development comes as the Russian invasion moves into its second month, and as Mariupol has seen a number of buildings and sites struck by shelling. The southeastern city has also seen a mosque and a children’s hospital hit by Russian fire.In the strongest US rebuke of Russia yet, the Biden administration announced earlier this week that they had determined that Moscow had committed war crimes amid its invasion in Ukraine. “We’ve seen numerous credible reports of indiscriminate attacks and attacks deliberately targeting civilians, as well as other atrocities. Russia’s forces have destroyed apartment buildings, schools, hospitals, critical infrastructure, civilian vehicles, shopping centers, and ambulances, leaving thousands of innocent civilians killed or wounded,” Secretary of State Antony Blinken said in a statement on Wednesday upon the administration’s announcement.“Many of the sites Russia’s forces have hit have been clearly identifiable as in-use by civilians,” he added, noting the Mariupol maternity hospital and theater struck.
Ukraine: Russia seized rescue workers trying to deliver food to Mariupol - Ukraine on Tuesday accused Russian forces of seizing 15 rescue workers and drivers who were working with a humanitarian convoy to provide food and supplies to Mariupol, which has endured heavy attacks throughout the invasion. Ukrainian President Volodymyr Zelensky said that Russia blocked an aid convoy on a previously agreed upon route. He added that a convoy was seized near Manhush, which is located just outside Mariupol, according to The Associated Press. The Red Cross also confirmed to the AP that the aid convoy was unable to enter the city. “We are trying to organize stable humanitarian corridors for Mariupol residents, but almost all of our attempts, unfortunately, are foiled by the Russian occupiers, by shelling or deliberate terror,” the Ukrainian president said, the AP reported. Mariupol has been attacked recently by Russian navy vessels in addition to enduring weeks of Russian air and land strikes. The reported aid workers’ capture comes amid warnings of supply shortages in some parts of Ukraine as a result of Russia’s unprovoked attack.
Mariupol council: Russia turning city into 'ashes of a dead land' - Mariupol’s local council said Tuesday that Russia is turning the Ukrainian port city into a “dead land” after Russia dropped two more bombs on it.Ukraine refused to surrender Mariupol to Russia Sunday, which Russia had offered in exchange for safe passage for citizens to leave the city. The city, which had a population of 400,000 before the war, has been the focus of Russia’s attacks in recent weeks, including shelling of a theater, art school and other public buildings where mainly women and children have been seeking shelter. "Once again it is clear that the occupiers are not interested in the city of Mariupol. They want to level it to the ground and make it the ashes of a dead land," the council said in a statement.Hundreds of thousands are believed to be trapped in Mariupol without access to heat, food or water. Satellite images show widespread destruction in the city’s residential areas.Ukrainian President Volodymyr Zelensky said Monday that the city is “being reduced to ashes” but will “survive.” He previously said that the siege of Mariupol is a “terror that will be remembered for years to come.”Russia on Sunday called for Ukrainians in Mariupol to lay down their arms and end what it called a "terrible humanitarian catastrophe," a demand that was quickly rejected. “There can be no talk of any surrender, laying down of arms,” Ukrainian Deputy Prime Minister Irina Vereshchuk told the news outlet Ukrainian Pravda. Russia bombed a theater in Mariupol on March 16 where hundreds of civilians were hiding out. A week prior, they bombed a maternity and children’s hospital. The Mariupol City Council confirmed about 2,400 deaths as of March 14. According to Reuters, the council has not given any details about any casualties from the latest bombings. Mariupol is currently the biggest city still held by Ukraine in the Donetsk region.
Russian officials say it has destroyed major fuel depot outside Kyiv -Russian officials on Friday said they have destroyed a fuel depot in Ukraine that was reportedly one of the largest fuel bases in the country.Russian Defense Ministry spokesman Igor Konashenkov in a briefing video said high-precision weapons and cruise missiles fired from the sea struck the fuel depot near the Ukrainian capital of Kyiv on Thursday night.Konashenk said Russia destroyed 24 pieces of military equipment, including seven tanks and five infantry vehicles, during overnight strikes.The fuel depot reportedly supplied the Ukrainian army in the center of the country.Ukrainian officials did not immediately verify the attack publicly.Reuters reported it could not immediately verify the authenticity of the attack. Russia's invasion of Ukraine has lasted more than a month as Ukrainian forces continue to put up stiff resistance to the assault.
Polish schools expect as many Ukrainian refugees as there are students in Los Angeles - Three weeks into the largest refugee flight in Europe since World War II, more than 75,000 new students have registered in the Polish education system. Warsaw has taken in more than 9,000 students from Ukraine, increasing by 1,000 a day. More than 3,200 students have enrolled in Krakow — the equivalent of adding six additional school buildings.With the greatest portion of Ukrainian refugees landing in Poland, Education and Science Minister Przemyslaw Czarnek projected on Friday that the overall number could grow to 700,000 students from Ukraine applying to Polish schools.“The Polish educational system is not prepared for this,” said Jacek Kucharczyk, president of the Institute of Public Affairs, a think tank in Warsaw.Poland is known for having some of the best schools in the world, ranking above the United States and most of Europe on PISA standardized test scores in reading, math and science. And despite its opposition to previous refugee waves, the country has so far given a warm reception to Ukrainians fleeing the war.But the challenge of absorbing such a huge influx of new students — equivalent to the whole Los Angeles school district — is extraordinary. And it’s further complicated by language barriers and the upheaval these new students have experienced.Poland is not sure how it will accommodate the new arrivals. It was already facing a teacher-and-classroom shortage. And that sets up the potential for schools to become a point of backlash in the months ahead.“Our minister, Czarnek, is a religious fundamentalist and nationalist,” Kucharczyk said. “He’s the worst person to run this school system in a time of this crisis, refusing to speak with NGOs.”“He wants to dump the refugee children on the school system and see how they cope,” Kucharczyk continued. “It makes me very worried that the education minister then might blame the refugees when school systems fail, instead of the government for lack of action.”
NATO to bolster troops in Bulgaria, Hungary, Romania and Slovakia - NATO Secretary-General Jens Stoltenberg said Wednesday the alliance is likely to bolster troops along its eastern flank, deploying four new battle groups in Bulgaria, Hungary, Romania, Slovakia. "I expect leaders will agree to strengthen NATO's posture in all domains, with major increases in the eastern part of the alliance on land, in the air and at sea," Stoltenberg said during a press conference ahead of the NATO leaders summit in Brussels. Since the Kremlin's Feb. 24 invasion of Ukraine, NATO has readied 140,000 troops in the region and mobilized a colossal war chest of advanced military equipment. Of the approximately 140,000 troops, the United States has provided the lion's share with 100,000 soldiers. The U.S. service members and NATO troops are currently deployed in neighboring NATO-member countries and are not directly fighting with Russian forces inside Ukraine. U.S. Ambassador to NATO Julianne Smith said Wednesday that a permanent stationing of U.S. and NATO troops is currently on the table. "NATO is in the process now of stepping back and thinking more about a medium and longer-term force presence in NATO territory on that eastern flank," Smith said, adding that the new deployments to the region send "a pretty clear message to Moscow." "Permanent stationing could be one solution, or persistent rotations as another option, that could be on the table. So at this point, what we need to do is have our military commanders give us the best advice that they can come to us with specific proposals and then as an alliance, look at what the security environment requires," Smith said.
World War III is here, but it's not what we expected - World War III appears to have started with Russia's attack on Ukraine, but without nuclear missiles so far.Make no mistake. The battlefield for this war is worldwide; it's just that it is primarily an economic battlefield. When Russia attacked Ukraine, the other great powers did not send soldiers and tanks. Instead, they orchestrated one of the most comprehensive economic warfare schemes ever devised.Measures included cutting Russia out of the international payments system called SWIFT, blocking Russian exports (except most commodities) and discouraging commerce of many kinds with Russia. Many countries froze accounts owned by Russia's central bank and also accounts owned by prominent wealthy Russians. Wealthy Russians targeted by sanctions also saw yachts moored outside Russian territory seized. The value of the yachts runs into the billions of dollars.In the wake of these unprecedented sanctions, many non-Russian companies have reduced, suspended or eliminated operations in Russia. Here is a list of over 400. Not all were forced to take action because of the sanctions. But companies expected that doing business inside Russia would become extraordinarily difficult and also did not want to get on the bad side of governments around the world participating in the sanctions.Russia has responded with an export ban covering more than 200 products. Notably, Russia did NOT include its major exports, energy and other minerals in the ban. It did curtail wheat and sugar exports temporarily. Wheat has become a scarce commodity after Ukraine, the fourth largest wheat exporter in the world—behind only the European Union, Russia and Australia—announced a halt to those exports to preserve grain stocks for domestic consumption in the war-torn country.The United States and the United Kingdom have banned Russian oil exports. But this is mostly symbolic as oil can be rerouted quickly so that Russian oil will go to countries accepting its oil while oil bound for those countries from other suppliers is rerouted to the United States and the UK. A ban on fertilizers may be the most consequential Russian export restriction. Russia produces23 percent of the world's ammonia, 14 percent of its urea and 21 percent of its potash. (Ammonia and urea are major sources of nitrogen for crops and potash provides potassium.) Without adequate amounts of fertilizer, crop yields could decline worldwide causing food prices to jump even higher than they are today. The length of the economic war depends in part on the length of the Russia-Ukraine conflict. It is, however, difficult to see why those sanctioning Russia would want to reward it by lifting sanctions if the conflict ends with Russia forcing an agreement on Ukraine that includes recognition of Crimea as part of Russia (seized in 2014) and independence for two of Ukraine's primarily Russian-speaking provinces. The Russians will also insist that Ukraine be prohibited from joining NATO and likely restrict the size of the Ukrainian armed forces.The sanctioning countries will reasonably ask: Who can trust that the Russians will abide by the agreement which will probably include a military withdrawal and respect for Ukraine's new boundaries? Won't Russia simply invade Ukraine again when it has something else that it wants?This is what I mean when I say we've entered World War III. I see no clear end to the economic warfare or geopolitical jockeying. Countries opposing the invasion of Ukraine will want to keep the pressure on Russia with the hope of undermining Russia's war-making capability. Russia will counter with attempts to integrate its economy with that of China, India and other countries in Asia, Africa and Central and South America including Mexico and Brazil which have not embraced sanctions.That means the United States, European nations and their allies around the world will have to decide whether to impose secondary sanctions on those countries retaining normal trading relationships with Russia. It's a complex situation and could turn out to be a real mess.
Navalny Sentenced to 9 More Years in Prison - A Moscow court has sentenced jailed Kremlin critic Alexei Navalny to nine more years in prison on fresh charges of embezzlement and contempt of court, raising fears among allies that his life may be in danger in a remote colony after his near-fatal poisoning. Judge Margarita Kotova on Tuesday found Navalny guilty in a makeshift court inside the maximum-security prison in Pokrov 100 kilometers (60 miles) east of Moscow where he is already serving a 2.5-year sentence for violating parole in poisoning recovery. The court sentenced him to nine years in maximum-security prison and ordered him to pay a fine of 1.2 million rubles ($11,500). In an Instagram post published after the sentencing, Navalny, President Vladimir Putin's main domestic critic, said the Russian president is "afraid of the truth." "Putin is afraid of the truth, I have always said this. Fighting censorship, relaying the truth to the people of Russia always remained our priority," Navalny said. Navalny's lawyers Olga Mikhailova and Vadim Kobzev were briefly detained outside the makeshift court, the independent Novaya Gazeta newspaper reported. State prosecutors last week requested that the judge sentence Navalny, 45, to an additional 13 years in prison on charges of fraud and contempt of court. Investigators accuse Navalny of stealing for personal use more than $4.7 million in donations that were given to his political organizations that were retroactively declared “extremist” last year. That sum was lowered to 2.7 million rubles ($25,800) during the course of the trial. Navalny’s spokeswoman Kira Yarmysh expressed fears that “Alexei will be face to face with those who have already tried to kill him.”
The heads begin to roll in Russia - European media report that Russian President Vladimir Putin ordered thehouse arrest of two senior Federal Security Service (FSB) officers. Colonel-General Sergei Beseda, Chief of the FSB’s “Fifth Service,” reportedly was detained along with his deputy, Anatoly Bolyuk, charged with providing flawed intelligence about Ukraine and their improper use of operational funds. Separately, Oleksiy Danilov, Ukraine’s national security council chief, claimed that several Russian generals have been fired. The implications portend more suffering yet to come, but likewise opportunities to increase pressure on the Russian leader from within.Perhaps emulating Joseph Stalin, this could be the onset of a purge and Putin’s desperate ploy to provide his domestic audience with a fall guy for self-inflicted wounds. His call to rid Russia of “scum and traitors” as “a necessary self-purification of society” might be Putin’s theatrical unveiling of not merely a further crackdown against the Russian people, but also his version of a “cultural revolution” to bring further to heel those around him on whom he has counted to take and maintain power. If I were one of the oligarchs or “siloviki,” those from Russia’s intelligence services who profiteered on Putin’s kleptocracy, I’d be more than just a little worried.Putin’s rhetoric is victimization, villains and heroes. He casts himself as the people’s champion. Putin chose the FSB, a machine organized and conditioned to execute his autocratic vision and tell him what he wants to hear — whether or not it conforms with reality.Putin has relied on the FSB as his principal source of power and protection, not merely at home, but also across the former Soviet states over which he is determined to restore Russia’s dominion. His reorganization of the FSB from the KGB’s ashes should have told us precisely the direction he planned to take.Putin’s outlook was made clear to me during my first meeting as the CIA’s chief of station in a former Soviet state with the local FSB chief, the “Rezident,” a general known for crushing the anti-Russian rebellion in Chechnya. He looked the part of a film noir Cold War villain, comically uncomfortable in the posh local restaurant. FSB protocol required that he bring another officer; Moscow prohibited its officers from meeting alone with the CIA.
Australia Slaps Russia With Alumina Export Ban, Catapults Aluminum Prices Higher - Fragile supply chains are crumbling worldwide after Russia invaded Ukraine. The latest disruption comes from Australia, as the world’s top alumina exporter has shunned shipments to Russia, sending aluminum spot prices higher. Bloomberg reports Australia’s top alumina refineries choked off flows of alumina to Russia’s United Co. Rusal International PJSC, the world’s second-largest aluminum company by production output. Rusal has a 20% stake in Rio Tinto Group’s Queensland Alumina Ltd refinery. Rio is working out options regarding its partnership with Rusal. Australia accounts for 20% of Russia’s alumina supply, also called aluminum oxide, which is derived from bauxite ore and sent to refiners and turned into alumina. Bulk carriers then ship the alumina to smelters in Russia, where it’s then transformed into aluminum. The Australian government said Sunday alumina and aluminum ores exports to Russia had been banned immediately. “There was a ship that was due to dock in Australia this week to collect a load of alumina bound for Russia,” Prime Minister Scott Morrison said. “That boat is not going to Russia with our alumina.” Even though aluminum was not on the targeted sanction list imposed by Western countries after Russia invaded Ukraine, large corporations are isolating Russia and or disinvesting in the country. Australia is throttling supplies that could severely impact the Russian output of aluminum. We detailed how much of the world relies on Russian aluminum in a weekend commodity note. Since Australia has banned exports of critical ingredients to produce aluminum in Russia, one should expect possible supply disruptions or at least declining supplies of the metal. Aluminum prices jumped as much as 5.1% to $3,554 a ton. Bloomberg notes today’s news “reinforces the case for LME prices to find a foothold above $4,000/ton.” So how does this impact, everyday people? Well, aluminum is used in anything from beer cans to beer kegs, kitchen utensils, window and door frames, consumer electronics, household appliances, aircraft, and spacecraft components.
Pakistan Revives Reko Diq: World's Largest Undeveloped Copper-Gold Deposit --Canadian mining giant Barrick Gold Corporation and the governments of Pakistan and Balochistan have reached a deal to restart Reko Diq mining project. Reko Diq is the world's largest undeveloped copper-gold porphyry deposit. The project was abandoned in 2011 after a Pakistan Supreme Court bench headed by former Chief Justice Iftikhar Chaudhry canceled the mining license granted to Tethyan Copper Company (TCC), a joint venture between Canada's Barrick Gold and Antofagasta Minerals of Chile. TCC challenged the cancelation in the International Centre for Settlement of Investment Dispute (ICSID). On July 12, 2019, the ICSID Tribunal awarded TCC $5.894 billion plus interest of $700,000 per day in damages against Pakistan. As of 1 March 2022, the award stood at $6.5 billion. The new agreement between Barrick Gold Corporation and the governments of Pakistan and Balochistan does away with this award. It also increases the share of the project owned by Pakistan from 25% to 50%. Reko Diq is part of the Tethyan metallogenic belt (TMB) that extends from the Balkans in Europe to Pakistan including Serbo-Macedonian, Anatolian, Takab, Kerman and Chagai metallogenic belts. It is believed to be rich in copper and gold deposits. The new agreement to start Reko Diq waives the ICISD award. In the reconstituted project, Barrick will have 50% ownership and Pakistan 50%, comprising a 10% free-carried, non-contributing share held by the government of Balochistan, an additional 15% held by a special purpose company owned by the government of Balochistan and 25% owned by other federal state-owned enterprises. The federal government’s shares of 25% will be divided equally amongst three state-owned entities (SOE): Oil & Gas Development Corporation Limited (OGDCL), Pakistan Petroleum Limited (PPL), and Government Holdings Pakistan Limited (GHPL). This is huge improvement over the prior deal that gave the Baluchistan government 25% stake in the project, with Tethyan holding the remaining 75%.When the project goes into production in 5 or 6 years time of development, it will produce 200,000 tons of copper and 250,000 ounces of gold a year for more than half a century. At current prices, the annual copper output will be $2 billion and gold output $500 million. The project’s development will bring in investment of approximately $10 billion in Balochistan, including $1 billion which would be invested in social uplift projects such as roads, schools, hospitals, and the creation of technical training institute for mining. The investment is also said to result in the creation of over 8,000 jobs, according to a report in The Express Tribune newspaper.
Russian oligarchs are welcome in Turkey, foreign minister says - Turkish Foreign Minister Mevlut Cavusoglu said Saturday that he'd welcome sanctioned Russian oligarchs into his country as both tourists and investors, as long as any business dealings were kept within the realms of international law.Turkey has been in the spotlight this week with its coastal waters seeing the arrival of two multimillion-dollar superyachts, reportedly belonging to Russian oligarch Roman Abramovich — quite literally circumnavigating Western sanctions.With each one worth an estimated $600 million or more, Abramovich is seen stationing $1.2 billion in the non-EU country as he seeks to move his assets out of reach of U.S., U.K. and EU governments targeting Russia's wealthy elite. Turkey said it's a legitimate move — so long as the yachts remain outside the territorial waters of sanctioning countries, which extend 12 nautical miles out from the coastline.Speaking to CNBC's Hadley Gamble at the Doha Forum, Qatar, Turkish Foreign Minister Mevlut Cavusoglu said that any activity had to be legal."We implement U.N.-approved sanctions, so if any Russian citizens want to visit Turkey, of course, they can visit Turkey. Now Russians are coming to visit Turkey, that's no problem," he said.
Pakistani PM urges Islamic nations to mediate in Ukraine war (AP) — Pakistan’s prime minister on Tuesday urged foreign ministers from Muslim-majority nations to help end Russia’s war in Ukraine, appealing also to China’s top diplomat to join the effort. Imran Khan spoke at the start of a two-day gathering in Islamabad of the 57-member Organization of Islamic Cooperation, which for the first time saw the attendance of China’s foreign minister, Wang Yi, as a special guest.The war in Ukraine “could have great consequences for the world,” Khan warned and added that the rest of the planet is “already suffering,” with surging prices of oil, gas and wheat from a region known as the breadbasket of the world. He urged the ministers to “mediate, try to bring about a cease-fire and an end to the conflict.” Wang’s attendance underscored China’s increasing influence among OIC countries — as well as the Islamic organization’s readiness to overlook charges of widespread attacks by Chinese authorities on the country’s minority Muslim Uyghurs.
Earthquake of magnitude 7.3 suspends the operation of some semiconductor factories in Japan -Last weeks earthquake in Japan had a magnitude of 7.3, creating power shortages in the impacted districts. Market experts have confirmed reports of a rapid effect on semiconductor output following the earthquake, including factories run by Kioxia, Micron, and Sony. While delays to production appear to have been mild overall, the earthquake had far more serious and tragic consequences. The earthquake, which had its epicenter off the shore of Fukushima, struck at midnight local time, killing at least four people and injuring more than 100. Kioxia's NAND manufacturing lines have been shut down owing to contamination concerns in recent weeks. A manufacturing mistake has had a significant influence on the availability of this critical component of SSDs and is predicted to have a minor impact on price, maybe as much as 10%. However, owing to the cautious restart of manufacture, Kioxia's K1 facility (located in Kitakami, Japan, the epicenter of the magnitude 5 earthquake) was not working at full capacity. Following this latest stoppage caused by the earthquake, it appears that resuming operations at the K1 facility at full production capacity will require some more time. According to reports, Sony has three facilities in locations around the earthquake's epicenter that may have been impacted. As a precaution, Sony has temporarily ceased operations at its Storage Media Plant, Laser Semiconductor Plant, and Image Sensor Plant. Sumco and Shin – Etsu, two lesser-known firms, manufacture semiconductor wafers in the Richter zone. Because wafer fabrication requires "very high stability," its output is likely to have been impacted. Finally, Renesas, which operates mostly in the automation industry, was forced to temporarily close and conduct an extensive investigation of its facilities. Four wafer plants, including two 12-inch wafer operations, were located in earthquake zones with a magnitude of 1 to 3 and had no severe interruptions. We will keep you updated on how this affects the market, and if we receive any information, we will notify you as quickly as possible.
North Korea says it tested massive new intercontinental missile — North Korea’s latest launch was a huge, new intercontinental ballistic missile (ICBM), state media reported on Friday, in a test leader Kim Jong Un said was designed to demonstrate the might of its nuclear force and deter any U.S. military moves. It was the first full ICBM test by nuclear-armed North Korea since 2017, and flight data indicated the missile flew higher and longer than any of North Korea’s previous tests, before crashing into the sea west of Japan. Dubbed the Hwasong-17, the ICBM is the largest liquid-fueled missile ever launched by any country from a road-mobile launcher, analysts said. Kim ordered the test because of the “daily-escalating military tension in and around the Korean Peninsula” and the “inevitability of the long-standing confrontation with the U.S. imperialists accompanied by the danger of a nuclear war,” state news agency KCNA reported. “The strategic forces of the DPRK are fully ready to thoroughly curb and contain any dangerous military attempts of the U.S. imperialists,” Kim said while personally overseeing the launch, according to KCNA. DPRK are the initials of North Korea’s official name, the Democratic People’s Republic of Korea. North Korea’s return to major weapons tests capable of potentially striking the United States poses a direct challenge to U.S. President Joe Biden as he responds to Russia’s invasion of Ukraine. And it raises the prospect of a new crisis following the election of a new, conservative South Korean administration that has pledged a more muscular military strategy to counter Pyongyang. South Korea’s President-elect Yoon Suk-yeol, who will speak to Chinese President Xi Jinping later on Friday, said North Korea had nothing to gain from provocation. China is North Korea’s neighbor and sole major ally. The launch drew condemnation from leaders in the United States, Japan and South Korea. Responding to North Korea’s banned ICBM launch through the United Nations Security Council (UNSC) will be far more difficult now than after the last test in 2017. World powers on the council are currently at odds over the Ukraine war, making the kind of sanctions that were imposed on North Korea by the UNSC after the 2017 test a far more complicated process.
North Korea releases dramatic video confirming ICBM missile test North Korea state media on Friday released dramatic footage of its recent intercontinental ballistic missile (ICBM), its 12th missile test this year, The Associated Press reported.The footage confirms that North Korea launched its first ICBM test since 2017 on Thursday. The Korean Central News Agency (KCNA) reported that the missile had traveled close to 700 miles and had reached its highest altitude of close to 4,000 miles before it soon crashed into the water between Japan and North Korea, the news outlet noted.Footage shown by North Korean state TV showed a dramatized missile launch with North Korean leader Kim Jong Un wearing a leather jacket and sunglasses while walking with officials in slow motion and looking at their watches seriously, according to a video shared by the AP.The video shows the missile being rolled out and launched, later panning to Kim being joined by a group of men in gear clapping and appearing to praise him.KCNA reported Kim saying "The strategic forces ... are fully ready to thoroughly curb and contain any dangerous military attempts of the U.S. imperialists” as he oversaw the launch, according to Reuters.Analysts believe that this latest missile test would be the biggest yet liquid-fueled missile that any nation has launched, according to Reuters, amid fears over the country’s escalatory series of missile launches.The White House denounced the missile test on Thursday.
Finland's people now strongly back joining NATO, poll says, a massive political shift that would enrage Russia- A survey of people in Finland found that a majority wanted the country to join NATO after Russia invaded Ukraine. The survey by the Finnish Business and Policy Forum Eva think tank found that 60% of people supported Finland joining NATO, a massive jump from previous years. Eva polled 2,074 people between March 4 and March 15. Finland shares a long border with Russia and was once part of the Russian Empire. After it gained independence, it was invaded by the Soviet Union in 1939 but fought back and was not defeated. The country has for decades maintained a careful balance between Russia and Western countries, which involved avoiding NATO membership. At the time of the last Eva survey in 2021, most Finns seemed to support that position, with only 34% backing NATO membership. But Russia's invasion of Ukraine, another non-NATO country, prompted a change — almost doubling support for NATO membership. Ilkka Haavisto, the research manager at Eva, said of the results: "Russia has shown that it does not respect the integrity of its neighbors. "The war in Ukraine has concretely shown what the horrors of a defensive war on Finland's own territory would be and made it clear that NATO countries cannot use their military forces to help defend a nonaligned country."
UK schools in crisis as COVID surges, with cases highest among youngest and unvaccinated - The rampant spread of the BA.2 COVID variant through British schools is barely mentioned in the media. Mitigation measures in education settings, which were already at a bare minimum, were removed entirely on January 19. Twice-weekly free testing ended in most schools on February 21. On April 1, it will end in special schools, leaving children with comorbidities undefended against the virus. The latest figures published Tuesday by the Department for Education (DfE) showed that more than 200,000 pupils could not attend school March 17 due to COVID. Recorded cases had tripled in two weeks. Of the 202,000 pupils, 159,000 were absent with a confirmed COVID case—up from 45,000 on March 3. Another 16,000 pupils had a suspected case of coronavirus, up from 6,000 earlier in the month. Most worrying is the increase in the number of serious COVID cases involving younger children, including babies. Data compiled by SafeEdforAll (Safe Education for All) member @TigressEllie, found that admissions to hospital among those aged 0-5 doubled in two weeks, from 218 to 432 on March 9. A similar increase took place for 6-17-year-olds. Office for National Statistics (ONS) data reveals the highest infection rates in all age groups are among 2-11-year-olds. This age group remains unvaccinated in the UK, yet is expected to attend pre-school settings, nurseries and primary schools with no mitigation measures in place at all—no masks, no appropriate ventilation, no social distancing. The above graph shows child COVID hospital admissions throughout the pandemic. It was published by Independent Sage member Professor Christina Pagel. Referring to all age groups, Pagel tweeted March 19, “deaths within 28 days of +ve test [positive] are flat in UK as a whole, but this wave is still recent… and might end up higher than first Omicron wave.” Rising case numbers have prompted scientists to demand the Conservative government roll out vaccinations for 5-11- year-olds. This was approved by the UK’s Joint Committee on Vaccination and Immunisation on February 16, but no plans have been enacted for the necessary mass vaccination campaign. The Guardian reported in January data from the US Centres for Disease Control showing unvaccinated 5-11-year-olds were three times more likely to end up in hospital than those with two jabs. To date, only a quarter of 12-15-year-olds have received a second dose in the UK. Meanwhile, the number of schools in England self-reporting COVID cases is accelerating. Figures compiled by parent Daniella Modos-Cutter show cases in at least 167 primary schools, 27 secondary schools, 9 combined schools, three colleges and eight pre-school settings between February 28 and March 14. Schools in Essex, Greater Manchester, Gloucester, Newquay, and Cardiff and Merthyr in Wales sent classes home due to staff off sick with COVID last week.
BOE pushes for tougher regulation of $1.7 trillion crypto market - The Bank of England called on policymakers to beef up the global framework for regulating cryptocurrencies to prevent them from threatening the wider stability of financial markets. The U.K. central bank’s Financial Policy Committee suggested the role of prudential and market integrity regulators should be expanded and their coordination increased. The remarks reflect concern that the $1.7 trillion crypto market is now big enough that it could unsettle the broader financial system in times of strain. It's larger than the $1.2 trillion market of subprime mortgages, which triggered a global crisis more than a decade ago.
ECB to start work in 2022 to add climate risk to capital buffers - European bank regulators are set to start work later this year on adding climate-change risks to the framework for setting capital requirements, in a shift that would penalize lenders for failing to prepare for losses from extreme weather and the shift to clean energy. Several members of the European Central Bank’s supervisory board say they expect to begin discussions in the second half of 2022 once they’ve received results from an ongoing climate stress test and accompanying review. Determining the methodology is likely to be contentious and take until next year or beyond, the people said, meaning a new approach to setting individual requirements could still be several years away. This month, the ECB began the most detailed study to date of the losses banks could face from climate change, and called it a “learning exercise” for the industry and regulators alike. Requiring banks to broadly assign more capital on the basis of climate risks would represent a major shift in the way regulators seek to prevent financial-sector blowups, and has been lobbied against by the industry.
No comments:
Post a Comment