Inflation Surprise Puts Onus on Fed to Hit Brakes Even Harder - - The US economy has shown surprising resilience in the face of the fastest inflation and interest-rate hikes in a generation. That means the Federal Reserve will have to stomp even harder on demand. What started as a pandemic-driven supply shock has morphed into widespread inflation rooted just as much in resilient demand, underscored by unexpectedly high numbers that dashed hopes price gains were ebbing. While consumers are showing some signs of slowing, they’re still largely keeping up with persistent price pressures, powered by historic wage gains.
The Best-Case Scenario for the Fed’s Inflation Fight Is Dead - The latest reacceleration in underlying inflation just took the Federal Reserve’s best-case scenario off the table, and that may help explain the market’s violent selloff in the wake of the data: The central bank isn’t likely to suspend aggressive interest-rate increases soon. But the base case for monetary policy — a 4% terminal fed funds rate by late 2022 or early 2023 — remains very much intact despite all the market hysteria. The core consumer price index — which excludes volatile food and energy prices — jumped 0.6% in August and accelerated to 6.3% from the period a year earlier. But the core version of the personal consumption expenditures price index, which the Fed uses for its 2% inflation target, is likely to slow to around 4.3%, according to Anna Wong, Bloomberg Economics’ chief US economist, who adjusts the CPI basket to match the PCE’s weights. That would already be in line with where the Fed has estimated core PCE would be in the fourth quarter, according to its June Summary of Economic Projections. Among other things, the PCE gives less weight to housing and automobiles.
"Yesterday's CPI Showed Why Nearly All People Who Pretend They Know What Is Going On Really Have No Clue" -Yesterday’s US CPI report was one of those market-moving blockbusters that underline why nearly all the people who like to pretend they know what is going on really have no clue. I include myself in that group too for having been swept away by the trend expecting a weak inflation number for August on the back of lower gasoline prices – though in my defense I have been warning “not transitory” for over a year, and yesterday specifically flagged that US CPI was only going back to 2% again in magical DSGE models, not real life.Regardless, what we saw yesterday was a 0.1% m-o-m rise in headline CPI against expectations of a -0.1% print, so the y-o-y rate only declined slightly from 8.5% to 8.3%; and core CPI soared 0.6% m-o-m vs. 0.3% expectations to increase from 5.9% to 6.3% y-o-y. Despite the drop in gasoline prices, the contribution from rents (covered here many times before) soared; so did grocery prices; so did health insurance. Even the BLS’s new core core core measure, which takes out energy, food, shelter, and used cars and trucks was up further to well above 6% y-o-y. As Larry Summers put it via Twitter, itself in the headlines again for several reasons:“Today’s CPI report confirms that the US has a serious inflation problem. Core inflation is higher this month than for the quarter, higher this quarter than last quarter, higher this half of the year than the previous one, and higher last year than the previous one. Median inflation used to be a favourite indicator for team transitory. This month it was at its highest ever reading. It is highly implausible that inflation will fall to 2 percent without unemployment exceeding 4.5 percent. Yet this is the most pessimistic view among 19 members of the FOMC. Dangerous group think. With core inflation running above 7 percent this month and likely, given rent behaviour, to remain elevated, I fear it is unlikely that a peak Fed funds rate around 4 will be enough to restore 2 percent inflation.” Markets are indeed now pricing for a terminal Fed Funds rate of over 4.25%. Moreover, they are not just expecting a 75bps hike in September, but risks of 100bps!That threat was underlined by Summers, who added: “It has seemed self-evident to me for some time now that a 75bps move in September is appropriate. And, if I had to choose between 100bps in September and 50bps, I would choose a 100bps move to reinforce credibility.” More importantly, the same message was echoed by the Fed’s Wall Street Journal whisperer, Nick Timiraos, who underlined yesterday’s data “clinches the case for the Federal Reserve to lift interest rates by at least” 75bps at its next meeting.That is not what you call a timorous Fed response – and the market was understandably all the synonyms for the same as a result: fearful; apprehensive; faint-hearted; trembling; quaking; cowering; weak-kneed, etc. That’s what you get if you are long and wrong.
The Fed Stopped Buying MBS Today. A date for history: Today, September 15, the Fed stopped buying mortgage-backed securities altogether. It had been tapering its purchases since late last year. Since June, when the phase-in of QT started, it still purchased MBS to replace some of the pass-through principal payments from mortgage payoffs and mortgage payments that reduced the balance of its MBS faster than the cap of $17.5 billion. The idea was to keep the run-off of MBS within the cap of $17.5 billion in June, July, and August. But this circus is finally over. On today’s release of scheduled purchases by the New York Fed, there were zero MBS purchases scheduled: Yesterday, September 14, the Fed conducted its final purchase of MBS. The Fed bought $387 million in MBS in the To Be Announced (TBA) market, which is a minuscule amount by the Fed’s standards. It went out with a whimper, so to speak. This is a screenshot of the trade that the New York Fed posted on its website. I underlined the operation date (Sep 14) and the settlement date (Oct 20): The Fed books these trades when they settle. So, it will book this trade on October 20, which is a Thursday. Its weekly balance sheets are always as of Wednesday evening, and are published on Thursday. This trade will show up on the next balance sheet after October 20, which is the balance sheet to be released on October 27. So halleluiah, the balance sheet on October 27 will show the final purchases of MBS. And then it’s over. A trickle of trades haven’t settled yet. The MBS that were purchased over the past two months will still trickle into the weekly balance sheet until October 27. This includes a batch of MBS trades that the Fed conducted on July 25 and that settled on September 14, and that showed up on today’s balance sheet. Here is one of the trades that settled yesterday and was included today: In total, $9.2 billion in MBS trades showed up on the balance sheet today. It is these trades, when they settle, that cause the balance of MBS to rise in the jagged manner. MBS come off the balance sheet mostly through pass-through principal payments. When the underlying mortgages are paid off because a home is sold or a mortgage is refinanced, or when regular mortgage payments are made, the principal portion is forwarded by the mortgage servicer (such as your bank) to the entity that securitized the mortgage (such as Fannie Mae), which then forwards those principal payments to the holders of the MBS (such as the Fed). The book value of the MBS shrinks with each pass-through principal payment. This reduces the amount of MBS on the Fed’s balance sheet. These pass-through principal payments are uneven and unpredictable, and do not match the purchases in the TBA market. So the MBS balances form this jagged line of increases when TBA purchases settle, and the decreases when the pass-through-principal payments come off.
Cleveland Fed: Median CPI increased 0.7% and Trimmed-mean CPI increased 0.6% in August --The Cleveland Fed released the median CPI and the trimmed-mean CPI this morning: According to the Federal Reserve Bank of Cleveland, the median Consumer Price Index rose 0.7% in August. The 16% trimmed-mean Consumer Price Index increased 0.6% in August. "The median CPI and 16% trimmed-mean CPI are measures of core inflation calculated by the Federal Reserve Bank of Cleveland based on data released in the Bureau of Labor Statistics’ (BLS) monthly CPI report". Note: The Cleveland Fed released the median CPI details here: "Motor Fuel" decreased at a 73% annualized rate in August! Note that Owners' Equivalent Rent and Rent of Primary Residence account for almost 1/3 of median CPI, and these measures were up between 7.5% annualized in the Midwest and almost 11% in the South with an average of close to 8.7%. The year-over-year increase was larger in August than in July. This graph shows the year-over-year change for these four key measures of inflation. On a year-over-year basis, the median CPI rose 6.7%, the trimmed-mean CPI rose 7.2%, and the CPI less food and energy rose 6.3%. Core PCE is for July and increased 4.6% year-over-year.
Inflation Reduction Act May Become a Misnomer -The Inflation Reduction Act’s (IRA) name may become a misnomer if investment surges while supply chains remain constrained - fueling inflation. That’s according to a new BofA Global Research report, which dubbed the IRA the most important, and largest, federal green energy and climate package in U.S. history. “Many tax credit programs included in the IRA specify certain labor requirements that could prove restrictive and drive up project costs,” the BofA Global Research report stated. “Transmission is a critical piece of the energy transition (particularly onshore) but does not play a prominent role in the IRA. The U.S. has struggled to build transmissions lines from areas of abundant renewables, like the Midcontinent (wind) and Southwest (solar), to key demand centers,” the report added. “The IRA is certain to spur more investment in renewables-rich regions, which could lead to even more price volatility in those markets as load balancing challenges intensify. Additionally, transmission challenges will lead to capital inefficiencies as renewables projects are developed in areas with sub-optimal capacity factors,” the report continued. BofA Global Research’s report noted that facilitating transmission build-out requires permitting reform and stated that progress on this front will likely depend on the outcome of negotiations between Senator Manchin and others. Following the IRA’s signing into law, American Petroleum Institute President and CEO Mike Sommers acknowledged that the IRA “takes important steps toward new oil and gas leasing and investments in carbon capture and storage” but added that it “falls well short of addressing America’s long-term energy needs and further discourages needed investment in oil and gas”.
Podesta-led White House team tagged to execute climate law - President Joe Biden on Monday will announce creation of a new White House team, to be led by senior adviser John Podesta, that will oversee spending of the $369 billion in climate incentives included in the Inflation Reduction Act, according to an executive order obtained by POLITICO.. Creation of the new office represents the Biden administration’s efforts to pivot from passing historic climate legislation to implementing its provisions in a way that helps achieve the president’s goal of cutting U.S. emissions in half by the end of this decade. The new office, which will collaborate with the existing White House Office of Domestic Climate Policy, will have responsibility for structuring the law’s grant programs, clarifying language for tax credits and touting its economic and jobs potential. Ali Zaidi, Biden’s next national climate adviser, is expected to take the lead on broader national climate policy and will report directly to Biden. His focus will include actions to clamp down on emissions from the oil and gas industry, power sector and other contributors to climate change. The White House will give Podesta a team within the Executive Office of the President under the newly created White House Office on Clean Energy Innovation and Implementation. The order emphasized the new office, working in tandem with the climate policy office, would help speed clean energy deployment, reduce the cost of energy efficient appliances, boost U.S. domestic manufacturing that would create more jobs, put electric vehicles on the road and lower energy costs. Scientists and activists have warned that the White House must not squander the law’s opportunities because nations are far off from meeting global climate targets to keep temperatures in check, and U.S. progress — given its status as the world’s largest economy and historical contributor to climate change — is crucial. But even successfully executing the Inflation Reduction Act is not enough to meet Biden’s climate target, with independent models suggesting it will slash planet-heating gases 40 percent below 2005 levels by 2030 — 10 percentage points shy of Biden’s mark. The White House tasked Zaidi, who will report directly to Biden as Gina McCarthy’s successor, with making up a bulk of that difference. His portfolio will include finding more emissions cuts through new regulations and actions across federal agencies that the administration largely held at bay to avoid disrupting delicate talks on Capitol Hill. Separately, the executive order also makes Podesta the chair of the National Climate Task Force, with Zaidi serving as vice chair. That task force includes agency chiefs and top White House personnel. Podesta will also co-chair a White House working group to expand clean energy and economic development in coal communities and serve on an interagency council designed to address neighborhoods facing disproportionate amounts of pollution.
Climate law: What to watch at Interior, FERC and DOE - E&E News - The Department of Energy, Interior Department and Federal Energy Regulatory Commission are grappling with how to implement the landmark climate law and carry out President Joe Biden’s priorities for shifting the country towards low-carbon energy. Biden’s signing of the Inflation Reduction Act — hatched in a deal between Senate Majority Leader Chuck Schumer and Energy and Natural Resources Chair Joe Manchin — set off a sprint for agencies to advance new programs, directives and rulemakings. That ranges from assisting the Internal Revenue Service in advancing clean energy tax credits to carrying out an overhaul of public land policies that advance wind, solar and new oil and gas. “Since it was dropped by Manchin and Schumer as a done deal, everybody’s trying to figure out how to implement,” said Kathleen Sgamma, president of the Western Energy Alliance in Denver. Along with requiring extensive coordination between agencies, the implementation will likely kick off lengthy rulemakings amid challenging regulatory bottlenecks for large energy projects. “Money isn’t everything,” said Kristin Eberhard, director of climate at the Niskanen Center. “There’s also barriers to clean energy in the form of regulatory burdens and sort of NIMBY objections to actually citing transmission lines, and solar plants and wind farms and geothermal.” The climate law also will provide billions in incentives to upgrade and expand the electric grid and develop power lines for offshore wind and other resources, adding pressure to the Federal Energy Regulatory Commission’s efforts to address bottlenecks in transmission development. Since last year, the commission has weighed and proposed changes to the process for building new transmission infrastructure, which observers say is needed to support more carbon-free power. In a letter to FERC last month, Democratic members of the House and Senate called on the agency to strengthen the policies it has issued thus far, describing its role as “complementary” to that of Congress with the passage of the climate law and other legislation. “Clear direction from FERC is now more important than ever,” the lawmakers said in their letter. The law also comes during an uncertain landscape for energy politics, considering the midterm elections and the prospect of Republicans gaining more seats in Congress. Eberhard said the administration faces pressure to quickly implement climate and energy provisions that are sweeteners in red states — to evade “obstructionist” attitudes from GOP members. “It’s just a race against the clock to get some of those things flowing,” she said. But experts say it won’t be easy for DOE, FERC and Interior to rapidly develop the rules and programs called for in the law, which included $369 billion for climate and energy. Here’s what to watch at the agencies in coming months.
How oil companies could thrive under the climate law - At first glance, the Inflation Reduction Act would seem like a financial problem for the U.S. oil and gas industry. The fine print suggests otherwise.The bill, signed into law by President Joe Biden last month, imposes a new minimum tax on high-earning companies and a tax on corporations that buy back shares of their own stock. It came just weeks after top U.S. oil producers reported record earnings and billions in share purchases.A funny thing happened on the way to the president’s desk, though. Lawmakers shaved off the tax provision’s rough edges and added a couple of breaks that will allow oil producers to benefit — potentially — from one of the industry’s worst-ever years.“It gives them a gimme for one year,” said Trey Cowan, an oil and gas analyst at the Institute for Energy Economics and Financial Analysis, which aims to accelerate an energy transition.The upshot is that some companies that lost money during the oil price crash of 2020 will be able to use those losses to ease their tax liability in 2022, when the industry has reported record profits. It’s unclear how many companies will benefit because many of them will pay their taxes under the conventional tax law, rather than the Inflation Reduction Act’s minimum-tax provision.The new minimum-tax system requires corporations to pay their federal taxes based on their financial statement income, sometimes called book income. Companies that earn more than $1 billion will either have to pay their standard tax bill or 15 percent of their book income, whichever is greater, according to the text of the law.But the law allows companies to take a couple well-known tax breaks when calculating their minimum-tax payments, including one that former President Donald Trump used in his real estate business. And it also calculates the $1 billion earnings threshold based on a three-year average, which could significantly cut oil companies’ liabilities for 2022.Companies will be able to use a maneuver called the net operating loss carryover when they calculate their bills under the minimum tax. The loophole allows a company that has a loss in one year to “carry” the loss into a future year and reduce its taxable income by the same amount.Those types of carryovers have been used for decades in the energy industry and other businesses. Trump declared a net operating loss from his casinos and other businesses of $916 million for 1995, which would have been enough to offset $50 million in income for the next 18 years, The New York Times reported.The Inflation Reduction Act will allow companies to carry forward their book income losses starting at the end of 2019 and offset up to 80 percent of their company’s minimum-tax bill in any given year, said Wes Poole, Americas oil and gas tax leader at the consulting firm EY.The law also allows a couple of other important tax breaks when calculating what a company owes under the minimum-tax provision. Companies can deduct the depreciation of their assets, and certain foreign taxes, both of which are important to the oil industry.It’s unclear how much the industry could carry forward in offsets, but it’s potentially a large amount. Collectively, a sample of 36 top oil and gas producers lost $91 billion in 2020, according to research Cowan provided. Companies that wind up paying the minimum tax can also use any losses from 2020 to smooth out their tax bills for the next two years under the law’s averaging clause.
Where the New Climate Law Means More Drilling, Not Less - The New York Times - A compromise built into the law ensures oil and gas leasing in the Gulf of Mexico for the next decade. Activists say the region has been “sacrificed” to fossil fuels. — Justin Solet planted his foot on the edge of his boat and pointed to a natural gas rig protruding from the waters ahead. A web of pipelines and rusted storage tanks jutted up from the marsh behind him as a shrimp boat floated past and markers for crab traps bobbed on the water’s surface. “We are water people,” said Mr. Solet, 37, a member of the United Houma Nation, a Native community with many shrimpers, oyster farmers and crab fishers who depend on the Gulf of Mexico’s bounty. “This is their livelihood. And it’s right next to these tanks that I don’t think have been fixed or serviced in years.” Oil and gas wells and drilling equipment are a persistent threat to the fishing industry in the Gulf. In addition to the 2010 Deepwater Horizon disaster, there have been dozens of less-noticed oil spills. Last month, on the first day of Louisiana’s inshore shrimp season, a tank platform collapsed, pouring 14,000 gallons into Terrebonne Bay and ruining the catch. Now, more drilling may be on the way. Under a new climate and tax law, the federal government will lease hundreds of millions more acres for offshore drilling in the Gulf in the next decade, even as it invests $370 billion to move the country away from fossil fuels and develop wind, solar and other renewable energy. More Gulf leasing was among the concessions that Democrats and President Biden made to Senator Joe Manchin III of West Virginia, a Democrat who champions fossil fuels and whose vote for the legislation was crucial in the evenly divided Senate. It came despite Mr. Biden’s promise as a candidate to end new drilling on public land and in federal waters “period, period, period.” And it came even though Deb Haaland, who will oversee the leasing as the interior secretary, said as a congresswoman in 2020 that “we need to act fast to counteract climate change and keep fossil fuels in the ground.” The leasing also follows a warning from the International Energy Agency that nations must stop approving new fossil fuel projects if the world has any hope of keeping the average global temperature from increasing 1.5 degrees Celsius above preindustrial levels. That’s the threshold beyond which scientists say the likelihood of catastrophic climate impacts increases considerably. The planet has already warmed 1.1 degrees Celsius. The new law condemns communities like Houma, which are already dealing with storms made more intense by climate change, to continued reliance on oil and gas drilling, even as other parts of the United States race toward renewable power, said Cynthia Sarthou, executive director of Healthy Gulf, an environmental organization based in New Orleans.
Administration awards Gulf of Mexico drilling leases to oil giants - The Washington Post - The leases from a 2021 sale were given to oil and gas companies as part of a deal with Sen. Manchin over climate legislation. The Biden administration on Wednesday reinstated $190 million worth of leases to companies bidding to explore for oil and gas in the Gulf of Mexico, despite widespread concerns about accelerating climate change. The Bureau of Ocean Energy Management granted the 307 oil and gas leases as part of a compromise that won support last month from Sen. Joe Manchin III (D-W.Va.) for the Inflation Reduction Act and its roughly $369 billion in climate-related spending and tax credits.The Lease Sale 257, which had been held in November 2021, had been invalidated by a federal judge in February.On Wednesday, the Biden administration sought to stress that the sale would “protect biologically sensitive resources, mitigate potential adverse effects on protected species and avoid potential ocean user conflicts.”Gulf of Mexico federal offshore oil production accounts for 15 percent of total U.S. crude oil production and federal offshore natural gas production in the Gulf accounts for 5 percent of total U.S. output, according to the Energy Information Administration. And the gulf was the scene of the massive Deepwater Horizon oil spill in 2010, a rig that was operating on behalf of BP.Chevron submitted the highest sum of winning bids at $47 million. Other major successful bidders included Anadarko, BP, Shell and Exxon Mobil.The Inflation Reduction Act specifies how the administration should deal with lease sales in the Gulf of Mexico. It instructs the administration to hold another lease sale for oil and gas alone. Subsequently, the bill says, there will be sales of oil and gas leases coordinated with lease sales of renewable energy from wind turbines.Democrats have been divided over oil and gas lease sales with President Biden, House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Charles E. Schumer (D-NY) all supporting them as part of the compromise with Manchin.
Congressional Sausagemaking, or How Inflation Reduction Became Fossil Fuel Export Promotion- Steve Fazzari and Servaas Storm’s breakdowns of the Biden administration’s Inflation Reduction Act are acute and persuasive. I think they point inescapably to a striking conclusion: That this flamboyantly contradictory production only looks like a piece of legislation. Really it is a new species of mythical beast – a twenty-first-century counterpart of the ancient Greeks’ fire-breathing Chimera, which notoriously joined the head of a lion with the torso of a goat and the tail of a serpent. The crossbreeding on display in the Act is at least as eye-catching: Key parts were inspired by the Green New Deal and similar proposals pushed by advocates of strong action to limit climate change. As Storm and Fazzari lucidly explain, many of these provisions mark real advances, even if some, such as the tax credits for Carbon Capture and Storage, are unlikely to help much. Even these features, though, betray unmistakable traces of more exotic fauna. The bill selectively reorients many progressive notions away from any hint of carbon pricing and avoids strong regulatory decrees. Instead, it emphasizes a dizzying array of investment incentives and tax credits as part of a (successful) strategy to enlist wider support not only from the usual suspects – alternative energy, Silicon Valley, and parts of finance – but also Ford Motor and other manufacturers, utilities, and electrical industry interests. Plus some previously skeptical unions. But the imprint of the Democratic Party’s progressive wing is plain enough. The same holds for other provisos of the bill, including the corporate minimum tax and the very cautiously hedged opening to allow Medicare at last to bargain with pharmaceutical manufacturers over the prices of a few drugs, though this move likely drew support from some other elements of the medical-industrial complex. The tiny (1%) tax on stock buybacks, adopted at the last minute as a stopgap to plug revenue losses after Democrats close to private equity balked at raising taxes on the masters of the universe, is another instance where the influence of the Party’s progressive wing sticks out, though the rate is unlikely to deter any buybacks at all and signals which interests really won. But what elevates the new beast to legendary status are the startling features Senators Manchin and Sinema insisted upon as the price for their votes. As the bill hurtled toward final passage, Sinema held out for deletion of a revenue raising provision Manchin and Senate Majority Leader Schumer had agreed upon that would have slightly tightened up the famous “carried interest” tax loophole. By allowing private equity firms to treat income earned as capital gains instead of ordinary income this trick has long shielded the industry from billions of dollars in tax payments and has become something of a legend as an example of how big money corrupts politics. Sinema’s brazen hold-up – she was awash in campaign contributions from the sector – can easily be over-interpreted and it was, as major media narratives rushed to portray Schumer as a populist hero challenging Wall Street.[1] With Sinema and many other Democrats, including President Biden himself in the 2020 campaign, all benefitting from private equity largesse, the proposal was quickly and unceremoniously dropped.[2]Which brings us to the real question about Inflation Reduction Act. The legislation had been lying fallow for the better part of a year. Manchin’s stonewalling had opened up a black hole that threatened to suck down the entire Biden agenda into it. The late July announcement that Manchin and Schumer had suddenly agreed to add a host of generous concessions to oil, gas, and mining interests to the bill and pass a separate measure shortening the time allowed for reviews of proposals for new pipelines and utility connections took everyone’s breath away. Not just the question of why the West Virginia Senator had suddenly relented, but why Schumer and the White House had agreed. Speculation about what changed has run rife ever since.There is a plain answer: the war in Ukraine’s shattering impact on world energy markets. Few analysts expected a large-scale Russian invasion of Ukraine and almost nobody believed that Ukraine had much prospect of turning one back in the event it happened. When the guns kept booming in eastern Europe, the shock was profound. The threat to Europe’s cheap energy supply was obvious.
U.S. evaluating need for further SPR oil releases after October -Granholm - U.S. President Joe Biden’s administration is weighing the need for further releases of crude oil from the nation’s emergency stockpiles after the current program ends in October, Energy Secretary Jennifer Granholm told Reuters. A Department Of Energy official later said the White House was not considering new releases from the U.S. Strategic Petroleum Reserve (SPR) at this time beyond the 180 million barrels that the president announced months ago. The Biden administration this year has delivered about 1 million barrels of oil per day from SPR stockpiles to lower fuel prices and pare energy inflation ahead of midterm elections in November. The releases so far this year have helped knock average U.S. retail gasoline prices down to $3.75 a gallon this week from $5 a gallon in June. But they also have cut U.S. emergency stocks to below 450 million barrels, lowest since 1984. OPEC and its allies led by Russia on Monday agreed to a small oil production cut beginning next month to bolster prices that have slid on fears of an economic slowdown. It is “a little early to say to say that there is going to be more SPR releases,” said Abhiram Rajendran, head of global oil at Energy Intelligence. “But if OPEC starts getting aggressive on cutting supply, that’s a possibility.” The nation’s overall crude stocks have been declining since mid-2020 due to sales from congressional mandates and Biden’s price initiative. Without the SPR releases, U.S. commercial crude oil inventories “would be much lower than they are and they are already below average,” said Phil Flynn, an analyst at Price Futures Group. Granholm also said during a visit to Houston on Thursday that the administration and allies are still discussing a cap on prices for Russian oil purchases. A price cap would restrict revenues available to Russia amid its invasion of Ukraine. The administration has not ruled out a U.S. fuel export ban, but said it is “certainly not something on top of the list,” she said. Granholm recently wrote to U.S. refiners urging them to replenish low fuel inventories ahead of winter and to curb rising exports of gasoline and diesel. The letter warned the administration may take unspecified emergency measures if fuel stocks fell further.
Janet Yellen warns US gas prices could spike this winter as oil soars once Europe stops buying Russian crude - There's a risk US gas prices at the pump will soar again this winter as a partial European ban on Russian crude imports takes hold, Treasury Secretary Janet Yellen has warned.The average price of gas in the US has fallen steadily since hitting a record in June, providing some much-needed relief as inflation remains near 40-year highs. But American drivers could well feel an impact if crude prices rise in the wake of European sanctions kicking in, according to Yellen."It's a risk," she told CNN's "State of the Union" Sunday, having been asked whether gas prices could rise again in 2022."This winter, the European Union will cease, for the most part, buying Russian oil," she said. "And, in addition, they will ban the provision of services that enable Russia to ship oil by tanker. And it is possible that that could cause a spike in oil prices."The EU is set to end all seaborne imports of Russian crude on December 5, fulfilling a pledge its members made when agreeing asixth sanctions package against Moscow in June.Yellen expects that embargo to push up oil prices as global supply tightens, which could in turn push up prices for US gas.This summer, American drivers benefited from a slide in oil prices that has led to falling pump prices, according to the AAA. The national average price of gas has dropped for 11 weeks in a row, from a high of just above $5 a gallon in June to $3.72 on Monday, its data showed.Concerns about the hit to demand from a recession and continuing COVID-19 curbs in China have weighed on the price of oil in recent months.
Biden Officials Weigh Buying Oil at Around $80 -The US may begin refilling its emergency oil reserve when crude prices dip below $80 a barrel, according to people familiar with the matter. Biden administration officials are weighing the timing of such a move, with an eye toward protecting US oil-production growth and preventing crude prices from plummeting, said the people, who asked not to be named sharing internal deliberations. The discussions come as West Texas Intermediate, the U.S. benchmark, plunged to almost $81 a barrel last week, its lowest level since January. While President Joe Biden in March ordered the release of an historic 180 million barrels from the Strategic Petroleum Reserve -- an effort to tame skyrocketing oil and gas prices -- officials are now aiming to slow those releases to keep the market in check heading into the winter. At the same time, officials are trying to reassure oil producers that the administration won’t let prices collapse amid intense volatility that’s fueled massive daily swings. Buying crude to refill the reserve, which is now at the lowest level since 1984 after a record drawdown last week, would be supportive for the market. WTI pared losses to trade near $87 a barrel on the news on Tuesday. White House and Energy Department communication staff didn’t immediately respond to requests for comment.
Democrats shame Big Oil in hourslong hearing - Between April and June, Exxon reported almost $18 billion in earnings. Chevron and Shell reported more than $11 billion. And BP reported $8.5 billion. Printed on a large poster and placed behind the seat of House Oversight and Reform Chair Carolyn Maloney (D-N.Y.), those numbers loomed in the background for almost the entirety of the panel’s four-hour Thursday hearing on the oil and gas industry. Maloney’s message: While gas prices soared, so did oil and gas company profits. “The truth is that Americans are suffering from high energy costs in large part because of Big Oil, which is making record profits while charging high prices at the pump,” Maloney said in her opening remarks. “Fossil fuel companies could lower prices dramatically and still have billions left to invest in a transition to cleaner, and ultimately cheaper, fuels.” Democrats aimed to name and shame the oil and gas industry for the impacts of climate change, building on last year’s blockbuster hearing with top executives from Exxon Mobil Corp., Chevron Corp., Shell PLC and BP PLC (Greenwire, Oct. 28, 2021).But with no oil company board members willing to show up for this week’s follow-up, the committee turned to data, subpoenaed documents and expert testimony.Late Wednesday, committee Democrats released an initial batch of internal oil company documents that showed executives mocking climate activists and American consumers (Greenwire, Sept. 15). On Thursday, they gave a platform to climate disaster survivors, academics and advocates. Here were some notable moments from the marathon hearing:
Oil Executives Privately Contradicted Public Statements on Climate, Files Show - The New York Times - Documents obtained by congressional investigators show that oil industry executives privately downplayed their companies’ own public messages about efforts to reduce greenhouse gas emissions and weakened industry-wide commitments to push for climate policies.Internal Exxon documents show that the oil giant pressed an industry group, the Oil and Gas Climate Initiative, to remove language from a 2019 policy statement that “could create a potential commitment to advocate on the Paris Agreement goals.” The statement’s final version didn’t mention Paris.At Royal Dutch Shell, an October 2020 email sent by an employee, discussing talking points for Shell’s president for the United States, said that the company’s announcement of a pathway to “net zero” emissions — the point at which the world would no longer be pumping planet-warming gases into the atmosphere — “has nothing to do with our business plans.”These and other documents, reviewed by The New York Times, come from a cache of hundreds of thousands of pages of corporate emails, memos and other files obtained under subpoena as part of an examination by the House Committee on Oversight and Reform into the fossil fuel industry’s efforts over the decades to mislead the public about its role in climate change, dismissing evidence that the burning of fossil fuels was driving an increase in global temperatures even as their own scientists warned of a clear link.On Thursday, the House committee is expected to discuss some of its early findings. “It’s well established that these companies actively misled the American public for decades about the risks of climate change,” said Representative Ro Khanna, a Democrat from California who spearheaded the investigation with Carolyn B. Maloney, the New York Democrat who leads the House committee. “The problem is that they continue to mislead,” Mr. Khanna said.At a hearing last year, oil industry executives stressed their support for a transition to clean energy and denied that they have misled the public. They acknowledged that the burning of their products was driving climate change, although none pledged to end their financial support for efforts to block action on climate change, and they said that fossil fuels were here to stay.The committee’s subpoena has sought documents related to companies’ role in contributing to climate change, their marketing and lobbying efforts on climate, and the funding of third parties accused of spreading climate disinformation. Several of the companies and organizations subpoenaed — which include Shell, Exxon Mobil, Chevron, BP, the American Petroleum Institute and the U.S. Chamber of Commerce — have yet to produce some of the key documents that have been requested, according to committee staff members.
New Documents Unveiled in Congressional Hearings Show Oil Companies Are Slow-Rolling and Overselling Climate Initiatives, Democrats Say - Congressional Democrats presented fresh evidence Thursday which they say proves that oil companies are continuing to mislead the public on climate change and undercut global efforts to reduce greenhouse gas emissions.At a hearing held by the House Committee on Oversight and Reform, lawmakers read from newly released documents obtained from ExxonMobil, Chevron, Shell and BP as part of an ongoing investigation into the fossil fuel industry and its role driving climate change.Among the documents was an internal memo sent to ExxonMobil’s chief executive, Darren Woods, that apparently sought to weaken the climate commitments of an international oil industry group, as well as internal emails from Exxon and other companies showing employees appearing to question the speed or seriousness of their efforts to pivot their businesses to focus on cleaner products.Democrats say the documents also show that the companies’ climate pledges depend on “unproven technologies whose future success and commercialization are not assured.” The hearing came as the oil companies are sitting on some of their biggest profits ever—Exxon reported $17.9 billion in profit over just three months this year—with the war in Ukraine having sent oil and gas prices skyrocketing. Democrats accused the companies of maximizing financial returns while Americans suffer from rising costs and the increasingly damaging impacts of extreme weather, rather than using their revenue to follow through on their pledges to reduce emissions.“These companies used these windfall profits to enrich investors and boost salaries of top executives,” said Rep. Carolyn Maloney, D-New York, the committee chairwoman. “Their clean energy investments, however, were a drop in the bucket.”Republicans on the committee largely defended the oil companies and criticized the Democrats’ energy policies, saying Democrats should be trying to increase oil and gas production in the face of high prices, rather than targeting the energy industry.“This investigation is part of the Democrats’ war on America’s energy producers,” said Rep. James Comer, R-Kentucky and the committee’s ranking member.Democrats had invited directors from the major oil companies to testify, but they declined to appear. The hearing, which was originally scheduled for March but was rescheduled after Russia invaded Ukraine, was the third held by the committee as part of its investigation into efforts by oil companies to sow doubt about climate science and derail or delay efforts to address warming.At the first hearing last year, top executives from each of the four companies testified by video conference and rejected accusations that they had misled anyone about climate change. Instead, they said, their companies recognize climate change as a threat and are helping to address the problem by investing in low-carbon fuels, carbon capture technology, renewable energy and by lowering their own direct emissions. Maloney said the companies have obstructed the committee’s investigation since then, refusing to turn over some documents while releasing massive volumes of press releases and other public documents. But, she argued, the documents that they have turned over, some of which the committee released on Wednesday night, already show contradictions with the company’s public statements.
Biden 'committed' to permitting deal with Manchin - The White House said Monday that President Joe Biden is “committed” to permitting reform legislation promised to West Virginia Democratic Sen. Joe Manchin.Democratic leaders promised Manchin permitting reform in exchange for his support of the Inflation Reduction Act. Today, White House press secretary Karine Jean-Pierre said the president remained behind the accord.“Without compromise, there would be no deal,” Jean-Pierre told reporters Monday morning aboard Air Force One, according to a White House transcript. “The president is committed to the deal.”Biden is standing by his pledge to Manchin even as dozens of progressive lawmakers and environmental activists ramp up pressure on the president to jump ship from the agreement (E&E Daily, Sept. 12).Senate Democrats have voiced optimism about passing the measure by attaching it to funding legislation that must be enacted by the end of September to keep the government open (E&E Daily, Sept. 7).Jean-Pierre was tight-lipped about whether the president was as enthusiastic about that plan, simply stating, “We support that deal and that vote, and we will work with Congress to determine the best pathway.”Final text of Manchin’s permitting plan has not been released. However, an outline of the arrangement stated the proposal would include one- to two-year mandatory schedules for finishing environmental reviews and set some limits on legal challenges.Advocates are particularly worried permitting reform could result in faster permits for fossil fuel projects. Sen. Bernie Sanders (I-Vt.) recently came out in opposition and cited his fears the legislation would ultimately hamper climate progress (E&E Daily, Sept. 9).“At a time when climate change is threatening the very existence of our planet, why would anybody be talking about substantially increasing carbon emissions and expanding fossil fuel production in the United States?” Sanders asked on the Senate floor last week.Activists on Monday also voiced frustrations about how the mining sector could benefit from the package (Greenwire, Aug. 29).
‘Sleazy backroom deal’: Progressives tangle one more time with Manchin – POLITICO -After nearly two years of watching Joe Manchin tank some of their biggest priorities, House progressives finally have sway over one of his. And they have every intention of using it. Dozens of House Democrats are now threatening Manchin’s proposal to streamline energy project permits — even if it breaks a commitment that paved the way for the party’s massive climate, tax and health care victory earlier this summer. Now that President Joe Biden has signed that legislation into law, House liberals insist they have the numbers to at least force a negotiation on a Manchin side deal they see as too fossil fuel-friendly. Led by Natural Resources Committee Chair Raúl Grijalva, many of those progressives are ready to take a stand: Dozens are leaning on Speaker Nancy Pelosi to separate this month’s must-pass stopgap funding bill from the Manchin-crafted permitting measure that she and Senate Majority Leader Chuck Schumer had already agreed upon. “This is a tale of two houses,” said Rep. Jared Huffman (D-Calif.), slamming Schumer and Manchin’s agreement to take up permitting reform in exchange for his vote on the party-line bill as a “sleazy backroom deal.” It’s all shaping up as Democrats’ last big internal fight before the midterms, a rare remaining sore point for a party that’s largely and finally united on everything from abortion to the economy to same-sex marriage. And after nearly an entire Congress defined by the 50-50 Senate, the House is taking a starring role: Sen. Bernie Sanders (I-Vt.) is pledging to vote against the permitting bill if it’s linked with government funding, but lower-chamber progressives are offering the main intraparty resistance to Manchin’s plan. The Senate is planning to pass a short-term funding bill with permitting reform attached just before the Sept. 30 deadline, daring Grijalva and his allies to risk a shutdown fight over the issue, according to multiple Democrats familiar with the plan. In an interview on Monday, Manchin seemed unworried about the fate of his proposal: “I would think that common sense would have to kick in sooner or later.” The text of Manchin’s permitting bill is not yet public, but senior Democrats in both chambers are downplaying the chances of disaster. Several lawmakers and aides said they believe there is a path to an amended deal that can win over Grijalva and other House Democrats while keeping Manchin on board. One key motivator: Many clean energy advocates say a permitting deal as envisioned by Manchin’s initial framework would benefit renewable projects, including wind and solar generation, even if it would also accelerate some fossil-fuel pipelines, such as the long-stalled Mountain Valley natural gas line that originates in the senator’s home state. Permitting reform, as Manchin put it, means “we’re able to have the energy security that our country needs now.” Referring to new transmission lines for renewable energy, he added: “And as we move towards the transition [to clean energy], you’re able to do that with the infrastructure it’s going to take. ... I would like to think people are being practical and not being political.”
More than 70 House Democrats join push against Manchin’s permitting reform - More than 70 House Democrats are signing on to a letter pressing Democratic leaders to not include a side deal with Sen. Joe Manchin (D-W.Va.) on reforming the permit process for energy projects in a bill funding the government. The permitting reform language was offered to Manchin to win his vote on the massive climate, tax and health care bill known as the Inflation Reduction Act that was signed into law by President Biden last month. Manchin provided the critical support to get that bill through the evenly divided Senate after winning concessions from Democratic leaders. But in the new letter, the Democratic lawmakers are asking Speaker Nancy Pelosi (D-Calif.) and House Majority Leader Steny Hoyer (D-Md.) not to include the permitting reforms championed by Manchin into a stopgap funding measure that Congress is expected to take up this month. Without a stopgap funding measure, the government will shut down on Oct. 1. “The inclusion of these provisions in a continuing resolution, or any other must-pass legislation, would silence the voices of frontline and environmental justice communities by insulating them from scrutiny,” they lawmakers wrote. “We urge you to ensure that these provisions are kept out of a continuing resolution or any other must-pass legislation this year,” they added in the letter that was spearheaded by Rep. Raúl Grijalva (D-Ariz.). The opposition from Democrats is a significant problem. If the group follows through on the letter, Democrats might not have the votes to pass a government funding bill if it includes the language backed by Manchin. And the fact that so many members signed on to the push may give them some additional leverage. Democrats have historically opposed any changes perceived as undercutting environmental reviews in the permitting process, arguing that this could hamper the consideration of climate and pollution concerns. When they announced the agreement on the major climate, tax and health care bill, Senate Majority Leader Charles Schumer (D-N.Y.) and Manchin said that they, along with Pelosi and President Biden, had reached a deal to pass permitting reform by October to secure Manchin’s vote. Schumer has already said publicly that he would include the provisions in a stopgap funding measure, known as a continuing resolution.
What’s in Joe Manchin’s proposed permitting reform and could it cause a government shutdown? – Vox --Whether the government is forced to shut down at the end of the month may hinge onDemocrats’ approach to permitting reform, an issue that has divided the party in recent weeks.Permitting is the process for getting federal approval for energy projects, including oil and gas pipelines, which often undergo extensive review for their environmental impact. It can be a long and expensive process, and while Republicans and Democrats agree that the experience could be improved, they differ on what those reforms should entail.Sen. Joe Manchin (D-WV), a chair of the Senate Energy and Natural Resources committeewho has deep ties to the coal industry, has long taken issue with the current permitting process, arguing that it’s too convoluted. This summer, he struck a deal with Senate Majority Leader Chuck Schumer: In exchange for Manchin’s backing on the Inflation Reduction Act, Schumer guaranteed a vote on permitting reforms that would streamline approval of fossil fuel and renewable energy projects.Last week, Schumer announced that he plans to attach these permitting reforms to the short-term spending bill that’s expected to fund the government through mid-December, also known as a continuing resolution (CR). The decision has prompted pushback from more than 70 House members, including many progressives, and Sen. Bernie Sanders (I-VT).In a letter sent to both Schumer and House Speaker Nancy Pelosi last week, House lawmakers argue Manchin’s reforms would make it easier to greenlight harmful oil and gas projects, and reduce constituents’ abilities to oppose such endeavors. Additionally, they claim that attaching the policies to a must-pass bill would force lawmakers to choose between “protecting … communities from further pollution or funding the government.”Sanders, in a fiery floor speech last week, echoed many of these concerns, and later said that he would not vote for a CR that includes permitting reforms. For now, it’s uncertain if Democratic opposition to the permitting reforms would be sufficient to sink a CR altogether. Although 76 House members have expressed their opposition, they have not indicated whether they would block the bill if it was put on the floor. Depending on how many lawmakers are willing to vote down the bill in the lower chamber, there could be enough Republican support to make up for those losses. Similarly in the Senate, Republican support could neutralize Sanders’s vote in opposition. It’s also possible that progressive pressure affects the final legislative text of the permitting reform, which has yet to be released.
GOP expresses hostility to Manchin permitting reform campaign - Some Republicans are expressing hostility to Sen. Joe Manchin’s (D-W.Va.) campaign to use a government funding bill to advance permitting reform, adding to doubts about the effort’s future. Republicans have long lamented the length of time it takes to advance fossil fuel and other energy projects. And Manchin’s efforts could be the best shot they’ve had in years to speed up the environmental review process for energy projects. But Republicans are also upset over the party-line passage of the sweeping climate, tax and health care bill passed under budget reconciliation rules that sidestepped the filibuster — an effort made possible by Manchin. And they have no interest in making things easier ahead of the midterms for fractious Democrats already struggling to unify behind the plan. Many liberals strongly oppose the Manchin permitting reform deal, and nearly 80 House Democrats have come out against the plan. “If you’re now looking for Republicans to support and give you more cover than you have right now, you’re not going to find it with us,” Sen. John Barrasso (Wyo.), No. 3 Senate Republican, told reporters this week. Manchin struck a deal to pass permitting reform with Senate Majority Leader Charles Schumer (D-N.Y.) along with President Biden and Speaker Nancy Pelosi (D-Calif.) last month, according to the senators. Schumer said the agreement was part of an overall deal to advance the climate, tax and health care bill formally titled the Inflation Reduction Act. As part of the deal, Manchin and top Democrats agreed to advance permitting reform by Oct. 1, the start of fiscal 2023. They did not specifically name a vehicle, but a stopgap government funding bill is the only must-pass legislation on the docket before that date. The permitting reforms, which are expected to include truncated environmental reviews in the process of planning energy projects, have turned off a large group of House Democrats and drawn swift backlash from hundreds of advocacy groups. To pass the stopgap funding bill, known as a continuing resolution (CR), senators would need at least 60 votes to bypass a filibuster. Manchin has expressed hope that his proposal will attract sufficient GOP support to secure its passage, telling The Hill this week that the Senate is “going to have CR with permitting.” But that increasingly looks like wishful thinking on the part of the West Virginia senator, as a number of Republicans say they want to go further “So far what Joe’s put out is a one-page template — I haven’t seen anything else — and like I said, it’s not very ambitious in my view. It’s not enough for me to get to ‘yes,’ because frankly I don’t know why I would want to facilitate mediocrity,” said Sen. Kevin Cramer (R-N.D.).
Senate Republicans introduce separate permitting-reform bill - Sen. Shelley Moore Capito (R-W.Va.) has introduced separate legislation to overhaul the permitting process for energy projects, as Democrats debate a similar proposal agreed on by Senate Majority Leader Charles Schumer (D-N.Y.) and Sen. Joe Manchin (D-W.Va.). Capito, the ranking member on the Senate Environment and Public Works Committee, presented the bill as necessary to give industry “regulatory certainty.” She also said the proposal would expedite the completion of the Mountain Valley Pipeline, a project set to run through West Virginia. Manchin has made the completion of the pipeline a major priority, and the summary of the side deal reached with Schumer includes removing several obstacles to the goal. The West Virginia Republican also framed her separate introduction of a bill as in response to the lack of public text from Manchin, who has thus far released a summary of the proposal. “Since our calls for action and offers to see legislative text from the permitting ‘deal’ remain unheeded, Republicans are introducing this legislation today to deliver solutions to the roadblocks, delays, and postponements of key infrastructure projects across the country,” Capito said in a statement. Thirty-eight Senate Republicans co-sponsored the measure, including Minority Leader Mitch McConnell (Ky.), Minority Whip John Thune (S.D.) and Energy Committee ranking member Sen. John Barrasso (Wyo.). After over a year of negotiations, Manchin struck a deal with Schumer to support a sweeping Democratic climate and infrastructure bill in exchange for agreeing to introduce the separate permitting reform bill. The side bill has sparked fierce backlash from climate hawks in the Democratic caucus, and it remains unclear if Republican support for the measure exists to offset any Democrats who decline to support it. Last week, House Natural Resources Committee Chairman Raúl Grijalva (D-Ariz.) led more than 70 House Democrats in a letter asking House leadership not to include Manchin’s measure in stopgap funding that will prevent a government shutdown. “The inclusion of these provisions in a continuing resolution, or any other must-pass legislation, would silence the voices of frontline and environmental justice communities by insulating them from scrutiny,” they wrote. “As Senator Manchin’s said, there has always been bipartisan support for comprehensive permitting reform and this introduction reaffirms that,” a Manchin spokesperson told The Hill. “He looks forward to getting it passed by the end of the month.”
House Dem leaders scramble permitting reform effort - House Democratic leaders threw the permitting reform effort into doubt on Wednesday, saying the overhaul did not necessarily need to be attached to a stopgap government funding bill. That declaration flies in the face of repeated pledges from Senate Democrats, who have said that a deal between Sen. Joe Manchin (D-W.Va.) and Majority Leader Chuck Schumer (D-N.Y.) would tie together permitting and the stopgap funding bill, otherwise known as a continuing resolution. House Speaker Nancy Pelosi (D-Calif.) told reporters, “We have agreed to bring up a vote, yes. We never agreed on how it would be brought up, whether it be on the CR, or independently or part of something else. So, we’ll just wait and see what the Senate does.” She added, “And I’m not worried about it.” Manchin, the chair of Energy and Natural Resources Committee, has argued the deal requires moving the proposal with the continuing resolution, the latter of which Congress must pass before Oct. 1 to avert a partial government shutdown. The split between the House and Senate is another blow to the permitting overhaul effort, which would ease environmental reviews of major energy projects. In recent weeks, dozens of House Democrats have pressured leaders, saying they would resist voting for a funding bill that includes permitting language. House Republicans could scramble the effort as well — a top GOP lawmaker said that her party might be willing to vote for the bill if it went far enough on reforms. The must-pass CR likely would be the best chance for passage before the midterm elections and what’s likely to be an unpredictable lame duck session. House Majority Leader Steny Hoyer (D-Md.) said House Democrats have agreed to “nothing” regarding the permitting bill, including how it moves. He suggested he favored the House approving a CR this week, a move that would preclude the permitting legislation that is still being negotiated in the Senate. For their part, the chief Senate negotiators on the legislation said the public release of the bill language could come as soon as the end of the week. The Senate plans to act first on the CR, likely next week. “They are going through the edits now, so we are hoping to get it cleared up,” Manchin told reporters.
Sanders blasts permitting reform as Democrats' divide grows - Sen. Bernie Sanders said Thursday he would oppose a stopgap government spending measure that includes forthcoming permitting legislation, underscoring progressive resistance to the bill amid protests by environmental groups. Sanders, a Vermont independent who caucuses with Democrats, called the permitting proposal a “disastrous side deal” that would make it easier for fossil fuel companies to “pollute the environment and destroy our planet.. “At a time when climate change is threatening the very existence of our planet, why would anybody be talking about substantially increasing carbon emissions and expanding fossil fuel production in the United States?” Sanders asked on the Senate floor.Senate Majority Leader Chuck Schumer (D-N.Y.) struck a deal with Senate Energy and Natural Resources Chair Joe Manchin (D-W.Va.) in July to pass the permitting overhaul in exchange for Manchin’s vote on the Inflation Reduction Act, Democrats’ sprawling climate, health care and tax law. Their plan is to attach it to the continuing resolution, the must-pass stopgap spending measure to keep the government open when the fiscal year ends Sept. 30.It will need 60 votes to pass the Senate, but most Democrats are rallying to support Manchin’s deal, and Republicans are beginning to soften their tone. Sanders’ opposition may not directly impact the bill’s fate in the upper chamber, but it’s part of a larger intraparty battle that could derail it.Manchin said Thursday he had been expecting Sanders to oppose it and reiterated that he expects permitting reform to ride on the CR.“We’re talking about small nuclear reactors, we’re talking about solar farms and wind farms, but we have to have the fossil horsepower that we need right now to run the country,” Manchin said.Other Senate climate hawks see potential benefits for clean energy projects they’re hoping to get off the ground with billions of dollars from the Inflation Reduction Act and a path to clearing backlogs for the transmission projects needed to escort renewable power around the country (E&E Daily, Sept. 8).Despite Sanders’ vocal opposition, fellow progressive Sen. Elizabeth Warren (D-Mass.) was noncommittal on the bill Thursday.“There’s no language out there right now,” Warren said. “I need to see what has been agreed to.”There’s a brewing battle, however, in the House, where progressives are publicly pressuring leadership to drop permitting from the CR or any other must-pass bill. House Natural Resources Chair Raúl Grijalva (D-Ariz.) is circulating a letter making that demand, and it now has signatures from more than 50 House Democrats, enough to derail the bill if Republicans do not end up supporting permitting reform (E&E Daily, Sept. 6). Sanders entered the letter into the congressional record during his floor speech.
W.Va. vs. Va.: Permitting overhaul a backyard brawl - - Sen. Joe Manchin (D-W.Va.) wants a contested natural gas pipeline in his state to be part of his permitting reform effort. But Virginia lawmakers who might typically support a permitting overhaul are balking at the deal, in part because of the pipeline that would run between the two states.At issue is the path of the 303-mile Mountain Valley pipeline. Virginia’s two Democratic senators have been circumspect on permitting reform, with one saying Thursday that congressional action could unfairly wade into the complicated political battle over the pipeline in his state.“For years, I have taken the position to both pipeline opponents and proponents that Congress should not be making pipeline decisions,” Sen. Tim Kaine (D-Va.) told reporters. “We should be setting up a permitting process that works and then have any project go through them.” Kaine added that when a deal is eventually released, “I would not like something that would have Congress doing this.”The West Virginia-Virginia split is a crucial part of the permitting debate roiling Capitol Hill. Democratic leaders in the Senate are looking to shore up support for permitting reform as they seek to pass the measure along with a stopgap government funding bill. But Democrats across the political spectrum are balking at the agreement.According to legislative frameworks and statements from Manchin, the yet-to-be-released permitting measure, which would streamline environmental reviews of energy projects, would also direct federal agencies to prioritize finalizing permit approvals for the Mountain Valley pipeline. The agreement would make changes to the arena where legal challenges to the pipeline would be filed.As proposed, the project would move West Virginia natural gas to a compressor endpoint in Pittsylvania County, Va., after crossing six other county lines.The developer behind the project claims the project is nearly 95 percent complete. Opponents, however, claim that the figure fails to recognize the complexity of the remaining work and the intense land restoration efforts pending.Despite earning approval in 2017 from the Federal Energy Regulatory Commission, the pipeline has been mired in setbacks and slowdowns as legal challenges to permits and environmental reviews have stymied progress.Many of those legal decisions have come from the 4th U.S. Circuit Court of Appeals, located in Richmond, Va. Manchin’s proposal would move those permit legal challenges to the U.S. Court of Appeals for the District of Columbia Circuit, although future decisions remain far from certain for that court (Energywire, Sept. 15).A shift away from the venue is among the issues Virginia lawmakers are worried about.“I don’t know exactly what the final outcome of that is going to be, but I would have deep concern about stripping jurisdiction away from the 4th Circuit on this or any other manner,” Kaine added.Kaine said he was scheduled to receive a briefing Thursday afternoon to get a better feel for what is contained in the actual language of the proposed permitting reform bill. He also said he’s discussed his concerns with Schumer and wants to talk with Manchin in the future.As Kaine has balked at the pipeline, Virginia’s Republican Gov. Glenn Youngkin has backed it. According to a July 29 letter he sent to FERC, the governor argued the increased availability of natural gas would go a long way toward helping the state shore up its electric generation supply and act as a bridge fuel.“I do not believe it is in the best interest of Virginians to condemn this project in the spirit of reducing carbon emissions when this project is in fact central to continue meeting emission reduction goals in the commonwealth,” Youngkin wrote.
Markey opposes Manchin push to include permitting reform in stopgap funding bill -Sen. Ed Markey (D-Mass.) is joining a group of liberal House members in opposing Sen. Joe Manchin’s (D-W.Va.) push to pass changes to the environmental review process in a stopgap funding bill. Markey became the second Democratic-caucusing senator to call for the issues to be separated. Sen. Bernie Sanders (I-Vt.) has previously expressed opposition to the West Virginia senator’s reforms. Democratic leadership promised Manchin they would pass changes to the country’s permitting system to expedite the approval of both fossil and renewable energy projects in exchange for his vote on their climate, tax and health care bill. Senate Majority Leader Charles Schumer (D-N.Y.) has said he would include such changes in a temporary funding measure that would prevent a government shutdown. But Markey said in a written statement on Friday that the two should not be tied, citing concerns about possible impacts on communities that are already overburdened by pollution. “As a way forward is discussed, and especially as new anti-environment proposals are being brought to the permitting discussions, we should not attach the permitting overhaul package to the must-pass government funding legislation,” Markey said in a statement on Friday. However, Markey also acknowledged the importance of the deal with Manchin and said he would speak with colleagues about “whether this package can reflect the values of environmental justice.” Any funding measure, with or without permitting reforms, would require 60 votes to pass the Senate. If both Markey and Sanders are not on board, at least 12 Republicans will have to vote with the rest of the Democrats to get it across the finish line. Republicans have long-sought changes similar to those that Manchin is pushing, but some have said that his changes may not go far enough, and that they don’t want to reward him for going along with Democrats’ climate and tax bill. On the House side, a lot of the opposition has come from Democrats, with nearly 80 of them opposing the idea of tying the funding measure to the permitting changes. Neither Manchin’s office nor Democratic leaders have released text on the permitting legislation. But, a summary from Manchin’s office says that it would limit how long environmental reviews can take, something liberal opponents warn could restrict community involvement and expedite fossil fuel projects.
Senate Democrats set action on Kigali climate treaty - Senate Majority Leader Chuck Schumer on Thursday moved to take up the so-called Kigali Amendment next week, putting the chamber on track to ratify its first climate treaty in decades. The Obama administration supported the Kigali Amendment to the Montreal Protocol to phase down hydrofluorocarbons, or HFCs, which are potent greenhouse gases. Stemming from air conditioning and refrigeration appliances, HFCs have a warming effect more potent than carbon dioxide. “HFCs need to be dealt with as soon as possible because they are thousands — thousands — of times more damaging to our atmosphere than carbon dioxide,” Schumer said. “This is a very important opportunity for the Senate to make official America’s intention to phase these dangerous chemicals out of use.” To make the Kigali agreement U.S. law, backers must get 67 senators to agree. And even though Republicans stalled on Kigali through the Trump administration, the refrigerant and cooling industry has worked to build a coalition of support. The Kigali Amendment called on nations to phase down the production and use of HFCs by 85 percent over 15 years. That could prevent a half-degree Celsius of warming by the end of the century. Congress already enacted a regulatory regime authorizing EPA to set rules limiting HFCs in appliances as part of the year-end spending bill in 2020. Sen. John Kennedy (R-La.) was among its sponsors. Still, Republican holds on the treaty have prevented ratification. Environment and Public Works Chair Tom Carper (D-Del.) told E&E News yesterday that four Republicans issued a “hold” on the treaty vote, which prevents accelerated consideration. The chamber will likely vote Tuesday to wind down debate and Thursday on final passage. “The business community is all over this,” Carper said. “The idea that we would give tens of thousands of jobs, millions of dollars of economic value and allow the Chinese to come in, why would we do that? And that’s the message the business community is taking to the four remaining Republicans.” Carper declined to name the Republican holdouts. Wyoming Sen. John Barrasso, top Republican on the Energy and Natural Resources Committee, told E&E he does have concerns on this treaty vote, but he declined to elaborate.
US envoy urges China to resume talks to avert climate crisis - U.S. climate envoy John Kerry on Tuesday urged China to resume bilateral talks to avert a global warming crisis, calling on world leaders to accelerate their energy transition to abandon fossil fuels. The United States and China, the world’s largest economies, must work together to tackle climate change, Kerry said. Both countries are also the largest emitters of greenhouse gases in the world. “My hope is that President Xi will come back to the table with us so that we can work together to deal with this international threat,” he said. Last month, China suspended talks with the United States on climate, security and other areas in response to a contentious visit to Taiwan by US House Speaker Nancy Pelosi. She has said the United States must dispel the “negative influence” of that visit before resuming talks. Speaking to a group of American companies in Hanoi, Kerry also called on the private sector to boost its investment in the energy transition process. He highlighted the urgency with which countries must abandon dirty fuels, such as coal and oil , in favor of renewable sources, in order to limit global warming to 1.5 degrees Celsius above pre-industrial levels. “No government in the world has enough money to finance the transition,” he said. “The only way to finance this is to bring the private sector to the table.” The former US Secretary of State spoke just a few days after the environmental officials of the main economies of the Group of 20 (G20) failed to agree on a joint statement after a meeting in Bali.
Republican wants to raise office temperatures at DOE, EPA - A top Senate Republican wants to keep the heat up — literally — on staffers working in the Department of Energy and EPA.A new bill introduced Tuesday by Sen. Joni Ernst (R-Iowa) would set the temperature at the agencies’ headquarters to at least 78 degrees during the summer.The legislation, dubbed the “Lead by Example Act,” is a response to Western grid operators asking customers to hike their thermostats amid a scorching heat wave.California managed to avoid rolling blackouts, in part because of consumers agreeing to reduce demand during peak hours.Still, Republicans are highlighting the threat to California’s grid as part of its political campaign against Biden administration federal energy and climate policies, even as experts are arguing the record demand followed high temperatures most likely exacerbated by climate change (E&E Daily, Sept. 9).“During a hot summer, liberal leaders told folks to set the AC to 78 degrees to compensate for failed Democratic policies,” Ernst, the vice chair of the Senate Republican Conference, said in a statement. “It’s time for Biden officials to adhere to the same regulations they’re pushing on hardworking Americans.”Ernst’s bill would require DOE and EPA buildings set a minimum room temperature of 78 degrees whenever they use air conditioning.“Not only will this make Washington bureaucrats think twice before imposing arbitrary rules on Americans, it could even save money,” Ernst said. “It’s time to make ‘em squeal, and sweat!”Such a move would actually fall within room temperature guidelines from the U.S. General Services Administration, the federal agency tasked with overseeing the executive branches’ building and real estate management.GSA guidelines, according to its website, suggest temperatures should hover between 74 and 78 degrees for federal buildings in the summertime, with changes acceptable for different geographic locations. Winter temperatures should hover between 68 and 72 degrees, the guidelines added.
Ted Cruz Calls To Defund "Biden's Army Of IRS Agents" --Sen. Ted Cruz (R-Texas) has called on his Republican colleagues in Congress to block funding for what he described as “Biden’s army of IRS agents” that the GOP has warned would be used to target Americans earning less than $400,000 a year. Cruz made the remark in a Sept. 13 statement on social media, which came as President Joe Biden celebrated the passage of the Inflation Reduction Act, which includes nearly $46 billion in new funding for IRS enforcement out of the $80 billion or so total funding boost to the tax agency.“Every single Republican should commit to not funding Biden’s army of IRS agents,” Cruz said in the statement.While Democrats have portrayed the Inflation Reduction Act as an anti-inflationary measure that would lower the cost of healthcare, prescription drugs, and energy, Republicans have argued it would lead to higher energy prices and aggressive IRS audits. In an interview on Fox News in which he elaborated on his position, Cruz argued that the extra funding for the tax agency should instead be used to stem the flow of illegal immigrants into the United States.“Every single Republican ought to say ‘we will not vote to fund these 87,000 new IRS agents, we’re not going to fund Biden’s army to harass Americans and we’re going to take that money and put it on our southern border to secure our border,'” Cruz told the outlet.Republicans have argued that part of the IRS funding boost would be used to hire 87,000 new IRS agents and that small businesses and Americans making less than $400,000 would be targeted with tax audits.
The IRS is refunding a staggering $1.2 billion in late filing fees - There might be a check coming in the mail if you were late filing a 2019 or 2020 federal return. In a one-time offer, the IRS is refunding $1.2 billion in late filing penalties for those tax years. This unprecedented relief is an acknowledgment of the difficulties taxpayers have faced during the pandemic. While in ordinary filing seasons the IRS penalizes taxpayers for procrastination, the agency is signaling that it realizes that’s too harsh for many people who may have struggled to file their returns because of the pandemic. The average refund in failure-to-file penalties will be about $750, according to the IRS. If you filed your return late and are therefore eligible for a refund of the penalty, there’s nothing you have to do. The IRS began sending out the payments automatically. The agency said close to 1.6 million taxpayers should receive refunds or credits. “So it’s certainly possible that a given taxpayer will get two refunds if they filed both a 2019 and 2020 return late,” IRS spokesman Eric Smith said. Taxpayers normally pay a penalty of 5 percent per month, up to 25 percent of the unpaid tax, when a federal return is late. IRS move toward free e-filing could end years of corporate domination But many individuals and businesses may have missed the filing deadline for 2019 and 2020 because of pandemic-related issues. Businesses were closed, delaying taxpayers from getting the information they may have needed to file. People may have been too sick to be concerned about filing their returns. Many paid and free tax preparation services were curtailed. “At the same time, the IRS was virtually unreachable by phone, while a backlog of unprocessed paper returns and correspondence that started in 2020 continued to grow,” National Taxpayer Advocate Erin M. Collins said in a blog post. “Many taxpayers, through no fault of their own, and sometimes even when they timely filed, were subject to late-filing penalties.” IRS has $80 billion coming. It should be spent on answering the phone. The penalty forgiveness can be significant, Collins said. Let’s say you owe the IRS $10,000. File late, and the penalty is $500 per month, up to a maximum of $2,500.
Amid Russian rout in Ukraine, US media demands greater NATO involvement in war - The rout of Russian forces in Ukraine continued Monday, with Russian forces now having lost a total of 3,000 square kilometers of territory in northeastern Ukraine. At a briefing with reporters Monday, a senior US military official stated, “On the ground in the vicinity of Kharkiv, we assess that Russian forces have largely ceded their gains to the Ukrainians and have withdrawn.” He continued, “To the north and east many of these forces have moved over the border into Russia. We also assess that Ukrainian forces have very likely taken control of Kupiansk and Izium in addition to smaller villages.” The official continued, “we're aware of anecdotal reports of abandoned equipment, Russian equipment, which could be indicative of Russia's disorganized command and control.” In the face of this military disaster for Russia, the US media ran a victory lap, praising the extent to which heavy US military equipment helped turn the tide of the war and demanding the deployment of further US-NATO weapons systems to Ukraine. The Washington Post concluded: “The exhilaration of recent days must be a reminder to the U.S. Congress and to Europe that a maximum effort to supply Ukraine now is an investment in a successful outcome later. Ukraine has a long wish list of needed weapons systems. At the very least, President Biden’s recent request for $13.7 billion in aid to Ukraine is sensible and deserves quick action.” The “wish list” mentioned by the Post includes the Army Tactical Missile System, a long-range missile system for the HIMARS with a range of over 190 miles, as well as main battle tanks and armed drones. The Wall Street Journal wrote in an editorial: “The offensive vindicates Ukraine’s assurances that with enough advanced Western weapons it could retake territory. After Ukraine’s early victory in defense of Kyiv, the U.S. and Europe let Russia gain an artillery advantage in the Donbas. But once the U.S. supplied longer-range rockets and artillery, especially precise Himars, it has become a more even fight. Ukraine’s recent advances show the U.S. should supply even more Himars platforms.” The editorial added: “Ukraine’s advances are encouraging, but Mr. Putin’s threat to the world is far from over.” In a deliberately vague statement, the Journal wrote: “A nuclear escalation can’t be accepted as normal warfare. Radiation fallout could reach NATO territory. NATO will have to increase its military aid and let Ukraine take the fight inside Russia.” Whether framed as a response to a hypothetical nuclear attack by Russia or not, a major US newspaper has responded to the success of Ukraine’s offensive by demanding that the United States order its Ukrainian proxy forces to carry out attacks inside Russia itself.
Blinken announces $600M in military assistance for Ukraine -- Secretary of State Antony Blinken on Thursday announced an additional $600 million in military assistance for Ukraine.“Together with our Allies and partners, we are delivering the arms and equipment that Ukraine’s forces are utilizing so effectively as they continue their successful counteroffensive against Russia’s invasion,” he wrote in a State Department release. Blinken authorized the 21st shipment of military munitions from the U.S. to Ukraine since September 2021, which will include arms and other equipment from the Defense Department. Earlier this week, Ukraine launched a major counteroffensive on the Russian military, attacking from the north after staging a campaign that led Russia to believe that the smaller country would attack from the south. Blinken said in his statement that “President Biden has been clear we will support the people of Ukraine for as long as it takes,” adding that the total amount of military assistance from the U.S. since President Biden’s inauguration will now stand at $15.8 billion.
Biden warns Putin over nuclear, chemical weapons – President Joe Biden warned Russian President Vladimir Putin not to use chemical or tactical nuclear weapons in his invasion of Ukraine, saying there would be a “consequential” response.“Don’t. Don’t. Don’t,” Biden said in a televised interview with U.S. broadcaster CBS that is due to air on Sunday night. “It would change the face of war unlike anything since World War II.”Biden’s warning comes after a surprise counteroffensive by Kyiv put Russian forces in retreat in Ukraine’s northeastern Kharkiv region.The U.S. on Thursday announced it would send $600 million in military aid to Ukraine, with its contributions totaling $15.1 billion since the start of the war in February.Asked how the U.S. would respond if Putin were to use chemical or tactical nuclear weapons, Biden said: “It’ll be consequential. They’ll become more of a pariah in the world than they ever have been. And depending on the extent of what they do will determine what response would occur.” CBS released excerpts of the “60 Minutes” interview ahead of its scheduled broadcast on Sunday.
U.S.-Taiwan bill sails through Senate panel despite White House misgivings - Legislation that would overhaul U.S. policy toward Taiwan easily cleared a powerful Senate committee on Wednesday, the latest chapter in the swift congressional response to China’s increasingly belligerent threats to the self-governing island.The most comprehensive revamp of U.S.-Taiwan policy in more than four decades came together despite concerns from the White House and some senators in both parties that it risked upending U.S. policy at a time when tensions remain high between Washington and Beijing. Those worries grew acute after Speaker Nancy Pelosi’s visit to Taipei prompted an unprecedented response from China’s military.After a robust and sometimes heated debate, however, the Senate Foreign Relations Committee approved the Taiwan Policy Act by a vote of 17-5. The bill, which complements the Taiwan Relations Act of 1979, is aimed at boosting Taiwan’s ability to defend itself militarily against a potential Chinese invasion of the island while deepening symbolic U.S.-Taiwan ties that Beijing has blasted as a reversal of the status quo.“If we hope to have a credible deterrence … we need to be clear-eyed about what we are facing,” said Foreign Relations Chair Bob Menendez (D-N.J.), who introduced the legislation alongside Sen. Lindsey Graham (R-S.C.). “If we don’t crank up our support for Taiwan, there will be a military offensive” against Taipei, added Sen. Jeff Merkley (D-Ore.). Indeed, the prospect of bolstering Taiwan’s defenses and strengthening U.S. ties with the island has united dovish Democrats and hawkish Republicans of late, but especially over the last few years. Some Democrats have even adopted the aggressive view that the U.S. should abandon its long-standing “strategic ambiguity” policy and instead declare that Washington will defend Taipei militarily from an invasion, an approach sometimes referred to as “strategic clarity. Among the provisions in the sprawling legislation is a $4.5 billion authorization for direct military assistance. The bill also bolsters Taiwan’s sovereignty when it comes to its membership in international organizations in a way that, according to supporters, does not upend the so-called One China policy — the diplomatic acknowledgment of Beijing’s view that Taiwan is a part of China.
Pelosi going to Armenia amid renewed clashes with Azerbaijan - Speaker Nancy Pelosi will travel to Armenia this weekend in a show of support for the country, which has been locked in a deadly fight with Azerbaijan, two people familiar with the visit told POLITICO. Pelosi will make the journey accompanied by Rep. Jackie Speier (D-Calif.) after a stop in Berlin for the G-7 Speakers’ Summit. She’s expected to meet with Prime Minister Nikol Pashinyan in Yerevan, the capital, as well as other government officials. It will be the speaker’s latest dramatic foreign trip following her contentious arrival in Taiwan last month. With the midterms approaching — and the possibility that she will lose the gavel if Republicans return to the majority — the belief in Washington is that Pelosi wants to cement her legacy as a champion of human rights, not only in the United States but around the world. Speier, meanwhile, is one of a handful of Armenian-American lawmakers in Congress. When asked about the upcoming trip, Drew Hammill, the speaker’s deputy chief of staff, said, “We don’t confirm or deny international travel in advance due to longstanding security protocols.” Speier’s office did not immediately return requests for comment. Armenia and Azerbaijan have been locked in a bloody, decadeslong feud over Nagorno-Karabakh, the territory internationally recognized as part of Azerbaijan but populated with ethnic Armenians. Two years ago, both nations fought their second big war over the contested land, leading to thousands dead and more regional power for Baku. Violence erupted again last weekend, with officials in both capitals blaming the other for attacking first. Armenia claimed Azerbaijan’s military used drones, artillery, mortars and small-arms fire to target a number of border towns. Azerbaijan, however, said Armenian forces were moving into position for a long-term escalation of fighting. More than 170 soldiers on both sides have been killed in skirmishes over the past few days, officials in Yerevan and Baku claim. Russia said it had brokered a cease-fire Tuesday, but it was short-lived and violence continued into Wednesday.
As U.S. rail strike looms, White House aides scramble to avert crisis - President Biden made calls to union leaders and rail companies Monday, pressing for a deal to avert a national railroad strike that is days away from shutting down much of the country’s transportation infrastructure, according to a White House officialBiden administration officials have also started preparing for a potential shutdown, warning a strike could seriously damage the U.S. economy, as well as hurt Democrats in the upcoming midterm elections, according to two people familiar with the matter.Biden’s calls follow unsuccessful emergency meetings at the White House last week, which have been led by the White House National Economic Council and included Labor Secretary Marty Walsh. Transportation Secretary Pete Buttigieg is also involved in trying to broker the impasse, said the two people, who spoke on the condition of anonymity to speak freely about internal deliberations.The stalemate pits two of Biden’s top priorities against each other. The president has been an adamant defender of union workers, but does not want a breakdown in the nation’s transportation infrastructure that would disrupt commuter and passenger services.The administration has little time to act: The nationwide rail shutdown is set to go into effect after midnight on Friday, and labor and management have been at an impasse over difficult issues such as sick time and penalties for missing work. It would be the first such strike in about three decades.Already, Amtrak has started warning passengers that interruptions will begin Tuesday on its national network. The passenger railroad said it is pulling trains on three long-distance routes “to avoid possible passenger disruptions while on route.”“These adjustments are necessary to ensure trains can reach their terminals prior to freight railroad service interruption if a resolution in negotiations is not reached,” Amtrak said in a statement.And a spokesperson for the Federal Railroad Administration said the agency “is initiating oversight and enforcement efforts to ensure safety during any potential interruption of rail operations.”The freight industry has warned that the strike would shut down 30 percent of the country’s freight and “halt most passenger and commuter rail services.” A freight railroad shutdown could “devastate” Amtrak operations, according to the Association of American Railroads, with roughly half of commuter rail systems running at least partially on tracks or rights of way owned by freight railroads. Hundreds of thousands of daily commuter trips would be disrupted, the association said earlier this month.
Bernie Sanders Blocks Proposal Which Would Avoid Rail Strike -- Sen. Bernie Sanders (I-VT) blocked a Republican effort to require railroad employees and companies to accept recommendations of a nonpartisan panel in order to avoid a strike which, if it goes through, will impact millions of Americans. The GOP resolution - introduced by Senate Health, Education, Labor and Pension Commission Ranking Member Richard Burr (R-NC) and Sen. Roger Wicker (R-MI), would have required railroad workers to adopt the outlines of a labor deal, The Hill reports. According to the Vermont Senator, railroad companies are making 'huge profits' and should treat employees more fairly. "The rail industry has seen huge profits in recent years and last year alone made a record breaking $20 billion in profit," he said. "Last year the CEO of CSX made over $20 million in total compensation while the CEOs of Union Pacific and Norfolk Southern made over $40 million each in total compensation." Sanders contrasted that to freight rail workers who are "entitled to a grand total of zero sick days." According to GOP Senators, their resolution would have avoided a "disastrous" rail strike, which could bring rail travel and freight shipments grinding to a halt across the country. Sen. Minority Leader Mitch McConnell (R-KY) said Democrats were putting the economy at risk. "If a strike occurs and paralyzes food, fertilizer and energy shipments nationwide, it will be because Democrats blocked this bill," he tweeted.
Biden announces tentative labor deal to avoid rail strike - President Joe Biden announced a tentative deal early Thursday morning to avert a nationwide rail strike that threatened to disrupt large swaths of the energy sector. Any accord would have to be ratified by freight rail union members, who have been demanding concessions on overscheduling and sick time. The deal calls for a 24 percent wage increase for rail workers through the 2020-2024 period, according to a press release from the Association of American Railroads.“I thank the unions and rail companies for negotiating in good faith and reaching a tentative agreement that will keep our critical rail system working and avoid disruption of our economy,” Biden said in a statement.The announcement came after railroads and union representatives were in negotiations for 20 hours at the Labor Department on Wednesday to reach a deal, to avert a Friday deadline. Companies had been warning that a rail strike could wreak havoc on the energy sector and possibly shut down oil and coal facilities. On Capitol Hill, Republicans called on Biden yesterday and congressional Democrats to halt the ongoing railroad labor dispute they say threatens to further stoke the flames of inflation across the country. Sens. Richard Burr (R-N.C.) and Roger Wicker (R-Miss.) asked for immediate passage of a resolution that would put an end to the negotiations by mandating recommendations made by a nonpartisan panel appointed by Biden. Republicans appear eager to place a potential supply chain crisis at Democrats’ feet ahead of the midterm elections, accusing the congressional majority of favoring union allies over the national welfare. Burr and Wicker attempted to pass their resolution by unanimous consent but failed after Sen. Bernie Sanders (I-Vt.) objected. The Republicans are now calling on Senate Majority Leader Chuck Schumer (D-N.Y.) to hold a full vote regarding the resolution. “Here’s the promise I’ll make Sen. Schumer: If he’ll bring it to the floor, I’ll produce 48 Republican votes,” said Burr. “That means Democrats only need to produce 12 people who support it to keep the American people from having a $2 billion a day negatively impacting them.”
Rail deal awaits workers' sign-off as strike fears wane - As the White House on Thursday celebrated a tentative agreement to avert a nationwide rail strike that could have devastated the economy, union officials cautioned that not everything is signed, sealed and delivered. Most crucial in the days ahead: Workers across a dozen unions need to vote to ratify the compromise. “There’s going to be a lot of work to do after today,” AFL-CIO Transportation Trades Department President Greg Regan said. “This was a big breakthrough, and we can take a day to reflect on it.” Yet “I don’t want to kid anybody here.” It may not be an easy sell, especially for the members of the unions that had earlier opposed the recommendations of a White House-appointed emergency board. Emboldened by a historically tight labor market and an unusually high union approval rate, many workers had already been making plans Wednesday to picket — and could have some qualms about agreeing to a deal that doesn’t deliver everything they initially sought. Thursday’s agreement “doesn’t mean our employees didn’t want to strike, because they’re angry,” said Dennis Pierce, president of the Brotherhood of Locomotive Engineers and Trainmen, one of the holdouts on the emergency board’s recommendations. “Our job now is to go out and explain to them what we were able to accomplish that can help improve their lives.” Nonetheless, the tentative deal — which emerged from 20-plus hours of negotiating — was a major political win for President Joe Biden, whose administration facilitated the labor-management talks, and good news for an economy that has seen little of that lately. Speaking Thursday from the Rose Garden, Biden called the tentative agreement a “validation” of his belief that unions and employers can work together “for the benefit of everyone.” “This agreement can overt a significant damage that any shutdown would have brought. Our nation’s rail system is the backbone of our supply chain,” he said, flanked by Labor Secretary Marty Walsh and other top economic aides.
While rail unions meet with Biden to avert strike, 500 railroaders attend mass meeting to organize rank-and-file rebellion - With the specter of a national rail strike in the United States looming, two meetings took place on Wednesday night. The first, held in secret, behind closed doors in a Washington conference room, was between officials from the rail unions, the railroads and President Biden. The purpose of this marathon discussion, which lasted 20 hours and ended early Thursday morning, was to work out a concessions contract and avoid a strike. The agreement reached yesterday is only a slight re-wording of the one proposed last month by Biden’s Presidential Emergency Board (PEB), which workers overwhelmingly oppose and were prepared to strike against. It added only a single paid and three unpaid sick days. Most importantly, from the standpoint of the conspirators in Washington, it extended the end of the “cooling off period” to block a strike. The White House was determined to reach a deal before the deadline to spare congressional Democrats the optics of passing legislation to try to crush a strike only weeks before critical midterm elections. From the floor of the Senate, Bernie Sanders, who presents himself as a “democratic socialist,” played his assigned role in the conspiracy, blocking Republican-sponsored legislation to enforce Biden’s PEB. Sanders, who voted in 1991 with a huge bipartisan majority to break the last national rail strike, was maneuvering to buy time, while bolstering the credibility of Biden and the Democrats and concealing the bipartisan unity against railroaders. Sanders rushed immediately to declare the “real progress” contained in the sellout deal. Meanwhile, House speaker Nancy Pelosi admitted Thursday that Democrats had already prepared legislation in advance to illegalize the strike if it began. The new tentative agreement is, in reality, an injunction in all but name, enforced through the screen of the unions. The American political establishment never tires of claiming that all of its wars abroad are waged in the name of human rights and democracy. Yet in the United States, as far as it is concerned, the right to strike, the most basic right available to workers, does not exist. This is one thing they have in common with all dictatorships. Indeed, Biden bragged on Twitter Thursday that the “trains were running on time,” a phrase commonly associated with Mussolini’s fascist Italy and its brutal and bloody suppression of working class opposition, including of railroad workers. In addition to Congress, the use of police and the courts, one of the principal means through which the right to strike is negated is through the trade union bureaucracy. The unions, completely integrated with management and the state, have for decades worked to block or isolate strikes and enforce one sellout after another. Biden, the self-described most “pro-labor president in American history,” is seeking to rely upon and greatly expand on those corrupt relations that already exist. The latest White House–brokered sellout on the railroads follows similar maneuvers with the unions against dock and refinery workers earlier this year. But the period in which all of this could have gone unchallenged is over. The working class is beginning to move into struggle all over the world. Every one of these struggles has tended to develop into a rebellion against both the union apparatus and the capitalist state. The highest organizational and strategic expression of this is the rapid growth of rank-and-file committees all over the world.
Railroaders furious after unions reveal that no tentative agreement exists, despite sabotage of strike -One day after leading Democratic politicians and the media announced that tentative agreements had been reached between the two largest railroad workers unions, both unions acknowledged that no final tentative agreements actually exist yet and that workers should not expect to view any details of the agreements for weeks. In an eight-sentence statement released Friday afternoon, one of the unions, SMART-TD, wrote that “a number of posts purporting to reveal the finalized contents or finalized components of a TA have spread rapidly and are being presented as factual. They are not.” The statement adds, “Anyone who states that they have seen a final copy of the TA, have a copy of the final TA or knows the final contents of the agreement is not being truthful.” The documents, it continues, “have not been fully reviewed by both parties’ legal counsel” and have not been presented “to the SMART-TD District 1 General Chairpersons, nor has it been distributed to officers or membership.” The SMART-TD statement added that “factual information” regarding the phantom agreement would be posted on their website “sometime next week.” As to when the full actual agreement would be posted for workers to review, the union did not say. In an interview with In These Times published Friday afternoon, Dennis Pierce, president of the other union, the Brotherhood of Locomotive Engineers and Trainmen (BLET), revealed that the union’s general chairman had yet to review the agreement and that members would not get to see it for up to a month. “This is probably going to take three to four weeks,” Pierce said. He claimed that this was “not a delay tactic, it’s just the way the process works.” Why it would take BLET “three to four weeks” to post a slightly reworded version of the Biden-backed Presidential Emergency Board (PEB) recommendations, which have already been roundly rejected by workers for failing to deal with inhuman attendance systems and increasing health care costs, was not explained. “Everyone needs to remain calm,” Pierce begged. The BLET president, who according to LM-2 tax documents, was paid over $275,000 in total compensation in 2021, added, “We’re not trying to impose anything. We’re trying to give them [that is, rank-and-file workers] a chance to decide their future.” (Emphasis added) Pierce did not explain how sabotaging workers’ desires and democratic vote to strike, on the basis of a non-existent agreement, was allowing “them” a “chance to decide their future.” The language used by Pierce in his interview is extremely telling. It reveals the vast social chasm that exists between the union apparatus, with its bloated six-figure salaries, and the rank-and-file workers who have seen their social and economic standing deteriorate while producing record profits for the rail companies. Adding insult to injury, Pierce chided workers, outraged that their strike was deliberately sabotaged by the union in the 11th hour, not to make an “emotional decision” when the TA finally materializes.
Democratic House Speaker Pelosi to rail workers: Accept a pro-company deal or we’ll force you to - Among those praising the tentative rail agreement, worked out in the middle of the night between Wednesday and Thursday, is House Democratic Speaker Nancy Pelosi. In a statement issued yesterday, Pelosi heaped praise on the Biden administration and “the representatives of the labor unions who wouldn’t leave the table without achieving justice for their workers.” What “their workers” think of the “justice” that has been achieved at the table with Biden and Labor Secretary Marty Walsh is evident in the outpouring of anger at the deal worked out behind their backs. Pelosi, with a net worth of $135 million, is one of the richest individuals in a Congress composed largely of millionaires. When Pelosi declares that the agreement is “good for our economy,” she really means it is good for Wall Street. When she adds that it is good “for our security,” she means that blocking a strike of railroad workers is a necessary part of American war planning. After her words about “justice for workers,” Pelosi proceeded to threaten workers that if they don’t accept this “justice,” then other measures will be necessary. In her statement, Pelosi acknowledged that the Democrats would have sided with the carriers and barred any strike: With hope for an agreement but concern for the challenges that a strike would present, Congress stood ready to take action. Congress under the Commerce Clause of the Constitution has the authority and responsibility to ensure the uninterrupted operation of essential transportation services and has in the past enacted legislation for such purposes. Led by the Transportation and Infrastructure Committee, the House prepared and had reviewed legislation, so that we would be ready to act, pursuant to Section 10 of the Railway Labor Act. That is, Pelosi and the entire political establishment (Democrats and Republicans alike) stood ready to bar a strike and force through an agreement that workers rejected.
Federal judge rules HIV prevention drug coverage unconstitutional on “religious freedom” grounds --Last week a Federal Judge in Texas ruled unconstitutional an Affordable Care Act (ACA) requirement that US healthcare plans cover a pre-exposure prophylaxis (PrEP) drug which prevents the spread of the human immunodeficiency virus (HIV). The judge made this reactionary attack on public health on the basis that covering HIV prevention drugs violates the religious freedom of the plaintiffs. The WHO says that HIV, which, left untreated, leads to the life-threatening AIDS syndrome, is still a major global health emergency with more than 40 million deaths worldwide to date. The case was brought to court in 2020 by a group of Republican Party connected Texas Christian fundamentalists on the behalf of Braidwood Management and Kelley Orthodontics, arguing that the lifesaving drugs such as Tuvada and Descovy can “facilitate or encourage homosexual behaviour,” with the plaintiffs challenging the legality under the Constitution and the Religious Freedom Restoration Act of 1993. The Biden administration has announced it is “reviewing” the decision. US District Judge Reed O’Connor went further than just HIV prevention, however, using it as a launching board for a broad attack on the entire framework of coverage for preventative services recommended by the US Preventative Task Force which are covered by private health insurance at no cost to the patient under ACA rules. The American Medical Association and a coalition of 60 medical organizations have warned that the ruling could mean that “patients would lose access to vital preventive healthcare services, such as screening for breast cancer, colorectal cancer, cervical cancer, heart disease, obesity, diabetes, preeclampsia, and hearing.'In fact, this is one of the primary aims of the lawsuit. No doubt businesses would be thrilled at the cost savings of not covering preventative care for their employees, and as will be shown, the real plaintiff to the case is the Republican Party, one of the twin parties of big business in the US. As much as the American financial oligarchy has moved to dismantle public health, letting diseases like COVID-19 and Monkeypox run rampant, so too does it move to remove access to life saving drugs. As Lenin wrote, “Political reaction all along the line is a characteristic feature of imperialism.” Its attitude to public health is no different.Since their approval in the last decade, HIV PrEP treatments have become one of the necessary measures required to prevent further transmission of the virus, with the US Centers for Disease Control and Prevention (CDC) crediting its use with the decline in HIV diagnoses. Nearly 2.8 million people around the world rely on the drug according to the Global PrEP tracker database.
Republicans push for delay on same-sex marriage vote – Pat Toomey hasn’t decided if he’ll back legislation protecting same-sex marriage. He is sure, however, that Monday is too soon for a vote.“There’s a lot of complex issues that have not been resolved. And we haven’t even seen text ... it does seem that the scheduling has been driven by Sen. Schumer’s political ambitions, rather than an attempt to get an outcome,” the retiring Pennsylvania Republican said Wednesday. “I don’t think it’s constructive to have a vote on Monday.”Toomey’s hopes for delay highlight the uncertain whip count for the same-sex marriage bill, which cruised surprisingly through the House with 47 GOP votes in July but is now on shaky ground as backers to try to push past a Republican filibuster. Sens. Rob Portman (R-Ohio), Susan Collins (R-Maine) and Thom Tillis (R-N.C.) are racing to finish a proposed amendment that would clarify religious liberty safeguards.Senate Majority Leader Chuck Schumer could move as early as Thursday to set up a vote Monday, but Portman said he’s unsure if that timeline will hold.“I don’t think we have the votes yet,” Portman said. “I don’t want to move ahead unless the votes are there. I’m still talking to people. Others have been more optimistic, but people need some time.”There isn’t much more time left before the election, though, with no guarantee a post-midterms vote would succeed. And the urgency was apparent on Wednesday afternoon.Portman, Tillis, Collins and Sens. Tammy Baldwin (D-Wis.) and Kyrsten Sinema (D-Ariz.) met for roughly an hour to finish hashing out their updated version of the legislation. After that sitdown, Baldwin said it was “highly likely” the legislation will be made public on Thursday: “I still think we can do this next week.”
Graham introduces bill to ban abortions nationwide after 15 weeks - Sen. Lindsey O. Graham (R-S.C.) on Tuesday introduced a bill that would ban abortions after 15 weeks of pregnancy nationwide, the most prominent effort by Republicans to restrict the procedure since the Supreme Court overturned Roe v. Wade in June.“I think we should have a law at the federal level that would say, after 15 weeks, no abortion on demand except in cases of rape, incest or to save the life of the mother,” Graham said at a news conference. “And that should be where America is at.”Graham’s measure, which stands almost no chance of advancing while Democrats hold the majority in Congress, comes just weeks after he and most Republicans defended the Supreme Court’s decision to overturnRoe by arguing that allowing states to decide on abortion rights would be the most “constitutionally sound” way of handling the issue.On Tuesday, Graham vowed that if Republicans took back the House and the Senate in the midterm elections there would be a vote on his 15-week abortion bill.“Abortion is a contentious issue,” Graham said. “Abortion is not banned in America. It is left up to elected officials in America to define the issue … States have the ability to do [so] at the state level, and we have the ability in Washington to speak on this issue if we choose. I have chosen to speak.”Graham was joined at the news conference by several antiabortion leaders, all women. Rep. Christopher H. Smith (R-N.J.) introduced a version of the bill in the House on Tuesday as well. Senior GOP aides in the House have indicated the bill would be a top priority for them if Republicans take back the majority.The name of the bill — which includes the nonmedical phrase “late-term abortions” — drew sharp criticism from abortion rights activists. Used almost exclusively by antiabortion activists, the phrase is generallyunderstood to refer to abortions between 21 and 24 weeks of pregnancy or later.“15 weeks is not ‘late term,’ particularly given the significant challenges to access around the country,” Christina Reynolds, vice president of communications at Emily’s List, wrote in a tweet.
Pandemic safety net programs kept millions out of poverty in 2021, new Census data show --EPI Blog --It should not have taken a pandemic to realize poverty is a public policy choice. Public investments in safety net programs continue to be extremely effective poverty reduction tools, as newly released Census income data show. Government social programs kept tens of millions of people out of poverty in 2021. Because of expansions to programs like unemployment insurance benefits and the child tax credit, poverty rates were actually lower in 2021 than they were prior to the COVID-19 pandemic. The poverty reduction achieved through expanded social insurance programs highlights how much policymakers’ choices can impact poverty. Unfortunately, some of the program expansions enacted in the pandemic have already been reversed, and cuts to programs like unemployment benefits and the child tax credit will increase household economic distress going forward. Last year, Social Security had the largest anti-poverty impact, reducing the number of people in poverty by 26 million. Recent policy expansions including refundable tax credits, like the earned income tax credit (EITC) and child tax credit (CTC), and economic impact stimulus payments also reduced the number of people in poverty by roughly 10 and 9 million people respectively.
Democrats should demand child tax credit from Republicans - Catherine Rampell - Before Democrats even think about giving away another tax break to corporations, they should demand more dollars for poor kids.After all, kids are the constituency that Democrats are supposed to care more about. As the midterms inch closer, corporate lobbyists are demanding an extension of a key tax break relating to research and development. The basic background: Historically, the tax code had allowed companies to write off the cost of R&D spending immediately (rather than doing so more gradually, over several years after the fact). This meant companies could lower their tax bills right away, rather than in dribs and drabs over multiple years.This longtime perk expired, though, at the end of 2021. Industry groups such as Business Roundtable are working hard to get Congress to retroactively restore it, and they have issued dire warnings about the economic damage that might occur if lawmakers don’t swoop in to the rescue. Republican lawmakers have been agitating for the tax break’s revival, too.Here’s the twist: It was Republicans who took the tax break away in the first place." If you’re confused about why they might have done this, you’re not alone. After all, back in 2017, when Republicans controlled both Congress and the White House, they passed an enormous corporate tax cut.To help make their corporate rate cuts as large as possible, Republicans included some measures that would (ostensibly) raise a little bit of money to offset the cost. Among these supposed pay-fors was this change to the tax treatment of R&D spending.The business lobby wasn’t super-psyched about these revenue-raisers, but the measures generally were not scheduled to bite right away. They would take effect several years down the road, if they happened at all.In fact, the presumption at the time was that these provisions mightnever materialize because future Congresses would step in and reverse them first. One of the architects of that 2017 GOP tax overhaul, Rep. Kevin Brady (R-Tex.), even publicly and repeatedly endorsed proposals to undo his own handiwork.In other words, the R&D change was a cynical gimmick intended to make the bill look cheaper for official budget scorekeeping purposes — but that leading Republicans never actually expected, or wanted, to happen.Republicans, of course, no longer control the legislature. But Democrats also tend to like the idea of incentivizing companies to invest in more research and experimentation. So, Democratic lawmakers seem to be on board with doing cleanup for Republicans this year. The question now is what Democrats should demand in return for bailing out Republicans — that is, for thanklessly fixing a section of the tax code that their GOP counterparts deliberately broke.The best answer: More money for poor kids, through a revived expansion of the child tax credit.
US Is Becoming a ‘Developing Country’ on Global Rankings that Measure Democracy, Inequality - The United States may regard itself as a “leader of the free world,” but an index of development released in July 2022 places the country much farther down the list.In its global rankings, the United Nations Office of Sustainable Development dropped the U.S. to41st worldwide, down from its previous ranking of 32nd. Under this methodology – an expansive model of 17 categories, or “goals,” many of them focused on the environment and equity – the U.S. ranks between Cuba and Bulgaria. Both are widely regarded as developing countries.The U.S. is also now considered a “flawed democracy,” according to The Economist’s democracy index.As a political historian who studies U.S. institutional development, I recognize these dismal ratings as the inevitable result of two problems. Racism has cheated many Americans out of the health care, education, economic security and environment they deserve. At the same time, as threats to democracy become more serious, a devotion to “American exceptionalism” keeps the country from candid appraisals and course corrections.The Office of Sustainable Development’s rankings differ from more traditional development measures in that they are more focused on the experiences of ordinary people, including their ability to enjoy clean air and water, than the creation of wealth.So while the gigantic size of the American economy counts in its scoring, so too does unequal access to the wealth it produces. When judged by accepted measures like the Gini coefficient, income inequality in the U.S. has risen markedly over the past 30 years. By the Organization for Economic Cooperation and Development’s measurement, the U.S. has the biggest wealth gap among G-7 nations. These results reflect structural disparities in the United States, which are most pronounced for African Americans. Such differences have persisted well beyond the demise of chattel slavery and the repeal of Jim Crow laws.
DeSantis sends migrants to Martha’s Vineyard - Florida Gov. Ron DeSantis (R) flew two planes of migrants to Martha’s Vineyard, Mass., on Wednesday, intensifying a fight in which high-profile GOP governors have been sending migrants to liberal enclaves. A spokesperson for DeSantis, considered a possible GOP presidential candidate in 2024,confirmed to Fox News on Wednesday that the migrants were flown on two chartered planes. “Yes, Florida can confirm the two planes with illegal immigrants that arrived in Martha’s Vineyard today were part of the state’s relocation program to transport illegal immigrants to sanctuary destinations,” DeSantis spokesperson Taryn Fenske told the media outlet. DeSantis has been sending migrants to “sanctuary” cities or states that limit their cooperation with federal immigration authorities.About 50 Venezuelan migrants, including some children, reportedly were flown to Martha’s Vineyard, according to the Martha’s Vineyard Times. The island, just south of Cape Cod, is a popular summer vacation area frequented by a number of Democratic power players, including former President Obama. Fenske told Fox News that states like Massachusetts, New York and California are better suited to take care of the migrants because of their more lax immigration policies, noting their support for what he described as the Biden administration’s open border policies.
Biden condemns Republicans for using migrants as ‘props’ -- President Biden on Thursday condemned Republican governors for using migrants as “props” for “political stunts” as he defended his administration’s handling of the southern border. Biden, addressing a Congressional Hispanic Caucus Institute gala, did not directly name GOP governors who have in recent weeks transported migrants out of their states and to blue states and Washington, D.C. But he and other White House officials have pushed back hard on the tactic, dismissing it as a political ploy that puts migrant families at risk. “Republicans are playing politics with human beings, using them as props. What they’re doing is simply wrong, it’s un-American, it’s reckless,” Biden said Thursday evening. “And we have a process in place to manage migrants at the border. We’re working to make sure it’s safe and orderly and humane,” Biden continued. “Republican officials should not interfere with that process by waging these political stunts.” BIden called for Senate Republicans to negotiate with Democrats on a pathway to citizenship for so-called Dreamers, who were brought to the U.S. as children and granted protections, as well as farm laborers and other essential workers. Florida Gov. Ron DeSantis (R) flew two planes of migrants to Martha’s Vineyard in Massachusetts on Wednesday. He has been sending migrants to “sanctuary” cities or states, which limit their cooperation with federal immigration authorities. Texas Gov. Greg Abbott (R) has repeatedly made similar moves, including sending two buses of migrants to Vice President Harris’s residence in Washington that arrived on Thursday.
5th Circuit upholds Texas law forbidding social media ‘censorship’ — again - A Texas law that bans social media companies from censoring users’ viewpoints is constitutionally allowed, the 5th Circuit Court of Appeals ruled on Friday, in a blow to Facebook, Twitter and Google.The ruling is a win for Texas Gov. Greg Abbott and Texas Attorney General Ken Paxton in their efforts to combat what they call censorship of conservative viewpoints by social media companies.Despite the ruling, the Texas law does not immediately take effect; it will do so once the appeals court issues written instructions to the district court that had decided the case.The law, H.B. 20, had previously been blocked from taking effect by a May 5-4 Supreme Court ruling, which had granted an emergency request by tech trade groups NetChoice and the Computer and Communications Industry Association, which represent Facebook, Twitter and Google. The trade groups have alleged the Texas law violates the First Amendment rights of the companies they represent. “Today we reject the idea that corporations have a freewheeling First Amendment right to censor what people say,” Andrew Oldham, a Donald Trump appointee who had previously served as Abbott’s general counsel, wrote in the 5th Circuit’s decision.
Trump and DOJ near agreement on expert for review of seized records -Former President Donald Trump and the Justice Department neared agreement on Monday on the identity of an outside expert to oversee a review of records seized by the FBI last month from his Mar-a-Lago estate as part of a criminal investigation into alleged unauthorized retention of national security secrets. Prosecutors said in a court filing that they did not object to one of the special master candidates proposed by Trump’s legal team, U.S. District Court Judge Raymond Dearie, a New York-based appointee of President Ronald Reagan. The Justice Department’s stance appears to clear the way for Dearie’s appointment by the judge overseeing litigation that Trump brought over the Aug. 8 search of his Florida home, U.S. District Court Judge Aileen Cannon, although she still has discretion over whom to select. While the identity of the master could soon be resolved, Trump and prosecutors remain at odds over numerous other aspects of the review, most significantly whether it should cover about 100 documents marked as classified that FBI agents recovered during the raid. In a filing on Monday morning, Trump’s lawyers urged Cannon to keep in place a ruling that blocked the Justice Department from continuing its criminal investigation into the highly sensitive government records stashed in the basement and in his office at his Florida home, which also serves as a private club. The submission, a response to prosecutors’ warning that the Trump appointee’s unorthodox directive — preventing FBI investigators from accessing the files seized in their Aug. 8 search — was harming national security, urges her to stay the course. “In what at its core is a document storage dispute that has spiraled out of control, the Government wrongfully seeks to criminalize the possession by the 45th President of his own Presidential and personal records,” Trump’s attorneys wrote in a 21-page filing. Trump directly praised Cannon last week, calling her initial ruling “courageous” and lashing out at the Justice Department for moving to appeal her order. The department has asked Cannon to temporarily set aside the portion of her order that blocked FBI access to about 100 records marked as classified — including some bearing labels denoting the most sensitive records the government possesses.
Judge appoints special master, denying DOJ access to classified records A federal judge on Thursday denied the Justice Department’s motion to access the classified records stored at Mar-a-Lago and installed a recently retired judge to serve as the special master former President Trump requested. The duo of orders from federal district Judge Aileen Cannon will ignite a Department of Justice (DOJ) appeal to the 11th Circuit and also selects Judge Raymond Dearie to serve as the special master — the one candidate both the DOJ and Trump’s legal team could agree on. The order requires Dearie to complete his review by Nov. 30 — a slightly shorter deadline than the 90-day window Trump requested, but one that punts the determination past the midterms. In a rare instance of siding with the DOJ, Cannon required Trump to pay for the full cost associated with a special master. Cannon’s decision came after the DOJ asked for a partial stay of the judge’s motion, arguing they should be able to review the more than 100 classified documents taken during the search as Trump could have no possible claim to the records as either personal property or under executive privilege. “If the court were willing to accept the government’s representations that select portions of the seized materials are—without exception—government property not subject to any privileges, and did not think a special master would serve a meaningful purpose, the court would have denied plaintiff’s special master request,” Cannon wrote. “The court does not find it appropriate to accept the government’s conclusions on these important and disputed issues without further review by a neutral third party in an expedited and orderly fashion.” The order is the latest blow to the DOJ, where the investigation based on those documents is largely blocked until the completion of the review. While the intelligence community-led damage assessment of the fallout from the mishandling of the documents has been allowed to continue, the DOJ made clear it will be difficult to complete while the FBI is siloed from its other intelligence partners.
Trump Administration Prosecutor Charges in New Book that Justice Department Was Corrupted by Trump and Attorney General William Barr - By Pam and Russ Martens: --Two new nonfiction books are being released today. Bestselling author and anthropologist Sarah Kendzior’s book, They Knew, describes Donald Trump as a “transnational career criminal.” The book from the former top federal prosecutor in the Southern District of New York under the Trump Justice Department, Geoffrey Berman, a Republican, reinforces Kendzior’s thesis with the revelation that Trump’s Justice Department was weaponized “to aid the President’s friends and punish his enemies,” both foreign and domestic.One of the most outrageous demands from the Justice Department, writes Berman, was “pressure to pursue baseless criminal charges against John Kerry, who had served in the Obama administration as secretary of state.” Berman writes the following in Holding the Line: Inside the Nation’s Preeminent US Attorney’s Office and Its Battle with the Trump Justice Department:“Throughout my tenure as U.S. attorney, Trump’s Justice Department kept demanding that I use my office to aid them politically, and I kept declining — in ways just tactful enough to keep me from being fired.”Berman was not willing to be the easily-molded lieutenant that Trump demanded of all of his lackeys. So late on a Friday evening, June 19, 2020, Attorney General William Barr told a bald-faced lie to the American people: he announced that Berman was resigning his post as U.S. Attorney for the Southern District of New York. As for who was going to replace Berman, Barr wrote this: “I am pleased to announce that President Trump intends to nominate Jay Clayton, currently the Chairman of the Securities and Exchange Commission, to serve as the next United States Attorney for the Southern District of New York.”Two hours later, Berman released his own statement indicating that William Barr had just told a brazen lie to the American people. Berman’s statement was this: “I learned in a press release from the Attorney General tonight that I was ‘stepping down’ as United States Attorney. I have not resigned, and have no intention of resigning my position, to which I was appointed by the Judges of the United States District Court for the Southern District of New York.”The following day, Barr issued another statement indicating that Trump was removing Berman from his post but would leave Berman’s Deputy in charge of the office on an interim basis. Barr had stated on Friday evening that he would be putting in Craig Carpenito, the sitting U.S. Attorney for the District of New Jersey, as acting head of the office until Clayton could be confirmed by the Senate. The acknowledgement by Barr that Berman’s Deputy would be allowed to fill the post until a confirmation occurred appeased Berman and he agreed to step down.Both the White House and media outlets confirmed at the time that Clayton had asked to replace Berman in the job as U.S. Attorney for the Southern District of New York and that Trump discussed the job with him and ultimately agreed to oust Berman in order to install Clayton. Clayton had never served a day as a prosecutor at a state or federal level. At the time of his confirmation hearing in 2017 to serve in the Trump administration as Chair of the Securities and Exchange Commission, Clayton had been outside counsel to Goldman Sachs for years and his law firm, Sullivan & Cromwell, had represented 8 of the 10 largest Wall Street firms in the prior three years. (See our report: As Goldman Sachs and JPMorgan Face Criminal Probes, Barr Fires Top Prosecutor; Tries to Replace Him with Banks’ Former Lawyer, Jay Clayton.)
Jan. 6 panel weighs new DOJ cooperation after Trump world subpoenas - A week after federal prosecutors bombarded Trump world with Jan. 6-related subpoenas, the chair of Congress’ Capitol attack committee said members are actively discussing how quickly to deliver its evidence trove to the Justice Department.“We have a meeting on Friday. I plan to bring it up,” Rep. Bennie Thompson (D-Miss.) told reporters at the Capitol Tuesday, following a roughly four-hour-long meeting of the Jan. 6 select committee. “I think now that the Department of Justice is being proactive in issuing subpoenas and other things, I think it’s time for the committee to determine whether or not the information we’ve gathered can be beneficial to their investigation.”Any decision to provide more material doesn’t seem imminent. In a statement, a committee spokesperson emphasized the select panel would “reach decisions” on sharing more information in “the report or otherwise” in October or November.“The committee has thus far made a significant volume of material publicly available in more than 20 hours of public hearings. We are preparing for additional public presentations in one or more hearings this month,” said the spokesperson, who was granted anonymity to provide clarity on the panel’s planning.Thompson’s comment, while not a final decision, represents one of several significant questions the select committee faces in its final stretch. The Justice Department has repeatedly asked congressional investigators to turn over their transcripts since April. But any delivery of evidence could complicate some of the ongoing prosecutions of Jan. 6 defendants, many of whom have demanded access to any committee transcripts received by prosecutors.Until late July, the panel had resisted efforts to produce transcripts to the Justice Department, preferring to maintain a tight grip on their prized evidence — particularly amid concerns among some lawmakers that prosecutors needed to more aggressively investigate former President Donald Trump’s attempts to overturn the 2020 election.Though it’s unclear whether the committee will ultimately opt to send more of its 1,000-plus witness transcripts to the Justice Department, Thompson’s comments represent a significant recognition from the panel; namely, that the agency’s probe has now — at least publicly — begun making significant inroads into Trump’s inner circle. Last week, prosecutors rained more than 40 subpoenas onto key figures who aided Trump in his efforts to subvert President Joe Biden’s win.A Justice Department spokesperson did not immediately respond to a request for comment.
The Justice Dept.’s Jan. 6 investigation is looking at ... everything - Dozens of subpoenas issued last week show that the Justice Department is seeking vast amounts of information, and communications with more than 100 people, as part of its sprawling inquiry into the origins, fundraising and motives of the effort to block Joe Biden from being certified as president in early 2021.The subpoenas, three of which were reviewed by The Washington Post, are far-reaching, covering 18 separate categories of information, including any communications the recipients had with scores of people in six states where supporters of then-President Donald Trump sought to promote “alternate” electors to replace electors in those states won by Biden.One request is for any communications “to, from, or including” specific people tied to such efforts in Arizona, Georgia, Michigan, New Mexico, Nevada, Pennsylvania and Wisconsin. Most of the names listed were proposed fake electors in those states, while a small number were Trump campaign officials who organized the slates.Taken together, the subpoenas show an investigation that began immediately after the storming of the U.S. Capitol on Jan. 6, 2021, and has cast an ever-widening net, even as it gathers information about those in the former president’s inner circle.“It looks like a multipronged fraud and obstruction investigation,” said Jim Walden, a former federal prosecutor. “It strikes me that they’re going after a very, very large group of people, and my guess is they are going to make all of the charging decisions toward the end.”After being told the various categories of information sought in the indictment, Walden noted the focus on wide categories of communications among the individuals. He said he suspected it was part of a prosecutorial strategy to try to blunt any claims that Trump activists were just following the advice of lawyers in seeking to block the certification of Biden’s victory.“It’s hard to say you were just relying on all these lawyers if there are text chains showing conspirator conversations, or consciousness of guilt,” Walden said. A subpoena is not proof or even evidence of wrongdoing, but rather a demand for information that could produce evidence of criminal conduct. The new batch of subpoenas point to three main areas of Justice Department interest, distinct but related:
- the effort to replace valid Biden electors with unearned, pro-Trump electors before the formal congressional tally of the 2020 election outcome on Jan. 6, 2021
- the rally that preceded the riot that day
- the fundraising and spending of the Save America political action committee, an entity that raised more than $100 million in the wake of the 2020 election, largely based on appeals to mount pro-Trump legal challenges to election results.
Even those three prongs don’t capture other, important parts of the Justice Department’s Jan. 6 investigation, in which more than 870 people have been arrested for alleged crimes of violence, trespass and — in the case of two extremist groups who prosecutors say played key roles in the chaos — seditious conspiracy. Hundreds more are still being sought for crimes related to the riot.
Watch: Dem Rep. Says "We Gotta Kill" MAGA "Extremists" -Democratic Congressman Tim Ryan sparked controversy Tuesday by referring to so called MAGA Republicans and declaring “We’ve gotta kill and confront that movement.” Appearing on MSNBC, Ryan stated that America needs to “move out of this age of stupidity” and into an “age of reconciliation and reform.”“How do we fix all of these broken systems?” Ryan posited, adding “Some of those answers will come from Republicans. Not the extremists that we’re dealing with every single day. We’ve gotta kill and confront that movement.” Watch: Tim Ryan: We have to “kill and confront that movement” of “extremist” Republicans. pic.twitter.com/ETITYgjGsj Even if you accept that he’s speaking figuratively, that’s an extremely poor choice of words in light of Biden repeatedly declaring half the country as ‘extremists’.Ryan’s comments come after Hillary Clinton compared “MAGA Americans” to Al Qaeda, on the anniversary of 9/11:Did Hillary Clinton just compare "MAGA Americans" to the AL-QAEDA on live TV?! Unhinged Hillary leaves everyone STUNNED pic.twitter.com/JSEA7xdr94 As we highlighted last week, a Convention of States and Trafalgar Group poll found that a majority believe that Biden’s ‘battle for the soul of the nation’ speech, during which he was bathed in blood red light and flanked by marines, was purposefully designed to “incite conflict.”Now a new survey by the group has found that more than 58 percent of voters believe Biden has further divided the country, with just one in five saying he has provided any unification.A further poll by conducted by I&I/TIPP has found that almost two-thirds of Americans, 62 percent, agree that the White House’s attacks on “MAGA Republicans” has increased division in the country, with even a whopping 73 percent of Democrats agreeing.In fact, the poll found that more Democrats agreed with the statement than Republicans!
Citigroup snubbed on muni deal over gun law, costing Texas city --A Texas city declined to award a bond deal this week to Citigroup even though the bank submitted the most competitive bid, showing how Wall Street is still contending with a Republican-backed state law that punishes financial firms for taking on gun policies. The bank was rejected after submitting the best bid among firms that sought to underwrite two bond sales totaling almost $100 million this week by Anna, Texas. It's unusual for a municipality to reject a bank's winning bid on a municipal bond deal. An attendee holds a pistol during the Defense and Security Equipment International exhibition at Excel in London. Frances La Rue, a spokesperson for Anna, said in a statement that officials chose the second-lowest bid after discussions with the office of the state's Republican attorney general and the municipality's legal counsel and financial adviser. The attorney general's office, which oversees most bond sales in Texas, said Friday that it is still reviewing Citigroup's ability to comply with the state's gun law. The firearms measure was one of a pair of laws that took effect in September 2021, limiting Texas governments' work with companies unless the firms verify that they don't "discriminate" against gun entities or boycott the fossil fuels industry. Citigroup initially suspended muni underwriting in the state for a few months after September 2021 as it worked to verify compliance. It resumed underwriting Texas muni deals in November and closed a deal as recently as last week. In 2018, Citigroup announced policies that set restrictions on the firearms industry after the mass shooting at a high school in Parkland, Florida. Citigroup said it would prohibit retailers that are customers of the bank from offering bump stocks — devices that let semiautomatic rifles fire even more rapidly — or selling guns to people who haven't passed a background check or are younger than 21. The bank's policy does include caveats, including an exemption to the under-21 age restriction if a person has military training, for example.
Goldman Sachs faces Fed scrutiny of money-losing Marcus consumer unit Goldman Sachs Group's six-year foray into consumer banking — the unit dubbed Marcus — is the focus of a new review at the Federal Reserve. Fed officials have been looking into the Wall Street giant's online-banking platform aimed at retail customers, according to people with knowledge of the matter. For at least several weeks, they've been peppering Goldman management with questions and follow-ups in a process that's still continuing, the people said, asking not to be identified discussing confidential information. The review goes beyond the central bank's regular oversight of the firm, and is distinct from its more frequent industrywide looks at business lines of interest. By zeroing in on Marcus, the central bank is taking stock of a division that's relatively new and growing substantially inside a company without much history dealing with the general public. While it's not indicative of any wrongdoing, it is another headache as Chief Executive Officer David Solomon marches ahead with his ambition to expand Goldman — a merchant of high finance — in the world of consumers: soaking up deposits, issuing credit cards and, at some point, offering checking accounts to the masses. The examination puts yet more pressure on the bank's leaders to showcase their command of the business and tighten controls. Representatives for Goldman Sachs and the Fed declined to comment.
U.S. Banks Lost a Record $370 Billion in Deposits Last Quarter – WSJ - Deposits at U.S. banks fell by a record $370 billion in the second quarter, the first decline since 2018. Deposits fell to $19.563 trillion as of June 30, down from $19.932 trillion in March, according to the Federal Deposit Insurance Corp.
Toomey predicts Supreme Court will overturn SEC's climate risk plan --— The top Republican on the Senate Banking Committee told the chair of the Securities and Exchange Commission to expect the U.S. Supreme Court to eventually throw out the agency's landmark climate disclosure proposal on Thursday, accusing the markets regulator of overstepping its statutory bounds. SEC Chair Gary Gensler was testifying before the committee on Thursday morning when Sen. Pat Toomey, R-Pa., argued that the climate disclosure rulemaking the agency introduced in March would not survive judicial scrutiny in the long term. "The SEC may not want to answer to Congress on its climate disclosure rule, but ultimately, the SEC will have to answer to the courts — which should make it nervous," Toomey said, adding later: "The SEC should consider itself to be on notice by [the Supreme Court] that the separation of powers still exists and will be upheld." The SEC's climate disclosure proposal would require public companies to calculate certain forms of their emissions and disclose potential exposure to climate risks, including from societal energy transition. As proposed, the disclosures would include Scope 1, 2, and 3 emissions, which cover a firm's direct emissions, indirect emissions in the form of purchased energy, and emissions from "upstream and downstream activities in a registrant's value chain," according to the proposal's text. Banks have urged the SEC to retool its proposed approach to Scope 3 emissions, arguing that the regulatory burden could be immense if financial institutions are responsible for calculating the emissions of their clients and borrowers.
Romney leads bipartisan push to give ILC applications a fair shake — A bipartisan group of senators is warning the Federal Deposit Insurance Corp. to give new industrial loan company charter applications due consideration, urging the regulator to "follow the laws that Congress carefully designed." The letter, obtained by American Banker and addressed to acting FDIC Chairman Martin Gruenberg on Thursday morning, was written by Sen. Mitt Romney, R-Utah. Notably, Romney's letter was signed by four Democratic senators and four other Republicans. "We write today to express support for the industrial loan company charter and respectfully remind you to ensure the Federal Deposit Insurance Corp. continues to follow the laws that Congress carefully designed for the FDIC to consider new deposit insurance applicants, including ILCs," the letter said, which was signed by Sens. Romney, Catherine Cortez Masto, D-Nev., Marsha Blackburn, R-Tenn., Roy Blunt, R-Mo., Gary Peters, D-Mich., Jacky Rosen, D-Nev., Bill Hagerty, R-Tenn., Mike Lee, R-Utah, and Kyrsten Sinema, D-Ariz. "Unfortunately, some seek to pause or even close the charter," the lawmakers said. "We strongly oppose regulatory actions, both formal and informal, that might target the ILC charter in a manner not consistent with the laws Congress has passed." The FDIC declined to comment for this story, except to say it will respond to the lawmakers' offices directly. Granted and supervised by the FDIC, ILC charters have long been viewed with skepticism by the broader banking industry as well as some consumer advocates. ILC charters are the only federal bank charters that can be owned by commercial companies rather than bank holding companies, meaning industrial banks are not directly supervised by the Federal Reserve.
The gap between decentralized and traditional finance is getting bigger -— The federal government has been turning the screws against some of the most radical ways that companies are looking to disrupt the traditional financial system, widening the chasm between mainstream finance and decentralized disruptors. One of Treasury's most recent enforcement actions — the sanctioning of DeFi protocol Tornado Cash — could have long-running consequences for how banks and their decentralized financial competitors interact. When the Treasury sanctioned Tornado Cash, it set off a wave of discontent among DeFi companies and some lawmakers who've argued that sanctioning the open source, self-running protocol will set a precedent that could expand Treasury's sanction powers. Financial policy experts largely dismissed these worries, however, and said that the real implication of Treasury's crackdown on DeFi is quieter, but no less meaningful. As Treasury increasingly looks to wrangle with the sprawling and evolving DeFi space, it's creating a more bifurcated system between decentralized finance and the more traditional financial sector. While there's always been a gap between the kind of "clean" money that banks deal in and money that moves in less-regulated corners of the economy, Treasury's renewed focus on DeFi makes it clear that the federal government is not handling DeFi with kid gloves anymore. "Traditional banks, like the big banks and even those that are mid-sized and smaller, all have significant AML requirements that can be quite onerous, while DeFi is set up to be much less onerous, much less centralized and more democratized. It's just a different system than traditional banks," said Chris Campbell, chief policy strategist at Kroll and former assistant secretary of the Treasury for financial institutions. "And it's becoming more difficult to merge those two worlds."
Banks, consumer advocates want CFPB to police nonbank personal lenders -Two rare allies — a consumer group and bank trade association — are urging the Consumer Financial Protection Bureau to start regulating larger fintech lenders that make installment and other kinds of personal loans. The Center for Responsible Lending and the Consumer Bankers Association petitioned CFPB Director Rohit Chopra in a letter Thursday to develop a rule that would expand the agency's jurisdiction to include such lenders, which the groups argue should be subject to the same rules as large banks and credit unions. "Although our views on consumer financial regulatory issues often diverge, CRL and CBA share a common belief that the absence of a rule defining larger participants in the market for personal loans has created an unlevel playing field and a large risk to consumers that the Bureau can and should resolve through a larger participant rulemaking," the letter said. The CFPB previously entertained the idea of expanding its purview in 2017, when the agency said in its agenda that it "is now working to develop a proposed rule that would define nonbank 'larger participants' in the market for personal loans, including consumer installment loans and vehicle title loans." In 2018, however, the agency under the Trump administration classified the rulemaking as "inactive." The groups called on the CFPB to again consider the rulemaking as the number of fintech firms targeting subprime customers grows. Banks have long complained that fintech nonbanks don't have the same kind of strict oversight that they do.
White House urges regulators to 'redouble' crypto oversight efforts -- The White House has released a series of reports, including from the Treasury Department, outlining a federal plan for digital-asset regulation. The reports — in response to President Biden's March 9 executive orderthat called for Treasury and other agencies to recommend reforms — urge regulators to continue acting vigilantly when it comes to cryptocurrency transactions. Regulators, particularly banking regulators, have emphasized that their cautious approach to crypto has helped insulate the U.S. economy and traditional financial institutions from the volatility in cryptocurrency values that occurred earlier this year. "We've seen in recent months substantial turmoil in cryptocurrency markets, and these events really highlight how without proper oversight cryptocurrencies risk harming everyday Americans, financial stability and our national security," Brian Deese, director of the National Economic Council, said in a call with reporters late Thursday. "And that is why this administration believes now more than ever prudent regulation in cryptocurrency is needed if digital assets are going to play the role we believe they can in fostering innovation and supporting our economic and technological competitiveness," Deese said. While senior administration officials said on the call that the proposed guidelines in the digital-asset space are meant to acknowledge the potential positive use cases for this technology, the recommendations emphasized protecting consumers and financial stability. "Digital assets pose meaningful risks for consumers, investors and businesses," the White House said in a statement. "Prices of these assets can be highly volatile: The current global market capitalization of cryptocurrencies is approximately one-third of its November 2021 peak. Still sellers commonly mislead consumers about digital assets' features and expected returns, and noncompliance with applicable laws and regulations remains widespread."
Regulators are coming for fintechs and the banks that power them -Recently, Blue Ridge Bank in Charlottesville, Virginia, disclosed that its regulator imposed an enforcement action requiring corrective measures that reflect serious and widespread risk management and compliance failures with significant implications for the bank's fintech partner banking relationships. The market had been anticipating some type of enforcement action against Blue Ridge after regulatory issues seemed to derail a proposed merger with another bank and rumors spread of disruption among its fintech partners. On the face of it, a limited action by one regulator against a single bank with only $2.7 billion of assets should be worth barely a passing notice. But this regulatory action is the tip of the iceberg. Intense regulatory scrutiny is coming for fintechs and the bank partners on which they rely. However, not all fintechs or their bank partners are yet truly prepared to meet this higher level of regulatory scrutiny. Over the past 15 years, fintechs (more precisely, nonbank providers of financial services) have grown dramatically in both number and size, fed by unprecedented venture investment and, candidly, the weaknesses and lack of agility of incumbent banks. According to the consulting firm Oliver Wyman, incumbents' share of value in financial services collapsed from 90% in 2011 to 65% this year (even after the correction in fintech valuations). Nonbank fintechs have built large and impactful businesses. For instance, Affirm and Chime reportedly each have 13 million customers, more than U.S. Bank (No. 5 by assets), PNC (No. 6) and Truist (No. 7). PayPal alone has more than 300 million customers. The special legal powers available only to banks mean that even the largest nonbank fintechs must rely on bank partners to deliver financial services to their many customers. Only banks can offer insured deposits, access the Federal Reserve's payment system and card rails, lend effectively across state borders, etc. Hence, the need for partnerships among fintechs and banks. The Durbin amendment, which severely restricts debit interchange revenue once banks top $10 billion of assets, means that smaller community banks are best suited to be partners to deposit-oriented fintechs. Large banks are also typically less inclined to jeopardize their national brand by partnering with direct-to-consumer fintechs, preferring instead to compete head-on.
BankThink: SEC's regulatory approach chills innovation and may send crypto overseas --Gary Gensler, chair of the Securities and Exchange Commission, invites crypto companies to stop by, sit down and be proactive about understanding the application of securities laws to their entities' business. However, rather than provide useful guidance to entities who try to "come in and talk," the SEC begins to investigate, serve subpoenas, and, in the case of Coinbase, threaten a lawsuit after Coinbase attempted to proactively engage with the commission. In recent months, the SEC has ramped up its "regulation by enforcement" strategy — despite publicly denying the practice — posing a threat to the United States' lead in the global race to capitalize on the digital assets economy. Two recent actions illustrate the SEC's hostile approach. In July, the SEC filed an enforcement action against a former Coinbase employee and two other individuals for alleged insider trading. And in a more recent move, the SEC is now apparently investigating whether Coinbase allows unregistered securities to be traded on its platform.Other than the focus on Coinbase in particular, both actions illustrate the SEC's approach to regulating digital assets through enforcement rather than through well-informed rulemaking or guidance where the American people have a say. Indeed, industry is forced to manage compliance by reading between the lines of SEC enforcement filings, whether these are complaints filed in court or settlement agreements posted on its website. These are not the actions of a pro-innovation agency cultivating good relationships with an industry that it supposedly wants to have "come in and talk." As cryptocurrencies' widespread adoption and prominence continue to grow, there is broad consensus among policymakers and industry stakeholders alike that clear, fit-for-purpose regulations are long overdue. Leading figures in the crypto ecosystem have long asked for a better-defined regulatory framework to guide their work, but the recent approach by SEC leadership poses a serious threat to domestic innovation in this space.Rather than working alongside Congress and other agencies like the Commodity Futures Trading Commission to coalesce around a unified approach to crypto regulation, the SEC has taken an opposite approach: working to slow down the industry and stifle innovation. Even SEC Commissioner Hester Peirce voiced her opposition to the SEC increasing resources and staff to focus on enforcement. Unlike Congress, the CFTC and the millions of people who own and use cryptocurrencies, the SEC seems to inflexibly view these assets as securities rather than commodities, while failing to provide clarity as to why. Naturally, the SEC would be forced to relinquish its oversight of crypto if the assets are deemed commodities, suggesting a rigid bias behind its beliefs that is not rooted in any legitimate legal basis, but rather a tortured interpretation of a more than 70-year-old Supreme Court precedent.
Progressives 'cautiously optimistic' as Barr agenda comes into focus --Changes are coming to the Federal Reserve's regulatory and supervision policy, just not the type of sweeping reform some had advocated and others had feared. Last week, Michael Barr gave his first speech since being sworn in as the Fed's new vice chair for supervision in July. He outlined a different set of priorities from his predecessor, Randal Quarles, but did not deliver the full- scale rebuke called for by certain progressive groups at the onset of the Biden administration."I would have liked more specificity on these things, like outlining Trump-era guidelines and what exactly he wants to change," said Renita Marcellin, senior policy analyst at Americans for Financial Reform. "But he laid out all the things we can expect to see in the fall. … We're cautiously optimistic, but optimistic nonetheless, on where things are headed. But yes, at some point, the devil is in the details, and we want to see the details." The speech, delivered at the Brookings Institution, was the first time Barr outlined his aspirations as vice chair for supervision, a presidentially appointed position tasked with setting the Fed's regulatory agenda. Barr shared few details about his visions for the position during his Senate confirmation hearing. In his remarks, some policy experts saw Barr potentially laying the groundwork for increasing capital requirements. During a question-and-answer session after the speech, he said he would not commit to making the final implementation of the Basel III international regulatory standards capital neutral, contradicting a stance espoused by Fed officials as recently as last year.Barr also said he would oversee a "holistic" review of the Fed's various capital requirements this fall. During that effort, Barr said he would evaluate whether the country's largest banks were sufficiently capitalized."What we're doing is this fall taking a look at where we are with capital in the system so that as we make judgments about Basel III, the supplementary leverage ratio, countercyclical capital buffer, it's with an overall sense of is capital in the system strong enough," he said. "It's strong; I think the question is, is it strong enough?" Left-leaning policy advocates say the question of whether there is sufficient capital in the system is one that went unasked under Quarles, who was appointed vice chair for supervision by then-President Donald Trump.
Appeals court dismisses Hunstein suit in win for banks --An appeals court has dismissed a debt collection lawsuit that threatened to upend the ability of debt collectors— and banks that hire them— from outsourcing the notification of a debt to consumers. In an expected win for the debt collection industry, the 11th U.S. Circuit Court of Appeals on Friday reversed a three-judge panel's ruling last year and dismissed the case, Hunstein v. Preferred Collection and Management Services Inc., for a lack of standing.The court held that a debt collector did not violate the Fair Debt Collection Practices Act when it gave an outside mail letter vendor a consumer's personal account information related to collecting a debt. Though the FDCPA forbids any communication about a debt to a third party, financial services companies have used mail vendors for decades to send notification letters to debtors.A federal appeals court dismissed a lawsuit against a debt collection agency after finding that the plaintiff did not suffer concrete injury when their personal information was shared with the debt collector.. The Hunstein decision last year forced some debt collectors in Alabama, Georgia and Florida to stop using letter vendors. It also produced "hundreds of copycat lawsuits across the U.S.," said Scott Purcell, the CEO of the Association of Credit and Collection Professionals."It is a relief to see that many of the broader negative implications of this case have now been mitigated," Purcell said. "This decision solidifies that concrete harm must be shown to meet the standing requirements for bringing a lawsuit under the Fair Debt Collection Practices Act in federal court."The case involved the plaintiff Richard Hunstein who sued Johns Hopkins All Children's Hospital over a debt for his son's medical treatment. Ultimately the case turned on the issue of standing and whether the electronic delivery of private information that was not made public constituted harm to the consumer.Last year, a three-judge panel ruled that Hunstein's case against a Tampa, Fla., debt collector, Preferred Collection and Management Services Inc., could continue. The judges said Preferred had violated the FDCPA by sending information about the debt electronically to CompuMail Inc., a Concord, Calif., collection letter vendor. However, the Supreme Court issued a verdict last year in TransUnion LLC v. Ramirez, that found a plaintiff must show concrete injury to establish an alleged intangible harm. In the Hunstein case, Chief Judge William Pryor said that because the plaintiff was unable to show concrete harm — such as the public dissemination of private information — he had no standing and dismissed the case. "The plaintiff alleges that a creditor sent information about his debt to a mail vendor, which then sent him a letter on behalf of the creditor reminding him of the terms of the debt," Pryor wrote. "Though he identified no specific harm in his complaint, he now claims that the debt collector's act caused him a concrete injury because it was analogous to the common law tort of public disclosure."The judge continued: "The comparison to public disclosure of private facts is the sole basis on which the plaintiff rested his claim of concrete harm. Because that comparison fails, he cannot show any real harm, and we dismiss his complaint."
CFPB's Chopra calls level of P2P fraud 'frightening' - The Consumer Financial Protection Bureau is exploring ways to fight a massive uptick in fraud in real-time payments, Director Rohit Chopra said Wednesday. Speaking remotely at an event celebrating the nonprofit Public Citizen's 50th anniversary, Chopra said the CFPB is looking at the framework of the Electronic Fund Transfer Act to determine how it should apply to peer-to-peer payment providers such as Zelle, PayPal's Venmo and others. The law's implementing regulation, Regulation E, provides specific protections to consumers when they transfer funds electronically. Despite the increase in fraud, financial institutions have long claimed they cannot be held liable when a consumer incorrectly sends a payment to the wrong person or is tricked into sending a payment that later turns out to be a scam. "The level of sophistication and technology use is really frightening … because there's not really that moment to hold or freeze or take back" the money, Chopra said of the tactics used by criminals to defraud consumers. "The way in which individuals are defrauded, it's become difficult to crack down." Banks and credit unions, and their trade groups, have said they will sue the CFPB if it tries to assign broad liability for fraudulent payments that were authorized by consumers. Without specifically stating what the CFPB plans to do, Chopra implied that there are "small ways" to ensure that real-time payment providers at least investigate consumer allegations of fraud. "We have been talking to a lot of institutions and a lot of stakeholders about how should the framework of the Electronic Fund Transfer Act apply to P2P players and payment providers," he added. "What are the differences in [how] small banks and large banks are dealing with it? What are some of the small things we can do to make sure that consumer rights, when it comes to getting an investigation into an error or potential fraud, are adhered to?" Chopra said he didn't have an immediate answer but is very concerned about how fraud levels are increasing and whether consumers know where to get help.
Lawmakers spar over consumer protections for BNPL, other new products — Democrats on the Senate Banking Committee called for stronger consumer protections around novel financial products on Tuesday, arguing too little is done to police fintechs. But a top Republican and industry supporters countered that a heavy regulatory hand would stifle innovation and hurt consumers who could benefit from new alternatives. The committee's Democrats focused largely on three types of products that have grown popular in recent years: buy now/pay later, where consumers can pay for retail purchases interest-free in a handful of regular installments; earned wage access products, which proponents tout as a safer alternative to payday loans; and training repayment agreements, or employer contracts that can require new hires to pay their company back for certain education programs. For two of those three products — BNPL and earned wage access — Senate Banking Chair Sherrod Brown, D-Ohio, suggested that "stronger consumer protections" could make them significantly more palatable. "Newer credit products, like buy now/pay later, could help consumers pay for products in installments, with strong consumer protections. Yet many of these products come with hidden fees, they lack transparency, and they aren't underwritten properly," Brown said. He added later that "employer-based earned wage advances with strong consumer protections can help workers cover unexpected expenses or emergencies — though the better alternative would simply be for the companies to pay their workers enough to live on." But the Ohio Democrat had harsher words for training repayment agreement programs, arguing that their acronym of "TRAP" was painfully apt. Brown described the debt product as "so predatory, so offensive" that it "should have no place in our financial system." Among committee Republicans, only Ranking Member Pat Toomey of Pennsylvania asked questions during the hearing. His opening remarks stressed the upsides of financial innovation and warned Democrats about the potential risk of squashing it with heavy regulation. "As long as consumers have truthful and accurate information about financial products, they're best positioned to decide what products to use," Toomey said. "Any regulation of financial products should fit the product type, make room for innovation, and maximize consumer choice. Too often, however, the response from my friends on the other side of the aisle is to see something new and panic."
CFPB, FTC say court ruling would undercut credit reporting law - The Consumer Financial Protection Bureau and the Federal Trade Commission say that a 2021 federal court decision could limit protections for consumers looking to remove errors on their credit reports. In a court filing this week, the two agencies argued that the ruling "undercuts a central remedial purpose" of the Fair Credit Reporting Act. The law requires banks, mortgage lenders, debt collectors and other companies that furnish information used in credit reports to investigate any disputes and correct errors. The case involves a Pennsylvania man, Stefan Ingram, who reported that a Comcast account opened under his name was fraudulent. The Consumer Financial Protection Bureau and the Federal Trade Commission argue that a federal judge's ruling last year risks opening a loophole under the Fair Credit Reporting Act.Bloomberg Ingram's debt under the account was sent to a debt collection agency. After Ingram's lawyer asked for the information to be scrapped from his credit report, Comcast asked for a police report and determined that the account wasn't fraudulent absent more information. Ingram sued Equifax, Experian and Comcast as part of the original lawsuit, and he settled with those companies in 2019. Last year, a federal judge ruled sided with the remaining defendant, the debt collector Waypoint Resources Group. The judge wrote that Ingram had "failed to provide sufficient information" so that Waypoint could investigate the issue, calling his complaint "frivolous." Now the CFPB and FTC are taking issue with the ruling. They submitted a "friend of the court" brief with the U.S. Court of Appeals for the Third Circuit, where Ingram's lawyers are hoping to get the earlier decision overturned. The two federal agencies argued that the law is clear that companies that furnish information to credit reporting agencies must investigate any disputes. They also wrote that the judge's ruling could lead to companies not advising consumers that their dispute was deemed frivolous, thereby "leaving consumers in the dark." "Allowing furnishers to reject purportedly frivolous disputes risks opening a loophole to this rule, whereby consumers may never be advised of the outcome of their disputes and will not be provided the information necessary to cure any deficiencies," the CFPB wrote in a summary of the brief posted on its website. "As a result, inaccuracies in credit reports may go uncorrected."
Wells Fargo to pay $145 million to settle government's 401(k) inquiry Wells Fargo has agreed to pay $145 million to resolve a government inquiry into the company's stock-related contributions to its employee retirement plans. The Department of Labor said that the bank's 401(k) plan overpaid for preferred stock that was eventually deposited into employees' accounts. The San Francisco bank has disputed the agency's allegations, but it agreed to pay a $13.2 million penalty to the Labor Department, plus $131.8 million to plan participants, to settle the issue. The Labor Department's investigation, which covered 2013 to 2018, found that the bank paid between $1,033 and $1,090 per share for preferred stock. The preferred shares then turned into $1,000 in Wells Fargo common stock for plan participants. "Our investigation found those responsible for Wells Fargo's 401(k) plan paid more than fair market value for employer stock and, by doing so, betrayed the trust of the plan's current and future retirees," Secretary of Labor Marty Walsh said in a press release. In a statement, Wells Fargo said it "strongly disagrees" with the allegations and "believes it followed applicable laws in conducting the transactions." "Though the Company disagrees with the DOL's allegations and has not conducted these transactions since 2018, Wells Fargo believes resolving this legacy matter is in the best interest of the Company," the bank's statement said. Wells Fargo also said that all 401(k) plan participants received "all matching and profit-sharing contributions due to them" and that an independent third party confirmed that the plan did not pay more than the fair market value of the stock. The bank and the plan trustee, GreatBanc Trust Co., agreed to the settlement without admitting or denying the agency's allegations.
97 Members of Congress Reported Trades in Companies Influenced by Their Committees - At least 97 current members of Congress bought or sold stock, bonds or other financial assets that intersected with their congressional work or reported similar transactions by their spouse or a dependent child, an analysis by The New York Times has found. U.S. lawmakers are not banned from investing in any company, including those that could be affected by their decisions. But the trading patterns uncovered by the Times analysis underscore longstanding concerns about the potential for conflicts of interest or use of inside information by members of Congress, government ethics experts say.Times reporters analyzed transactions between 2019 and 2021 using a database of members’ financial filings called Capitol Tradescreated by 2iQ Research. They matched the trades against relevant committee assignments and the dates of hearings and congressional investigations.When contacted, many of the lawmakers said the trades they reported had been carried out independently by a spouse or a broker with no input from them. Some have since sold all their stocks or moved them into blind trusts. Two said the trades were accidental. Here’s everything The Times’s analysis turned up. Read the full article.
The Day Wall Street’s Narrative of “Inflation is Over” Fell Apart: A Sea of Red by Wolf Richter -What I got from the reaction in the markets today: Until this morning, they eagerly ignored my inflation discussions over the past many months, of how CPI inflation has been shifting into services – housing, health insurance, auto insurance, medical services, etc. – and those good folks focused instead on prices of gasoline and plane tickets, which are plunging, and so they expected this inflation to be well on the way out the door. Inflation “collapse” is what Jonathan Golub, a Managing Director in Credit Suisse’s New York office, called it ridiculously on CNBC’s Fast Money just yesterday morning.“Every one of us sees when we go to the gas station that the price of gasoline is down, and oil is down. We see it even with food. So, it really is showing up in the data already. And, that’s a really big potential positive,” he said. And stocks are going to soar because inflation is over, and the Fed will pivot or whatever. I mean, this stuff is just a hoot.This phenomenon was all over Wall Street – this crazy notion that because gas prices were plunging, inflation would suddenly go away on its own. Obviously, these people cannot be that dumb; they had a purpose, and the purpose was to hype stocks into the stratosphere, and they did it for days. And it worked.Then came the CPI release this morning. As I’ve been reporting for months, today’s numbers once again showed that inflation is getting increasingly entrenched in vast parts of the economy that have little or nothing to do with tangled-up supply chains and messed-up commodities, and that this inflation is getting worse, that it has been muscling into services for the 12th month in a row, and that the Fed will have one heck of a time cracking down on this raging inflation. Here’s my analysis and charts of the CPI mess today.And markets should take Powell et al. seriously when they talk about further big rate hikes, more rate hikes, and higher rates for longer, because this inflation is tearing up the economy, and they know it, and they’re going to crack down on it, and it may be too little and way too late, but they’re now cracking down on it. By the looks of it, markets today started to take Powell et al. a wee bit more seriously, which triggered a widespread sell-off that in the span of a few hours unwound most of the six-day-long hype-and-hoopla “inflation is over” rally.Just about everything tanked: Industrial stocks, blue chips, giant tech stocks, SPACs, IPO stocks, even Apple bigly (-5.9%), and Meta of course (-9.4%), and Nvidia (-9.5%), and Advanced Micro Devices (-9.0%), and NXP Semiconductors (-8.1%), and Boeing (-7.2%), and Eastman Chemical (-11.3%).The S&P 500 index dropped 4.3%, and it was a sea of red. Only five stocks in the S&P 500 index were green, including Twitter the second-best performing stock in the index today, which spiked, I mean ticked up 0.8% on the news that its shareholders approved the buyout offer from Elon Musk, who used to walk on water, but now doesn’t feel like doing the buyout anymore, and the whole thing is a mess for the court to sort out.And there’s of course Cathie Wood, who’s been out there promoting the idea that “deflation” is the real threat here, and that the Fed is making a “mistake” by cracking down on the hype-and-hoopla stocks in her funds, I mean on inflation. Her Ark Innovation ETF [ARKK] fell 6.8% today and is down 73% from the peak in February. No wonder she’s getting a little antsy about the Fed crackdown on inflation.Cryptos got knocked down too. Bitcoin got whacked down by about 10% from $22,500 early this morning to $20,150 at the moment. It’s down close to 70% from its high. Ethereum got knocked down about 9%. Cryptos, which had been hyped as a hedge against inflation, swoon every time inflation is shown to rage.Gold dropped about $30/oz on the CPI news this morning. Gold, a classic and time-proven hedge against inflation over the long term, after a huge run-up during the Everything Bubble, has remained roughly flat since the Fed pivot late last year.But “roughly flat” is great compared to the Nasdaq Composite, another hedge against inflation, which plunged 5.2% today and is down 28% from its peak in November.Among bonds, prices fell and yields jumped. This is good news for yield investors wanting to buy bonds and CDs going forward, tempered by the fact that yields didn’t jump nearly enough to make up for raging inflation:The 6-month Treasury yield jumped by 19 basis points today to 3.75%, the highest since November 2007:
Private equity still investing billions in dirty energy despite pledge to clean up -Private equity firms pumping billions of dollars into dirty energy projects are exposing investors, including pensioners, to unknown financial risks as the planet burns and governments face escalating pressure to act, new research finds.The first-of-its-kind climate risks scorecard ranks Carlyle, Warburg Pincus and KKR as the worst offenders among eight major private equity companies with significant fossil fuel portfolios. All three continue investing heavily in greenhouse-gas-emitting projects with no adequate plan on transitioning away from oil and gas, according to the analysis by two financial watchdog non-profits of publicly available information. The firms also have scant transparency on political and climate lobbying, the report finds.Private equity refers to an opaque form of financing away from public markets in which funds and investors buy and restructure companies including startups, troubled businesses and real estate operations.The eight firms on the scorecard manage a combined $3.6tn in assets including about $216bn in energy projects – an amount equivalent to the fossil fuel financing by the world’s five biggest banks last year.Carlyle is rated F, the lowest in the climate credentials scorecard that has been created by the Private Equity Stakeholder Project (Pesp) and Americans for Financial Reform Education Fund (Afref).More than three-quarters of Carlyle’s energy investments are in fossil fuels, and just over 60% of its 2022 first half profits came through its subsidiary NGP Energy Capital, which focuses almost exclusively on oil and gas projects.Last year Warburg Pincus announced that it would not seek further fossil fuel investments in its next buyout, yet since then its dirty energy portfolio has expanded.KKR, one of the world’s wealthiest private equity firms, has said it will continue to invest in fossil fuel projects despite publishing a climate action strategy.Among the worst downstream polluters is Blackstone, which also scored a D rating, with its power plants emitting a combined 18.1m metric tonnes of planet-warming carbon dioxide in 2020 – equivalent to the annual emissions of nearly 4m gas-powered cars, according to the report.Higher atmospheric and ocean temperatures are directly linked to the rise in catastrophic events such as drought, extreme temperatures and hurricanes, which in 2021 cost $152.6bn in the US alone.“The scorecard provides important information and analysis that can help investors and communities understand what these firms are doing, and makes very clear that the firm’s climate commitments are largely empty words, said Oscar Valdes Viera, research manager at Afref and co-author of the climate risks scorecard.Globally, private equity manages trillions of dollars for wealthy individuals and institutional investors such as mutual funds, endowments and pension funds. The industry has invested an estimated $1tn in the energy sector since 2010, and while there’s been growth in renewables, the lion’s share is still in oil, gas and coal.
ESG on the edge: Controversy weighs on sustainable ETFs - Investing in ESGs has taken a controversial turn in recent weeks as some states have taken aim at the sustainable funds. This month, Florida banned its $186 billion pension fund from investing according to ESG factors. And in Texas, the state's comptroller accused ten financial firms of boycotting energy companies. The move could force certain Texas government funds to sell any shares in these companies. BlackRock was among those named in the accusation, although in a statement the company affirmed that it is not boycotting oil. But the shift in sentiment has led to increased scrutiny of how ESG funds are composed. "It's actually relatively simple, we're not boycotting energy companies," Arne Noack, Head of Systemic Investment Solutions for the Americas for DWS, told Bob Pisani on CNBC's 'ETF Edge' on Wednesday. "[USSG and SNPE] have between 4% and 5% of a stake in energy companies, which is in line with the S&P 500," he added. Noack said that USSG, for example, is largely sector neutral compared to the MSCI USA Index benchmark, but only invests in companies that perform better than the average from the ESG angle. The politicization of sustainable funds particularly stems from the question of what the products focus on and promote, and the factors considered when constructing one. "ESG stands for Environmental, Social and Governance, and the focus has been on the 'E' part of it," Todd Rosenbluth, head of research at VettaFi, said in an 'ETF Edge' interview on Wednesday. "Whether companies are too focused on climate change, and what's happening related to that." Rosenbluth explained that the strategies are broadly diversified and assessed based on 30 different subfactors. Climate change is among them, but also issues like fair pay practices and gender diversity. Some of the largest ESG funds have significant stakes in the energy industry. According to VettaFi, BlackRock's ETFs ESGU and SUSA have 4.8% and 3.8%, respectively, in companies like Baker Hughes, Chevron, Exxon Mobil, Halliburton, and Valero Energy. The weighting for energy stocks in these funds are in line with the S&P. "So how can you be favoring ESG and still have exposure to these large cap, multinational energy companies?" Rosenbluth said. "You can have both. These are intended to be broadly diversified products." The ESG industry is comprised of 186 sustainable ETFs, according to VettaFi, representing 6% of exchange-traded funds as a whole at about $100 billion in value. That's about 1.5% of the dollar value of the ETF business as a whole. While there have been efforts to standardize and codify what ESG means, the challenge remains of how to exactly define the products. "We're talking about funds that have different objectives that are all valid,"
HUD probe into valuation bias focuses on Appraisal Foundation - The Department of Housing and Urban Development is investigating allegations of discriminatory policymaking by one of the appraisal profession's key quasi-regulatory bodies. The probe is centered on the Appraisal Foundation, according to multiple sources directly familiar with the investigation and an inquiry email from a HUD lawyer reviewed by American Banker this week. The Appraisal Foundation is a Washington, D.C.-based nonprofit that sets best practices and entry requirements for appraisers throughout the country. Congress granted it the authority to write the Uniform Standards of Property Appraisal Practice, or USPAP, which it then licenses to state and territorial appraisal boards. Those agencies, in turn, apply USPAP as law. HUD's Office of Systemic Investigations is examining the foundation to determine if its standards and requirements perpetuate racial inequities in home valuation as well as within the appraisal profession's own ranks, according to the email. HUD investigators have spoken to current and former Appraisal Foundation board members and staffers as well as people in and around the profession, including working appraisers. Individuals interviewed by HUD told American Banker that they detailed shortcomings in the foundation's rulemaking process and a lack of independence for its two rulemaking bodies: the Appraisal Standards Board and the Appraisal Qualifications Board. As a private entity, the foundation is not subject to the federal Administrative Procedure Act, which requires a lengthy and deliberate process for publicly vetting potential new regulations. Instead, it uses an "exposure draft" process that some in the profession feel draws insufficient input from outside groups, including those focused on issues of race and discrimination. Individuals familiar with the Appraisal Foundation's inner workings also told HUD the organization prioritizes its own revenue objectives over the best interests of the profession. One person interviewed by HUD, who requested anonymity to discuss the investigation, described a culture in which board members were reluctant to voice concerns with policies or procedure out of fear of reprisal from the foundation's leaders, president David Bunton and senior vice president Kelly Davids.
VA home loan bill could open door to more virtual appraisals - Another segment of government-backed home loans could soon become available without needing an in-person property appraisal. A bill passed by the House this week directs the Department of Veterans Affairs to change its policies around appraisals of properties against which it provides loans. These changes include provisions for so-called "desktop appraisals" — in which properties are reviewed virtually rather than in person — and waivers of appraisals altogether. H.R. 7735, also known as the Improving Access to the VA Home Loan Benefit Act of 2022, is the latest government initiative aimed at addressing the national undersupply of home appraisers and the issues it is creating in the mortgage industry. The Department of Veterans Affairs has special requirements for home appraisals related to its veterans home loan program. If the bill advances through the Senate and is signed into law, the VA will join Fannie Mae and Freddie Mac in codifying the use of virtual appraisals. The government-sponsored entities began allowing for desktop appraisals on the mortgages they purchased provisionally during the pandemic, when in-home inspections were prohibited. Last fall, then-acting Director of the Federal Housing Finance Agency Sandra Thompson announced that the change would be made permanent for certain loans starting this year. Thompson said the change allows appraisers to complete more valuation reports in a shorter amount of time and alleviates pressures on rural and underserved communities, where a lack of appraisers is hampering transactions.
Until appraisal bias is conquered, the racial wealth gap will persist - Growing up in Indiana, John Mellencamp’s classic 1980s ballad, "Pink Houses," remains one of my favorites. Today, that song's perceptive lyrics resonate very differently with me. The song's first verse describes a Black man on his front porch in a Black neighborhood thinking "he's got it so good" with an interstate running through his front yard. The wiser, more experienced adult in me now more clearly understands how the song portrays the very different fortunes and expectations for communities of color — along with too many others left behind — in their pursuit of the American dream. And, I clearly see that appraisal bias is a common injustice for many people of color who buy, sell, or refinance their homes. After all, achieving the American dream and building intergenerational wealth through homeownership is only possible if property values are assessed fairly and accurately for all.That's why last summer, the National Credit Union Administration joined 12 other federal agencies to begin righting a longstanding wrong. At President Biden's direction, the Property Appraisal and Valuation Equity Task Force, PAVE for short, was charged with confronting a skeleton in the closet: the undervaluing of properties due to racial or ethnic bias.This discriminatory practice has limited the ability of many families of color to benefit fully from the financial returns of homeownership. For example, a 2021 Freddie Mac study of 12 million appraisals found that homes in Black and Latino neighborhoods were valued lower than similar properties within white communities.Multiple media investigations have also shown blatant appraisal bias against people of color. In one recent news story, a home that had been "whitewashed" by removing any trace of its Black owners was appraised for hundreds of thousands of dollars more than the original estimate. Such injustice must come to an end.More than a decade ago, in the Dodd-Frank Wall Street Reform and Consumer Protection Act, Congress enacted reforms to address problems in the appraisal industry. As a congressional staffer, I contributed to the provisions in that law addressing appraisal bias. Among other things, these reforms strengthened the powers of the Appraisal Subcommittee, the federal agency that supervises state appraisal regulatory programs. Those fixes addressed appraisal independence and appraisal inflation. However, as the Freddie Mac study, other reports, and recent news coverage demonstrate, we continue to see breakdowns in the appraisal system, particularly bias based on race. Technology offers us one solution to the problem of human prejudice. That's why the NCUA is working with other agencies on joint rules to establish quality control standards for automated valuation models. In doing so, we must ensure algorithms do not result in bias in their results and violate fair-lending laws.Ultimately, systemic appraisal bias is perpetuated by several factors, so we must adopt a multipronged approach to fix the problem. In addition to the recently released recommendations in the PAVE Action Plan, existing statutes like the Fair Housing Act and the Equal Credit Opportunity Act must be leveraged to right this wrong.
30-Year Mortgage Rates at 6.30%; 14 Year High --From Matthew Graham at MortgageNewsDaily: Boring Day For Rates, But Not "Good" Boring The mortgage market is no stranger to excitement in 2022. Unfortunately, it hasn't been the good kind of excitement. That's especially true of the past few weeks as rates pushed back up to long term highs. After yesterday's upside surprise in the Consumer Price Index (a key inflation report that frequently causes volatility in markets), rates surged up to match the highest levels in 14 years. ... Lenders continue to offer rates in the low to mid 6% range. Many loans continue to require a historically high amount of upfront cost due to pricing constraints in the mortgage bond market (i.e. investors aren't offering premiums to buy loans that run a high risk of being paid off the moment rates drop enough for a refi to make sense). This is a graph from Mortgage News Daily (MND) showing 30-year fixed rates from three sources (MND, MBA, Freddie Mac) over the last 5 years. The 30-year fixed rate for top tier scenarios was 6.30% today, up from the recent low of 5.05% on August 1st. Go to MND and you can adjust the graph for different time periods.
Housing September 12th Update: Inventory Decreased 1.0% Last Week --Active inventory decreased 1.0% last week. Here are the same week inventory changes for the last four years (the increase in 2019 was a one-week surge): Inventory bottomed seasonally at the beginning of March 2022 and is now up 127% since then. More than double! Altos reports inventory is up 26.9% year-over-year. This inventory graph is courtesy of Altos Research. As of September 9th, inventory was at 547 thousand (7-day average), compared to 553 thousand the prior week. Inventory was down 1.0% from the previous week. Inventory is still historically low. Compared to the same week in 2021, inventory is up 26.9% from 431 thousand, however compared to the same week in 2020 inventory is down 5.5% from 579 thousand. Compared to 3 years ago, inventory is down 43.2% from 964 thousand. Here are the inventory milestones I’m watching for with the Altos data:
1. The seasonal bottom (happened on March 4th for Altos) ✅
2. Inventory up year-over-year (happened on May 13th for Altos) ✅
3. Inventory up compared to two years ago (currently down 5.5% according to Altos)
4. Inventory up compared to 2019 (currently down 43.2%).
Here is a graph of the inventory change vs 2021, 2020 (milestone 3 above) and 2019 (milestone 4).The blue line is the year-over-year data, the red line is compared to two years ago, and dashed purple is compared to 2019.Two years ago (in 2020) inventory was declining all year, so the two-year comparison will get easier all year. Based on the recent changes in inventory, my current estimate is inventory will be up compared to 2020 in Q4 of this year.A key will be if inventory increases this month - so far inventory has decreased. Mike Simonsen discusses this data regularly on Youtube.
Mortgage Equity Withdrawal Still Strong in Q2; Homeowners now relying on Home Equity lines to extract equity Today, in the Real Estate Newsletter: Mortgage Equity Withdrawal Still Strong in Q2 Excerpt: Here is the quarterly increase in mortgage debt from the Federal Reserve’s Financial Accounts of the United States - Z.1 (sometimes called the Flow of Funds report) released on Friday. In the mid ‘00s, there was a large increase in mortgage debt associated with the housing bubble. In Q2 2022, mortgage debt increased $263 billion, the most since 2006. Note the almost 7 years of declining mortgage debt as distressed sales (foreclosures and short sales) wiped out a significant amount of debt.However, some of this debt is being used to increase the housing stock (purchase new homes), so this isn’t all Mortgage Equity Withdrawal (MEW).There is much more in the article.
California Home Sales off 24% YoY in August, Prices Up Only 1.4% YoY; August Existing Home Sales Forecast -Today, in the Calucalated Risk Newsletter: California Home Sales off 24% YoY in August, Prices Up Only 1.4% YoY; August Existing Home Sales Forecast On California: August’s sales pace was up 6.1 percent on a monthly basis from 295,460 in July anddown 24.4 percent from a year ago, when 414,860 homes were sold on an annualized basis. ... The statewide median price edged up 0.7 percent in August to $839,460 from the $833,910 recorded in July and was up 1.4 percent from the $827,940 recorded last August. The year-over-year price gain was the smallest in more than two years.From housing economist Tom Lawler: I project that existing home sales as estimated by the National Association of Realtors ran at a seasonally adjusted annual rate of 4.84 million in August, up 0.6% from July’s preliminary pace and down 19.2% from last August’s seasonally adjusted pace.
Hotels: Occupancy Rate UP 3.1% Compared to Same Week in 2019 --Note: This is the first week, since the onset of the pandemic, with the occupancy higher than the comparable week in 2019.From CoStar: STR: Weekly US Hotel Rates Outpace Pre-Pandemic Level by More Than 20% - U.S. hotel performance dipped from the previous week but continued to improve in comparison with 2019, according to STR‘s latest data through Sept. 3.Aug. 28 through Sept. 3, 2022 (percentage change from comparable week in 2019*):
• Occupancy: 62.8% (+3.1%)
• Average daily rate (ADR): $147.14 (+20.9%)
• Revenue per available room (RevPAR): $92.45 (+24.6%)
*Due to the pandemic impact, STR is measuring recovery against comparable time periods from 2019. The following graph shows the seasonal pattern for the hotel occupancy rate using the four-week average. The red line is for 2022, black is 2020, blue is the median, and dashed light blue is for 2021. Dashed purple is 2019 (STR is comparing to a strong year for hotels). The 4-week average of the occupancy rate is above the median rate for the previous 20 years (Blue). The 4-week average of the occupancy rate will increase during the Fall business travel period, and then decline in to the Winter.
Retail Sales Increase 0.3% in August - On a monthly basis, retail sales were up 0.3% from July to August (seasonally adjusted), and sales were up 9.1 percent from July 2021. From the Census Bureau report: Advance estimates of U.S. retail and food services sales for August 2022, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $683.3 billion, an increase of 0.3 percent from the previous month, and 9.1 percent above August 2021. ... The June 2022 to July 2022 percent change was revised from virtually unchanged to down 0.4 percent. This graph shows retail sales since 1992. This is monthly retail sales and food service, seasonally adjusted (total and ex-gasoline). Retail sales ex-gasoline were up 0.8% in August.The second graph shows the year-over-year change in retail sales and food service (ex-gasoline) since 1993. Retail and Food service sales, ex-gasoline, increased by 7.6% on a YoY basis. Sales in August were slightly above expectations, and sales in May, June and July were revised up, combined.
Retail Sales Doing Just Fine, Thanks Shoppers. But Sales at Gas Stations Sag on Plunge in Gasoline Prices by Wolf Richter -There was a big drop in sales at gas stations, driven by a plunge in gasoline prices and a drop in demand for gasoline (both of which I discussed yesterday). But retail sales without sales at gas stations jumped by 0.8% in August from July, and has been on a solid upward trend for months, even as inflation hasshifted from goods, sold by retailers, to services, which are not sold by retailers. Retail sales track sales of goods, not of services. And inflation has been shifting from goods to services, and services inflation is now driving overall inflation (which I discussed a couple of days ago), even as some goods prices are coming down. The retail sales data today by the Census Bureau are based on surveys of about 5,500 retail businesses, by retailer category, from the retailers’ point of view, not the consumers’ point of view. Overall retail sales rose by 0.3% from July, despite the drop at gas stations, and by 9.1% year-over-year, to $683 billion (seasonally adjusted). Compared to August 2019, the last normal year, total retail sales were up by an astounding 31.1%. Retail sales are grouped by categories of retailers, such as auto dealers and ecommerce sales, and not by product category. But CPI inflation is measured by product category. So CPI inflation cannot be easily applied to retail sales because the categories don’t match.
- Overall CPI inflation in August rose by 0.1% from July, and by 8.3% year-over-year. The CPI for services is spiking relentlessly but doesn’t figure into retail sales because retailers sell goods.
- CPI for gasoline: -10.6% in August from July. But retail sales at gas stations include the other stuff they sell. Many gas stations are in effect convenience stores, selling food, beverages, and other stuff, and the drop in the price of gasoline was moderated by price increases in the other stuff they sell.
- CPI for “food at home”: +0.7% in August from July – which falls into the retailer category of “food and beverage stores.” But Walmart is also a huge grocery retailer, and it is part of “general merchandise retailers,” not food and beverage stores.
- CPI for durable goods: +0.5% in August from July. Durable goods are sold by several retailer categories, including new and used vehicle dealers, ecommerce retailers, appliance stores, electronics stores, furniture stores, general merchandise stores, etc. Their different products face different pricing environments, with some prices declining (i.e. used vehicles and electronics) and with other prices rising (i.e. new vehicles).
- Sales at New and Used Vehicle and Parts Dealers, the largest category, jumped by 2.8% in August from July, and by 6.8% from a year ago, to $128 billion, seasonally adjusted. Compared to August 2019, sales were up 21%.
- This comes on a mix of much higher prices and much lower unit sales as new vehicle dealers are still facing large-scale inventory shortages, though they have shifted, and some brands have now plenty of inventory, while other brands are essentially out of fuel-efficient vehicles.
Gasoline Demand Destruction Accelerates Despite Plunge in Prices: Consumption Drops to August 1997 Level -Gasoline Demand Destruction Accelerates Despite Plunge in Prices: Consumption Drops to August 1997 Level by Wolf Richter -- Over the four weeks through September 9, gasoline consumption dropped by 11.7% from the same four-week period in 2019, to 8.56 million barrels per day on average, below the same periods in 2020 and 2021, according to EIA data today. The EIA measures gasoline consumption in terms of barrels supplied to the market by refiners, blenders, etc., and not by retail sales at gas stations. On this moving four-week average basis, it was the steepest decline so far this year, that has seen nothing but declines from the same periods in 2019. The decline accelerated even as gasoline prices have plunged from the top of the spike in mid-June. This may indicate that the classic economic principle of “demand destruction” – where a price spike triggers a decline in demand that then causes the price to back off – may not just be a blip, but that this demand destruction may have become in part structural. Peak driving season is in the summer. But this year, gasoline demand in the summer (red line in the chart below) was substantially below the summer driving season in 2019 (yellow line) and in 2021 (gray line), and roughly even with the beaten-down levels of 2020 (green line). And then in August and September, demand fell further, and ended below the levels of 2020: This demand destruction caused by sky-high gasoline prices is happening on a global scale. It’s where price resistance has set in, and people have changed their behavior a little here and there. They cut out unnecessary trips. They’re prioritizing their most fuel-efficient vehicle in the garage. When they buy a vehicle, fuel economy is moving up as a decision factor. Working from home has become sticky, and fewer people are commuting to work every day. And for vacations, people might have chosen to go places that involve less driving. This demand destruction pushed down the price. The average price of gasoline in the US, all grades combined, had spiked to $5.00 a gallon by June 13, according to EIA data. This type of price spike – up 63% year-over-year – sent shock waves through wallets and minds. Everyone was talking about the price of gasoline. But the average price has now dropped to $3.69, which is where it had been for years in the past – and yet, demand destruction accelerated: Gasoline consumption has been stagnant since 2007. Over the long term, the four-week average gasoline consumption of 8.56 million barrels per day was first exceeded in August 1997: EVs are still only a minuscule part of the 284 million vehicles in operation. There are only 1.8 million EVs on the road, for a minuscule share of 0.63% of all vehicles in operation (my discussion on what Americans are driving). EVs are being prioritized for driving in two-vehicle households to dodge high gasoline prices. And EV sales are booming, with long wait lists and consumers willing to pay whatever. So EVs are starting to have some impact on gasoline demand, but it’s still very small.
BLS: CPI increased 0.1% in August; Core CPI increased 0.6% - From the BLS: The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.1 percent in August on a seasonally adjusted basis after being unchanged in July, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 8.3 percent before seasonal adjustment. Increases in the shelter, food, and medical care indexes were the largest of many contributors to the broad-based monthly all items increase. These increases were mostly offset by a 10.6-percent decline in the gasoline index. The food index continued to rise, increasing 0.8 percent over the month as the food at home index rose 0.7 percent. The energy index fell 5.0 percent over the month as the gasoline index declined, but the electricity and natural gas indexes increased. The index for all items less food and energy rose 0.6 percent in August, a larger increase than in July. The indexes for shelter, medical care, household furnishings and operations, new vehicles, motor vehicle insurance, and education were among those that increased over the month. There were some indexes that declined in August, including those for airline fares, communication, and used cars and trucks. The all items index increased 8.3 percent for the 12 months ending August, a smaller figure than the 8.5-percent increase for the period ending July. The all items less food and energy index rose 6.3 percent over the last 12 months. The energy index increased 23.8 percent for the 12 months ending August, a smaller increase than the 32.9-percent increase for the period ending July. The food index increased 11.4 percent over the last year, the largest 12-month increase since the period ending May 1979. Both CPI and core CPI were above expectations. I'll post a graph later today after the Cleveland Fed releases the median and trimmed-mean CPI.
Consumer prices rise unexpectedly in August, sending stock market tumbling - A hotter-than-expected inflation report on Tuesday sent the stock market tumbling. The Dow Jones Industrial Average fell more than 1,200 points, which amounted to a nearly 4% drop, making it the index's worst day since June 2020. Meanwhile, the S&P 500 — the index to which many 401(k)s are pegged — dropped more than 4%, its worst day of 2022. The tech-heavy Nasdaq plummeted more than 5%. Inflation data released on Tuesday revealed that prices rose slightly in August, worsening the cost woes for U.S. households as the Federal Reserve readies to decide on another interest rate hike next week. The data calls into question whether inflation has peaked. On a monthly basis, the consumer price index rose 0.1% in August, inching upward from the flat month-to-month movement in July, according to the Bureau of Labor Statistics. The consumer price index, or CPI, rose 8.3% over the past year in August, a slight slowdown from 8.5% in July, according to the bureau. The CPI continued to show one major bright spot: gasoline prices. The cost of gas continued to fall significantly, dropping 10.6% in August. Prices rose broadly outside of the energy sector. Food prices rose 0.8% on a monthly basis, slowing from their monthly increase in July but remaining highly elevated. Measures of the consumer prices for shelter, new vehicles and apparel all rose at a faster rate in August than they had over the month prior. The data arrives little more than a week before Federal Reserve officials meet to determine what investors expect to be another borrowing cost increase aimed at fighting inflation.
Stubbornly high rents, food prices boost U.S. inflation in August - (Reuters) – U.S. consumer prices unexpectedly rose in August and underlying inflation accelerated amid rising costs for rents and healthcare, giving the Federal Reserve ammunition to deliver a third 75 basis points interest rate hike next Wednesday. The surprisingly firm inflation readings reported by the Labor Department on Tuesday were despite an easing in global supply chains, which had contributed to a surge in prices earlier in the year. With a resilient labor market supporting strong wage growth, inflation has probably not peaked, keeping the Fed on an aggressive monetary policy path for a while. “The Fed is all but sure to hike rates aggressively next week, likely by 75 basis points, while pushing back strongly against talk of a near-term pause in the tightening cycle,” said Sal Guatieri, a senior economist at BMO Capital Markets in Toronto. The consumer price index edged up 0.1% last month after being unchanged in July. Though consumers got some relief from a 10.6% decline in gasoline prices, they had to dig deeper to pay for food, rent, healthcare, electricity and natural gas. Food prices rose 0.8%, with the cost of food consumed at home increasing 0.7%. Food prices surged 11.4% over the last year, the largest 12-month increase since May 1979. Economists polled by Reuters had forecast the CPI dipping 0.1%. In the 12 months through August, the CPI increased 8.3%. That was a deceleration from July’s 8.5% rise and a 9.1% jump in June, which was the biggest gain since November 1981. Inflation has overshot the Fed’s 2% target. Beyond the dilemma the August inflation numbers present to the U.S. central bank, they are a headache as well for the Biden administration and congressional Democrats hoping to limit their losses in the Nov. 8 mid-term elections, which are expected to flip the House of Representatives into Republican hands. The annual CPI has remained above 8% for six straight months. President Joe Biden said on Tuesday it would “take more time and resolve to bring inflation down,” and cited the recently passed Inflation Reduction Act aimed at lowering the cost of healthcare, prescription drugs and energy as steps taken by the White House to ease the burden of higher prices on Americans. Fed officials gather next Tuesday and Wednesday for their regular policy meeting. Financial markets have priced in a 75 basis points rate increase next Wednesday, with potential for a full percentage point, according to CME’s FedWatch Tool.
Inflation rose 0.1% in August even with sharp drop in gas prices --Inflation rose more than expected in August as rising shelter and food costs offset a drop in gas prices, the Bureau of Labor Statistics reported Tuesday. The consumer price index, which tracks a broad swath of goods and services, increased 0.1% for the month and 8.3% over the past year. Excluding volatile food and energy costs, CPI rose 0.6% from July and 6.3% from the same month in 2021. Economists had been expecting headline inflation to fall 0.1% and core to increase 0.3%, according to Dow Jones estimates. The respective year-over-year forecasts were for 8% and 6% gains. Energy prices fell 5% for the month, led by a 10.6% slide in the gasoline index. However, those declines were offset by increases elsewhere. The food index increased 0.8% in August and shelter costs, which make up about one-third of the weighting in the CPI, jumped 0.7% and are up 6.2% from a year ago. Medical care services also showed a big gain, rising 0.8% on the month and up 5.6% from August 2021. New vehicle prices also climbed, increasing 0.8% though used vehicles fell 0.1%. Markets slumped after the news, with futures tied to the Dow Jones Industrial Average down nearly 350 points after being higher earlier. "Wishful expectations that we are on a downward trajectory and the Fed will lay off the gas may have been a bit premature." Treasury yields leaped higher, as the 2-year note, which is most closely tied to Federal Reserve interest rate moves, surged 0.13 percentage point to 3.704%. Markets had been widely expecting the Fed to enact a 0.75 percentage point rate increase at its meeting next week. Following the CPI release, traders took the possibility of a half-point move completely off the table and even were pricing in a 10% chance of a full percentage point hike, according to CME Group data. "They're watching for where inflation is coming from,". "It's very clear to them that it's food, it's transportation and it's rent. Rent keeps marching higher. That is the most stubborn of everything the Fed is fighting at this point." After peaking above $5 a gallon this summer, gasoline prices have pulled back sharply. However, the cost of living in other key areas such as food and shelter continues to push higher, raising concerns that inflation that had been concentrated is now beginning to spread. Within the jump in food costs, bread prices rose 2.2% on the month and are up 16.2% from a year ago. Eggs surged another 2.9% and are up 39.8% for the 12-month period, and canned fruits increased 3.4% and 16.6%, respectively. On the plus side, airline fares continued their recent decline, off 4.6% on the month though still 33.4% higher than a year ago. There also was some good news for workers in the August report, as real average hourly earnings rose a seasonally adjusted 0.2% for the month. However, they remained down 2.8% from a year ago. To combat the broad surge in the cost of living, the Federal Reserve has raised interest rates four times this year for a total of 2.25 percentage points. Tuesday's report was not expected to have great impact on the September meeting but rather through the end of the year and into 2023 as the central bank looks to tame inflation without tanking the economy. . Specifically, policymakers are concerned about a huge gap between job openings and available workers as labor force participation is stuck below its pre-pandemic levels. That has resulted in rising wages that have in turn put pressure on prices.
Gas prices falling across U.S., but not in California – - Gas prices are dropping for nearly everyone in the country but remain stubbornly high in California, where state officials are blaming oil companies and reminding voters that relief is on the way in the form of tax rebates scheduled to arrive in weeks.Experts say factors to blame for the high cost of gas in California — now more than $5 a gallon — include problems at refineries that supply the state as well as higher taxes, more regulations and the same global issues driving the overall U.S. market.Still, the cost of gas is something that consumers, and voters, tend to notice and can be problematic for elected officials with elections looming in November. California Republicans are seizing on the sustained prices as they hope to erode Democratic dominance in state government. “The Legislature had an opportunity to provide real relief to Californians by suspending the gas tax,” Assemblymember Kevin Kiley (R-Rocklin), who is running for Congress against a Democrat in a Northern California district, said Tuesday. “Instead, the Supermajority opted to create a do-nothing Select Committee as an attempt at political cover. Now our residents are paying the price.”California’s gas prices are nowhere near the $6 peak seen in June, but are still a source of anger. Rather than suspend the state’s gas tax, which is now up to 53.9 cents per gallon, Democrats this year opted to send $9.5 billion in direct payments to families.The refunds were the result of months of tense back-and-forth between Gov. Gavin Newsom’s administration and legislative leaders over how best to combat inflation-driven increases at the pump. Talks of suspending the state’s scheduled gas tax increase, or pausing the tax altogether, fizzled early in the year — much to the frustration of Republicans and some moderate Democrats. If prices persist, it could mean trouble for Democrats in battleground districts such as the Central Valley, where two Democratic hopefuls, Assemblymembers Adam Gray (D-Merced) and Rudy Salas (D-Bakersfield), are in tight congressional races with Republicans.With the focus once again on California’s high prices, Democratic lawmakers in the most populous state were reminding the public Tuesday that rebate checks are on their way. State Sen. Nancy Skinner, chair of the budget committee, touted the refunds, which will be between $200 and $1,050 depending on filing status and income, in an email to constituents. Those payments are set to start appearing in Californians’ bank accounts in October, just in time for the general election.
Services Inflation Spikes, Core CPI Jumps, Food Inflation Worst since 1979, Durable Goods Rise, but Gasoline & Airfares Plunge - By Wolf Richter - Gasoline prices plunged, but food prices jumped, prices of durable goods rose again, “core CPI,” which excludes food and energy, jumped, and prices of services spiked relentlessly as inflation has shifted from supply-chain issues and commodities to services. This process of inflation muscling into services started a year ago and has been getting worse every month for the 12th month in a row, a clear sign that inflation has gotten solidly entrenched, and is getting worse in vast parts of the economy, and that the Fed will have a hard time dislodging it.Overall inflation as measured by the year-over-year Consumer Price Index (CPI-U), released today by the Bureau of Labor Statistics, backed off a wee bit, but not nearly as much as expected, to 8.3% in August, from 8.5% in July, and remained in the ugly zone. On a month-to-month basis, CPI rose 0.1%, up from a 0% rise in July. The Consumer Price Index for “all urban wage earners & clerical workers” (CPI-W) backed off to 8.7%, from July’s 9.1%. The average year-over-year rates in July (9.1%), August (8.7%), and September (x%) will determine the COLAs for Social Security benefits in 2023. The two-month average is 8.9%. September’s CPI is going to be roughly in the same range, and the COLA for 2023 will be in the 8.9% range, up or down a little. The CPI for services spiked relentlessly, jumping by 0.6% in August from July and by 6.8% year-over-year, the worst increase since October 1982. This is now the driver of inflation, it’s a huge part of the economy, and it includes the housing components of CPI, and it’s a nightmare. Many services have little or no contact with commodities: Insurance, rent-based factors, education, healthcare, etc. Only a few services are impacted by commodities, especially fuel costs: airfares, other transportation services, utility services, etc. And that’s why a decline in commodities prices has little impact on services. Services inflation is the worst kind of inflation. These are the categories with year-over-year increases. Within them are some categories with month-to-month declines, such as delivery services and airline fares, which may indicate that inflation is shifting to categories that now have big month-to-month increases, such as health insurance, vehicle insurance, and vehicle maintenance. More on housing inflation in a moment:The “core” CPI, which excludes the volatile commodities-dependent food and energy components, jumped to 6.3% on a year-over-year basis, and to 0.6% on a monthly basis. This index is design to measure inflation in the broader economy, and it will give the Fed the willies: The CPI for “food at home” – food bought in stores and at markets – spiked by 13.5% year-over-year, the worst since February 1979. On a month-to-month basis, prices jumped by 0.7%. Food inflation hits lower-income consumers the most because they spend a bigger part of their budget on food. Food inflation, along with housing cost inflation, are brutal for them. Inflation cycles from category to category, letting up in some categories, and heating up in others, and you can see the shifting dynamics in the table below:
Early Look at 2023 Cost-Of-Living Adjustments and Maximum Contribution Base - The BLS reported this morning: The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 8.7 percent over the last 12 months to an index level of 291.629 (1982-84=100). For the month, the index declined 0.2 percent prior to seasonal adjustment. CPI-W is the index that is used to calculate the Cost-Of-Living Adjustments (COLA). The calculation dates have changed over time (see Cost-of-Living Adjustments), but the current calculation uses the average CPI-W for the three months in Q3 (July, August, September) and compares to the average for the highest previous average of Q3 months. Note: this is not the headline CPI-U and is not seasonally adjusted (NSA). In 2021, the Q3 average of CPI-W was 268.421. The 2021 Q3 average was the highest Q3 average, so we only have to compare Q3 this year to last year.This graph shows CPI-W since January 2000. The red lines are the Q3 average of CPI-W for each year. Note: The year labeled is for the calculation, and the adjustment is effective for December of that year (received by beneficiaries in January of the following year). CPI-W was up 8.7% year-over-year in August, and although this is early - we need the data for September -my guess is COLA will probably be around 8.6% to 8.8% this year, the largest increase since 11.2% in 1981 (and larger than the 7.4% increase in 1982). The contribution base will be adjusted using the National Average Wage Index. This is based on a one-year lag. The National Average Wage Index is not available for 2021 yet, but wages probably increased again in 2021. If wages increased 4% in 2021, then the contribution base next year will increase to around $153,000 in 2023, from the current $147,000. Remember - this is an early look. What matters is average CPI-W, NSA, for all three months in Q3 (July, August and September).
Core Producer Prices Hotter-Than-Expected In August As Services Cost Rise -After yesterday's 'peak inflation'-narrative-crushing CPI print, analysts expected headline US producer prices to drop 0.1% MoM (after falling 0.5% MoM in July) and it did but core PPI rose 0.4% MoM (more than expected 0.3% MoM). Graph Source: Bloomberg Core PPI rose 7.3% YoY (considerably hotter than the +7.0% expected, but less than July's +7.6%)... Graph Source: Bloomberg So just like CPI, we saw a rise in Services costs while Goods costs slipped... 40% of the increase in prices for final demand services can be attributed to margins for fuels and lubricants retailing, which rose 14.2 percent. Over three-quarters of the decrease in prices for final demand goods is attributable to the index for gasoline, which fell 12.7 percent The full breakdown... A drop in Energy costs dominated the weakness... The pipeline for headline PPI remains upwardly focused but has been reducing in recent months and fell dramatically in August... Graph Source: Bloomberg Finally, margins continue to come under pressure as the CPI-PPI spread remains red for the 20th straight month... Graph Source: Bloomberg So is PPI signaling peak inflation? Or are Services costs about to surprise the market?
Industrial Production Decreased 0.2 Percent in August --From the Fed: Industrial Production and Capacity Utilization Industrial production decreased 0.2 percent in August. Manufacturing output edged up 0.1 percent after increasing 0.6 percent in July. The index for mining was unchanged, and the index for utilities decreased 2.3 percent. At 104.5 percent of its 2017 average, total industrial production in August was 3.7 percent above its year-earlier level. Capacity utilization declined 0.2 percentage point in August to 80.0 percent, a rate that is 0.4 percentage point above its long-run (1972–2021) average. This graph shows Capacity Utilization. This series is up from the record low set in April 2020, and above the level in February 2020 (pre-pandemic). Capacity utilization at 80.0% is 0.4% above the average from 1972 to 2021. This was below consensus expectations. The second graph shows industrial production since 1967.Industrial production decreased in August to 104.5. This is above the pre-pandemic level. The change in industrial production was below consensus expectations.
Weekly Initial Unemployment Claims decrease to 213,000 -The DOL reported: In the week ending September 10, the advance figure for seasonally adjusted initial claims was 213,000, a decrease of 5,000 from the previous week's revised level. The previous week's level was revised down by 4,000 from 222,000 to 218,000. The 4-week moving average was 224,000, a decrease of 8,000 from the previous week's revised average. The previous week's average was revised down by 1,000 from 233,000 to 232,000. The following graph shows the 4-week moving average of weekly claims since 1971.Three More Unions Reach Tentative Agreements With Freight Railroads - Three more railroad unions have reached tentative agreements with U.S. freight railroads on a new labor contract, announced the National Carriers’ Conference Committee (NCCC).The tentative agreements announced Sunday include the Brotherhood of Maintenance of Way Employes Division of the International Brotherhood of Teamsters; the International Brotherhood of Boilermakers; and the International Association of Sheet Metal, Air, Rail and Transportation Workers-Mechanical Department.“The tentative agreements … include a 24% wage increase during the five-year period from 2020 to 2024 — with a 14.1% wage increase effective immediately — and five annual $1,000 lump sum payments. Portions of the wage increases and lump sum payments are retroactive and will be paid out promptly upon ratification of the agreements by the unions’ membership,” said the NCCC, the group representing Class I railroads in the contract negotiations. The tentative agreement also adds an additional paid day off that can be used as a personal day, vacation day or on the employee’s birthday.The three unions represent more than 86,000 freight rail employees. Eight unions have accepted tentative deals they will be taking to their members for ratification. Altogether, there are over 140,000 employees at the bargaining table employed by the U.S. operations of Class I railroads.A new labor deal has been in the works since January 2020, but the negotiations had failed to progress. A federal mediation board took up the negotiations but released the parties from those efforts earlier this summer. Per the Railway Labor Act, the remaining unions would be able to legally stage a work stoppage or strike after a cooling-off period ends Sept. 16. The heads of two rail unions said Sunday that the freight railroads’ decision to begin delaying shipments of security-sensitive and hazardous material ahead of this week’s looming strike deadline is only an attempt to get shippers to increase pressure on Congress to intervene and block a work stoppage.Several major Class I railroads said Friday they would begin curtailing shipments of hazardous materials and other chemicals in the event loads could be left unattended on a rail network. A strike or lockout is not allowed until Friday. “This completely unnecessary attack on rail shippers by these highly profitable Class I railroads is no more than corporate extortion,” the heads of the unions that represent engineers and conductors — Jeremy Ferguson, president of the Sheet Metal, Air, Rail and Transportation Workers-Transportation Division union, and Dennis Pierce, president of the Brotherhood of Locomotive Engineers and Trainmen union — said in a joint statement.
Amtrak restoring canceled trains after tentative agreement reached -Amtrak is reversing its plans to cancel long-distance train trips after rail unions and freight railways reached a tentative contract agreement this week, avoiding a strike. “Amtrak is working to quickly restore canceled trains and reaching out to impacted customers to accommodate on first available departures,” the company said in a statement. The passenger rail service began canceling routes on Tuesday before canceling all long-distance routes two days later in advance of the potential strike, fearing that freight rail lines would shut down as early as Friday before the trains reached their destination. Amtrak was not involved in the contract negotiations between rail workers and freight companies, but many of its trains run on railroads owned by third parties that could be impacted by a strike. Rail workers could have gone on strike as early as Friday at the conclusion of a cooling-off period in negotiations.
Largest private-sector nurses strike in U.S. history begins in Minnesota - About 15,000 nurses in Minnesota walked off the job Monday to protest understaffing and overwork — marking the largest strike of private-sector nurses in U.S. history.Slated to last three days, the strike spotlights nationwide nursing shortages exacerbated by the coronavirus pandemic that often result in patients not receiving adequate care. Tensions remain high between nurses and health-care administrators across the country, and there are signs that work stoppages could spread to other states.Minnesota nurses charge that some units go without a lead nurse on duty and that nurses fresh out of school are delegated assignments typically held by more experienced nurses, across some 16 hospitals where strikes are expected.The nurses are demanding a role in staffing plans, changes to shift scheduling practices and higher wages.“I can’t give my patients the care they deserve,” said Chris Rubesch, the vice president of the Minnesota Nurses Association and a nurse at Essentia Health in Duluth. “Call lights go unanswered. Patients should only be waiting for a few seconds or minutes if they’ve soiled themselves or their oxygen came unplugged or they need to go to the bathroom, but that can take 10 minutes or more. Those are things that can’t wait.”Paul Omodt, a spokesman for the Twin Cities Hospital Group, which represents four hospital systems where nurses are striking in the Minneapolis-St. Paul area, said that the nurses union did not do everything it could to avoid a strike.“Nurses have steadfastly refused to go to mediation,” Omodt said. “Their choice is to strike. This strike is on the nurses.”Conny Bergerson, a spokeswoman for Allina Health, another hospital system in the Twin Cities where nurses are on strike, said “rushing to a strike before exhausting all options such as engaging a neutral federal mediator does not benefit our employees, patients or the communities we serve.”The Minnesota Nurses Association, the nurses union, said hospital administrators have continued to “refuse solutions” on understaffing and safety in contract negotiations. It said nurses have increasingly been asked to take on more patients for bedside care to make up for labor shortages, exacerbating burnout and high turnover.
Survey finds nurses are leaving over coronavirus stress A survey of 2,500 nurses released Wednesday found that 64 percent are looking to leave the health-care profession, a nearly 40 percent increase from a similar survey a year ago. Three-quarters of those surveyed said they have experienced burnout since the coronavirus pandemic began, and half said they had suffered feelings of trauma, extreme stress or post-traumatic stress disorder. “Our nurses are the backbone of our health system,” said Dani Bowie, vice president of clinical strategy and transformation at Trusted Health, a health-care advocacy group that released the survey. “So, if they’re not operating out of their best state, it’s very detrimental to the well-being of our community and our patients.”The pandemic has worsened the U.S. nursing shortage as overworked and ill-treated health-care workers have quit en masse. Half the nurses surveyed said they had been verbally attacked by patients or their family members; almost a quarter said they’d been physically assaulted. The U.S. Bureau of Labor Statistics forecasts an annual average of 194,500 openings for registered nurses through 2030.
North Carolina Supreme Court rules that nurses can be held criminally liable for medical errors - A decision last month by the North Carolina Supreme Court exposes nurses to legal liability for medical injuries, even when the nurses are working under the direction of a doctor. The justices overturned a state precedent that had stood for 90 years. This ruling arrives amid an ongoing campaign to scapegoat health care workers for tragedies that result from the conscious negligence of the health care corporations and often the state. It follows the conviction of former nurse RaDonda Vaught for criminally negligent homicide over a medication error. Moreover, the current ruling was handed down in the same state where former detention center nurse Michelle Heughins is being prosecuted for involuntary manslaughter related to the death of an inmate. The case before the North Carolina Supreme Court, Connette v. Charlotte-Mecklenburg Hospital Authority, involved a girl named Amaya Gullate. In 2010, when she was three years old, Gullate had a heart condition for which doctors at Atrium Health recommended an ablation procedure. After the child underwent anesthesia, her heart stopped, thus depriving her brain of blood and oxygen for about 12 minutes. Gullate sustained permanent brain damage and developed cerebral palsy and profound developmental delay. She now requires constant care. Attorney John Edwards (the former US senator and Democratic presidential candidate) represented Gullate’s family, which sued the certified registered nurse anesthetist (CRNA), three doctors and the hospital over the incident. In 2018, a trial judge excluded testimony that would have questioned the decisions that CRNA Gus Vansoestbergen made in relation to Gullate’s care. The judge cited the precedent set in North Carolina by Byrd v. Marion General Hospital as justification for this move. That 1932 decision protected nurses who work under a doctor’s supervision.Edwards and the family appealed this ruling. In 2020, a state appeals court panel unanimously affirmed the trial judge’s decision to exclude testimony about Vansoestbergen’s work. The family continued its appeals, and the case ultimately reached the North Carolina Supreme Court. In late August, the court issued a 3-2 decision in favor of the family, thus overturning the Byrd precedent. “Due to the evolution of the medical profession’s recognition of the increased specialization and independence of nurses in the treatment of patients over the course of the ensuing 90 years since this Court’s issuance of the Byrd opinion, we determine that it is timely and appropriate to overrule Byrd as it is applied to the facts of this case,” wrote Justice Michael Morgan for the majority. But regardless of the “specialization” of the CRNA in this case, he was not acting with “independence” but under the supervision of a physician, who ultimately chose the treatment.
Opinion | California's fast food regulation attempt is ham-handed – by The Washington Post Editorial Board - California has a habit of pursuing well-meaning policy goals in ham-handed ways. Unfortunately, its new law to regulate the fast-food industry appears to fit the trend.On Labor Day, Gov. Gavin Newsom (D) signed a bill expanding protections for fast-food workers. The Fast Food Accountability and Standards Recovery Act responds to a real issue: California’s fast-food workers have long reported experiencing retaliation, wage theft and other unacceptable working conditions. A research brief released last month from the University of California at San Francisco and Harvard’s Shift Project found that these employees earn $3 per hour less on average than workers in other parts of the service sector. This margin adds up to more than $6,000 a year, a significant shortfall in a very expensive state.In a nod to European-style sector-wide collective bargaining, the new law creates a 10-member “Fast Food Council” of employees, franchisees, advocates and government representatives. The council will have the authority to set standards on working hours, conditions — and minimum wages. California’s current minimum wage is $15 per hour for businesses with more than 25 employees, but the council can increase it to as much as $22 in 2023. The law also authorizes counties, or cities with populations of more than 200,000, to create “Local Fast Food Councils,” and it establishes a cause of action for workers facing retaliation or discrimination by an employer.Industry groups argue the law will raise costs for franchise operators, which will then be passed on to consumers. An analysis from the University of California at Riverside, commissioned by the International Franchise Association, suggests that a 50 percent increase in worker compensation could result in a 17 percent increase in prices. The U.S. Chamber of Commerce, for its part, claims the law would “micro-manage the fast-food industry with unelected bureaucrats.”California’s own Department of Finance opposed an earlier draft of the bill, cautioning that it could “lead to a fragmented regulatory and legal environment for employers and raise long-term costs across industries.” That bill assessment also pointed out that it could be counterproductive, because imposing stricter standards on some sectors could exacerbate delays in enforcement.The version of the bill that was signed into law is, at least, better than the original. After some pushback, California’s Senate limited its scope to chains with more than 100 franchises nationally, up from 30, and deleted a clause that would have held companies jointly liable for labor violations at franchises.
New York lifts mask mandate for public transit, correctional facilities, shelters - —- New Yorkers are no longer required, but still encouraged, to wear masks on subway trains, correctional facilities, detention centers and homeless shelters, Gov. Kathy Hochul announced Wednesday. The ending of the state’s facial covering requirement for public transportation and certain congregant settings — some of the last pandemic-era restrictions still in place in the state — comes amid a decline in Covid-19 cases and as the Hochul administration looks to lure more New Yorkers and visitors back to New York City.The transit mask mandate was one of the last ones in the nation.Masks, however, must still be worn in health care settings and adult care facilities, including nursing homes. Signs will be posted in transit centers to encourage mask use, but also note they are optional.: “We have to restore some normalcy to our lives,” Hochul announced during a late-morning event in New York City. “Starting today, the Department of Health will be issuing new guidance regarding masks based on the CDC guidance. Masks will be optional.”The governor said the decision to lift the mask mandate was based on the stabilization of Covid rates in the state. Health Commissioner Mary Bassett added that nursing homes and health care facilities are still requiring facial coverings due to the risks of Covid spread in such settings.“This is to protect everyone in a health care facility, where we know there will be people infected,” she said. “The same goes for nursing homes.”The announcement came just one day after Hochul said her administration was considering whether to end the public transportation facial covering requirement. “We’ll be talking about making some announcements on that very shortly,” she told reporters at Penn Station Tuesday when asked if she was considering spiking the mandate.
Pregnant women held indefinitely in Alabama jail for drug use in pregnancy --According to research done by National Advocates for Pregnant Women (NAPW), an Alabama county has locked up more than 150 pregnant women and new mothers since 2010 for using drugs during pregnancy. The state’s chemical endangerment laws were written to protect children from exposure to drugs; they have been used for years to punish pregnant women. Mandatory stipulations for rehabilitation have caused many women to remain in jail for months, endangering both their unborn children and their own health. Twenty-three-year-old Ashley Banks was released from Etowah Detention Center on August 25 after being arrested in May with a small amount of cannabis in her possession. She confessed to police that she had used the drug two days prior, just before she discovered she was pregnant. She was placed in an overcrowded cell and told she could have a bottom bunk—the only allowance made for her high-risk pregnancy. The bottom bunk was assigned to two women, though, and Banks ended up sleeping on the floor. About six weeks after her arrest, Banks began bleeding vaginally. A deputy escorted her to nearby Gadsden Region Medical Center, where she was diagnosed with subchorionic hematoma. The condition causes blood to pool between the amniotic sac and the wall of the uterus and can lead to miscarriage—vaginal bleeding is associated with an even greater risk. For five weeks, Banks continued to bleed. She told reporters with AL.com that she was often hungry and experienced fainting spells. Two separate specialists evaluated Banks for signs of drug addiction, with each determining that she was not an addict and therefore would not qualify for in-patient rehabilitation. Alabama’s chemical endangerment laws condition release upon payment of a $10,000 bond and mandatory drug rehabilitation. Despite raising the $10,000, she could not bond out without agreeing to rehabilitation. And because she did not have an addiction, she did not qualify for the treatment. She remained at Etowah Detention Center, sleeping on the floor and trying to maintain an at-risk pregnancy, until a judge released her to a community corrections program on August 25.
Newsom signs bill to make tech companies protect kids online – — California Gov. Gavin Newsom has signed a pair of laws fought by the tech industry that will force social media companies to adopt safety guidelines for Californians under 18 and publicize their content moderation policies.A proposal Newsom approved Thursday will set new standards for online spaces often visited by children, like YouTube and TikTok, such as limiting push notifications late at night. A separate bill on content moderation, which came in response to the Jan. 6 Capitol riot, will require social media companies to report to the state data on their enforcement actions against users.Newsom, a Democrat and father of four who has close ties to the tech world, signaled plans to support children’s mental health initiatives in August but had not publicly backed either bill before this week.“We’re taking aggressive action in California to protect the health and wellbeing of our kids,” Newsom said in a statement, adding that as a parent, “I’m familiar with the real issues our children are experiencing online.”California’s adoption of both bills marked back-to-back blows for the tech sector, whose lobbyists had argued such laws would set costly new rules and stall innovation. Some have suggested the legislation could infringe on Section 230 of the Communications Decency Act, which protects online platforms from being held liable for what is posted on them.“These bills would create significant and potentially costly compliance requirements that may unintentionally stifle innovation and competition. The measures require study, as they may raise constitutional concerns and conflict with federal law,” said Khara Boender, state policy director for the Computer & Communications Industry Association.The companies will have until mid-2024 to adhere to the new rules aimed at shielding young Californians from online predators and social media addiction, among other harms. The law, AB 2273, also restricts the collection and sharing of kids’ personal data, specifically information that’s unrelated to the online platform’s services.California’s new legislation raises the stakes of a data privacy proposal being debated in Congress — which, as written, would override such state regulations. House Speaker Nancy Pelosi signaled her support for California’s AB 2273 as she called for changes to the federal bill to make sure it wouldn’t undercut the state’s laws.
Michigan Democrats end K-12 school COVID safety measures, following Biden’s CDC - As schools reopened across Michigan after Labor Day, districts have abandoned mask mandates, COVID testing and quarantine requirements for people exposed to COVID. Many schools are coupling these dangerous pro-business policies with shortened quarantines and isolation periods for children and educators stricken with the virus. This is despite the unremitting growth of the national and global death toll, the horrors of debilitating Long COVID, and the fact that over 10 million children have lost a parent or caregiver to the disease. In Michigan, as nationally, both US teachers unions have either directly signed on to the ending of disease mitigation or facilitated it. In the state’s largest K-12 district, the Detroit Federation of Teachers (DFT) agreed to a June 30, 2022 end-date for mandatory masking. There is no mention of COVID-19’s existence, much less policies for disease protection, on the Michigan Education Association’s web page, going back throughout 2022! The deaths of educators are not tracked or even memorialized by the unions. Shedding crocodile tears over “learning loss,” the unions and politicians also studiously ignore the reality of Long COVID and the trauma of losing family members, in their haste to prove their service to the Democratic Party and Wall Street. Above all, they are focused on protecting their dues stream and “seat at the table.” Meanwhile Democratic Governor Gretchen Whitmer, Democratic Detroit Mayor Mike Duggan, et al. are supporting the climbdown by the Centers for Disease Control and Prevention (CDC) on quarantine and masking guidelines—the better to keep parents on the job and support the profits of the automakers and Michigan’s businesses—and insisting on a return to unsafe school buildings. In the state’s largest districts, including Detroit, Grand Rapids, Dearborn, Royal Oak, Lansing and Kalamazoo, virtually all mitigation has ended. They are implementing the CDC’s shortened quarantine guidelines requiring COVID-positive students to stay home for only five days and be masked to day 10. These changes in regulations are not the result of safe conditions, but of economic priorities. In fact, last week, the number of COVID-19-positive patients treated in Michigan hospitals rose to 1,227, the highest since Omicron’s peak last February. Case positivity in the state is between 20 and 25 percent of those tested, and has been since late July, indicating the disease is far more prevalent than can be gleaned from the limited reporting. In 2022, 6,727 more COVID deaths have been reported in the state officially, pushing the annual death rate to more than 10,000. As of last week, 34,818 Michiganders have perished from the preventable infection. Due to increasing failure to identify COVID as the cause of death (people are supposedly dying with COVID, rather than because of COVID), these numbers are undercounts.
Seattle Education Association shuts down strike of teachers in antidemocratic maneuver - The Seattle Education Association (SEA) announced Tuesday afternoon that a vote it called to shut down the week-long strike of Seattle teachers passed 57 to 43 percent. Teachers and staff have been ordered back to work Wednesday. Educators should reject this antidemocratic maneuver, vote down the still unreleased tentative agreement (TA) and organize themselves to take control of and continue the strike. The entire process through which the SEA held and passed this vote is illegitimate. A TA was announced by the union Monday late in the evening, at about 10 p.m. Pacific, yet no details were released to the membership. In a Facebook Live video, SEA President Jennifer Matter stated that it would “at best … provide a summary,” while she and her fellow bureaucrats “finalize the language of the full text.” Shortly afterwards, local news organizations reported on the developments as if the strike had already been called off. Then the vote to suspend the strike was held at a day-long meeting Tuesday, based only on highlights. The vote violated a resolution that was earlier proposed and passed by the rank and file that the strike could only be ended after a vote on the TA. Moreover, the vote was held online and controlled by the SEA itself, with no oversight from the rank and file, providing ample opportunity for ballot-stuffing. Finally, the most recent update from the union on the contract is that “info on voting on TA ratification will come later in the week.” As an elementary teacher said to the World Socialist Web Site, “[The] SEA leadership/bargaining team came in with a very clear bias. The email for today’s general assembly stated the meeting was ‘to hear highlights of the TA and vote to suspend the strike.’ Many of us are frustrated and feeling disrespected by SEA leadership at this point. “Originally, we voted to go on strike with the stipulation that the strike would end only if membership ratified the TA. Today, it ended up that we voted whether or not to suspend the strike, while we all know full well if we suspend, that’s the end of it. We will have lost our momentum and leverage in bargaining. Essentially, we were agreeing to a TA that we still have not seen.” Another teacher commented on social media, “We are going back to work with 7 [percent wage increase] including the Cost of Living Assistance. … I am voting no on the TA. Also, membership in other districts saw drafts of everything including actual numbers for class sizes and a salary schedule… we have not seen actual numbers. I am very disappointed.” An article in the Seattle Times confirmed the figure, as well as noting a 4 percent increase in year two of the contract and a 3 percent increase in year three, plus small bonuses for certain tiers of educators. This is under conditions in which inflation is at more than 8 percent, in fact higher in cities like Seattle, meaning that the contract would sanction significant cuts in real wages.
Oberlin College To Pay Family Bakery $36.6 Million In Damages Over False Racism Accusations - Following a failed appeal, Ohio’s Oberlin College is finally set to pay $36.6 million in damages that the courts have awarded to a local bakery in a defamation case. In a Sept. 9 statement, Oberlin announced that it had “initiated” payments to Gibson’s Bakery, a 137-year-old, fifth-generation family business that was wrongfully accused of racial profiling after a shoplifting incident involving black students.In April, an Ohio appeals court upheld a jury’s finding that the college, in its handling of student protests over the 2016 incident, committed libel, slander, and interference with business relationships against the bakery. On Aug. 30, the Ohio Supreme Court decided to not hear Oberlin’s final appeal, bringing an end to the long-running legal battle.“We are disappointed by the Court’s decision. However, this does not diminish our respect for the law and the integrity of our legal system,” Oberlin officials said. “This matter has been painful for everyone. We hope that the end of the litigation will begin the healing of our entire community.“We value our relationship with the City of Oberlin, and we look forward to continuing our support of and partnership with local businesses as we work together to help our city thrive.”The statement didn’t include an apology to the Gibsons, whose business was pushed to the brink amid protests and harassment.In November 2016, store clerk Allyn D. Gibson caught a black Oberlin student stealing wine bottles from the store. The confrontation between the clerk and the student, joined by his two black peers, soon escalated into a fight. When the police arrived at the scene, they found the clerk lying on the ground, while the three Oberlin students punched and kicked him.The students pleaded guilty to a misdemeanor in 2017 and acknowledged in court that the clerk’s actions weren’t racially motivated. But that didn’t stop Oberlin officials and students from organizing demonstrations outside the bakery, during which protesters demanded that customers shop elsewhere. According to court filings, Oberlin’s Dean of Students, Meredith Raimondo, along with other staff, were involved in the distribution of flyers that were handed out at the protests. The flyers, titled “DON’T BUY,” urged a boycott of the bakery, asserting that it was a “RACIST establishment with a LONG ACCOUNT OF RACIAL PROFILING and DISCRIMINATION.” The college’s supplier of food for its dining halls was also told by Raimondo to halt ordering from Gibson’s.The Gibsons sued Oberlin in 2017, alleging “significant financial and emotional damages” caused by the college’s actions, including repeated vandalism, property damage, and harassment over the months following the shoplifting incident. In June 2019, a Lorain County jury found that Oberlin acted inappropriately toward the bakery, a decision the college appealed.
Distress Prior To Covid-19 Infection May Predict Post-Covid Symptoms - A study published in this week’s JAMA Psychiatry reported on whether symptoms of anxiety, depression, worry and stress prior to suffering an acute Covid-19 infection might predict post-Covid-19 symptoms, commonly known as “Long Covid.” The authors, based at Harvard Medical School and the T.H. Chan School of Medicine at Harvard, used data from two Nurses’ Health Studies and the Growing Up Today study, whose cohorts were 96% female with an average age of 57 years. There were approximately 55,000 participants in the study, which dated back to April 2020, soon after the pandemic began. Over one third of the participants were healthcare workers. Surveys were provided in April 2020 to those who had not yet sustained a SARS-CoV-2 (Covid-19) infection, and included questions regarding anxiety, depression, loneliness, stress, and worry. Of the participants, 6%, or 3200 individuals, developed a Covid-19 infection within the 19 months following the initial month of the study. Those who reported evidence of Covid-19 infections were then assessed for any post-Covid symptoms longer than 4 weeks following onset of infection. These symptoms could include brain fog, fatigue, loss of sensations of taste or smell, and depression. Overall, those who reported symptoms of distress prior to Covid-19 infections had a 50% more likelihood of reporting post-Covid symptoms four or more weeks after illness. Prior studies have shown that advanced age, obesity, and co-morbidities such as high blood pressure are associated with increased severity of acute infetions as well as post-Covid sequelae, but few large studies have identified psychological distress factors impacting disease outcomes. The authors of the current study acknowledge that they are by no means implying that post-Covid-19 symptoms have any relationship to a psychosomatic illness nor fabrication of symptoms. Indeed, over 40% of those with post-Covid issues had no prior history of any notable stress, depression or loneliness. Perhaps more notably, the authors recognize that this is a very narrow representation of the general population in the United States. The majority of the participants were White female healthcare professionals in their mid to late 50’s. Moreover, symptoms were self-reported and not based on outside clinical evaluations. While there are multiple limitations to this study, not to mention the ongoing stress on healthcare workers regarding risks of Covid-19 infections leading to continued worry and anxiety, it raises the important issue of the need to better identify risk factors for post-Covid issues, as well as the need to mitigate these stressors, due to Covid or otherwise.
Hospital Infection Control Departments Tenaciously Resist Airborne Transmission, Aided by CDC - By Lambert Strether - What is infection control? According to the CDC: Infection control prevents or stops the spread of infections in healthcare settings. Which, arguably, hospitals are. In fact, hospitals have administrative structures for Hospital Infection Control (HIC).Again the CDC: The role of the hospital infection control committee (HICC) is to implement the annual infection control programme and policies….
- Develop a system for identifying, reporting, analyzing, investigatingand controlling HCAIs
- Develop and implement preventive and corrective programs in specific situations where infection hazards exist….
- Review and update hospital infection control policies and proceduresfrom time to time.
HICC shall meet regularly – once a month and as often as required. Since we’re now 924 days / 30 = ~30 months = 30 meetings into the latest Coronavirus pandemic, one would have expected those regular monthly meetings to have culminated in robust and coherent “politicies and procedures” to prevent the airborne transmission[1] of SARS-CoV2. But who am I kidding? Nothing could be further from the truth. Here are some revealing anecdotes[2]. (I’m including medical offices because the hospitals are the hegemonic institution in the delivery of health care in the United States, and others could be expected to follow their lead.) For example: […]At the very least, mask policy — the first layer of defense against aerosol transmission, before ventilation — is inconsistent (or inconsistently enforced) across jurisdictions in hospitals. So it’s no wonder that Politico writes “Nowhere is safe: Record number of patients contracted Covid in the hospital in January“[3]: More than 3,000 hospitalized patients each week in January had caught Covid sometime during their stay, more than any point of the pandemic, according to U.S. government data analyzed by POLITICO. The record surge demonstrates the virulence of the Omicron variant and how even hospitals, where infection control is paramount, provided little refuge. “Any level of hospital transmission is concerning,’ said Aaron Milstone, a professor at the Johns Hopkins Bloomberg School of Public Health who focuses on the prevention of hospital-acquired infections. “The data suggests that hospitals should review their practices and make sure they are doing everything they can to protect patients.”
Moderna-backed mouse study offers first head-to-head BA.5, BA.1 booster data - In mice, the BA.5-targeting bivalent booster now rolling out nationwide did an equally good job at thwarting the BA.5 omicron subvariant as the bivalent booster targeting its predecessor, BA.1, which US regulators passed on. That's according to a pre-print study—which hasn't been peer-reviewed or formally published—authored by researchers at Moderna and Washington University School of Medicine.Although the study is still a preprint and only involved mice, it provides some of the first head-to-head data comparing the two omicron-targeting booster options considered for this fall—one of which is currently going into arms across the US. And the findings may raise questions about the US booster strategy.Over the summer, the US Food and Drug Administration—under advisement of its independent expert committee—decided to pass on authorizing the omicron BA.1-targeting bivalent COVID-19 booster. The formula was the farthest along in the development of an omicron-targeting booster and had human clinical data at a time when regulators were scrambling to make decisions and begin dose manufacturing at scale for the nationwide booster campaign this fall.But even in the summer, BA.1 was already long gone. BA.1 was the first version of omicron that swept across the US, causing a towering wave of infection in January and February this year.But, by June, when the FDA was making decisions, BA.1 was no longer circulating, and two omicron subvariants, BA.2 and BA.2.12.1, had already swept through. BA.5 and BA.4 were on the rise. The FDA, with the majority of its advisers, wanted to target the leading edge of SARS-CoV-2's evolution, so it set its crosshairs on BA.4 and BA.5, which share the same spike protein. The FDA expected the BA.4/5-targeting booster would be better at protecting against BA.5 than the BA.1-targeting booster—but they didn't have clear evidence for that. Some experts, including one of the FDA advisers, were critical of the decision to move forward without a clinical trial or data indicating that the BA.4/5 booster would be better than the BA.1 booster.That's where the new mouse data comes in. In experiments with mice vaccinated with the original COVID-19 vaccines, researchers compared different boosters given seven months after the initial series. The booster options included the original vaccine, the BA.1-targeting bivalent vaccine, and the BA.4/5-targeting bivalent vaccine. There was also an unboosted control group and a sham booster group, which got an injection of a buffer solution.The two bivalent vaccines increased mouse neutralizing antibodies against BA.1 and BA.5 significantly more than a third shot of the original vaccine. But, both BA.1- and BA.4/5-targeting formulas generated fairly similar levels of neutralizing antibodies against both omicron subvariants. A month after the booster, researchers challenged the mice with an intranasal BA.5 exposure. Again, both bivalent boosters offered better protection against infection and lung inflammation than a boost with the original vaccine. But among the two bivalent boosters, there wasn't a clear winner.
Have The New Bivalent Covid-19 Vaccine Boosters Been Tested On Humans? - Were the original Moderna and Pfizer-BioNTech Covid-19 mRNA vaccines tested on humans before receiving emergency use authorization (EUA) in late 2020 from the U.S. Food and Drug Administration (FDA)? Absolutely. Thousands of them. How about the monovalent booster versions of these vaccines designed to protect against the original severe acute respiratory syndrome coronavirus 2 (SARS-Cov-2)? Yes, indeedy. Lots. OK, so what about the new bivalent booster vaccines designed to protect against both the original SARS-CoV-2 and the BA.4 and BA.5 Omicron subvariants? Well, to borrow the title from a 2009 rom-com, it’s complicated.If you recall, on August 31, the FDA announced that they had amended the original Moderna and Pfizer-BioNTech Covid-19 mRNA vaccine EUA’s to include their new bivalent boosters. As I covered for Forbes on September 5, these bivalent boosters include two types of mRNA as opposed to the monovalent versions that consisted of just a single type. The type of mRNA in both the monovalent and bivalent boosters serves as blueprints for your cells code to code for the spike proteins that studded the surface of the original version of the SARs-CoV-2. The second type of mRNA, which only the new bivalent booster has, can act as blueprints for your cells to produce the spike proteins that cover the surfaces of the BA.4 and BA.5 Omicron subvariants that are more dominant right now. The BA.4 and BA.5 Omicron subvariants are quite different from the original version of the SARS-Cov-2. Thus, in theory, the bivalent boosters should provide significantly better protection against the currently circulating variants and subvariants and sub-subvariants and, well you get the picture. Well, theory is one thing. Concrete scientific evidence is another. The FDA announcement did mention studies that compared the use of bivalent boosters and monovalent boosters that included approximately 600 and 800 individuals 18 years of age and older for the Moderna ones and 600 participants greater than 55 years of age for the Pfizer-BioNTech ones. These studies reportedly found those who gotten the bivalent boosters had “better” immune response than those who had received the monovalent boosters. The studies also didn’t show any significant safety concerns with the bivalent boosters, mentioning the usual side effect stuff like pain, redness and swelling at the injection site, fatigue, headache, muscle pain, joint pain, chills, swelling of the lymph nodes in the same arm of the injection, nausea, vomiting, and fever.
Did the US Jump the Gun With the New Omicron-Targeted Vaccines? -Last month, the FDA authorized omicron-specific vaccines, accompanied by breathless science-by-press release and a media blitz. Just days after the FDA’s move, the Centers for Disease Control and Prevention followed, recommending updated boosters for anyone age 12 and up who had received at least two doses of the original covid vaccines. The message to a nation still struggling with the covid-19 pandemic: The cavalry — in the form of a shot — is coming over the hill.But for those familiar with the business tactics of the pharmaceutical industry, that exuberant messaging — combined with the lack of completed studies — has caused considerable heartburn and raised an array of unanswered concerns.The updated shots easily clear the “safe and effective” bar for government authorization. But in the real world, are the omicron-specific vaccines significantly more protective — and in what ways — than the original covid vaccines so many have already taken? If so, who would benefit most from the new shots? Since the federal government is purchasing these new vaccines — and many of the original, already purchased vaccines may never find their way into taxpayers’ arms — is the $3.2 billion price tag worth the unclear benefit? Especially when these funds had to be pulled from other covid response efforts, like testing and treatment.Several members of the CDC advisory committee that voted 13-1 for the recommendation voiced similar questions and concerns, one saying she only “reluctantly” voted in the affirmative.Some said they set aside their desire for more information and better data and voted yes out of fear of a potential winter covid surge. They expressed hope that the new vaccines — or at least the vaccination campaign that would accompany their rollout — would put a dent in the number of future cases, hospitalizations, and deaths.That calculus is, perhaps, understandable at a time when an average of more than 300 Americans are dying of covid each day.But it leaves front-line health care providers in the impossible position of trying to advise individual patients whether and when to take the hot, new vaccines without complete data and in the face of marketing hype.
The New COVID Subvariant BA.4.6 Is Spreading. Here's What We Know -- BA.4.6, a subvariant of the Omicron COVID variant which has been quickly gaining traction in the US, is now confirmed to be spreading in the UK.The latest briefing document on COVID variants from the UK Health Security Agency (UKHSA) noted that during the week beginning August 14, BA.4.6 accounted for 3.3 percent of samples in the UK. It has since grown to make up around 9 percent of sequenced cases.Similarly, according to the Centers for Disease Control and Prevention, BA.4.6 now accounts for more than 9 percent of recent cases across the US. The variant has also been identified in several other countries around the world.So what do we know about BA.4.6, and should we be worried? Let's take a look at the information we have so far.BA.4.6 is a descendant of the BA.4 variant of Omicron. BA.4 was first detected in January 2022 in South Africa and has since spread around the world alongside the BA.5 variant.It is not entirely clear how BA.4.6 has emerged, but it's possible it could be a recombinant variant. Recombination happens when two different variants of SARS-CoV-2 (the virus that causes COVID-19) infect the same person, at the same time.While BA.4.6 will be similar to BA.4 in many ways, it carries a mutation to the spike protein, a protein on the surface of the virus which allows it to enter our cells.This mutation, R346T, has been seen in other variants and is associated with immune evasion, meaning it helps the virus to escape antibodies acquired from vaccination and prior infection.Fortunately, Omicron infections generally cause less serious illness, and we've seen fewer deaths with Omicron than with earlier variants. We would expect this to apply to BA.4.6 too. Indeed, there have been no reports yet that this variant is causing more severe symptoms.But we also know that Omicron subvariants tend to be more transmissible than previous variants. BA.4.6 appears to be even better at evading the immune system than BA.5, the currently dominant variant. Although this information is based on a preprint (a study that is yet to be peer-reviewed), other emerging data supports this.According to the UKHSA's briefing, early estimates suggest BA.4.6 has a 6.55 percent relative fitness advantage over BA.5 in England. This indicates that BA.4.6 replicates more quickly in the early stages of infection and has a higher growth rate than BA.5.
New omicron variant is evolving in worrying ways, experts say - The latest omicron variant BA.4.6 is gaining ground and already accounts for 9.2% of new cases. An Associated Press report suggests that this new omicron subvariant is “even better at evading the immune system” than the fast-spreading BA.5. Emerging research also points out that the virus is mutating to become more immunity evasive. “Every time we think we’ve seen the peak transmission, peak immune escape properties, the virus exceeds that by another significant notch,” said Eric Topol, head of Scripps Research Translational Institute, per the report.But this can’t go on forever.“I think there is a limit,” said Matthew Binnicker, director of clinical virology at Mayo Clinic in Rochester, Minnesota. “What we’re really dealing with, though, is there’s still a lot of people across the world who don’t have any prior immunity — either they haven’t been infected or they haven’t had access to vaccination.” Simply put, if the baseline immunity rises significantly, then the rate of infections should go down, he said, adding that there is a chance the virus mutates and becomes more severe.White House COVID-19 coordinator Dr. Ashish Jha said at a recent press conference that the virus will exist for the rest of our lives.“Obviously if we take our foot off the gas — if we stop updating our vaccines, we stop getting new treatments — then we could slip backward,” he said, per AP.“Just be aware that BA.4.6 is going to be resistant, and it is gaining ground on BA.5. So folks who are immunocompromised in general should be more cautious,” Dr. David Ho, a professor of microbiology and immunology at Columbia University, told CNN.What Is Centaurus? New COVID Subvariant Found In Florida, Europe - COVID-19 subvariants are still being discovered more than two-and-a-half years after lockdowns took place. BA.2.75, a recent coronavirus subvariant of the omicron variant, has increased COVID-19 cases, specifically in Florida and Europe.Also known as Centaurus, BA.2.75 was first discovered in India early this spring and was christened by a Twitter user who decided to name the subvariant after a constellation. While the name is becoming popular, the WHO has not yet adopted the name. While, according to Medical News Today, omicron is still the most prominent variant in the U.S., the BA.2.75 subvariant, reports show, when it was discovered, was spreading faster than other omicron subvariants. The World Health Organization (WHO) hasn't designated BA.2.75 as a variant of concern, but it is monitoring the strain. WHO Director-General Tedros Adhanom Ghebreyesus spoke at the Member State Information Session in July in which he first announced the organization was closely tracking the subvariant."In Europe and America, BA.4 and BA.5 are driving waves. A new sub lineage of Omicron called BA.2.75 has also been detected, which we're following closely," he said in his remarks.Adhanom Ghebreyesus said many countries have reduced their COVID-19 testing measures, which can muddy the "true picture of an evolving virus."According to reports, BA2.75 infections still haven't outnumbered those of its omicron subvariant predecessors, BA.4 and BA.5. Additionally, reports show BA.2.75 is still most common in India, where it was first discovered, and some data shared by a COVID-19 analyst Twitter user suggested that BA.2.75 infections have already peaked.
U.S. Covid Casualties Fall By 20% In A Fortnight -- Covid casualties in the United States have fell by 20 percent and the number of positive cases have dropped by 24 percent in the last fortnight, as per the New York Times' latest data. With 444 additional deaths reported on Monday, the total number of people that have lost their lives due to coronavirus infection in the country has risen to 1,050,845, as per Johns Hopkins University's latest data. 69,366 new infections on the same day took the total U.S. Covid cases to 95,327,751. Florida reported the most number of deaths - 176 - while Texas reported the most cases - 15,520. 1,483 additional deaths were reported globally on Wednesday, taking the total number of people who have lost their lives due to the pandemic so far to 6,516,759. 93,340,375 people have so far recovered from the disease, the Worldometer tally shows. U.S. hospitals report a 10 percent decrease in the number of Covid patients in the last two weeks. The number of I.C.U. admissions due to the worse stage of the viral disease has also fallen by 8 percent. U.S. Covid hospitalizations fell to 34,404. 4,181 of these patients are admitted in intensive care units. The nation's current test positivity rate is 12 percent. As per the latest data published by the Centers for Disease Control and Prevention, 224,367,691 Americans, or 67.6 percent of the eligible population, have been administered both doses of Covid vaccine so far. This includes 92.1 percent of people above 65. 48.6 percent of the eligible population, or 108,953,688 people, have already received a booster dose that is recommended to provide additional protection from the killer virus.
U.S. Reports 29% Decrease In Covid Cases In 2 Weeks -- The number of Covid positive cases in the United States has fallen by 29 percent in the last fortnight, as per the New York Times' latest data. A 9 percent decrease in Covid casualties was recorded in the country during the same period. With 520 additional deaths reported on Tuesday, the total number of people that have lost their lives due to coronavirus infection in the country has risen to 1,051,323, as per Johns Hopkins University's latest data. 67,306 new infections on the same day took the total U.S. Covid cases to 95,390,557. Michigan reported the most number of deaths - 150 - and the most cases - 10,062. 1,944 additional deaths were reported globally on Tuesday, taking the total number of people who have lost their lives due to the pandemic so far to 6,518,352. 93,460,171 people have so far recovered from the disease, the Worldometer tally shows. U.S. hospitals reported a 10 percent decrease in the number of Covid patients in the last two weeks. The number of I.C.U. admissions due to the worse stage of the viral disease has also fallen by 8 percent. U.S. Covid hospitalizations fell to 34,076. 4,133 of these patients are admitted in intensive care units. The nation's current test positivity rate is 12 percent.
Colorado COVID hospitalizations fall, but wastewater raises concerns - Colorado’s COVID-19 hospitalizations dropped this week after a three-week plateau, though rising amounts of the virus detected in wastewater around Denver complicate an otherwise optimistic picture.The Colorado Department of Public Health and Environment reported 159 people were hospitalized for the virus statewide as of Tuesday afternoon. The last time hospitalizations were lower was mid-May.It’s not clear why hospitalizations stopped dropping for a few weeks while cases and the percentage of tests coming back positive kept falling, said Talia Quandelacy, an assistant professor of epidemiology at the Colorado School of Public Health. Hopefully, they’ll keep falling, though rising concentrations of the virus in wastewater are something to watch, she said.“This is certainly a slightly larger drop than we’ve seen in the last month,” she said. “Overall, there’s still a bit of a mixed picture.”An average of 5.1% of tests came back positive over the last week, down from about 5.6% a week earlier. When fewer tests come back positive, that’s generally a sign that the virus isn’t spreading as widely.Cases dropped to 4,607 in the week ending Sunday, which was about 900 fewer than the week before — though it’s possible that low testing numbers on Labor Day were a factor. Outbreaks decreased for a seventh week, with 250 considered active as of Wednesday.Wastewater told a more complicated story. As of Friday, samples from 12 systems, mostly along the Front Range, suggested the amount of virus in their wastewater was increasing. Another 12 showed decreases, 25 didn’t show any change and 11 had insufficient data.Nationwide, cases and hospitalizations also have been trending down, according to data from The New York Times. It’s not clear if any of the current variants are likely to change the picture. The Centers for Disease Control and Prevention estimated that BA.5 has topped out at about 88% of cases nationwide, while BA.4.6 is slowly making gains and accounts for about 9% of infections. In Colorado, BA.5 was found in about 89% of sequenced samples as of Aug. 21, and neither BA.4.6 nor BA.4 was in a clear pattern of growth.
Massachusetts reports 20% jump in COVID cases after Boston-area virus wastewater data went up -State health officials on Thursday reported 7,936 confirmed COVID cases from the last week, a 20% jump following the recent rise in the Boston-area COVID wastewater data. The COVID wastewater tracker throughout the pandemic has been the first indication of cases at the community level, and the data has helped predict surges.The state’s daily average of 1,134 COVID cases from the last week is up from the daily rate of 946 infections during the previous week. Infection counts had been trending down in previous weeks.The positive test average had been climbing as the omicron BA.5 subvariant took over, but the positive test rate went down in recent weeks. The seven-day positive test rate is now 7.32%, up from 7.13% last week.The very infectious BA.5 variant is now responsible for 88.6% of new cases in New England, according to this week’s update from the Centers for Disease Control and Prevention. The omicron BA.4.6 variant appears to be on the rise, accounting for 8.6% of new cases.The Massachusetts Department of Public Health is now reporting its COVID data on a weekly basis, reflecting the evolving COVID response in the state. Previously, the data had been reported five days a week. The state reported 37 new COVID deaths over the past week, bringing the state’s total to 21,588 recorded deaths since the start of the pandemic. The daily average of deaths is now five, which is much lower than the daily death rate during the initial omicron surge.The state reported that 591 total patients are hospitalized with COVID, which is up 18 patients from this time last week.More than 5.4 million people in the state have been fully vaccinated, and more than 3.2 million people have gotten at least one booster dose. Also, the state reported that 739,426 additional booster doses have been administered.
Ohio reports 20,552 new COVID-19 cases this week -- The Ohio Department of Health on Sept. 15 reported 125,856 cumulative COVID-19 hospitalizations, an increase of 626 from a week prior. A total of 14,179 individuals have been admitted to the ICU due to the coronavirus, an increase of 48 from a week prior. The three-week average of reported hospitalizations is 568. The three-week average of reported ICU admission is 41.There are currently 1,331 people hospitalized who have COVID-19 as of Sept. 15 – 154 are in the ICU, 65 are on ventilators. The median age of those hospitalized is 65.Ohio residents account for a total of 39,675 COVID-19 deaths, the ODH reported Sept. 15, an increase of 99 deaths from a week prior. The three-week average of reported hospitalizations is 90.The median age of those who have died is 76.Mortality data is verified by coded death certificate information the state receives from the National Center for Health Statistics and can take some time to receive, the ODH notes on the state's coronavirus dashboard.Ohio has reported 20,552 new COVID-19 cases over the last seven days, bringing the state's total number of cases to 3,117,109, according to the state's coronavirus dashboard updated Sept. 15.Ohio has an average of 320.5 cases per 100,000 residents over two weeks, the ODH reported. The three-week average of reported cases is 22,521.The individuals who have tested positive range in age of less than a year to 111 years old; the median age is 38.The ODH reports 3,009,273 individuals are presumed recovered – defined as cases with a symptom onset over 21 days prior who are not deceased. Cuyahoga County accounts for 317,788 of the cases, 13,963 hospitalizations and 3,921 deaths.Cuyahoga County has been identified as having a “medium” community level of COVID-19 based on cases and hospitalizations by the Center for Disease Control and Prevention. The CDC recommends staying up to date with COVID-19 vaccines; get tested if you have symptoms; wear a mask if you have symptoms, a positive test or exposure to someone with COVID-19; and wear a mask on public transportation. As of June 1, masks are required in all Cuyahoga County government buildings regardless of vaccination status according to an executive order signed by county executive Armond Budish. A total of 7,458,600 Ohioans (63.81% of the state's population) have received at least one dose of the COVID-19 vaccine, and 6,912,341 Ohioans (59.13%) completed the vaccination process as of Sept. 15. A total of 3,782,047 have received a first booster, and 892,207 have received a second booster. Of Ohioans 18 and older, 73.41% (6,688,362) have started the vaccination process, and 68.51% (6,242,028) have completed it. A total of 3,609,805 have received a first booster, and 889,193 have received a second booster. Of Ohioans 12 and older, 71.35% (7,135,614) have started the vaccination process, and 66.54% (6,654,483) have completed it. A total of 3,742,602 have received a first booster, and 891,816 have received a second booster. Of Ohioans 5 and older, 67.44% (7,417,204) have started the vaccination process, and 62.76% (6,902,054) have completed it. A total of 3,782,030 have received a first booster, and 892,202 have received a second booster.
Several NE Ohio counties remain at high COVID-19 level — This past week, the state of Ohio saw its lowest COVID-19 caseload in more than two months, and the CDC is taking notice of the improvement.Several counties went from being listed as having "high" community spread of the coronavirus seven days ago to now "medium" spread, including six here in Northeast Ohio. This means health experts no longer recommend wearing face masks for residents of those areas while in indoor public spaces.Cuyahoga County remained in the "yellow" medium zone for the third week in a row, and was joined by Carroll, Erie, Portage, Stark, Tuscarawas, and Wayne after all were "orange" last week. Geauga, Holmes, Lake, Medina, and Summit are also still at the medium level.The CDC has continued to relax its coronavirus guidelines in recent weeks and months, but still recommends masking for people living in "high" counties, regardless of vaccination status. To meet this threshold, counties must either see at least 20 new COVID hospitalizations per 100,000 residents in a given week or a combination of both 200 new cases and 10 new hospitalizations per capita.Lorain County remained high for the second week in a row as it reported 212.7 new cases and 13.4 new hospitalizations per capita over the last seven days. It was joined by six other local counties, including three that were at medium only a week ago (Listed in bold):
- Ashland - 229,98 cases per 100K, 10.3 new hospitalizations
- Ashtabula - 227.27 cases per 100K, 15.5 new hospitalizations
- Huron - 269.45 cases per 100K, 13.4 new hospitalizations
- Mahoning - 144.3 cases per 100K, 23.1 new hospitalizations
- Richland - 223.68 cases per 100K, 10.3 new hospitalizations
- Trumbull - 158.61 cases per 100K, 23.1 new hospitalizations
By comparison, Cuyahoga County saw a case rate of 164.44 per 100K and a new hospitalization figure of 15.5, both decreases from last Thursday. The CDC still advises those in medium counties with compromised immune systems to wear masks and get tested for COVID-19 in certain situations.
U.S. Covid Positive Cases Tumble 30% In Last Fortnight --Known coronavirus positive cases in the United States have fallen significantly in the last two weeks, by 30 percent, according to the New York Times' latest data. A 6 percent decrease was recorded in Covid casualties in the country during the same period. With 937 additional deaths reported on Wednesday, the total number of people that have lost their lives due to coronavirus infection in the country has risen to 1,052,233, as per Johns Hopkins University's latest data. 103,473 new infections on the same day took the total U.S. Covid cases to 95,492,534. Georgia reported the most number of deaths - 150 - while Pennsylvania recorded most cases - 17,506. 2,459 additional deaths were reported globally on Tuesday, taking the total number of people who have lost their lives due to the pandemic so far to 6,520,681. 93,570,146 people have so far recovered from the disease, the Worldometer tally shows. U.S. hospitals reported a 11 percent decrease in the number of Covid patients in the last two weeks. The number of I.C.U. admissions due to the worse stage of the viral disease has also fallen by 8 percent. U.S. Covid hospitalizations fell to 33,552. 4,079 of these patients are admitted in intensive care units. The nation's current test positivity rate is 13 percent. Meanwhile, the World Health Organization said the end of the pandemic is in sight. "We are not there yet. But the end is in sight," WHO Director-General Tedros Adhanom Ghebreyesus told reporters.
AstraZeneca's Evusheld Gets CHMP Recommendation For EU Approval To Treat COVID-19 -- British drug major AstraZeneca plc (AZN.L,AZN) announced Friday that its Evusheld (tixagevimab and cilgavimab, formerly AZD7442), a long-acting antibody combination, has been recommended for marketing authorisation in the European Union for the treatment of COVID-19. The Committee for Medicinal Products for Human Use or CHMP of the European Medicines Agency has recommended the drug to treat adults and adolescents aged 12 years and older weighing at least 40 kg, with COVID-19 who do not require supplemental oxygen and who are at increased risk of progressing to severe COVID-19. The CHMP based its positive opinion on results from the TACKLE Phase III COVID-19 treatment trial. It was showed that one intramuscular or IM dose of Evusheld provided clinically and statistically significant protection against progression to severe COVID-19 or death from any cause compared to placebo. The recommended dose of Evusheld for treatment in the EU is 300mg of tixagevimab and 300mg of cilgavimab, administered as two separate, sequential IM injections. Michel Goldman, Professor, Institute for Interdisciplinary Innovation in Healthcare, Université Libre de Bruxelles, and former Executive Director of the European Innovative Medicines Initiative, said, "For high-risk patients, there is a major need for tolerable and effective therapies that can be used to block COVID-19 progression and prevent poor outcomes. As we head into the autumn and winter months when COVID-19 infections may rise, Evusheld represents an important new treatment option to protect patients infected with the SARS-CoV-2 virus against severe disease and death." Evusheld was granted marketing authorisation in the EU for pre-exposure prophylaxis (prevention) of COVID-19 in a broad population of adults and adolescents earlier this year. It is already available in a majority of countries in Europe. AstraZeneca said it expects the European Commission to shortly complete its review of the CHMP positive opinion to determine whether to grant marketing authorisation for treatment of COVID-19 in appropriate populations. Evusheld is being developed with support from the US government, including federal funds from various agencies. Evusheld, formerly known as AZD7442, was discovered by Vanderbilt University Medical Center and licensed to AstraZeneca in June 2020. Under the licensing deal terms, AstraZeneca will pay single-digit royalties on future net sales.’
How Bill Gates and his partners used their clout to control the global Covid response — with little oversight - Four health organizations, working closely together, spent almost $10 billion on responding to Covid across the world. But they lacked the scrutiny of governments, and fell short of their own goals, a POLITICO and WELT investigation found.When Covid-19 struck, the governments of the world weren’t prepared.From America to Europe to Asia, they veered from minimizing the threat to closing their borders in ill-fated attempts to quell a viral spread that soon enveloped the world. While the most powerful nations looked inward, four non-governmental global health organizations began making plans for a life-or-death struggle against a virus that would know no boundaries.What followed was a steady, almost inexorable shift in power from the overwhelmed governments to a group of non-governmental organizations, according to a seven-month investigation by POLITICO journalists based in the U.S. and Europe and the German newspaper WELT. Armed with expertise, bolstered by contacts at the highest levels of Western nations and empowered by well-grooved relationships with drug makers, the four organizations took on roles often played by governments — but without the accountability of governments.While nations were still debating the seriousness of the pandemic, the groups identified potential vaccine makers and targeted investments in the development of tests, treatments and shots. And they used their clout with the World Health Organization to help create an ambitious worldwide distribution plan for the dissemination of those Covid tools to needy nations, though it would ultimately fail to live up to its original promises.The four organizations had worked together in the past, and three of them shared a common history. The largest and most powerful was the Bill & Melinda Gates Foundation, one of the largest philanthropies in the world. Then there was Gavi, the global vaccine organization that Gates helped to found to inoculate people in low-income nations, and the Wellcome Trust, a British research foundation with a multibillion dollar endowment that had worked with the Gates Foundation in previous years. Finally, there was the Coalition for Epidemic Preparedness Innovations, or CEPI, the international vaccine research and development group that Gates and Wellcome both helped to create in 2017.
The Scientific Response to COVID-19: What Does the Biomedical Literature Say? -We are now nearly three years into the COVID-19 pandemic. Where do we go from here? According to the powers that be, we are over COVID. No, probably not. The biomedical establishment (NIH, CDC, FDA, Big Pharma) went all-in on vaccines that were developed from the apex of modern molecular biology. Yes, mRNA-based vaccines make perfect biological sense. Their design is straightforward, and more importantly they are easily “tunable” to new variants, so we can keep up with variants as they appear. Well, yes and no. The facility with which a modern molecular biology laboratory can pivot to new protein-coding mRNA constructs is astonishing, especially to a scientist who first cloned a gene when virtually all steps were done “by hand” in each individual laboratory: No cloning kits, no cloning vectors with multiple cloning sites, no PCR; the New England Biolabs catalog did not yet exist in its current biblical form, which every molecular biologist has one at the ready on her lab desk. But the laboratory is one thing. Injecting human subjects with a perfectly designed but unproven mRNA is altogether something else. So, have the vaccines been effective? Yes, but that all depends on the definition. It was known long before COVID-19 that lasting immunity to coronaviruses is problematic, so when the vaccines neither prevented infection nor transmission, despite various and sundry rationalizations from the politico-biomedical establishment, a new clinical endpoint was proposed: Vaccination prevented severe disease in many of those infected. Reasonably true, but not exactly what the people naturally expected of a vaccine. While there seems to be no rhyme to our collective response to the pandemic, the reasons are plain if largely hidden. What I would like to do here is consider the overall scientific response to COVID-19, as demonstrated by a view of the COVID-19 scientific literature, first from 30,000 feet and then at ground level. By any conventional measure, the scientific response to COVID-19 has been astonishing. In the 34 months of the pandemic a search of PubMed using COVID as the database query reveals that more than 300,000 scientific papers have been published with COVID (or Covid, case does not affect the search results) somewhere in the body of the publication.[1] By any reckoning, this is a mind boggling number. Compare this, for example, with the scientific literature for another epidemic. A search with using HIV AIDS as the query (the paper included both HIV and AIDS somewhere in the published version) returns 161,633 results, from 1982 through 12 September 2022. Breaking this down into citations per month, so far, COVID leads HIV AIDS by approximately 9,400 to 340. No sane person has the time to analyze each of papers in the COVID database or the HIV AIDS database, and few would use AI/machine learning to do so (with the latter probably missing critical information). It is difficult for those who were not present to believe how frightening the AIDS epidemic was in the 1980s. Most of my circle eagerly awaited the weekly editions ofScience and Nature and the biweekly issue of Cell, and our weekly Journal Club frequently discussed the latest research on AIDS and then HIV-AIDS after the suspected retrovirus was identified by Luc Montaigner and Françoise Barré-Sinoussi. In many ways, COVID-19 has been more frightening. It became clear early that AIDS, while lethal, was not easily transmitted, especially in the Global North[2]. SARS-CoV-2 was another matter altogether and has caused more than 6 million deaths worldwide over the past 34 months. This, from a virus that causes a version of the common cold according to much of the conventional wisdom. One might justifiably ask, “If the scientific response to COVID has been so robust, why haven’t we made more progress (neglecting political factors until a later post)?” What follows is primarily an educated guess based on a 40+ year career of reading the biomedical literature. The answer lies not in the practice of biomedical research.
Death of Los Angeles County man infected with monkeypox under investigation by health officials -On Thursday, Los Angeles County, California, health officials confirmed the death of a man recently diagnosed with monkeypox. This brings the number of fatalities with confirmed monkeypox infection to two in the United States. On August 30, Harris County, Texas, reported the first such death in the US in a severely immunocompromised individual. Dr. John Hellerstedt of the Texas Department of State Health Services said at the time that the case was under investigation to determine the role the infection played in his death. Like Hellerstedt, the Los Angeles County Department of Public Health’s Chief medical officer, Dr. Rita Singhal, was careful not to attribute the cause of death to the monkeypox virus until an autopsy was conducted and its contribution to his demise could be determined. Singhal said about the death, “We are early in the investigation and do not have additional details available at this time. As soon as details become available, we will share them while maintaining confidentiality and privacy.” California, with 4,346 monkeypox cases to date, has the highest number of infections among any state in the country, including 14 cases among those 19 and younger. Overall, the US has seen more than 22,000 cases since May, of which 89 confirmed or suspected cases are among children or adolescents. Leading the way in this category is Florida with 27 pediatric cases. The global case count for non-endemic regions during the 2022 monkeypox outbreak has reached over 64,000, affecting more than 100 countries and territories. While international cases have been trending downward since mid-August, the decline has been steepest across Europe, by 70 percent on a seven-day average over a month. However, cases appear to have steadied recently.
First U.S. death from monkeypox confirmed in Los Angeles County - The U.S. reported its first death caused by monkeypox, according to an announcement from the Los Angeles County Public Health Department.The resident “was severely immunocompromised and had been hospitalized,” the department said Monday, adding that others who are severely immunocompromised and suspect they have monkeypox should seek medical treatment.The death comes after six other countries with new outbreaks have reported deaths from the virus, including Brazil, India and Spain. There have been six other reported deaths globally in non-endemic countries.Though deaths have not been common in non-endemic countries, doctors have emphasized how painful the disease can be and urge continued action to quickly contain the virus and keep it from spreading through the population indefinitely.“This is not a benign infection. This death is very concerning to all of us,” David Harvey, executive director of the National Coalition of STD Directors, said at a Tuesday briefing with public and sexual health experts about the need for more federal funding for the outbreak. “We have to stay the course. We have to monitor this.”In some African countries where the virus has been endemic for decades, deaths have been more common, but those have been mostly caused by a variant not circulating globally. Access to therapeutics and health care likely affect the number of deaths, health experts said. Still, the virus strain transmitting in the U.S. also poses the risk of serious complications, health experts say.“It is clear that there are complications that are life-threatening with this virus, with inflammation of the brain, for example, encephalitis, inflammation of the lung, called pneumonitis, and also a very high risk for pregnant women, particularly for preterm pregnancies and fetal death,” Cesar Arias, a board member of the Infectious Diseases Society of America, said at the Tuesday briefing. “It’s been well-known that there could be fatal complications of this infection. ... It is not a simple disease.”
Nation warned to brace for a difficult flu season -Health experts are warning the nation to brace for what could be an exceptionally severe flu season this fall and winter, as more people who have not built up immunity over the last few years mix and mingle. There are two big reasons why more people could be vulnerable to the flu this year. The first is that with coronavirus restrictions such as the wearing of masks all but forgotten, people are more likely to come into contact with the flu virus this year than over the last two years. The second reason is that fewer people are likely to be immune from the flu virus this year because fewer people have been getting the flu over the last two years — as the pandemic locked people down and as people worried more about getting COVID-19. Richard Webby, a virologist at St. Jude Children’s Research Hospital’s infectious diseases department, said the past two flu seasons simply have not seen the same levels of exposure to the flu. “As a population, our immunity to the flu is down a bit,” Webby said. “When the virus comes back, it’s probably going to have a little bit more room to spread, a little bit more room to potentially cause disease.” In a normal year, exposure to the influenza virus generates some community immunity as about 10 to 30 percent of people are exposed to the flu in a normal season. But fewer people were exposed in 2020 and 2021, resulting in a decline in natural immunity. For example, pediatric flu deaths normally exceeded 100 every year before the pandemic. But the past two flu seasons have seen reported pediatric flu deaths fall under 40, with only one pediatric death confirmed in 2020. This lowered population immunity means that people are at a higher risk of contracting the flu this year, according to Webby. Amesh Adalja, senior scholar at the Johns Hopkins Center for Health Security at the Bloomberg School of Public Health, said the flu season for the past two years has essentially been “nonexistent” and added that this trend was always bound to end once social distancing became less practiced.
New York declares a state of emergency on polio over growing community transmission of the virus - New York Governor Kathy Hochul declared a state of emergency Friday for the entire state, as the polio outbreak continues to widen. The detection of the virus that causes polio in a wastewater sample in Nassau County, on Long Island, at the beginning of the 2022-2023 school year appears to have been the tipping point. According to state health officials, polio virus had been identified in 56 samples collected from wastewater in Rockland, Orange, and Sullivan counties, which extend northwest from New York City along the New Jersey and Pennsylvania border, as well as in the city itself, between May and August, and now Nassau in early September. About 50 of these samples were genetically linked to the polio case diagnosed in a young Jewish man from Rockland County in June who had never been vaccinated. The county is home to a large community of the Hasidic (ultra-orthodox), whose vaccination rates have been much lower than the general population. The symptoms of the young man included fever, stiffness in his neck, and weakness in his legs. The virus usually spreads through contamination with virus-laden fecal material. In this case, the polio virus was detected in his stool. Troubling, however, is that seven of the samples have not been linked to the Rockland County case, implying there has been far more undetected community spread than previously thought. In the case of the young man in Rockland, he was probably infected a week to three weeks prior to presenting with symptoms. He hadn’t traveled abroad, but had attended a recent large gathering. Polio was eliminated in the US back in 1979, according to the US Centers for Disease Control and Prevention (CDC). The last polio case in 2013 was in someone who caught the disease while traveling abroad. The current outbreak was caused by a vaccine-derived poliovirus, meaning someone who had been vaccinated with an attenuated poliovirus oral vaccine (the Sabin vaccine) had shed the virus, leading to community spread.
The superbugs are coming — oh wait, they’re here.- Covid-19 has made a lot of things about public health worse, and antimicrobial resistance is no exception. In 2019, more than a million people worldwide died from drug-resistant infections, according to The Lancet, and that was before the pandemic. In 2020, drug-resistant hospital-onset infections spiked 15 percent in the U.S. alone, the Centers for Disease Control and Prevention estimates.Despite tens of thousands of Americans dying each year from drug-resistant infections, this is not an issue that gets a lot of time in the Beltway health-policy spotlight.But last week, federal health officials, health advocates, pharma start-ups and investors met for two days at the World Antimicrobial Resistance Congress in some chilly conference rooms at the National Harbor in Maryland.Attendees from around the world pleaded with U.S. lawmakers to pass the PASTEUR Act, which aims to tackle a central and long-standing dilemma of this public health crisis: Powerful new antibiotics must be used sparingly and therefore aren’t big moneymakers for pharma. The proposed legislation incentivizes drugmakers to invest in new antibiotics by creating a subscription model in which they would be paid upfront for the products.Today, a new report released by the Progressive Policy Institute and shared exclusively with Pulse recommends additional concrete steps the federal government can take to reign in the AMR problem before it spirals further out of control. Here are a few:Tighten up antibiotic use in livestock. About 80 percent of the antibiotics in the U.S. are used in livestock, leading to drug-resistant bugs in the food and water supply. Unlike the EU, the U.S. (and other countries) doesn’t limit or collect data on how farmers can use antibiotics, according to the report. The feds should track that information, improve surveillance for AMR in the food chain and limit the use of “medically important” drugs in animals, the paper says.Improve testing. Doctors overprescribe antibiotics because it’s cheaper to prescribe a broad-spectrum drug than order and perform an expensive lab test. PPI says policymakers should ensure that more resources are allocated to improving affordable diagnostics that are readily available to doctors.Create incentives for drugmakers. Policymakers must find a way to encourage new drugs to be developed, given the tough profit environment. The authors suggest offering cash prizes to companies, having government bodies like the Biomedical Advanced Research and Development Authority and the Strategic National Stockpile purchase more drugs for preparedness and creating subscription-model systems in which drugmakers are paid upfront for their product, along the lines of what the PASTEUR Act suggests.
Johnson & Johnson and a New War on Consumer Protection - Almost every American, from nursery to deathbed, uses Johnson & Johnson products: baby shampoo, Band-Aids, Neosporin, Rogaine, and O.B. tampons; Tylenol, Imodium, Motrin, and Zyrtec; Listerine mouthwash and Nicorette gum; Aveeno lotion and Neutrogena cleanser; catheters and stents for the heart; balloons for dilating the ear, nose, and throat; hemostats and staples; ankle, hip, shoulder, and knee replacements; breast implants; Acuvue contact lenses. But what few of those consumers grasped until a series of baby-powder cases began to go to trial was that, for decades, the company had known that its powders could contain asbestos, among the world’s deadliest carcinogens.Slippery to the touch and soft enough to flake with your fingernail, the mineral talc is found all around the world, in deposits that can be more than a billion years old. Such deposits are sometimes laced with actinolite, anthophyllite, chrysotile, and tremolite. These accessory minerals, better known in their fibrous form as asbestos, grow alongside talc like weeds in a geological garden. As early as 1971, Johnson & Johnson scientists had become aware of reports about asbestos in talc. They and others also worried about a connection between cancer and talc itself, whether or not it contained asbestos. By the time of Berg’s diagnosis, the World Health Organization’s International Agency for Research on Cancer had designated talc containing fibrous particles a carcinogen and the genital application of any talc powder possibly carcinogenic. The F.D.A. had safety concerns, too, but its authority over products like baby powder was and remains, in the words of Ann Witt, a former senior official at the agency, “so minimal it’s laughable.”Johnson & Johnson has always insisted, including to this magazine, that its baby powder is “safe, asbestos-free, and does not cause cancer”; however, a 2016 investigation by Bloomberg and subsequent revelations by Reuters and the New York Times, based in part on documents that surfaced because of discovery in suits like Berg’s, exposed the possible health risk related to its powders. Following those reports, tens of thousands of people filed suits against the company, alleging that its products had caused their cancers. In 2020, after juries awarded some of those plaintiffs damages that collectively exceeded billions of dollars, Johnson & Johnson announced that it would no longer supply the talc-based version of its product to American stores.And then, quietly, the company embraced a strategy to circumvent juries entirely. Deploying a legal maneuver first used by Koch Industries, Johnson & Johnson, a company valued at nearly half a trillion dollars, with a credit rating higher than that of the United States government, declared bankruptcy. Because of that move, the fate of forty thousand current lawsuits and the possibility of future claims by cancer victims or their survivors now rests with a single bankruptcy judge in the company’s home state, New Jersey. If Johnson & Johnson prevails and, as Berg puts it, “weasels its way out of everything,” the case could usher in a new era in which the government has diminished power to enforce consumer-protection laws, citizens don’t get to make their case before a jury of their peers when those laws fail, and even corporations with long histories of documented harm will get to decide how much, if anything, they owe their victims.
Tests find PFAS abundant in some dental floss - That nice waxy glide as you floss your teeth? Turns out it could be courtesy of PFAS, the "forever chemicals" that hijacks hormones and is linked to reproductive problems, birth defects, testicular cancer and a host of other diseases. Mamavation, the wellness site, and EHN.org tested 39 different brands of floss for PFAS and found evidence of the chemical in one third of the samples. Levels ranged from 11 parts per million, or ppm, to 248,900 ppm. Four products had more than 70,000 ppm, or 7 percent, PFAS, with Oral-B Glide testing at 248,900 ppm, or nearly 25 percent. "None of these contaminants are something our readers want in their products," Mamavation founder Leah Segedie wrote. PFAS is a family of nearly 12,000 chemicals used to make products, like Teflon, slippery. It's also found in stain-resistant carpeting and fabrics, cosmetics and firefighting foam. PFAS are in the blood of nearly all Americans, and testing of umbilical cord blood and breast milk indicates that exposure begins before birth. Some PFAS bioaccumulate — build up — which means even low exposures are cause for concern over time as our bodies accumulate more and more of them. Companies and trade associations like the American Dental Association should "stop approving of any dental product that contains any forever PFAS compound," said Terry Collins, Teresa Heinz Professor of Green Chemistry & Director of Institute for Green Sciences at Carnegie Mellon University. "They should start educating their members about the insidious nature of low dose adverse effects from endocrine-disrupting chemicals."
'Forever chemicals' are everywhere. The battle over who pays to clean them up is just getting started. State and local governments across the country are suing manufacturers of toxic chemicals that are contaminating much of the nation’s drinking water, aiming to shield water customers and taxpayers from the massive cost of cleaning them up.These pervasive “forever chemicals,” known as PFAS, are linked to a variety of health hazards, including cancer. Now, as state lawmakers and federal regulators get serious about removing them, scores of governments and water suppliers are in pitched court battles over who is on the hook for hundreds of billions of dollars in damage — the companies that created the chemicals or the customers who are drinking them.Key rulings starting later this year could determine which side has the upper hand in these cases, which are part of an unfolding legal saga that could become the most expensive in U.S. history.Early estimates of the cost of removing PFAS from drinking water nationwide are about $400 billion — dwarfing the cost of settlements and cleanup costs from environmental contamination like asbestos and lead pipes or other public health settlements tied to tobacco and opioids.And if the chemical companies can’t be forced to pay, water customers and taxpayers will have to foot the bill.“The manufacturers of PFAS are in effect creating a water affordability problem for the people of New Jersey,” said Shawn LaTourette, the head of New Jersey’s Department of Environmental Protection, which was one of the first states to regulate the chemicals in drinking water and has filed several lawsuits seeking hundreds of millions of dollars for damages to the state’s natural resources.The reasons why the chemicals are so favored by manufacturers — they’re found in cosmetics, nonstick cookware and medical devices, and are key to brands like Scotchgard and Gore-tex — are the same reasons why they’re so hard to clean up: They’re long-lasting and resistant to fire, wind and water.Costs are almost certain to mount as the hazards become clearer and more regulators set removal requirements. The Environmental Protection Agency is just starting to address risks by setting non-binding limits for PFAS in drinking water and moving to designate two kinds as hazardous substances — moves that could lead to more cleanup costs nationwide and that the industry is fighting fiercely.
The dark side of LEDs: Suppression of melatonin by blue light --You may have heard that exposure to blue light can disrupt your sleep. As it turns, out it's also harmful to wildlife.At an inner-city university, mobs of wallabies are helping researchers understand how artificial light affects nocturnal marsupials.La Trobe University graduate researcher Alicia Dimovski is studying how exposure to light affects tammar wallabies.In one enclosure, they were exposed to light-emitting diodes (aka LEDs). A second enclosure had blue-shielded LEDs much like the "night mode" setting on your phone or laptop. Wallabies in a third enclosure experienced natural darkness.After 10 weeks, Alicia took blood samples to test the wallabies' melatonin levels. As it turns out, LEDs have a dark side.Like us, wallabies rely on the hormone melatonin for a good night's rest. And the level of melatonin produced in our bodies is regulated by a light-sensitive protein in our eyes called melanopsin. When certain wavelengths of light hit the melanopsin, it suppresses our melatonin production. Reduced levels of melatonin in our blood could mess with our bodies' natural sleep-wake cycle. Melatonin is also important for the immune system. In mammals, melatonin acts as an antioxidant, capturing free radicals.Free radicals are unstable atoms created by the body as a byproduct of various normal cellular processes. Despite their potential to damage DNA and other cells, the body does completely fine with low levels of free radicals. However, when we have an infection, the body's immune response can cause an increase in free radicals. Without melatonin, this increase in free radicals can cause oxidative stress, which increases inflammation.After 10 weeks of exposure to night-time LEDs, Alicia's wallabies had lower melatonin levels."White LEDs cause problems because they contain a large amount of blue light, so they are really effective at suppressing melatonin," says Alicia.However, the study found that removing the blue light from the LEDs made a big difference to melatonin levels. In fact, the wallabies exposed to amber LED light had melatonin levels on par with wallabies experiencing natural darkness.Beyond melatonin, for wallabies, the changing level of light throughout the four seasons is a timer for vital processes like reproduction."Animals that breed at a certain time of year, such as the tammar wallabies, rely on this biological clock to ensure that births occur when there is enough food to raise their young," says Alicia."Many Australian mammals have been shown to reduce their activity even under a full moon due to an increased predation risk. So even very low levels of light pollution can disrupt our wildlife."
Midwest mayors say more funds are needed to replace lead water lines, and work must be done equitably - CBS Chicago -- A staggering number of people in Illinois are drinking dangerous, lead-laced water. In fact, our lead pipe situation is the worst in the country. The CBS 2 Investigators have been uncovering the problem for years as part of our "Getting Hosed" series on bad water bills. As CBS 2 Investigator Megan Hickey reported, another push has been launched by elected officials to get the money needed to fix the issue. Mayors from around the Midwest came together Thursday for a summit in Milwaukee. The reason was to plead their cases to federal and state officials with decision-making power over how federal money will be spent to replace dangerous lead pipes. You don't have to look far to see the result of under investment in water infrastructure. The chronic water main woes in south suburban Dixmoor are just the tip of the iceberg. The more dangerous problem is one you can't see - lead contamination from decades-old lead service lines. At the "One Water Summit" Thursday, we learned there are more than 3.1 million lead service lines in the Great Lakes states. An estimated 730,000 are in Illinois - the highest concentration in the country. Runners up are Ohio with 650,000, Michigan with 460,000, and Indiana with 290,000. "This year's work alone will cost around $1.5 million," Evanston Mayor Daniel Biss said at the summit. Biss said they must replace more than 11,000 lead service lines — at a cost of over $168 million. "Without additional outside funding, this would result in an increase of more than 70 percent to our retail customers," Biss said. That figure is nothing compared to the issue in Chicago. Mayor Lori Lightfoot said Thursday that there are at least 380,000 lead service lines in the city. Lightfoot estimates it would take $8 billion to $10 billion to replace them all. "Our city's urban density makes underground infrastructure replacement particularly challenging, and site restoration even more complex," Lightfoot said on a video clip shown at the summit.
Why we worship waste --The ability to waste resources without the need to be concerned for one's well-being or future has always been a sign of wealth and power. Thorstein Veblen coined the phrase "conspicuous consumption" in his famous 1899 treatise The Theory of the Leisure Class. The point, of course, for the wealthy is to be conspicuous so as to attract the attention, praise and deference of their fellow citizens. Veblen explained that wealthy people also often communicate their power to others by having a group of attendants around them who do little or nothing. He dubbed this "vicarious leisure." Since there are only 24 hours in a day, one person, however wealthy and powerful, can only enjoy so much leisure. Vicarious leisure made possible by the excess wealth of an individual is an unmistakable sign that a person is important.The seemingly relentless drive of commercial enterprises to reduce waste and economize may appear to run counter to this. But that drive is only meant to produce more wealth for what Veblen calls the leisure class by which he means the power elite of society.But waste is valued more broadly in society, at least indirectly. Fewer and fewer people remember when the highway speed limit was 55 miles per hour in the United States, even for superhighways. The reason for a limit so far below what most cars can achieve was to save fuel. Today, of course, that speed limit is only a memory for most highways. It turns out that our worship of speed is a also the worship of waste. Wherever we promote speed in transportation over efficiency, we are choosing waste.Of course, we have now built countless buildings with sealed windows so that many hotels, offices and high-rise residences don't have windows that open. Who needs them when you can "control the climate" of the entire building and your part of it without reference to the climate outside? Our industrial food system is a quintessentially wasteful enterprise. In the United States this system expends between 10 and 14 calories of fossil fuels for every calorie of food produced. The U.S. Food and Drug Administration estimates that between 30 and 40 percent of all food in the United States ends up as waste, much of it in landfills (probably because it spoiled before it could be used or because it wasn't of satisfactory quality to the buyer). A significant portion of produce is discarded before it ever reaches store shelves because it doesn't look perfect, even though it is still fresh and nutritious. We worship perfection in biology assuming that industrial farming can provide products that are as unblemished as the gleaming surfaces of consumer electronics. Traveling by air has now been democratized so it doesn't have the same prestige it had when there was a fairly small group of wealthy business people and leisure travelers called jet-setters. This small group has graduated to private jets that they either own or charter. And, there is no greater symbol of status than a private jet—and practically none more wasteful. And, many people worship those who get around in such an inefficient ride..
Insects struggle to adjust to extreme temperatures making them vulnerable to climate change, study finds - Insects have weak ability to adjust their thermal limits to high temperatures and are thus more susceptible to global warming than previously thought. As more frequent and intense heat waves expose animals to temperatures outside of their normal limits, an international team led by researchers at the University of Bristol studied over 100 species of insect to better understand how these changes will likely affect them. Insects—which are as important as pollinators, crop pests and disease vectors—are particularly vulnerable to extreme temperatures. One way insects can deal with such extremes is through acclimation, where previous thermal exposure extends their critical thermal limits. Acclimation can trigger physiological changes such as the upregulation of heat shock proteins, and result in changes to phospholipid composition in the cell membrane. The team discovered that insects struggle to do this effectively, revealing acclimation of both upper and lower critical thermal limits was weak—for each 1°C shift in exposure, limits were adjusted by only 0.092°C and 0.147°C respectively (i.e. only a small compensation of 10 or 15%). They found, however, that juvenile insects have a greater ability to acclimate, highlighting that there can be critical periods of life when experiencing a heat wave that may improve later resilience. Lead author Hester Weaving of Bristol's School of Biological Sciences says that "as temperature extremes become more intense and frequent in our warming world, many insects will have to rely on shifting to new ranges or changing their behavior to cope, rather than being able to physiologically tolerate wider temperatures." "Our comparative study identified some major gaps in understanding insect responses to climate change and we urge for more studies on species in underrepresented groups and locations." The team are now investigating how the reproduction of insects is affected by exposure to extreme temperatures as this may be more important in predicting future distributions than measures of performance or survival. The research was published in Nature Communications.
Yukon salmon populations are falling. The cultural damage is vast. – In summer, the Yukon River teems with life. Ducks and geese raise their young in quiet sloughs. Moose graze amid shoreline willows. Beavers splash along the muddy banks. Concealed by waters milky with glacial silt, hundreds of thousands of salmon surge upstream from the Bering Sea toward the river’s origins in northwestern Canada, bound for the streams where they were born, will lay their own eggs and will die.Where there are salmon in the far north, there are people. A century ago, even a decade ago, families from the Indigenous communities along the river regularly spent weeks each summer at fish camp, the cabins and canvas tents that dot the riverbank near eddies where Chinook salmon congregate. Dog mushers set fish wheels — like windmills with mesh baskets that scoop up chum salmon — to feed their teams.But this year, the fish camps are empty. The wheels sit on shore. There are two primary salmon species in the Yukon: Chinook and chum. A good fall chum run might see 1.8 million fish reach the lower river, fresh from the Bering Sea. Fewer than 300,000 are expected in 2022. The Alaska Department of Fish and Game estimates that this year’s Chinook run is the lowest on record: Sonar logged only 44,581 fishentering the river. From the headwaters to the mouth, no one is fishing.It’s not just because of prohibitions in Alaska and resolutions to keep nets dry by Indigenous governments in Canada’s Yukon territory. “There is no salmon to fish anyways,” says Georgette McLeod, who teaches the Han language for the Tr’ondek Hwech’in government in Dawson City, Canada. “We have no salmon passing through.” Speaking from 100 miles downriver in Eagle Village, Alaska, where she is chief, Karma Ulvi calls the salmon situation “an emergency at this point. Something has to change. Otherwise, we’re facing an extinction.”The Yukon salmon crisis might seem remote, a problem for small communities scattered along a distant, subarctic river. But from the causes to the impacts, the fate of these fish has resonances both local and global. It is a story of how climate change and biodiversity loss intertwine — and what it means to survive and imagine the future amid rapid ecological flux. The transformation of lands, suddenly and without easy recourse, in ways that alter what they mean and how we dwell within them, is not restricted to the Yukon. It could come soon to your garden or favorite orchard, to the place where you live and its capacity to nourish, both in caloric and cultural terms. Understanding such change in one place — along a river where shifts in the populations of just two fish species have sweeping effects across societies and ecosystems — is important, and provides a warning, no matter where you live.
Tap water remains undrinkable in Jackson, Mississippi - The 150,000 residents of Jackson, Mississippi once again have water running to their homes and businesses after the city’s public water and sewage system collapsed amid flooding at the end of August. However, the water remains undrinkable and the city remains under a boil-water notice, which has been in place since July, before the current crisis hit. Despite officials reporting water pressure having normalized, many residents of Jackson have reported very low water pressure and discolored water coming from their taps. On Friday, Molly Minta, reporter for Mississippi Today, recorded herself turning on the faucet at her home in the Belhaven neighborhood of Jackson, only to reveal an ongoing social crime: coffee-brown water. The video was posted on Twitter and has been widely circulated, garnering more than 12.5 million views. Notwithstanding the the lack of clean drinking water, as of Friday, Jackson’s public schools resumed in-person learning, doubly endangering students in the midst of the ongoing coronavirus pandemic. Last week, Mississippi Republican Governor Tate Reeves said, “This water system broke over several years and it would be inaccurate to claim it is totally solved in the matter of less than a week,” continuing, “There may be more bad days in the future. We have, however, reached a place where people in Jackson can trust that water will come out of the faucet, toilets can be flushed and fires can be put out.” On Tuesday, Democratic Mayor Chokwe Antar Lumumba said there was “some optimism” about samples being taken of the city’s water. For the water to be declared safe and the water boil advisory to be dropped, two days of successful testing is required for health officials in Jackson to issue a declaration clearing the water for consumption. But emergency repairs are temporary, given the system’s aged infrastructure that could malfunction at any point, as it did during the colossal winter freeze of 2021, and again this year.
California water pipeline hits legal setback- A controversial Southern California water pipeline project has hit another snag, with a federal judge’s ruling that allows the Bureau of Land Management to withdraw key approvals granted during the Trump administration.In the latest turn of a long-running and politically sensitive dispute, U.S. District Judge George Wu ruled yesterday that BLM acted properly when it remanded two rights of way that had been granted to Cadiz Inc. by the Trump administration.“This is not a scenario in which an agency — for example — compiled a full NEPA record, came to a well-supported opinion, and then reversed its opinion mere months later,” Wu wrote, referring to the National Environmental Policy Act.Wu added that in the case of the Trump administration’s decisionmaking, “here, there is no Environmental Assessment, Environmental Impact Statement or accompanying record of decision … only what appears to be a rushed, cursory decision to grant the rights-of-way.”Cadiz seeks to transport water through an existing gas pipeline that runs across federal lands, as part of an ambitious plan to extract water from an aquifer underlying its desert lands and sell it to urban areas near Los Angeles (Greenwire, Dec. 6, 2021).Environmentalists hailed the decision by Wu, a George W. Bush administration appointee to the U.S. District Court for the Central District of California.“We’re pleased the court vacated this illegal Trump-era decision that would have allowed this massive water pipeline to move forward without the necessary environmental review,” said Lisa Belenky, a senior attorney at the Center for Biological Diversity.Belenky added that “Cadiz’s water-privatization scheme would dry up irreplaceable desert springs and seeps that are crucial to wildlife, even more so now because of climate change.”The executive chair of the Cadiz board of directors, Susan Kennedy, countered in a statement that the “ruling will have no impact on completion of the Cadiz Water Conservation and Storage Project and we do not expect additional environmental review by the BLM to cause significant delay.”Kennedy added that “Cadiz’s ownership of the pipeline is unaffected by the Court’s ruling, and any additional environmental review required by the BLM to convert the pipeline to transport water will be done concurrently with the existing construction schedule,” and she said that “the Company has no concerns with additional environmental review and believes review can be conducted without impeding the construction timeline.”
Tropical Storm “Kay” delivers nearly a year’s worth of rain across Southern California - (video) Tropical Storm “Kay” delivered nearly a year’s worth of rain across Southern California last week, shattering daily rainfall records. San Diego registered 16 mm (0.63 inches) of rain on Friday, September 9, 2022, breaking the previous record of 2.28 mm (0.09 inches) set in 1976 and marking its wettest day since December 14, 2021, when 24.8 mm (0.98 inches) of rain was registered. According to the Desert Research Institute’s Western Regional Climate Center, the possibility of the city receiving 12.7 mm (0.5 inches) of precipitation on a single September day is nearly zero. “But it wasn’t just the precipitation from the storm that was notable,” Allison Finch of AccuWeather noted.1 Kay also marked the closest approach to Southern California from the Pacific Ocean in the last 50 years. The next to last point tracked by the National Hurricane Center on September 10 was 209 km (130 miles) offshore from San Diego, making it the closest pass to the city from the ocean side since records began in 1949, according to Jesse Ferrell, AccuWeather senior weather editor and meteorologist. “The runner-up was Tropical Storm Hyacinth in 1972, which was a little farther out to sea but slightly farther north.”
Remnants of Tropical Storm “Kay” cause severe mudslides in California - (videos) The remnants of Tropical Storm “Kay” brought more flash flooding to parts of Southern California on September 12 and 13, 2022, with mud and debris flows sweeping through three San Bernardino County communities.Some residents of Oak Glen were ordered to evacuate after mudslides and debris hit Forest Falls on Monday afternoon, September 12.The order covers those living north and south of Oak Glen Road, from Casa Blanca Road to the county line, and south from Wild Lilac Point to Wildwood Canyon, deputies said. The number of Oak Glen residents ordered to evacuate was not available Monday night.1An evacuation center has been set up at Redlands East Valley High School, 31000 E. Colton Ave. in Redlands. Forest Falls residents were ordered to shelter in place.
No Major Atlantic Hurricanes Mid-Season for First Time in Years - There have been no major Atlantic hurricanes at this point, the traditional middle of the season, for the first time since 2014, Standard Chartered highlighted in a report sent to Rigzone late Tuesday. “This year there have been just five named storms to date, the latest of which went closer to London than Houston,” the analysts noted in the report. “Suppressed activity has been blamed on significant levels of atmospheric dust, which reduces storm formation, and upper-level winds, which prevent the vertical growth of storms. September is normally the peak of the season, with the Atlantic still warm, and the lowest wind-shear values across storm-producing zones,” the analysts added. In the report, the analysts pointed out that the 2022 Atlantic hurricane season was forecast to be above normal in terms of activity. The analysts also outlined that, at this point last year, the 14th named storm of 2021’s hurricane season formed. At the time of writing, the National Hurricane Center is tracking one weather disturbance in the Atlantic, which it predicts has a 40 percent chance of cyclone formation within 48 hours. The formation chance through five days is currently projected to be 50 percent.
Tropical Storm “Fiona” heading toward the Leeward Islands - Tropical Storm “Fiona” formed at 01:50 UTC on September 15, 2022, as the 6th named storm of the 2022 Atlantic hurricane season. The center of Fiona is expected to move across the Leeward Islands Friday night and early Saturday, and move near the Virgin Islands and Puerto Rico late Saturday into Sunday. At 15:00 UTC on September 15, the center of Tropical Storm “Fiona” was located about 800 km (495 miles) E of the Leeward Islands, according to the National Hurricane Center (NHC).1 Its maximum sustained winds were about 85 km/h (50 mph), gusting up to 100 km/h (65 mph). The minimum barometric pressure was 1 002 hPa, and the system was moving west at 22 km/h (14 mph). A westward motion with some decrease in forward speed is expected to continue through late Saturday, September 17, with a turn toward the west-northwest possible on Sunday. On the forecast track, the center of Fiona is expected to move across the Leeward Islands Friday night and early Saturday, and move near the Virgin Islands and Puerto Rico late Saturday into Sunday
Super Typhoon “Nanmadol” strengthening, forecast to slam into Kyushu, Japan - Nanmadol formed on September 13, 2022, as the 14th named storm of the 2022 Pacific typhoon season, strengthened to a typhoon on September 15, and reached super typhoon status on September 16. The system is still strengthening and is expected to reach Kyushu, Japan by September 18. At 12:00 UTC on September 16, the center of Super Typhoon “Nanmadol” was located about 795 km (495 miles) east-southeast of Kadena Air Base, Okinawa, Japan. Its maximum 10-minute sustained winds were at 175 km/h (110 mph), with gusts up to 250 km/h (155 mph), while maximum 1-minute sustained winds were at 240 km/h (150 mph), with gusts to 295 km/h (185 mph). The minimum central barometric pressure was 925 hPa and the system was moving NW at 15 km/h (9.2 mph). super typhoon nanmadol jtwc fcst 15z september 16 2022 Super Typhoon “Nanmadol” will continue on its current track under the steering influence of the subtropical ridge to the northeast.1 After midnight UTC on September 18, it will crest the subtropical ridge axis and recurve northeastward, making landfall over Kyushu, Japan, near Sasebo just after 15:00 UTC. Afterward, it will accelerate northeastward across Honshu and by 15:00 UTC on September 21 exit back into the Pacific Ocean east of Misawa. The favorable conditions will fuel further intensification to a peak of 250 km/h (155 mph) by 00:00 UTC on September 17, afterward, cooling sea surface temperatures, increasing vertical wind shear, and land interaction will gradually erode the system.
Typhoon “Muifa” makes landfall in Shanghai as the strongest typhoon to hit the city since 1949 - (video) Typhoon “Muifa” made its first landfall in China on the coast of Zhoushan, Zhejiang Province at approximately 12:30 UTC on September 14, 2022, with maximum sustained winds of up to 151 km/h (94 mph), and the second in Shanghai’s Fengxian District at 16:30 UTC, with maximum sustained winds of up to 126 km/h (78 mph). A total of 10 typhoons have made landfall in Shanghai since 1949 when the People’s Republic of China was established, with Muifa being the strongest when it landed, according to the Shanghai Meteorological Service. The most recent typhoon to approach Shanghai within 160 km (100 miles) was Khanun in 2005, which left 16 people dead and caused damage worth more than $1.2 billion USD. By 04:00 UTC on September 14, nearly 12 000 fishing boats have returned to ports; and by 10:30 UTC, more than 1.3 million people in Zhejiang have been evacuated. There have been no reports of fatalities or severe damage in the area, and the city resumed public transit on Thursday after closing the metro while the storm passed. Photos released on social media showed scooters and automobiles submerged in water in the city of Ningbo, south of Shanghai, as a result of heavy overnight rainfall. Muifa has weakened to a tropical storm since it made landfall, and is forecast to weaken further as it moves through the provinces of Shangdong and Liaoning.
BBC World Service - The Documentary, Kentucky flooding = How Kentucky has responded to the recent challenge of unprecedented flooding.
As winter looms, some flooded eastern Kentuckians struggle to find housing - Laverne Fields and her family are camping by the side of the road in Millstone, Kentucky. It’s been a month and a half since her trailer washed into the creek.“FEMA’s little bit slow on helping us,” Fields said. Her family has had to rely on their own resourcefulness and neighbors to get by. In the early days, they were trapped in the holler by fallen trees, and community members with off-road vehicles helped them clear the way. Over a few weeks, they cobbled together a collection of tarps, tents, and campers like the one Fields lives in. She shares it with her husband and a young boy she’s temporarily caring for, Bryson. But after that initial burst of adrenaline came a long, anxious pause for the family. The trailer is still in the creek, sitting like a box of toys dropped by a child, its contents spilling onto the ground. Now the air is dusty. There’s little shade outside, and no relief in her camper.“It gets really hot in there,” Fields said. “Me and the baby has breathing problems.” She’s too busy to appeal with FEMA right now. Fields lives with nine people: her brother, her cousins, her niece, some kids from other families she’s taking care of. There’s no electricity or running water in the camper. “We bathe morning and night with wet wipes,” Fields said. More than a month after record flooding in eastern Kentucky, it’s difficult to quantify how many people are still without permanent, safe shelters. But visiting the remote hollers and communities around the region, the situation becomes obvious: many are caught in limbo waiting for a solution, some making do with mold, mud and stink in their living quarters. Others are camping. More than 13,000 people have applied for FEMA aid. State and federal officials have promised to get people into temporary housing while they search for long-term solutions. But with winter on the way, and ongoing struggles accessing benefits, many are wondering if promises will be fulfilled in time — and when, given the scale of destruction, they will be able to replace temporary setups with something more permanent. Gov. Andy Beshear says the state is sheltering 300 people in 100 travel trailers across seven state parks. But not everyone qualifies. Kayla Morton, whose rented trailer was destroyed in Whitesburg, is living in Carr Creek State Park for now with her husband and two young sons. She says the state denied her request for a trailer, but she was eventually able to get one on her own. They had previously tried staying at a local motel, but at $75 per night, the stay quickly overextended their budget. “We didn’t have anywhere to stay and there was nowhere to rent, because there’s so many homes that are lost,” Morton said, as her three-year-old, Israel, tugged at her sleeve. “This was really our only option.” They expect to be here through the winter, if not longer.
Lagos flooding: Rescuers recover two corpses, save nine - Two persons lost their lives during the flood that submerged various communities in Alimosho Local Government Area of Lagos State on Monday. The Lagos Territorial Coordinator, National Emergency Management Agency, Ibrahim Farinloye, in a statement, said the flood caused by the torrential rainfall, swept the victims away in the Iyana Ipaja and Command areas of the state. He said one of the victims, identified simply as Alfa, had escaped with his wife and four children, adding that he returned to his house to pick some items when the flood that submerged his house swept him away. Farinloye said, “Two adult men were swept away at Iyana Ipaja and Command areas of Lagos State. A man simply known as Alfa was swept away as a result of heavy downpour that caused flooding that took over the whole communities of Ajayi Street, Olubodun Ifesowapo, Olubodun, Fafunwa, Ipaja West, and Tioluwani, in Alimosho LGA. “The deceased was said to have initially escaped with his wife and four children but the man was said to have returned to his house to pick some items in the course of which he was swept off. However, two other persons with him escaped with the help of the community members. He said, “The family of Alfa had been evacuated to a relative’s residence. While another adult man, who was said to have missed his steps on the Command Bridge, fell into the running water. But before help could reach him, he had been carried away.” In another development, nine ladies were rescued when a one-storey building that was submerged started sinking on Akinwunmi Street, Mende, in the Maryland area of the state. During a visit to the area, our correspondent observed that other buildings close to the building were also affected as landlords and residents in the affected houses were displaced. It was also observed that the issue of flooding had been a reoccurring problem affecting residents in the community. Speaking with our correspondent, a lady identified simply as Blessing, said she raised the alarm over the incident, adding that she took a video recording of the situation and sent it to her company, prompting her company’s safety manager to alert emergency responders. Blessing said, “I forwarded a video to my office group telling them that the flood occurrence is the reason I could not come to work, because there was no place to pass. My office representative asked if I had been able to come out of the building, and I said no. So, the safety manager of my office alerted rescue agents to come down to Mende and we were rescued.
Deadly flash floods devastate several towns in central Italy (AP) — Flash floods swept through several towns Friday in hilly central Italy after hours of exceptionally heavy rain, leaving 10 people dead and at least four missing. Dozens of survivors scrambled onto rooftops or up into trees to await rescue. Floods invaded garages and basements and knocked down doors. In one town, the powerful rush of water pushed a car onto a second-story balcony, while elsewhere parked vehicles were crumpled on top of each other in the streets. Some farm fields near the sea were meters (yards) under water. “It wasn’t a water bomb, it was a tsunami,” Riccardo Pasqualini, the mayor of Barbara, told Italian state radio about the sudden downpour Thursday evening that devastated his town in the Marche region near the Adriatic Sea. He said the overnight flooding left the town’s 1,300 residents without drinking water. A mother and her young daughter were missing after trying to escape the floods, Pasqualini told the Italian news agency ANSA. Elsewhere in town, a boy was swept away from the arms of his mother, who was rescued. Premier Mario Draghi told a news conference in Rome that 10 people were dead and four were missing in the flash floods. He thanked rescuers “for their professionalism, dedication and courage.” Officials said some 50 people were treated at hospitals for injuries. Draghi, who is serving in a caretaker role ahead of Italy’s Sept. 25 national election, planned to tour some devastated towns later Friday and his government announced 5 million euros (dollars) in aid to the region. “It was an extreme event, more than an exceptional one,″ climatologist Massimiliano Fazzini told Italian state TV. He said, based on his calculations, the amount of rain that fell, concentrated over four hours that included an especially heavy 15-minute period, was the most in hundreds of years. In a space of a few hours, the region was deluged with the amount of rainfall it usually receives in six months, state TV said. A summer of virtually no rain meant hillsides were unusually hard and dry, so the water ran faster down the slopes, increasing its impact. The fire department tweeted that dozens of people trapped in cars or who had climbed up to rooftops or trees to escape rising floodwaters had been rescued. Police in the town of Sassoferrato, unable to reach a man trapped in a car, extending a long tree branch to him and pulled him to safety. Helicopter crews rescued seven people in remote towns of the Apennine Mountains. Hundreds of firefighters struggled Friday to remove toppled tree trunks and branches amid thick mud as they searched for people who could have been buried by debris. They waded through waist-high water in flooded streets, while others paddled in rubber dinghies to scoop up survivors. In the town of Ostra, a father and his adult son were found dead in their building’s flooded garage where they had gone to try to get their car out, and another man who tried to remove his motorcycle from a garage also perished, state TV said. Elsewhere, a man was found dead in his car. “As it (the flood) played out, it was far, far worse than forecast,” said Civil Protection chief Fabrizio Curcio. A bad weather watch had been issued on Thursday, but not at the highest level. Hundreds of people fled or were evacuated from their homes until the premises could be checked for safety and mountains of mud cleared away. Some of the worst flooding hit the town of Senigallia, where the River Misa overflowed its banks. Hamlets in the hills near the Renaissance tourist town of Urbino were also inundated when fast-moving rivers of water, mud and debris rushed through the streets.
Nine dead after flooding hits Italy's Marche region - The Washington Post — Several hours of extraordinary rainfall triggered flooding across a stretch of central Italy early Friday and left at least 10 dead, with several others missing, according to authorities. As the rainfall stopped, rescue crews scrambled through mud and around fallen trees to look for survivors. Some people had taken refuge on rooftops or held onto branches amid the flooding. Italian media reported several searing accounts, including a mother and daughter who were believed to have been swept away while getting out of their car. . “All citizens are ordered to not leave their homes and go to higher floors,” one hard-hit town wrote in an all-caps bulletin on Facebook as the high water surged. A drought in Italy’s risotto heartland is killing the rice While Italy has had deadlier floods over the decades, the event marked yet another example of extreme weather, following a record drought that had sapped lakes and rivers and devastated crops. Fabrizio Curcio, the head of Italy’s civil protection department, said the flooded area over a matter of hours saw “about one-third of the rainfall you’d usually get in a year.” “There were moments of terror with truly extraordinary levels of water,” Curcio said. A spokesman for the civil protection department said the area had been hit with 400 millimeters, or about 15.75 inches, of rain. While it is difficult to connect any single event to climate change, experts say moments of extreme weather are becoming more common — including in Italy, which has seen melting Alpine glaciers, summer wildfires and rising seas that are chipping away at coastal cities. In a visit to the flooded region, Italian Prime Minister Mario Draghi said flooding risks had become an “emergency with climate change” and would require steps for prevention, including infrastructure investment. The flooding Friday stretched across the Marche region, from the inland hills to the Adriatic coast. Some mayors of the hard-hit towns noted that there had been no indication that such an extreme event might be coming.“[There was] only a yellow alert from the civil protection for wind and rain,” Maurizio Greci, the mayor of Sassoferrato, told Italian radio. “Nothing could foretell such a disaster.”
Dangerous Western fires spark air quality alerts in numerous states - Dangerous blazes continue to spread across the West, with 93 large fires burning in seven states.As smoke plumes rise into the skies, alerts for hazardous air quality are in effect in parts of Oregon, Washington state, Idaho, Wyoming and Montana. A special weather statement about hazardous air quality was also issued in east-central California and western Nevada. The smoke is most dense and toxic near its source but has also expanded in lesser amounts all the way to the East Coast.Idaho — where the Moose Fire, the nation’s second largest, is burning — leads the pack in terms of large fires, according to the National Interagency Fire Center (NIFC).Firefighters are battling 34 large fires in the state, followed by 23 in Montana, 13 in Washington, 12 in California and nine in Oregon. Utah and Wyoming each report one large fire.In Oregon, eyes are on the Cedar Creek Fire, which has grown to more than 86,000 acres after being sparked by lightning Aug. 1. After days of extreme fire growth, the fire remains uncontained. The rapidly spreading blaze has forced nearly 1,500 evacuations, while blanketing nearby cities such as Bend in dangerously high levels of smoke. Smoke from the fire has prompted alerts in south-central Oregon.Firefighters are also battling the massive Double Creek Fire in Oregon, which has burned more than 155,000 acres and is currently the nation’s largest blaze. That inferno has prompted the Oregon Department of Environmental Quality to issue an air quality advisory for the northeastern parts of the state.Fire and heavy smoke conditions in the West are unlikely to abate anytime soon, as hot and dry conditions have left forests ripe for fire growth. Red-flag warnings have been hoisted for much of eastern Wyoming because of hot, dry conditions conducive to fires.Hazardous air quality conditions — air quality index (AQI) levels of 301-plus — have been observed in at least five states, including California, where the Mosquito Fire continues to burn between Sacramento and Reno, Nev., in the Sierra Nevada.The Mosquito Fire has forced officials to evacuate more than 11,000 people. At least 25 homes have already been destroyed by the blaze, which has torched more than 48,700 acres and is just 16 percent contained.Other active and dangerous fires in California include the Fairview Fire, which still burns close to the town of Hemet, though it is now 56 percent contained. Downpours from the remnants of Tropical Storm Kay have assisted crews in containing that blaze. That fire has burned more than 28,000 acres and killed two people who were trying to flee the blaze.
Planting trees not always an effective way of binding carbon dioxide - Tree-planting has been widely seen as an effective way of binding carbon as carbon dioxide levels rise in the atmosphere. But now researchers from the University of Gothenburg and elsewhere are warning that forests on nutrient-poor land won't be an additional carbon sink in the long term. As forests age, their uptake of CO2 declines and, each time forests are planted, there is a risk of additional carbon being released from the soil. The capacity of plants to bind carbon is a key factor in calculating the effects of climate change as carbon dioxide levels rise in the atmosphere. Scientists have now measured how much biomass grows under air with elevated CO2 concentrations in several long term field experiments. Growth stimulation was poor or missing when the plants lived in poor soil, in some cases after only ten years. "The total biomass that binds carbon was not stimulated more by the elevated CO2 levels in our experiments over time. Exactly when growth slowed down depended on various factors, but one important one was how much nitrogen the soil contained," says Louise Andresen, a researcher at the University of Gothenburg. A more nuanced picture Other factors not previously taken into account are that some trees die and thus stop binding carbon dioxide. Instead, their carbon is released prematurely. While there has been debate about the size of our forests' capacity to mitigate the greenhouse effect in the past, this study published in the scientific journal Global Change Biology provides a more nuanced picture. "We now know that we humans can't just silence our consciences by planting forests; in the long term it doesn't actually help. The only thing that will help is for humanity to reduce its greenhouse gas emissions," says Louise Andresen. The researchers also warn that the actual planting of trees can have major negative effects. A heath or tundra-like land is a good carbon sink as it is. If machines roll in to prepare the soil for planting, there is a high risk that the carbon bound in the soil will be released into the atmosphere. Previously, the prevailing theory was that elevated carbon dioxide leads to an increase in the growth of biomass. Just like it is supposed to be good to talk to your plants to make them grow better. In outdoor experiments in the U.S., Switzerland, Denmark and elsewhere, forests, grasses and other vegetation were exposed to a manipulated level of carbon dioxide in the air, and researchers then measured the growth of the biomass. Where the soil had a low concentration of nitrogen, the researchers could see that the biomass stopped increasing after a few years of growth. "That's not great news, given that carbon dioxide levels in the Earth's atmosphere have risen from 380 ppm to over 410 ppm in the last 20 years alone. After these very long experiments, we know more about how vegetation responds to elevated carbon dioxide levels. When you take the whole ecosystem, the soil's fertility and the whole life cycle of the plant into account, many ecosystems do not increase the amount of carbon they bind,"
‘Timber Cities’ Might Help Decarbonize the World - Buildings constructed with more wood, and less cement and steel, would help decarbonize the construction and housing industries in line with global goals to cut greenhouse gas emissions 50 percent by 2030 and reach net zero emissions by 2050, new research shows. The paper, published Aug. 30 in Nature Communications, explains that building mid-rise wood dwellings to meet the demand from rapidly expanding urban populations could avoid about 100 gigatons of carbon dioxide emissions through 2100—about 10 percent of the reduction needed to cap global warming below 2 degrees Celsius.“We do know we need to reach this net zero target as soon as possible,” said lead author Abhijeet Mishra, with the Potsdam Institute for Climate Impacts Research. “Reaching 1.5 degrees is getting quite dicey to achieve. An earlier paper from our colleagues really looked at how buildings can be a global carbon sink.” But that work did not answer the question of where the wood would come from. “The idea was to fill that gap,” he said. The scale of wood construction envisioned would require about 555,000 square miles of additional tree plantations, an area slightly bigger than Alaska, on top of the 505,000 square miles of tree farms that exist globally today. The study paints a broad-brush picture of where growing those trees might be feasible, factoring in projected patterns of forest growth and decline.The geographical distribution of urban population growth also matters, because using wood for building only reduces carbon emissions if it’s not transported too far. In the meantime, planners and decision makers need to tackle the enormous challenge of rethinking the way people live, work and move about in cities, because mid-rise wood residential homes would alter population density patterns and transportation needs. Any plans that include trees and wood as a way to reduce carbon emissions also requires being aware of how trees and forests are responding to the warming climate. Wildfires, insect outbreaks and drought make any new tree-planting schemes an uncertain bet, so some experts say a wider range of options for decarbonizing building and housing must be on the table, including building structures with smaller footprints, recycling waste and construction materials into new buildings and using other alternative low-carbon building materials. New technologies could reduce the carbon emissions of the cement and steel used in construction in the years ahead, which would also change the equation, although there is no clear signal that’s already happening, or will happen very soon, Mishra said. Effective regulations and careful planning for new tree plantations would be needed to limit impacts to biodiversity and food production.
More than half of all tropical deforestation directly attributable to industrial mining takes place in Indonesia - New research published in PNAS today showed that, out of 26 countries, Indonesia accounted for 58.2% of the tropical deforestation directly caused by industrial mining activities. Brazil, Ghana and Suriname also stood out in the study, which underscored the need for stronger measures to protect tropical forests from destructive economic activities like mining. The researchers overlapped the geographic coordinates of industrial mines in operation from 2000–2019 with forest loss data from the Global Forest Change dataset for the same period. The data covered 26 countries representing 76.7% of the total tropical deforestation observed from 2000–2019. Coal extraction in the Indonesian province of East Kalimantan drove the mining-related deforestation in the country. The deforestation from iron ore and gold mining in the Brazilian state of Minas Gerais was clearly visible in the satellite data, while bauxite and gold mining were predominant in Ghana and Suriname. Industrial mining also had widespread indirect impacts on deforestation. More than two-thirds of the countries studied had, within 50 kilometers of the areas designated for mines, higher rates of deforestation that were not connected to other factors. "Against the rapidly growing demands for minerals, in particular for metals for renewable energy and e-mobility technologies, government and industry policies must take into account both the direct and indirect impacts of extraction," said Anthony Bebbington, Ph.D., Higgins Professor of Environment and Society at Clark University's Graduate School of Geography and corresponding author for the study. "Addressing these impacts is an important tool for conserving tropical forests and protecting the livelihoods of communities who live in these forests." For Indonesia, Brazil and Ghana, tropical deforestation from industrial mining peaked from 2010–2014 but continues today. Coal mining in Indonesia in particular doubled in this time period as output grew to match increased demand from China and India. The scope of forest destruction in the country stood out in the study, especially in East Kalimantan which lost 19% of its tree cover in the past two decades. The province, the center of coal mining for the country, hosts the construction site of the future national capital Nusantara, a city being built where a timber plantation once stood—and a tropical forest before that. The study points to the need for Environmental Impact Statements and other permitting requirements for industrial mining to include a broader geographic scope that includes more territory outside of the project concession area. Applications for new mining projects should also not be examined in isolation; the cumulative impacts of other projects, such as agricultural developments, need to be considered.
Conservation group ask feds to list rare NV springsnail as endangered due to lithium mine - A group of conservationists are seeking to get a tiny rare Nevada springsnail listed as an endangered or threatened species, arguing that the species is threatened by a planned lithium mine in Thacker Pass. The Western Watersheds Project petitioned the U.S. Fish and Wildlife Service to list the rare Kings River pyrg under the Endangered Species Act. The pyrg is only known to live in 13 small isolated springs around Thacker Pass in Humboldt County, an area where Canada based Lithium Americas, plans to develop a lithium mine. The mine secured federal approval early last year and has also secured a number of state permits required to begin construction of the project. “This rare springsnail’s entire world wide range stands to be affected by open-pit lithium mining, which threatens to draw down or contaminate all 13 springs where it is known to live,” said Erik Molvar, a wildlife biologist and executive director with Western Watersheds Project. “Federal land managers put this aquatic snail in the crosshairs of extinction by hastily approving large-scale lithium mining at Thacker Pass. Endangered species listing is now necessary to ensure the survival of the species.” Conservationists say the Kings River pyrg is highly vulnerable to natural and human-caused threats, including livestock grazing, various impacts associated with the recently approved Thacker Pass lithium mine, spring modification, hydrological drought, climate change, and the inadequacy of existing regulatory mechanisms. Conservationists claim the mine’s operation would deplete aquifers that feed the springs inhabited by the Kings River pyrg, causing springs to dry up and threatening the species’ survival. “The potential extinction of the tiny King’s River pyrg illustrates how delicate desert aquifers become heavily impacted by industrial mining activity,” said Kevin Emmerich, director of Basin and Range Watch. “The Thacker Pass Mine would pump 1.7 billion gallons of water annually for 41 years. It would be unsustainable for much of the wildlife in the Montana Mountains and would become a death sentence for this rare springsnail.”
Catastrophic tailings dam failure at the Jagersfontein diamond mine, South Africa - (videos) A catastrophic tailings dam failure occurred at the Jagersfontein diamond mine in South Africa early Sunday morning, September 11, 2022, causing loss of life and severe environmental damage. A toxic mine waste flooded the town of Jagersfontein, sweeping away at least 9 homes and numerous cars. In some parts of the town, the depth of the ‘mud’ was around 2 m (6.5 feet). At least 4 people have been killed and 40 others injured. Reports mention at least four people are in critical condition while hundreds have been left homeless. 35 patients have been transported to Diamant Hospital in Jagersfontein, amongst them 1 pregnant lady, 4 with fractured limbs the rest for bruises and hypothermia. 5 more patients were transported to Albert Nzula Hospital in Trompsburg, government officials said. “The provincial government has activated the disaster management team and the Joint Operation Centre to determine the extent of the disaster and also carry out evacuation processes where necessary,” the spokesperson of the Free State Premier said. “More details on what may have caused the incident will be shared at the later stage once government has received a detailed report on the incident.”
The fate of a lake after a dramatic mining disaster - On August 4, 2014, Mount Polley Mine in British Columbia, Canada, made international news when a dam failure released millions of cubic meters of tailings—hazardous by-products of mining operations—into the watershed. Much of this toxic slurry surged into nearby Quesnel Lake, forming a layer of fine sediment up to 15 meters thick on some parts of the lake floor. Although it did not claim any human lives, the Mount Polley disaster was the largest spill of mine waste into a lake ever recorded. Since then, several studies have examined its impact on the surrounding watershed. Now, Granger et al. report a deeper analysis of the long-term fate of about 38,000 metric tons of sediment that remained suspended in the westernmost of two basins of Quesnel Lake 1 month after the spill. With a maximum depth of 512 meters, Quesnel Lake is North America's third deepest lake. The researchers analyzed water quality data that had been collected from multiple sites throughout the lake between August 2014 and 2020 by several stakeholders, including provincial and federal governments, the mining industry, and public research institutions. By applying the concept of conservation of mass, the researchers found that the amount of suspended sediment in Quesnel Lake remained unusually high for the first three calendar seasons after the spill. During this time, some sediment left the west basin of the lake via Quesnel River, but much of the sediment moved against the typical direction of water flow into the east basin. After June 2015, suspended sediment levels fluctuated according to the lake's typical seasonal mixing schedule, reaching higher levels each autumn and spring but declining steadily year after year. These findings deepen the understanding of the aftermath of the Mount Polley accident, and they could help inform future research on the long-term impact of ecological disasters.
Cameroon's 'exploding lakes': Disaster expert warns deadly gas release could cause another tragedy - A sudden change on 29 August 2022 in the color and smell of Lake Kuk, in north-west Cameroon, has caused anxiety and panic among the local residents. Fears are driven by an incident that happened 36 years ago at Lake Nyos, just 10km away. On 21 August 1986, Lake Nyos emitted lethal gases (mainly carbon dioxide) that suffocated 1,746 people and around 8,300 livestock. It wasn't the first incident like this. Two years earlier, Lake Monoum, about 100km south-west of Lake Nyos, killed 37 people. Research into the cause of the Lake Nyos disaster concluded that carbon dioxide gas—released from the Earth's mantle—had been accumulating at the bottom of the lake for centuries. A sudden disturbance of the lake's waters due to a landslide resulted in a sudden release of around 1.24 million tons of carbon dioxide gas. Survivors briefly heard a rumbling sound from Lake Nyos before an invisible gas cloud emerged from its depths. It killed people, animals, insects and birds along its path in the valley before dispersing into the atmosphere where it became harmless. Both Kuk and Nyos are crater lakes located in a region of volcanic activity known as the Cameroon Volcanic Line. And there are 43 other crater lakes in the region that could contain lethal amounts of gases. Other lakes around the world that pose a similar threat include Lake Kivu at the border of Rwanda and the Democratic Republic of Congo, Lake Ngozi in Tanzania and Lake Monticchio in Italy. After Lake Nyos erupted, its water turned a deep red color and survivors reported the smell of rotten eggs. These are the same characteristics to have recently manifested at Lake Kuk. The change in color of Lake Nyos was only noticed after the gas burst. In an official press release, heavy rainfall was linked to the odor and change in color of Lake Kuk. The tens of thousands of people living around the lake were urged to "remain calm while being vigilant to continuously inform the administration of any other incident noted." Initial checks in some of the lakes were done more than30 years ago and not thoroughly—it was just one team and on one occasion. Further investigations and regular monitoring are required.Currently it's believed that, of the 43 crater lakes on Cameroon's Volcanic Line, 13 are deep and large enoughto contain lethal quantities of gases. Although 11 are considered to be relatively safe, two (Lakes Enep and Oku) are dangerous.Research has revealed that the thermal profile (how temperature changes with depth), quantity of dissolved gases, surface area or water volume and depth are key indicators of the potential for crater lakes to store large quantities of dangerous gases.The factors that lead to the greatest risk include: high quantities of dissolved gases, held under high pressures, at great depths, in lakes with large volumes of water. They are at an even greater risk of explosion when the lakes sit in wide or large craters where there are disturbances.
At least 7 people killed, widespread damage to homes and infrastructure after M7.6 earthquake hits Papua New Guinea - (video) A major earthquake registered by the USGS as M7.6 hit the Eastern Highlands Province of Papua New Guinea at 23:46 UTC on September 10, 2022 (09:46 LT, September 11) at a depth of 90 km (56 miles). The quake caused widespread damage to homes and infrastructure, triggered a series of deadly landslides, and left at least 7 people dead, according to official reports released on Monday, September 12.1 However, more people are feared dead as rescuers begin to reach remote landslide-hit communities. Police Commissioner David Manning said 3 alluvial miners were buried alive near the settlement of Wau while 4 others died in locations across Morobe and Madang provinces. Recent earthquakes in this area have caused secondary hazards such as tsunamis, landslides and liquefaction that might have contributed to losses. Papua New Guinea Red Cross secretary-general Valachie Quagliata said the area’s rough mountainous terrain made access difficult, with the worst affected areas not accessible by car. The quake has also damaged the Ramu hydropower plant, resulting in a total system outage across the Highlands provinces, Madang, and Morobe. Quagliata added significant power interruptions are expected in the days ahead. An undersea cable linking the regional capital Madang to Port Moresby was also affected by the quake, as was a link between Madang and Sydney. While parts of the highway connecting several main cities have been damaged, regional airports in Goroka and Lae-Nadzab remain open. Prime Minister James Marape said the earthquake’s impact is expected to be less than a 2018 quake that killed 150 people.
Strong M7.9 solar flare erupts from AR 3098 - A strong M7.9 solar flare erupted from Active Region 3098 at 09:49 UTC on September 16, 2022. The event started 09:44 and ended at 09:56 UTC. The region is located on the west limb of the Sun, so even if coronal mass ejection (CME) was produced it would be directed away from our planet. Solar activity is expected to be at low levels on September 16 and 17, with a continuing chance for R1-R2 (Minor-Moderate) radio blackouts. Very low levels are likely by September 18 as Region 3098 rotates off the visible disk. The geomagnetic field ranged from quiet to active levels due to transient influence over the past 24 hours. It is likely to reach active levels, with a chance for G1 – Minor geomagnetic storm levels, on September 16 and 17 in response to negative polarity coronal hole high speed stream (CH HSS) influence. Quiet to unsettled levels are likely on September 18.
Why are the glaciers in southeast Tibet melting so fast? - Millions of people depend on water from the glaciers of High-Mountain Asia. South-eastern Tibet, however, has some of the most rapidly melting glaciers in Asia. This is due to less summer snowfall, as a study led by the Swiss Federal Institute for Forest, Snow and Landscape Research WSL shows. Unlike in the Alps, glaciers on the Tibetan Plateau receive most of their snowfall during the summer months, which are the wettest but also the warmest. The glaciers in the south-eastern Tibetan Plateau feed the Brahmaputra River, on which millions of people downstream rely for domestic, agricultural, and industrial uses. Earth-observation satellites have recently revealed that glaciers in this region are experiencing some of the highest mass loss rates within Asia, and this loss is accelerating in the last decades. We know that rising temperatures due to climate change are causing glaciers to melt, but is this really the only factor behind the rapid retreat of the glaciers in this region? The scientists have disentangled the mechanisms behind south-eastern Tibet glaciers' high sensitivity to warming. To identify these mechanisms, they used a state-of-the art model to reconstruct the climate and mass changes of Parlung No.4 glacier in south-eastern Tibet over the last 45 years. That is the longest period of time for which changes in a glacier in this region have ever been reconstructed. The so called glacio-hydrological model the scientists used was informed by an extensive set of data collected on site and by remote sensing. Glacio-hydrological models integrate both glaciological and hydrological processes, e.g. glacier and stream flow. Long-term changes in the precipitation phase are very difficult to observe, especially at the high elevations of glacier accumulation areas. They require continuous precipitation measurements that are often costly and subject to large uncertainties. Therefore, using a well-informed model that was calibrated with locally collected data was the most practical way to quantify them. The researchers found that most of the mass loss acceleration was due to a shift of some of the summer precipitation from snow to rain, limiting the accumulation of snow—that eventually turns to ice—on the glaciers. Their results show that glacier melt has also increased, but that the decrease in snow accumulation was a stronger cause for recent mass loss in this region. The fact that less snow accumulates on the glaciers has a secondary effect in exposing glacier ice to sun and warmth for a larger part of melt seasons, which can greatly enhance melt. This has also become apparent in the Alps this summer, where a small winter accumulation has led to early and excessive summer melt. Altogether, the results show the importance of accounting for changes in glacier accumulation mechanisms in projections of glacier changes, and help to explain the particular sensitivity of summer-accumulation glaciers to warming. The study was published in the Proceedings of the National Academy of Sciences.
World heading into ‘uncharted territory of destruction’, says climate report - The world’s chances of avoiding the worst ravages of climate breakdown are diminishing rapidly, as we enter “uncharted territory of destruction” through our failure to cut greenhouse gas emissions and take the actions needed to stave off catastrophe, leading scientists have said. Despite intensifying warnings in recent years, governments and businesses have not been changing fast enough, according to the United in Science report published on Tuesday. The consequences are already being seen in increasingly extreme weather around the world, and we are in danger of provoking “tipping points” in the climate system that will mean more rapid and in some cases irreversible shifts. Recent flooding in Pakistan, which the country’s climate minister claimed had covered a third of the country in water, is the latest example of extreme weather that is devastating swathes of the globe. The heatwave across Europe including the UK this summer, prolonged drought in China, a megadrought in the US and near-famine conditions in parts of Africa also reflect increasingly prevalent extremes of weather. The secretary general of the United Nations, António Guterres, said: “There is nothing natural about the new scale of these disasters. They are the price of humanity’s fossil fuel addiction. This year’s United in Science report shows climate impacts heading into uncharted territory of destruction.” The United in Science report was coordinated by the World Meteorological Organization, and involves the UN Environment Programme, the UN Office for Disaster Risk Reduction, the World Climate Research Programme, the Global Carbon Project, the UK’s Met Office and the Urban Climate Change Research Network. The United in Science report found:
- The past seven years were the hottest on record and there is a 48% chance during at least one year in the next five that the annual mean temperature will temporarily be 1.5C higher than the 1850-1900 average.
- Global mean temperatures are forecast to be between 1.1C and 1.7C higher than pre-industrial levels from 2022-2026, and there is a 93% probability that at least one year in the next five will be warmer than the hottest year on record, 2016.
- Dips in carbon dioxide emissions during the lockdowns associated with the Covid-19 pandemic were temporary, and carbon dioxide emissions from fossil fuels returned to pre-pandemic levels last year.
- National pledges on greenhouse gas emissions are insufficient to hold global heating to 1.5C above pre-industrial levels.
- Climate-related disasters are causing $200m in economic losses a day.
- Nearly half the planet – 3.3 to 3.6 billion people – are living in areas highly vulnerable to the impacts of the climate crisis, but fewer than half of countries have early warning systems for extreme weather.
- As global heating increases, “tipping points” in the climate system cannot be ruled out. These include the drying out of the Amazon rainforest, the melting of the ice caps and the weakening of the Atlantic meridional overturning circulation, known as the Gulf stream.
- By the 2050s, more than 1.6 billion people living in 97 cities will be regularly exposed to three-month average temperatures reaching at least 35C.
California’s Net-Zero Roadmap Is Being Shaped by Regulators-Turned-Lobbyists - With Gov. Gavin Newsom set to sign a slate of bills boosting California’s fight against climate change, regulators are also finalizing a far-reaching plan to cut the state’s emissions. But the oil and gas industry is exerting pressure on regulators to shape the plan in ways that could delay the state’s progress, say critics.A draft of the plan by the California Air Resources Board (CARB), released in May, reflects the interests of oil and gas refiners and agrochemical companies involved in the production of biofuels, while relying on ineffective methods for cutting emissions, say climate policy experts and environmental justice groups. The plan is supposed to be a roadmap for achieving “carbon neutrality,” where the state effectively emits no greenhouse gases by 2045, while making deep cuts by 2030.Industry goals such as a build-out of engineered carbon capture technology (in which CO2 is captured and stored rather than released into the atmosphere), and an expanded role for liquid biofuels to displace fossil fuels in planes and trucks, have resulted in a model that enables more refineries to remain in operation, perpetuating risks for people living near them. Additionally, the plan sidesteps concerns about California’s cap and trade program while anticipating it will result in millions of tons of reductions — which critics worry won’t actually happen except on paper — over the next seven years. Among the industry’s lobbyists pushing these measures are at least three former California Air Resources Board regulators, who reached out to their former colleagues at the agency on behalf of fossil fuel, business groups and agrochemical clients, according to interviews and emails obtained by Capital & Main.Revolving door practices — in which government officials give up public service for lobbying in the private sector — have a long history in California, says Liza Tucker, a researcher at Consumer Watchdog who has investigated revolving door influence in other environmental agencies.“It’s a real problem, and it is entrenched,” Tucker said. For example, she added, the plan focuses on reducing demand for oil and gas in the state but says comparatively little about reducing supply for export — even though climate damage in California is caused by emissions from anywhere, as greenhouse gases in the atmosphere trap heat and influence extreme weather events like droughts, heatwaves and floods. A spokesperson for CARB did not acknowledge questions about influence from lobbyists but said regulators “heard from stakeholders in public workshops and webinars, at formal board meetings, and when requested, in meetings with staff or board members” while putting the plan together. The plan aims to drastically reduce emissions from the industrial, energy and transportation sectors. A final version will be released in the coming months, as CARB refines it based on ongoing feedback.
Summit Carbon Solutions touts pipeline easement milestone in Iowa - Agweek — Summit Carbon Solutions says it has reached a major milestone as it pushes ahead on its carbon capture pipeline project.The Iowa-based company says it has worked with 800 Iowa landowners to sign 1,400 easement agreements totaling nearly 350 miles. The company says it has agreements for more than half of the proposed route in the state.Summit says it remains on track to begin construction on the 2,000 mile, five-state pipeline in the third quarter of 2023.The company is partnering with 32 ethanol plants across the Midwest, including 12 in Iowa, to develop a pipeline that will store carbon underground in western North Dakota.The greenhouse gas captured from the ethanol plants will help the plants thrive by opening up access to markets with low carbon fuel standards, such as California and Canada. Summit says about 40% of all the corn grown in the United States and remains a key driver of commodity prices and land values.Summit says the Midwest Carbon Express pipeline is a $4.5 billion project, with a $1 billion investment in Iowa alone. Other states on the route are Minnesota, Nebraska, South Dakota and North Dakota.So far, Summit has filed for permits in Iowa and South Dakota.The carbon capture project also is being met with some resistance from landowners in the path of the proposed pipeline.Jessica Mazour of the Sierra Club in Iowa has been helping organize landowner resistance. "Summit can tout whatever false appearance of support that they want, but they’ve shown us time and time again that we cannot believe anything they say," Mazour said in an email. "The truth is that 80% of the counties on the Summit route have objected to the pipeline project and over 95% of the filings in the Iowa Utilities Board docket are objections. Until they are done filing their eminent domain list, we should not believe any of their uncited propaganda."
Delaware County Board of Supervisors send letter to Iowa Utilities Board opposing proposed Navigator pipeline -The Delaware County Board of Supervisors sent a letter to the Iowa Utilities Board, expressing their "unanimous opposition" to a proposed pipeline project more than 1,300 miles long, spanning five states. The Navigator Heartland Greenway CO2 pipeline would cover 810 miles in Iowa and cross through 33 counties. In the KWWL viewing area, that includes Butler, Bremer, Fayette, Buchanan and Delaware counties.The Navigator pipeline would transport 15 million tons of liquid carbon dioxide each year. It would then be transferred from local facilities to permanent underground storage locations in South Central Illinois.
USDA more than triples funding for ‘climate smart’ agriculture - The Biden administration plans to distribute more than $3 billion to fund projects that will reduce greenhouse gas emissions and sequester carbon in agriculture and forestry — a tripling of its initial commitment in February. U.S. Secretary of Agriculture Tom Vilsack was set to publicly announce the expansion of the Partnerships for Climate-Smart Commodities program on Wednesday, along with 70 projects that will receive the initial funding.“This is a really, really important day for American agriculture,” Vilsack told reporters Tuesday. “I just hope everybody fully appreciates the significance of what we’re doing here.”The program is being funded through the Commodity Credit Corporation, which has been historically used to support farmers with loans and payments and to fund conservation programs of the farm bill.The U.S. Department of Agriculture has said it can use the CCC to fund the new climate program without congressional approval because it will “aid in the expansion of markets for agricultural commodities,” a provision of its charter. A key goal of the program is to create markets for climate-friendly products.“We have significant resources left in the CCC account to be able to adequately and fully and completely respond to any farm bill program payments,” Vilsack said.The initial selected projects will get a total of about $2.8 billion over the course of five years, and the companies, universities, conservation groups and others that have proposed them will contribute a total of about $1.4 billion, Vilsack said. Funding for a second group of projects is expected later this year.It’s part of a voluntary approach the Biden administration is taking toward its goal of “net zero” agriculture that would boost the amount of carbon that remains in soil and reduce the emissions of livestock, machinery and other sources. Rather than force farmers to reduce emissions and improve soil health through regulations, Vilsack hopes to give farmers lucrative markets for products that are the result of those reduced-emissions strategies.
Biden announces funding for half a million electric vehicle charging stations- POLITICO (news video)
Money approved for states to build car-charging network (AP) — The Biden administration said Wednesday it has approved ambitious plans by 34 states and Puerto Rico to create a national electric vehicle charging network as the U.S. begins in earnest its transition away from gas-powered transportation.The plans’ approval means $900 million can begin to flow to the states, which are tasked with using money from President Joe Biden’s huge infrastructure law to form the network of chargers across the nation. Building out a reliable and convenient network is critical to spur more adoption of the technology, which is itself key to reducing greenhouse emissions that cause global warming.The announcement came on the same day that Biden toured the North American International Auto Show in Detroit to tout the new law that includes tax incentives to purchase electric vehicles. In practical terms, it means residents in some of those states could see more charging stations start popping up along major travel corridors as early as next summer. Biden has a goal of ultimately installing 500,000 chargers across America and building a network of fast-charging stations across 53,000 miles of freeways from coast to coast.
DOE's Shah ready to promote new $250B energy reinvestment loan program -The U.S. Department of Energy, newly equipped with $250 billion to lend to projects that repurpose or convert existing energy infrastructure, is now figuring out how to advertise the program to the communities that need it the most. "I would say the biggest challenge that we have, honestly, is that for many of these communities, they haven't thought about how to build a project," Jigar Shah, director of the DOE Loan Programs Office, told S&P Global Commodity Insights."That's the hard part, is starting that process."The Inflation Reduction Act, or IRA, signed by U.S. President Joe Biden in August, authorized $369 billion in climate and energy spending, with its bundle of tax credits receiving top billing. But the law also authorized nearly as much in new DOE loan authority — about $350 billion — as it did in overall spendingThe DOE Loan Programs Office, created by the Energy Policy Act of 2005, has provided about $36 billion in debt financing to commercial energy and advanced vehicle manufacturing projects. However, while previous loans prioritized innovation, Congress's latest authorization focuses on reuse. The IRA appropriated $11.7 billion to the loans office, for credit subsidies and administrative costs, and added about $100 billion in lending authority to DOE's existing loan programs. But the act also created a new Energy Infrastructure Reinvestment program, authorizing DOE to lend up to $250 billion to projects making use of existing energy assets.
What the Western drought reveals about hydropower - The relentless Western drought that is threatening water supplies in the country’s largest reservoirs is exposing a reality that could portend a significant shift in electricity: Hydropower is not the reliable backbone it once was. Utilities and states are preparing for a world with less available water and turning more to wind and solar, demand response, energy storage and improved grid connections. That planning has helped Western states keep the lights on this summer even in severe drought conditions. Take California, which experienced record demand during a heat wave last week but did not have to impose any rolling blackouts. That’s despite the fact that hydropower — which on average makes up about 15 percent of the state’s power generation mix under normal conditions — has dipped by as much as half this summer. “Obviously, water and energy are very much intertwined,” said Newsha Ajami, the director of urban water policy for Stanford University’s Water in the West initiative. “The interesting part here is that losing reliability in one is impacting reliability of the other. It’s hotter, it’s drier and people are using a lot more electricity as we rely on hydropower as one of our baseline power generators, but lake levels are lower.” During the heat wave, officials timed releases from hydropower projects, which accounted for as much as 10 percent of the electricity for the state at some times of day, according to data from the California Independent System Operator. Elsewhere across the West, planners are accounting for growing demand while factoring in reductions in hydropower. According to the 2018 National Climate Assessment, Southwestern hydropower and thermal power plant generation are “decreasing as a result of drought and rising temperatures.” A February study in the journal Water using World Wildlife Fund data found that by 2050, 61 percent of global hydropower dams will be at very high or extreme risk of droughts and/or floods.
Strike could send coal off the rails- - A dispute between railroad companies and their workers could deliver a major setback to the nation’s coal industry, while hamstringing transportation infrastructure and disrupting the economy less than two months before the midterm elections.Rail accounts for about 28 percent of U.S. freight, but certain industries rely on it especially heavily. For coal producers, railroads are the No. 1 mode of transportation.“I expect coal to be hit particularly hard,” said Ray Minjares, a program director at the International Council on Clean Transportation.A strike by unionized rail workers negotiating for better pay and benefits could upend freight and passenger rail service across the country. The workers areparticularly enraged by certain policies concerning leave, such as no sick days and penalties for taking time off.Workers could go on strike as soon as Friday if no deal is reached before then. Such a shutdown of the nation’s 7,000 daily freight trains could cost the economy as much as $2 billion per day, according to the railroad division of the Transportation Department.It would take an estimated 467,000 additional long-haul trucks per day to compensate for the freight disruption — and that’s a lot of extra pollution. Transportation is the single-largest source of U.S. greenhouse gas emissions, and heavy-duty vehicles spew a disproportionate amount of that pollution.According to the Association of American Railroads, railroads are as much as four times more fuel-efficient than trucks, reducing heat-trapping emissions by up to 75 percent.Entirely replacing the nation’s trains with trucks is unlikely to happen, though. There just aren’t enough trucks or drivers to operate them. The nation’s trucking industry is short 80,000 drivers — which doesn’t bode well for the supply chain.Still, daily train commuters whose service is interrupted by the strike may opt to drive. And despite rapid growth in recent years, electric vehicles only make up about 1 percent of cars on the road.Groups across industries are calling on Congress to intervene. Labor Secretary Marty Walsh has postponed a trip to Ireland as he and others in the administration seek to avert a strike.Rail companies and the majority of workers have already coalesced around a wage hike and benefits proposal, but the two biggest rail unions, which represent 57,000 engineers and conductors, are continuing to demand better leave policies. They say members have been fired for taking time off to attend family members’ funerals or for routine doctor visits.
EPA sued for failing to regulate hundreds of coal ash dumps -Environmental, civil rights, and community groups are suing the U.S. Environmental Protection Agency and Administrator Michael Regan for exempting hundreds of toxic coal ash dumps nationwide from a rule designed to protect the environment and public health.The nonprofit legal group Earthjustice filed the federal lawsuit on Aug. 25 in U.S. District Court for the District of Columbia. The plaintiffs in the case are Statewide Organizing for Community eMpowerment in Tennessee, the Indiana State Conference and LaPorte County Branch of the NAACP, Hoosier Environmental Council in Indiana, Clean Power Lake County in Illinois, the Sierra Club, and the Environmental Integrity Project."Power plant records reveal that about half of the toxic coal ash waste in the U.S. is entirely exempt from any federal health protections," said plaintiffs' attorney Mychal Ozeta with Earthjustice. "This is outrageous. The coal power industry is poisoning drinking water sources and the air we breathe while causing global warming."Coal ash is the waste left after burning coal for power and contains toxic substances including arsenic, lead, mercury, and radium. The EPA has acknowledged that the risks to humans associated with coal ash exposure include cancers, neurological and psychiatric problems, cardiovascular damage, and anemia.The EPA regulated coal ash in 2015 following public outcry over the massive 2008 coal ash spill from a Tennessee Valley Authority (TVA) power plant near Kingston, Tennessee. But when Earthjustice studied databases it found in EPA archives, it discovered that the agency exempted from regulation 292 coal ash landfills at 161 plants in 38 states, including 12 of the 13 Southern states.* The group says its count of inactive landfills is likely an underestimation, but it's also possible that its interpretation of industry data may have resulted in an overcount at particular facilities.EPA excluded from its oversight those coal ash dumps that stopped receiving new waste before the regulation when into effect, as well as those at power plants that had already stopped producing electricity. Earthjustice says the exempted landfills are located disproportionately in low-income communities and communities of color. But just because a coal ash landfill isn't taking new waste doesn't mean what's in it isn't contaminating the environment. Earthjustice and the Environmental Integrity Project studied industry data and found groundwater contamination exceeding federal health-based standards at 76% of regulated coal ash landfills, which tend to be newer and are more likely to have protective liners than the older, inactive landfills that EPA exempted from its rule. That means the inactive coal ash dumps are even more likely to be releasing toxic contaminants to groundwater.
Georgia ratepayers face big bill for coal ash cleanup - Plant Bowen’s cooling towers dominate the horizon east of Taylorsville Elementary School in Stilesboro, Georgia. They’re visible from 5 miles north at a boat slip in Euharlee, where paddlers push off into the Etowah River, and they form the backdrop for homes in each of the surrounding towns. Hard to spot, however, are the enormous ponds where Georgia Power stores the waste from the coal burned in Plant Bowen. Indeed, the plant is one of Georgia’s largest coal-fired power generation facilities and the source of the 20.4 million cubic yards of ash stored on site — enough to fill more than 6,000 Olympic-size swimming pools. The coal ash itself is filled with toxic chemicals like arsenic, mercury, lead, and chromium, but is not designated by the U.S. Environmental Protection Agency as hazardous waste.Now, the power company in charge has begun cleaning up its ash ponds across the state, as federal rules require. But more than two million energy-consuming households are on the hook for the cleanup cost. A 2019 decision by the state’s utility regulators allowed plant owner Georgia Power to charge the first $525 million in ash pond closure costs to customers. Georgia Power, which owns nearly all the state’s coal ash sites, estimates its total coal ash closure and monitoring costs will be nearly $9 billion, a utility spokesperson said. Georgia Power analysts expect they will request an additional $1.1 billion in coal ash closure reimbursement from customers over the next three years. Plant Bowen, an hour northwest of Atlanta, is the site of the state’s largest ash pond. Georgia’s 29 coal ash sites hold more than 92 million tons of waste, according to environmental groups’ analysis of data reported by companies.There are over 700 coal ash repositories nationwide, many of them unlined ash ponds like Plant Bowen’s, and many of them contaminating groundwater through seepage of dangerous chemicals. Under federal rules adopted by the EPA in 2015, companies must develop closure plans for ash ponds and prevent groundwater contamination. Environmental watchdogs typically argue that ash should be removed from unlined ponds entirely and transported to lined landfills, or reused as an ingredient in concrete or other building materials. In January, the EPA indicated to state regulators and utility companies that it would start enforcing the 2015 rules, which thus far had sparked little government action.On Jan. 11, EPA regulators sent a letter to the Georgia Environmental Protection Division, saying the state’s ash ponds may need to be excavated.In June, Georgia Power announced that it will excavate 9 million out of 20 million tons of stored ash at Plant Bowen for “beneficial reuse,” the largest such project in the U.S. Georgia Power now intends to excavate more of its ash than originally planned, removing ash from 20 of its 29 impoundments. But that excavation is expensive. Meanwhile, Georgia Power collects a 10.5% profit margin on investments the utility makes, including coal ash cleanup. The rate was approved by the state’s Public Service Commission, even though the commission staff had suggested a 9.5% return, in line with national averages for utility companies.
Will Black communities bear the burden of coal ash? - Uniontown is the second largest city in Perry County, Alabama. Like many counties in the Black Belt, Uniontown’s economy is tied to agriculture. Its rich, dark soil made it ideal for cotton plantations in the 1800s — meaning many enslaved people were brought here. The term “Black Belt” eventually evolved from describing soil to now the counties in Alabama with the highest percentage of Black people. Uniontown’s population is more than 90% Black. When Carrie James was growing up, factories peppered the town. It had Hatch Motors, Cahaba Steel, a shoe factory and more. Driving through downtown today, only the remnants of this time remain. Today, Uniontown City Hall is surrounded by crumbling brick buildings with shattered glass windows. Layers of dirt cake the windows of the abandoned Piggly Wiggly, the town’s only grocery store, which closed in 2018. James and other residents feel that Uniontown’s decline was both symbolized and accelerated by the county’s decision in 2005 to allow a large landfill that ultimately grew to accept waste from 33 states — including toxic coal ash from one of the country’s worst environmental disasters. More than 700 sites nationwide hold coal ash. Under federal rules, unlined coal ash ponds must be closed, and the safest option is usually to remove the ash and transport it to landfills. Companies can often build new landfills on the site of power plants. But some decide to send the ash to landfills off-site, and often out of state. South Carolina passed legislation to stop other states from dumping coal ash in its landfills. But Alabama currently has seven landfills accepting coal ash, and some accept waste from across state lines, according to state records. The CEO and chief executive officer of the Arrowhead Landfill in Uniontown said it’s poised to become one of the largest waste-by-rail landfills in the eastern United States, according to his LinkedIn page. Nationwide, landfills are disproportionately located in low-income, minority communities. An EPA study shows that people of color are more likely to live near polluters like landfills and breathe in polluted air. In January, the EPA announced its intention to enforce federal coal ash rules adopted in 2015. Thus far, the federal government had largely left it to companies and states to comply with the rules. Stepped-up federal oversight likely means more companies will need to remove coal ash from ponds, and they may look to send it to landfills like Arrowhead.On July 4, coal ash began being removed from Kingston, a predominantly White city, to dump in Uniontown, a predominantly Black community, according to ADEM records. Uniontown residents had no power to stop the move, and got no revenue from the transfer.Uniontown residents were terrified to have the coal ash pass through their town, worried it would blow off trucks and blanket their backyards and homes. “My husband has Alzheimer’s,” James said. “I’ve gotten some health problems since I got back here. I don’t know whether to even have a garden because I don’t know what’s in the air. I don’t know what’s in the soil.”
Coal plant sites could host 265 GW of advanced nuclear, costing 35% less than greenfield projects: DOE About 80% of operating and recently retired coal-fired power plant sites could host an advanced nuclear power reactor, with nearly 265 GW in total potential nuclear capacity, according to a Department of Energy report released Tuesday. Using transmission, switchyard facilities and other infrastructure at the coal plant sites could reduce the overnight cost of capital of a nuclear facility by 15% to 35% compared with a greenfield project, according to the analysis. “Fully decarbonizing the U.S. power grid and producing zero-carbon fuels will require hundreds of GWs in new zero-carbon ‘always available’ energy,” Judi Greenwald, Nuclear Innovation Alliance executive director, said in a statement. “Repowering coal plants with advanced nuclear energy advances decarbonization while taking advantage of a local workforce with experience running energy facilities.” The report comes as states and the federal government are looking for ways to take advantage of transmission lines and other equipment that was built to serve coal-fired power plants, in part to support the communities around the retired or soon-to-be shuttered generating facilities.DOE researchers from the Argonne, Idaho and Oak Ridge national laboratories found 190 operating coal plant sites that could host nearly 200 GW of nuclear capacity and 125 recently retired plant sites that could handle about 65 GW of nuclear capacity. There are about 100 GW of existing nuclear capacity in the United States, which account for 8.2% of all U.S. generating capacity, according to the Federal Energy Regulatory Commission.Coal-to-nuclear, or C2N, projects appear to perform better economically than stand-alone, greenfield nuclear projects, the researchers said.Also, building nuclear plants at retired coal plant generating stations may provide an economic boost to disadvantaged communities, according to the report.“The study results suggest economic potential for communities and firms that pursue C2N transitions,” the DOE researchers said. “An implication of this is that there is a potential advantage for interested coal communities to be first movers in what could be a series of many C2N transitions across the United States.”
Plan emerges to reopen Palisades Nuclear Power Plant, but federal grant key - The Palisades Nuclear Generating Station is a nuclear power plant located on Lake Michigan.
Special counsel hired to help PUCO has ties to HB 6 -An outside law firm working with the Public Utilities Commission of Ohio on responses to federal subpoenas and public records requests has multiple ties to the law at the heart of the state’s ongoing corruption scandal.The firm, Dinsmore & Shohl, is headquartered in Cincinnati and has offices in 30 cities across the United States. The Ohio Attorney General’s Office retained the firm as special counsel for the PUCO after it received the first of two federal subpoenas in the spring of 2021 relating to House Bill 6. The law called for more than $1 billion in subsidies for two nuclear plants formerly owned by a FirstEnergy subsidiary. Its other provisions included subsidies to Ohio utilities for two 1950s-era coal plants, as well as a gut of Ohio’s clean energy standards.“Dinsmore was chosen because the firm possesses expertise in federal criminal matters by virtue of having former Assistant U.S. Attorneys on staff,” said Bethany McCorkle, communications director for Ohio Attorney General Dave Yost. “Additionally Dinsmore is among the very limited number of sufficiently sized and experienced firms that do not practice before the PUCO.”Beyond its work on the 2021 subpoenas from the Department of Justice, the firm has been assigned to work on a deposition and responses to a subpoena in securities litigation involving FirstEnergy. Other work includes fulfilling public record requests from the Energy News Network and Eye on Ohio, as well as the Ohio Capital Journal. Various materials sought by those requests in February, April and July still have not been produced.Ohio House Majority Floor Leader Bill Seitz, R-Cincinnati, has been of counsel with the firm since 2014. That means he’s a senior lawyer there but does not share in firm profits and thus would not have a financial stake in the firm’s work for the PUCO. Seitz was a co-sponsor of HB 6 and was at the forefront of efforts to pass HB 6 in 2019. Then, in the wake of the arrests, he pushed for a “surgical repeal” that would leave most of HB 6 in place but eliminate the nuclear subsidies and a recession-proofing provision. Seitz also argued against ousting Householder from the House in June 2021. The Dinsmore firm’s lobbying affiliate, DSD Advisors, was also connected to HB 6 through lobbyist Matthew Davis’s work for FirstEnergy Solutions, the former FirstEnergy subsidiary now known as Energy Harbor since emerging from bankruptcy in 2020. Dinsmore lawyers also acted as local bankruptcy counsel for Murray Energy, which was later identified as “Company B” in the federal government’s July 2020 complaint against Householder. Attorney Eric Lycan filed papers with the Ohio Secretary of State in 2017, which then let Generation Now do business in the state as a nonprofit organization set up under Section 501(c)(4) of the Internal Revenue Code. Lycan also served as treasurer of the organization, which allegedly served as the primary dark money conduit for funds in the HB 6 scandal. Generation Now and its president Jeff Longstreth have both pled guilty to criminal charges in the case against Householder and others. The Internal Revenue Service has also revoked the organization’s status as a tax-exempt organization after it failed to file annual Form 990 reports for 2018, 2019 and 2020. Lycan also served as an officer for Coalition for Growth & Opportunity, Inc., and the Growth & Opportunity PAC. The PAC received more than $1 million from Generation Now, and the coalition got at least $200,000 from Empowering Ohio’s Economy, another dark money group that had received funds from American Electric Power.
Ohio Spars With Company Over Tax Break for Fracking Equipment -Bloomberg Tax - Stingray Pressure Pumping LLC and the Ohio tax commissioner are going head to head at the state’s high court in opposing briefs over which pieces of the company’s hydraulic fracturing equipment are exempt from sales and use tax. Tax Commissioner Jeffrey A. McClain assessed over $3.6 million in tax, interest, and penalties on 60 pieces of equipment Stingray bought for its fracking operations. The commissioner later canceled half of the assessments, finding the pieces of equipment they covered fell under the state’s exemption for equipment used “directly” in the production of oil and gas.
Fracking Equipment Taxable, Ohio Agency Tells State Justices – Law360 - An Ohio-based hydraulic fracturing company owes sales and tax on equipment purchased and not used directly in oil and gas production, the state Department of Taxation told the state Supreme Court...
Utica Shale Academy Donation -This past June, the EQT Foundation, the philanthropic extension of EQT Corporation, the nation’s largest natural gas producer, awarded the Utica Shale Academy a $25,000 grant to be used for the school’s heavy equipment operator and maintenance program. The academy, located in Salineville, provides a unique and vigorous learning environment through a specialized academic program which responds to employers’ and industries’ current and emerging and changing global workforce needs and expectations through business/school partnerships. “We are impressed with the work and dedication of the students and faculty at the Utica Shale Academy as they train the next generation of employees who will help to fuel and grow the energy industry here in Appalachia,”said Ellen Rossi, president of the EQT Foundation.
30 New Shale Well Permits Issued for PA-OH-WV Sep 5-11 | Marcellus Drilling News - Last week the three states with active Marcellus/Utica drilling, Pennsylvania, Ohio, and West Virginia, issued a collective 30 new drilling permits, down from the 40 permits issued the week before. PA roared back to life by issuing 21 of the 30 permits, with OH issuing just three and WV issuing six. Armstrong County, Ascent Resources, Butler County, CNX Resources, Coterra Energy (Cabot O&G), Elk County, Guernsey County, Indiana County,INR, Jefferson County (OH), Monongalia County, Ohio County, PennEnergy Resources, Seneca Resources, Snyder Brothers, Southwestern Energy, Susquehanna County,Utica Resource Operating, XTO
The dangers of Westmoreland’s proposed method of disposing of liquid landfill waste - I’m a science journalist and four years ago, I fell down the oil-field radioactivity rabbit hole. Here in Pennsylvania, a landfill applying for a permit with the state’s Department of Environmental Protection to evaporate liquid landfill runoff — called leachate — could create airborne radioactive material over people downwind. Every day across the nation, about 2.8 billion gallons of oil field brine are produced with toxic levels of salt, heavy metals, and the radioactive element radium. In Pennsylvania, levels have been recorded at up to 5,700 times EPA’s safe drinking water limit. Sludge that forms on the bottom of tanks and trucks that hold brine can be even richer in radium and can also contain exceptional amounts of radioactive lead. And with every Marcellus well, crushed rock and dirt called drill cuttings are bored out of black shale — a type of geologic formation the U.S. Geologic Survey reported in 1960 was so rich in uranium they thought about mining it, with the oil “considered as a possibly important byproduct.” All this waste must be handled, transported, and disposed of. My reporting has documented problems at every step. Brine is pumped deep underground at facilities called injection wells, which causes earthquakes. In Ohio, these wells are leaking. Sludge and drill cuttings are taken to treatment facilities where it’s often the task of improperly trained and inappropriately protected workers to mix in materials like lime in an attempt to solidify the material and lower the radioactive signature. If the radiation levels in the sludge decrease enough, the waste can be trucked to the same local landfills that handle household trash instead of being shipped by rail to radioactive waste disposal sites out west — a more expensive but safer option. At Westmoreland Sanitary in Belle Vernon, Pa., the Department of Environmental Protection told me from 2013 through 2017, 276,416 tons of oil-field waste were disposed. The landfill has also taken more than 200 tons of oil-field waste from an Ohio facility. An investigation I published last month revealed that workers are being dangerously exposed to radioactive sludge; I also found that railcars, which were being routed across the country to a disposal facility in the Utah desert, arrived at their destination leaking material. Costs of proper disposal are high and oversight is lax. A 1980 congressional exemption labeled oil-field waste nonhazardous despite many known hazards. As a result, the industry has regularly resorted to risky disposal measures, including disposing of oil-field brine at sewage treatment plants and spreading drilling waste on farm fields, a practice common in Oklahoma and Texas. For landfills that accept oil field waste, one big problem is leachate. For years, liquid landfill waste from Westmoreland flowed through a sewer pipe and into Belle Vernon’s sewage-treatment plant. In 2019, I met the plant’s superintendent, Guy Kruppa. He told me the stuff was so toxic that it was ruining his plant’s ability to treat sewage. Not only that, but it was also sending contaminants into the Monongahela River, a drinking water source. That same year, a judge ordered the landfill to halt the practice. The Department of Environmental Protection told me about 17 truckloads of leachate a day was instead being shipped to other sewage plants, an option that the agency said, “is not a preferred situation.” Last month, the Pittsburgh Tribune-Review reported that leachate had leaked into a local stream and the landfill didn’t immediately phone the Department of Environmental Protection or emergency management officials, as required by law. Liquid landfill waste clearly remains an issue, but we have two constantly moving bodies of fluids on this planet: water and air. If you can’t use water to carry away your waste for free, why not try the air? A leachate evaporator is a gas-fired boiler that will cook away the liquid landfill waste. A pair of treatment systems will remove 99% of the radioactivity, according to Westmoreland, relying in part on a device called a mist eliminator. But the science of precisely how this will be done is not clear and was not well explained during a hearing in early September. Yet, it’s of utmost importance, because the agency admits radium is the main radioactive element “of concern in the landfill leachate proposed for evaporation” and has found radium at levels dozens of times EPA’s safe drinking water limit at similar landfills.
Pennsylvania is just the latest sacrifice zone for the plastics industry - Sierra Club - DURING THE SUMMER OF 2018, two of the largest cranes in the world towered over the Ohio River. The bright-red monoliths were brought in by the multinational oil and gas company Shell to build an approximately 800-acre petrochemical complex in Potter Township, Pennsylvania—a community of about 500 people. In the months that followed, the construction project would require remediating a brownfield, rerouting a highway, and constructing an office building, a laboratory, a fracked-gas power plant, and a rail system for more than 3,000 freight cars. Five years after construction began at the site, Shell's complex, which is one of the biggest state-of-the-art ethane cracker plants in the world, is set to open. An important component of gas and a byproduct of oil refinery operations, ethane is an odorless hydrocarbon that, when heated to an extremely high temperature to "crack" its molecules apart, produces ethylene; three reactors combine ethylene with catalysts to create polyethylene; and a 2,204-ton, 285-foot-tall "quench tower" cools down the cracked gas and removes pollutants. That final product is then turned into virgin plastic pellets. Estimates suggest that a plant the size of the Potter Township petrochemical complex would use ethane from as many as 1,000 fracking wells. It is expected to emit up to 2.25 million tons of climate-warming gases annually, equivalent to approximately 430,000 extra cars on the road. It will also emit 159 tons of particulate matter pollution, 522 tons of volatile organic compounds, and more than 40 tons of other hazardous air pollutants. Exposure to these emissions is linked to brain, liver, and kidney issues; cardiovascular and respiratory disease; miscarriages and birth defects; and childhood leukemia and cancer. Some residents fear that the plant could turn the region into a sacrifice zone: a new "Cancer Alley" in Beaver County, Pennsylvania."I'm worried about what this means for our air, which is already very polluted, and for our drinking water," said Terrie Baumgardner, a retired English professor and a member of the Beaver County Marcellus Awareness Community, the main local advocacy group that fought the plant. Baumgardner, who is also an outreach coordinator at the Philadelphia-based nonprofit environmental advocacy group Clean Air Council, lives near the ethane cracker. In addition to sharing an airshed with the plant, she is one of the approximately 5 million people whose drinking water comes from the Ohio River watershed. When Shell initially proposed the petrochemical plant in 2012, she and other community advocates tried their best to stop it. And the plant's negative impact will go far beyond Pennsylvania. Shell's ethane cracker relies on a dense network of fracking wells, pipelines, and storage hubs. It's one of the first US ethane crackers to be built outside the Gulf of Mexico, and one of five such facilities proposed throughout Appalachia's Ohio River Valley, which stretches through parts of Ohio, Indiana, Kentucky, Pennsylvania, and West Virginia. If the project is profitable, more like it will follow—dramatically expanding the global market for fossil fuels at a time when the planet is approaching the tipping point of the climate crisis. For the residents who live nearby, Shell's big bet on plastic represents a new chapter in the same story that's plagued the region for decades: An extractive industry moves in, exports natural resources at a tremendous profit—most of which flow to outsiders—and leaves poverty, pollution, and illness in its wake. First came the loggers, oil barons, and coal tycoons. Then there were the steel magnates and the fracking moguls.
PA Stubbornly Continues to Try and Grab Hydrogen Hub for Itself | Marcellus Drilling News - Pennsylvania is stubbornly continuing to pursue a $2 billion hydrogen hub (part of the Biden infrastructure bill) on its own, without partnering with other Marcellus/Utica states. As we continue to point out, doing the application process alone jeopardizes attracting the project to our region. Yesterday the Pennsylvania House Environmental Resources and Energy Committee held a public hearing on hydrogen’s potential as an energy source. The opening presenter, Richard DiClaudio, president and CEO of the Energy Innovation Center Institute in Pittsburgh, made the case that hydrogen and the hydrogen hub is important to the future of southwestern PA.
Lancaster Sisters of the Corn Still Trying to $hake Down Williams | Marcellus Drilling News - The Catholic nuns of Lancaster County’s Adorers of the Blood of Christ are still, all these years later, trying to shake down Williams for more money because of a pipeline that runs underneath a cornfield owned by the sisters (hence our nickname for them). Using lawyers from Big Green groups, the nuns are arguing their “religious beliefs” were offended by the pipeline because it flows a nasty, filthy fossil fuel that causes global warming. Even though the sisters own and operate a home heated by natural gas at the same location! Williams should be suing the nuns, not the other way around.
Manchin deal might not save Mountain Valley pipeline - The Mountain Valley pipeline may never be finished — even if Sen. Joe Manchin’s permitting revamp becomes law.Legislation from the West Virginia Democrat could give a boost to the beleaguered project by steering legal challenges to a different court. But regulatory experts caution that the proposal, as described by Manchin, won’t guarantee the project gets completed.“It doesn’t necessarily direct an outcome,” said Ted Boling, a former longtime career federal official who served as associate director at the White House Council on Environmental Quality (CEQ) under former President Donald Trump. Boling is now a partner at Perkins Coie LLP.The Mountain Valley pipeline, or MVP, is intended to carry natural gas more than 300 miles from northern West Virginia to southern Virginia. Approved in 2017, it is years behind schedule after environmental groups successfully challenged many of its federal permits in court. Manchin wants to free the project from the legal thicket. But Manchin’s initial plan didn’t appear to free it from all legal challenges.By contrast, the Republican permitting proposal rolled out Monday would direct an outcome. Announced by West Virginia Republican Sen. Shelley Moore Capito, it says Mountain Valley’s new permits would not be “subject to judicial review.”And “judicial review” is what has stymied MVP. In particular, the project has been slowed by the reviews of a three-judge panel at the 4th U.S. Circuit Court of Appeals. The delays have caused some investors to question whether the pipeline can be completed.Unlike Capito, Manchin has not released specific legislative language for his proposal. When he announced his agreement on permitting last month with Senate Majority Leader Chuck Schumer (D-N.Y.), the summary he releasedhad two basic elements related to MVP.First, his plan would direct agencies to “take all necessary actions” to issue new permits for the pipeline. And it would give all jurisdiction on any further litigation to a different court: the U.S. Court of Appeals for the District of Columbia Circuit.The order to the agencies wouldn’t ensure the permits could survive court challenges. And while the D.C. Circuit might be more favorable, analysts said directing future challenges there implies that there will be more legal battles.MVP has a poor record before three judges at the 4th Circuit who have been hearing cases on the project. They have canceled the project’s federal permits, saying the underlying federal reviews have not complied with environmental laws. Attorneys for Mountain Valley’s developers have pleaded in court filings unsuccessfully for a new slate of judges.In January, the 4th Circuit vacated approvals from the Forest Service and Bureau of Land Management that would have allowed the pipeline to cross 3.5 miles of the Jefferson National Forest (Energywire, Jan. 26). The two agencies are working together on a new environmental review. The same three judges — Chief Judge Roger Gregory, Judge James Wynn and Judge Stephanie Thacker — are expected to handle cases over the pipeline’s state water certifications. The D.C. Circuit has been more favorable at times. It upheld FERC’s 2017 approval of the project and rejected challenges to the agency’s approval for an extension of time to complete the project. But in another pipeline case, the court ruled against the Dakota Access pipeline last year, requiring a new environmental review of the project. However, in that same case, the court overturned a district judge’s order to shut down the pipeline and drain it of oil (Energywire, Feb. 23). And D.C. Circuit judges grilled FERC in April about its handling of Mountain Valley, asking why the agency had not done more to review the “profoundly changed circumstances” after state officials found numerous environmental violations.
Fatal Tetco Incident in 2019 Said Combination of Pipeline Defect, Degraded System - A manufacturing defect, a degraded coating and an ineffective corrosion prevention system contributed to a fatal explosion and fire on Enbridge Inc.’s Texas Eastern Transmission (Tetco) natural gas pipeline near Danville, KY, the National Transportation Safety Board (NTSB) said Wednesday. The August 2019 Tetco Line 15 rupture and subsequent fire caused one death and sent six people to the hospital. NTSB noted the incident burned about 30 acres of land, destroyed five homes and damaged 14 other residences. The accident also raised market concerns about potential limits on Appalachian Basin gas flows reaching the Gulf Coast. Investigators concluded “that the combination of a pre-existing manufacturing defect – known as a hard spot – together with a degraded pipeline coating and ineffective cathodic protection, led to hydrogen-induced cracking at the outer surface of the pipe.” Cathodic protection, aka CP, is an electrochemical method for controlling corrosion of pipelines and other metal surfaces. According to NTSB, Enbridge’s integrity management program contributed to the accident by failing to accurately assess the 30-inch diameter pipeline’s condition or estimating the risk from interacting threats. NTSB said its accident report concluded that “Enbridge underestimated the risk posed by hard spots because its processes and procedures were inconsistent” with Pipeline and Hazardous Materials Safety Administration (PHMSA) guidance, as well as “industry knowledge of hard spot threat interaction.” To compensate for increased external corrosion, Enbridge and previous owners of the system increased CP voltages on the affected pipeline segment, noted investigators. NTSB’s report recommended six safety measures, with three directed to Enbridge and three to PHMSA, tied to evaluating gas flow change risks, in-line inspection data analysis limitations, threat assessments and threat interactions, and training and requalification practices.
Manufacturers push regulators for more natural gas pipelines -Manufacturers told lawmakers Friday that federal agencies should have a responsibility to secure reliable and affordable access to natural gas, mainly through a dramatic growth in pipeline infrastructure.A letter released Friday envisions an industry-oriented course correction at the Federal Energy Regulatory Commission and the North American Electric Reliability Corp. — one that sees the agencies turn from slow-walking regulators to active proponents of new infrastructure.“For decades, the current system has worked well. When pipeline capacity was needed, pipeline companies filed permits to the FERC and for the most part, the pipelines were approved and built without much delay,” wrote Paul Cicio, CEO of Industrial Energy Consumers of America.“That is no longer the case.”The letter argues a transformation is necessary because of the dire energy situation U.S. manufacturers find themselves in.Manufacturers, which have long used natural gas for fuel and as a raw material, have been particularly slammed by the rising costs and have to compete with utilities and LNG export facilities for the fuel.IECA is particularly concerned over natural gas prices heading into winter, when increased demand from utilities and export facilities for heating and power generation may strain existing pipeline capacity even further and skyrocket what they see as already untenable prices.FERC and NERC, Cicio argues, have an obligation to step in and ensure adequate pipeline capacity to fulfill the national imperatives of reliable energy and electricity.“The FERC’s responsibility needs to shift from being a regulator of pipeline permits to having responsibility to ensure that the pipelines that are needed will get built to secure our nation’s reliability,” wrote Cicio.He also said FERC should coordinate with power generators to potentially keep nuclear power plants or even coal-fired power plants online until more natural gas is available to all ratepayers.U.S. manufacturers have been sounding the alarm on natural gas infrastructure since February and have also called for gas export bans to shore up domestic supply (Energywire, July 28)Senate Energy and Natural Resources Chair Joe Manchin’s yet-to-be-released permitting reform package would in theory help natural gas infrastructure projects get quick regulatory authorization and hasten construction times (E&E Daily, Sept. 9). However, there is still stringent opposition from environmentalists and some Democrats to new natural gas projects. On Thursday, activists from Indigenous and front-line communities rallied in a Capitol Hill park and called on lawmakers to oppose permitting reforms and new natural gas projects.
Revealed: rightwing US lobbyists help craft slew of anti-protest fossil fuel bills - Republican-led legislatures have passed anti-protest laws drafted by an extreme-right corporate lobbying group in a third of all American states since 2018, as part of a backlash against Indigenous communities and environmentalists opposing fossil fuel projects, new research has found.The American Legislative Exchange Council (Alec) helped draft legislation criminalizing grassroots protests against pipelines, gas terminals and other oil and gas expansion projects in 24 states, under the guise of protecting critical infrastructure.Alec, which is funded by rightwing state lawmakers, corporate sponsors and trade groups, and wealthy ideologues, creates model legislation on a range of conservative issues such as gun control, abortion, education funding and environmental regulations.The laws were passed in 17 Republican-controlled states, including Oklahoma, North and South Dakota, Kansas, West Virginia and Indiana, where protesters now face up to 10 years in prison and million-dollar fines, according to a new report from the non-profit Climate Cabinet.The anti-protest bills, which were rolled out in response to the success of mostly Indigenous-led campaigns slowing down fossil-fuel infrastructure projects, have used intentionally vague language to create a chilling effect on free speech and assembly – both constitutionally protected rights, according to the report Critical Infrastructure Laws: A Threat to Protest & the Planet.“Indigenous-led demonstrations opposing fossil-fuel projects have been one of the most successful and effective forms of climate action to date … in an affront to the protected freedoms of our constitution, state legislatures have found a new legislative mechanism to oppress frontline communities and cause further harm and destruction to our planet,” said Jonathon Borja, co-author of the report.The first so-called critical infrastructure bills originated in Oklahoma in 2018, where the Republican state representative Scott Biggs referenced North Dakota’s Dakota Access pipeline (DAPL) protests and acknowledged that some anti-pipeline demonstrations had succeeded. “[The bill] is a preventative measure … to make sure that doesn’t happen here.”Other states followed after Alec created a model bill for lawmakers to copy. So far, the bills have not passed in any states where Democrats hold a majority in at least one legislative chamber, though some Democrats have voted in favor of them.In most of the bills, protesters, like those who participated in the DAPL demonstrations, could now face felony charges, while those charged with “aiding” protests could face harsh fines.
U.S. natgas futures rebound in choppy trade despite bearish outlook - U.S. natural gas futures rose in choppy trading on Monday, buoyed by technicals and slightly lower production estimates for the week, although elevated overall output and lower consumption forecasts clouded the outlook. Front-month gas futures NGc1 for October delivery rose 28.6 cents, or 3.6%, to $8.28 per million British thermal units (mmBtu) by 11:17 a.m. EDT (1517 GMT), reversing some declines from earlier in the session. The contract fell about 9% last week, its biggest weekly loss since late June and the first time it fell for three weeks in a row since early July. Data provider Refinitiv projected average gas output in the U.S. Lower 48 states at 98.9 billion cubic feet per day (bcfd) for the current week, slightly lower than the 99.3 bcfd in the prior week. But this was well above the five-year average of 87 bcfd. However, some analysts said there did not seem to be any clear fundamental driver at this point for the current uptick, although a break above technical resistance seemed to trigger fresh buying. So far this year, gas futures were up about 124% as higher prices in Europe and Asia keep demand for U.S. LNG exports strong. Global gas prices have soared due to supply disruptions and sanctions linked to Russia’s Feb. 24 invasion of Ukraine. The rise in gas futures, meanwhile, came despite the ongoing outage at the Freeport liquefied natural gas (LNG) export plant in Texas, which has left more gas in the United States for utilities to inject into stockpiles for next winter. Dutch wholesale gas prices, meanwhile, fell on comfortable supply and storage levels while prompt British prices rose in expectation of higher demand over the weekend. Last week, gas speculators increased net short positions by 27,316 contracts to 49,387 on the New York Mercantile and Intercontinental Exchanges, according to the U.S. Commodity Futures Trading Commission’s Commitments of Traders report. .
Natural Gas Futures Extend Win Streak Amid Lingering Domestic, Global Supply Concerns - Natural gas futures on Monday advanced for a third consecutive session, propelled by festering worries about winter storage inadequacy. The October Nymex gas futures contract jumped 25.3 cents day/day and settled at $8.249/MMBtu. November rose 24.3 cents to $8.287. NGI’s Spot Gas National Avg. followed suit, gaining 18.5 cents to $7.620.“The storage situation is definitely not going away – unless we start to get a lot bigger injections over the next few weeks,” StoneX Financial Inc.’s Thomas Saal, senior vice president of energy, told NGI. The U.S. Energy Information Administration (EIA) last Thursday reported an injection of 54 Bcf natural gas into storage for the week ended Sept. 2.The result fell short of the five-year average build of 65 Bcf and left stocks well below historic norms. Working gas in storage rose to 2,694 Bcf, according to EIA. However, stocks were 222 Bcf lower than a year earlier and 349 Bcf below the five-year average.Saal noted that production rose notably in recent weeks to meet both strong domestic demand and elevated calls from Europe and Asia for U.S. exports. At the same time, he said, cooling demand is fading as fall weather emerges in northern regions.“Even so, we may need to see even more production increases,” Saal said. “Overall demand is going to stay high because the growth in LNG is real and looks likely to last” into next year and beyond.
U.S. natgas futures edges up on threat of railroad strike (Reuters) - U.S. natural gas futures edged up to a fresh a one-week high on Tuesday on worries a possible railroad strike could threaten coal supplies to power plants, which could force generators to burn more gas to produce electricity. The White House made contingency plans seeking to ensure deliveries of critical goods in the event of a shutdown of the U.S. rail system while again pressing railroads and unions to reach a deal to avoid a work stoppage affecting freight and passenger service. "Market players ... fixated on the potential for U.S. coal supplies to be threatened amid a looming strike by the U.S. railroad union workers later this week," analysts said, noting the market ignored several bearish factors. Those bearish factors included record output, forecasts for lower demand next week than previously expected and the ongoing outage at the Freeport liquefied natural gas (LNG) export plant in Texas, which has left more gas in the United States for utilities to inject into stockpiles for next winter. Front-month gas futures rose 3.5 cents, or 0.4%, to settle at $8.284 per million British thermal units (mmBtu), their highest close since Sept. 2 for a second day in a row. That also put the contract up for a fourth day in a row for the first time since May. So far this year, gas futures are up about 123% as higher prices in Europe and Asia keep demand for U.S. LNG exports strong. Global gas prices have soared due to supply disruptions and sanctions linked to Russia's Feb. 24 invasion of Ukraine. Gas was trading around $56 per mmBtu in Europe and $53 in Asia. Data provider Refinitiv said average gas output in the U.S. Lower 48 states have risen to 93.1 bcfd so far in September from a record 98.0 bcfd in August. With the coming of cooler autumn weather, Refinitiv projected average U.S. gas demand, including exports, would slip from 93.1 bcfd this week to 92.7 bcfd next week. The forecast for next week was lower than Refinitiv's outlook on Monday.
Natural Gas Prices Surge Wednesday Across Futures, Cash Markets - Boosted by late-season heat, domestic storage concerns and robust global demand, natural gas futures on Wednesday rallied for a fifth-straight session. The October Nymex gas futures contract spiked 83.0 cents day/day and settled at $9.114/MMBtu, marking its biggest jump in the latest bull run. November gained 83.3 cents to $9.167. NGI’s Spot Gas National Avg. rose 28.0 cents to $8.155, extending its rally to three days amid a reemergence of summer warmth in the nation’s midsection. The natural gas market has been moving “from strength to strength,” analysts at Evercore ISI said Wednesday They noted robust demand for U.S. LNG exports – hovering near capacity – as Europe scrambles to ward off an energy crisis hastened by Russia’s war in Ukraine. Russia, long a key supplier of gas to the continent, has cut off the bulk of its pipeline deliveries to countries throughout Europe. Asian countries are now ramping up calls for liquefied natural gas as they move with haste to fortify supplies ahead of winter. What’s more, the Evercore team noted, coal-to-gas switching in the power sector continues to mount as the United States steadily retires coal plants. And, of course, seemingly endless summer heat continues to scorch much of the country into mid-September. Markets as far north as the Dakotas are forecast to endure highs in the 90s this week, keeping air conditioners cranking at the level once reserved for brief bouts from July to early August. “We must acknowledge the strong support for both higher LNG send-outs” and “even more significantly a hot summer,” the Evercore analysts added. Rystad Energy’s Zongqiang Luo, senior analyst, expects both continued strong domestic gas consumption and enduring demand for LNG. He, too, noted fallout from Russia’s actions and expectations that Europe will need as much American LNG as it can get to ensure adequate supplies for the coming winter. “Months of geopolitical wrangling have left the European gas market whiplashed, with volatile prices stemming from lack of supply, potential market intervention, and wider uncertainty,” Luo said. “In the view of most experts and policymakers,” the European gas market “is broken. But how it should be supported or fixed is an ongoing conversation with no clear resolution in sight.” NatGasWeather noted that a threatened rail strike in the United States may also have boosted bullish sentiment in the market. More notably, forecasts continue to show persistent heat. “The overnight data maintained unseasonably strong upper high pressure expanding to rule much of the U.S. next week, Sept. 18-22, resulting in widespread above normal temperatures,” NatGasWeather said Wednesday.
Natural Gas Futures Plummet After Negotiators Avert Railway Strike, EIA Prints Bearish Storage Print - Natural gas futures snapped a five-day rally and plunged in Thursday trading. The October Nymex gas futures contract fell 79.0 cents day/day and settled at $8.324/MMBtu after officials said a railway strike had been avoided and the latest government inventory report proved bearish. The prompt month had jumped 83.0 cents on Wednesday, the biggest gain in the multi-day rally. The November contract also dropped Thursday, shedding 79.5 cents to $8.372. NGI’s Spot Gas National Avg. followed suit and fell 49.0 cents to $7.665. The sell-off came amid reports Thursday that an agreement had been reached to avert a rail workers strike. “Disrupted freight rail lines could have snarled supply chains and cost the U.S. economy an estimated $2 billion per day,” “In the energy sector, disrupted freight coal transportation could have further strained precariously low coal inventories, leading coal operators to conserve scarce supplies, reduce coal generation, and increase the call on power sector gas demand.” However, President Biden on Thursday announced a tentative agreement to avert a walkout, alleviating coal delivery concerns and worries about economic fallout. The U.S. Energy Information Administration’s (EIA) latest storage report, meanwhile, furthered the case for bears. EIA printed an injection of 77 Bcf natural gas into storage for the week ended Sept. 9. The build kept inventories below average levels, but analysts on the online energy platform Enelyst said it reflected mounting production levels that could help narrow deficits as the market moves into shoulder season. Production early this month reached record levels above 100 Bcf/d, according to Bloomberg estimates, and output continued to hold near that level Thursday. The print also eclipsed market expectations. Prior to the EIA report, major polls found analysts expecting a slightly bullish result relative to the five-year average, with median estimates in the low 70s Bcf. The build in the comparable week of 2021 was 78 Bcf and the five-year average was 82 Bcf, according to EIA. The 77 Bcf injection for last week lifted inventories to 2,771 Bcf, though stocks remained below the year-earlier level of 2,994 Bcf and the five-year average of 3,125 Bcf. Looking ahead, however, analysts on Enelyst were looking for a build with next week’s print as high as the low 100s, citing the production increase. If that proves to be the case, it would mark only the second triple-digit increase of the current injection season and could put the market on track for adequate supplies ahead of winter.
US natgas drops 7% to 5-wk low on record output, global price drop (Reuters) - U.S. natural gas futures dropped about 7% to a five-week low on Friday with output holding near a monthly record and as global gas prices slumped. In what has already been a volatile week, that U.S. price decline came after prices dropped about 9% on Thursday due to a tentative deal to avert a rail strike and on a bigger-than-expected storage build last week. On Wednesday, prices soared about 10% on worries about the potential rail strike. In addition to rising output, the drop in U.S. gas prices also came on expectations demand would decline when the Cove Point liquefied natural gas (LNG) plant in Maryland shuts for a couple weeks of maintenance in October. U.S. gas demand has already been reduced for months by the ongoing outage at the Freeport LNG export plant in Texas which has left more gas in the United States for utilities to inject into stockpiles for next winter. Freeport, the second-biggest U.S. LNG export plant, was consuming about 2 billion cubic feet per day (bcfd) of gas before it shut on June 8. Freeport LNG expects the facility to return to at least partial service in early to mid-November. Front-month gas futures fell 56.0 cents, to settle at $7.764 per million British thermal units (mmBtu), their lowest close since Aug. 8. That put the front-month down about 3% for the week, marking the first time the contract fell for four weeks in a row since March. So far this year, gas futures are up about 109% as higher prices in Europe and Asia keep demand for U.S. LNG exports strong. Global gas prices have soared due to supply disruptions and sanctions linked to Russia's Feb. 24 invasion of Ukraine. Gas was trading around $55 per mmBtu in Europe and $42 in Asia. That was a 12% drop for European futures. The average amount of gas flowing to U.S. LNG export plants rose to 11.3 bcfd so far in September from 11.0 bcfd in August. That compares with a monthly record of 12.9 bcfd in March. The seven big U.S. export plants can turn about 13.8 bcfd of gas into LNG. Cove Point LNG in Maryland usually shuts in October for a couple weeks of maintenance. Separately, some traders noted Typhoon Nanmadol could cause some LNG demand destruction after it hits Japan over the weekend. The reduction in exports from Freeport has been a problem for Europe, where most U.S. LNG has gone this year as countries there wean themselves off Russian energy.
Looming rail strike sparks fear of energy chaos - Energy companies are warning that a threatened nationwide rail strike already is wreaking havoc on their supply chains and may cause severe bottlenecks across multiple industries, including coal, chemicals and oil and gas. U.S. freight railroads and unionized workers have been unable to reach a new contract over pay and benefits, and a strike could occur as early as Friday, the end of a federally-mandated cooling-off period between the two sides. Railroad companies have already begun curtailing shipments of hazardous chemicals such as chlorine and anhydrous ammonia to make sure they’re not stranded if workers walk off the job. That, in turn, is disrupting operations at refineries, chemical plants and other facilities, setting up the possibility that even a short strike could cause the shut down of some plants, companies say. In that scenario, fuel prices for consumers would spike and could also disrupt the broader economy at a time when inflation is eating into Americans’ household budgets. “A shutdown would have a tremendous impact on our supply chain,” White House press secretary Karine Jean-Pierre said Tuesday. “It would have a ripple effect into our overall economy and American families.” She added that President Joe Biden has personally been calling union workers. Biden appointed a commission in July to facilitate negotiations between companies and labor leaders that has yet to resolve the disagreement. Trade groups representing oil producers and the chemical industry have called on Congress to step in if the two sides can’t solve the dispute. But on Tuesday, when asked if congressional Democrats would support a resolution preventing a strike, Senate Majority Leader Chuck Schumer (D-N.Y.) said, “The bottom line is we are urging both sides to come together and come to an agreement —period.” Refiners and chemical manufacturers rely on railroads to bring in raw materials and transport finished products. Most crude oil is transported by pipeline, but refineries still rely on rail for supplies like isobutane used in gasoline and to carry away byproducts like sulfur, according to Rob Benedict, vice president of midstream and chemicals at the American Fuel and Petrochemical Manufacturers (AFPM). Chemicals make up the second-largest category of rail freight after coal — 55,000 carloads a week — and there aren’t enough trucks and barges to handle the volume, said Jason Miller, a professor in the department of supply chain management at Michigan State University. A prolonged strike would have a bigger impact on the economy than the shutdowns during the Covid-19 pandemic, Miller said. “At least during Covid, you able to keep [chemical] production going, oil production going,” he said. “You can’t do that with a rail strike.”
Louisiana plastics plant shot down by judge - A proposed $9.4 billion plastics plant received another body blow Wednesday, after a Louisiana state judge vacated 14 state permits and lambasted regulators for failing to live up to their "constitutional public trust duty."The ruling is a clear environmental justice win for residents of Welcome, La., a small community with a 99 percent minority population, 87 percent of whom identify as Black.That town, and the plant's impact on the land and the families living off it, was foremost in Judge Trudy White's 34 page ruling. "The blood, sweat and tears of their ancestors is tied to the land," White wrote, noting that Welcome's demographics reflect its roots as a place once dominated by plantations and now populated by descendents of slaves who worked those plantations.In the ruling, White cited Sharon Lavigne, director of RISE St. James, a local advocacy group, and winner of the 2021 Goldman Environmental Prize: "These are sacred lands. They were passed down to Black residents from their great-great-great grandparents who worked hard to buy these lands along the Mississippi to make them productive and pass them on to their families."The giant facility would have used ethane and propane as feedstock to ultimately make a variety of products used in plastics manufacturing. The project has been on hold since November 2020, when the federal government suspended a permit amid protests from local environmental groups.White agreed with those groups in her 34-page ruling, saying the state did not do enough to protect the health and well-being of its residents. Regulators technically followed the rules in issuing permits, White wrote, but "the constitutional public trust duty imposes an additional legal standard.""It demands [The Louisiana Department of Environmental Quality] go beyond its regulations if necessary to avoid potential environmental harm to the maximum extent possible" (emphasis in the original).A 2019 analysis by the nonprofit news site ProPublica estimated that the air around Formosa’s site is more toxic with cancer-causing chemicals than 99.6% of industrialized areas of the country. The plant's proposed emissions, the publication concluded, could triple levels of cancer-causing chemicals in one of the most toxic areas of the U.S.
Proposed Louisiana Petrochemical Projects Facing Hurdles from Residents, Court -Two major petrochemical projects planned for Louisiana’s St. James Parish are facing permitting obstacles following recent decisions that may affect them moving forward. A court ruling has stalled FG LA LLC’s plan to build a massive $9.4 billion plastics facility. The affiliate of global conglomerate Formosa Group has had the Sunshine Project on the drawing board since 2015. The Louisiana Department of Environmental Quality (LDEQ) had issued air permits in early 2020. However, the 19th Judicial District Court in East Baton Rouge Parish found that LDEQ erred in issuing air permits and violated the constitutional rights of petitioners. Several community and environmental groups had challenged LDEQ’s decision to issue the permits, citing, among other things, its location, which would be adjacent to the predominantly (87%) Black community of Welcome. The lawsuit was filed in 2020 by RISE St. James, Louisiana Bucket Brigade, Sierra Club, Center for Biological Diversity, Healthy Gulf, Earthworks and No Waste Louisiana. They alleged that LDEQ’s decision to issue the permits violated the federal Clean Air Act, state laws and the Louisiana constitution. In the FG case, Judge Trudy White vacated 15 state air permits that had been issued for the Sunshine Project, siding with the plaintiffs. White wrote that LDEQ was in violation of state and federal regulations. LDEQ’s reasoning for issuing the permits was “arbitrary and capricious,” the judge wrote. LDEQ issued permits under the federal Prevention of Significant Deterioration (PSD) New Source Review regulations. PSD permits authorize major sources of criteria pollutants, as well as noncriteria regulated pollutants in areas that attain federal standards. “FG LA failed to demonstrate that its emissions would not ‘cause or contribute to’ violations of the federal air standards,” White said. “LDEQ’s decision to issue the PSD permit anyway violated the Clean Air Act permitting law the agency was obligated to apply.” In addition, White wrote that the siting involved environmental justice issues, “The demographics of Welcome reflects its roots as a place once dominated by plantations, populated by the enslaved ancestors of present-day residents.” The case has been remanded to LDEQ, which has 60 days to appeal.
Natural gas pipeline fire in water SE of New Orleans - Federal agencies are investigating a natural gas pipeline explosion that started a towering blaze in a lake southeast of New Orleans. The line exploded shortly before 4 p.m. Thursday in Lake Lery and the fire was out by about 4:45 p.m. Friday, the Coast Guard said. Preliminary information indicates a barge broke loose from its mooring and hit the pipeline, according to the federal Pipeline and Hazardous Materials Safety Administration. “The pipeline has been shut down and the affected section of pipe has been isolated. Remaining gas will be allowed to burn off,” said a statement from the agency, part of the Department of Transportation. Nobody was hurt by the rupture and fire, the Coast Guard said in a news release Thursday night. There was a silver sheen Friday on the water between St. Bernard and Plaquemines parishes, Coast Guard spokesperson Riley Perkofski said in an email. It is expected to dissipate, the Coast Guard said Friday evening. Continuous monitoring by Environmental Safety & Health Consulting Services didn't find any air pollution, a news release said. The pipeline is owned by Third Coast High Point Gas Transmission, Perkofski wrote. Third Coast, which is based in Houston, did not return a call for comment.
The Oilfield That Made the Ocean Burn Last Year Is Now Spewing Methane - A huge oilfield in the Gulf of Mexico, which caused a hellish fire in the ocean last year, has been releasing massive amounts of planet-warming methane. Reuters reported last week on satellite data that shows that the Ku-Maloob-Zaap oilfield leaked 44,064 tons of methane into the atmosphere over the course of 24 days in August. That’s the equivalent of 3.7 million tons of carbon dioxide—what 653,106 homes emit by using electricity over the course of one year.Researchers with the European Space Agency found that the platform released around the same amount in another ultra-emission event in December 2021. That’s around 3% of Mexico’s average annual emissions.“In December, the flaring shut down, and they were venting gas almost constantly for 17 days,” Itziar Irakulis-Loitxate, a scientist from the Polytechnic University of Valencia and the lead author of the paper, told Reuters. “This time, however, they have been venting and flaring gas intermittently during the whole month.”If the platform’s unusual name rings any bells, it’s probably because this is the oilfield that dramatically caught fire last summer, making images of a doomsday-looking crater of flame on the ocean go viral. The fire began after an underground pipeline ruptured. The platform is owned by Pemex, Mexico’s state-owned and operated oil and gas company. While neither Reuters nor the ESA researchers could confirm the cause of either methane leak, previous reports suggest Pemex has a long history of not taking care of its aging oil and gas infrastructure, including at Ku-Maloob-Zaap. There were around 100 deaths attributable to accidents on Pemex sites between 2010 and 2017, according to research firm Statista.
Tellurian investor demands sale of LNG company, claiming nepotism - — A Tellurian Inc. investor is urging the would-be U.S. energy exporter to put itself up for sale, saying poor governance, nepotism and “misleading communications” have doomed the company’s $12.8 billion aspiration to ship shale gas overseas. Entami Corp., which specializes in event-driven and distressed-debt investing, called for a sale of the company founded six years ago by liquefied natural gas entrepreneur Charif Souki. In a letter to Souki and his management team, Entami Chief Investment Officer Achur Iskounen said Tellurian lacks the expertise, financial heft and “institutional credibility” to build and operate its proposed LNG-export complex.Although Entami’s self-declared stake in Tellurian amounts to just 1.5% of outstanding common stock, the pushback by a small investor highlights the challenges Souki’s team is facing in finding backers for the Driftwood LNG project in Louisiana. The company recently sweetened the terms of a risky debt deal that would kickstart financing, promising an eye-popping 12.5% yield and offering shale fields as collateral. Souki has “deluded and diluted shareholders,” established “unattainable” milestones and engaged in “misleading communications over the last year” while raising capital through debt and equity sales, Iskounen wrote. “A timely sale of Tellurian has become the only logical path to protect Shareholder value.”Iskounen cited “very serious questions of nepotism” and governance lapses. He singled out the chairman’s son, Tarek Souki, who as executive vice president of marketing and trading “draws a Salary larger than our CFO,” according to the letter.Tellurian didn’t respond to multiple requests for a response or make either of the Soukis available for comment. Iskounen, reached by email, declined to comment beyond the contents of his letter. In a 2013 Barron’s article, he was leading a startup called Iskounen & Co. that had $5 million under management and was shorting Apple Inc. “Tellurian is falling behind peers who are expanding capacity at their fastest pace ever,” he wrote in the letter to Tellurian. The company ought to sell itself to a major energy company with “the balance sheet and institutional credibility necessary to commission this geopolitically critical LNG project.”.
U.S. Seeks to Restore Safety Rules Sparked by Gulf Oil Spill --The Biden administration on Monday proposed offshore drilling safety measures that it said would help prevent oil spills and protect workers and the environment. The proposal aims to restore safety provisions put in place by the Obama administration in 2016 following the fatal 2010 BP Deepwater Horizon spill, the worst in United States history. The Trump administration had revised the rules in 2019 to reduce what the oil and gas industry said was a financial burden. The Interior Department, which oversees the Bureau of Safety and Environmental Enforcement (BSEE), said the changes would incorporate the latest industry technology improvements. “As our nation transitions to a clean energy economy, we will continue strengthening and modernizing offshore energy standards and oversight,” Interior Secretary Deb Haaland said on a call with reporters. “We will continue to put the lives and livelihoods of workers first, as well as the protection of our waters and marine habitat.” The rule revisions would tighten technical requirements of blowout prevention systems and mandate speedier failure investigations. They also require companies to submit failure data directly to BSEE rather than to third parties. The proposal is open to public comment until Nov. 14. Oil industry trade group the National Ocean Industries Association said it would review the proposal and work with federal regulators to ensure that the changes increase safety. Environmental group Oceana reacted to the proposal by calling for the end to offshore drilling. “While the new safety measures being proposed are a step in the right direction, no operator can promise there won’t be another disaster like BP’s Deepwater Horizon blowout,” Oceana campaign director Diane Hoskins said in an emailed statement.
Biden proposes strengthening offshore drilling safety regulations loosened by Trump - The Biden administration on Monday proposed to strengthen certain safety regulations for offshore oil and gas drilling that were loosened under the Trump administration. After the 2010 Deepwater Horizon oil spill that killed 11 workers and released 134 million gallons of fuel into the Gulf of Mexico, the Obama administration implemented new safety regulations. In 2019, the Trump administration revised those standards, making them more industry-friendly. On Monday, the Interior Department indicated that it would further tweak the rules, although the new proposal does not appear to be identical to what was put forth during the Obama years. Interior Secretary Deb Haaland told reporters on Monday that she believes that the changes will “improve conditions for offshore workers and the public.” She criticized the Trump administration’s rollback of the Obama-era rule, saying that it was done to “tip the balance of oversight of offshore activities back to the oil and gas industry.” Among the changes is the reinstatement of a requirement to send information on safety equipment failures to the federal government instead of to certain third parties that were permitted to collect data during the Trump years. Under the new rule, inspections of such failures will also need to start sooner. Under the Trump administration, inspections needed to begin 120 days after a failure; they would now need to start in 90. Under the Obama rule, inspections had to be finished within 120 days. The Biden administration estimates that the changes will cost between $2.2 million and $2.4 million over a 10-year period. The move comes after the Environmental Protection Agency similarly reinstated safety standards for chemical plants that were also loosened under Trump.
Administration awards Gulf of Mexico drilling leases to oil giants - The leases from a 2021 sale were given to oil and gas companies as part of a deal with Sen. Manchin over climate legislation. The Biden administration on Wednesday reinstated $190 million worth of leases to companies bidding to explore for oil and gas in the Gulf of Mexico, despite widespread concerns about accelerating climate change. The Bureau of Ocean Energy Management granted the 307 oil and gas leases as part of a compromise that won support last month from Sen. Joe Manchin III (D-W.Va.) for the Inflation Reduction Act and its roughly $369 billion in climate-related spending and tax credits.The Lease Sale 257, which had been held in November 2021, had been invalidated by a federal judge in February.On Wednesday, the Biden administration sought to stress that the sale would “protect biologically sensitive resources, mitigate potential adverse effects on protected species and avoid potential ocean user conflicts.”Gulf of Mexico federal offshore oil production accounts for 15 percent of total U.S. crude oil production and federal offshore natural gas production in the Gulf accounts for 5 percent of total U.S. output, according to the Energy Information Administration. And the gulf was the scene of the massive Deepwater Horizon oil spill in 2010, a rig that was operating on behalf of BP.Chevron submitted the highest sum of winning bids at $47 million. Other major successful bidders included Anadarko, BP, Shell and Exxon Mobil.The Inflation Reduction Act specifies how the administration should deal with lease sales in the Gulf of Mexico. It instructs the administration to hold another lease sale for oil and gas alone. Subsequently, the bill says, there will be sales of oil and gas leases coordinated with lease sales of renewable energy from wind turbines.Democrats have been divided over oil and gas lease sales with President Biden, House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Charles E. Schumer (D-NY) all supporting them as part of the compromise with Manchin.
Agency OKs nearly $190M in bids from offshore oil lease sale - (AP) — The Biden administration accepted nearly $190 million Wednesday in bids from an offshore oil and gas lease sale that was held nearly a year ago but rejected by a federal judge.The Bureau of Ocean Energy Management’s action was required by the climate bill that was signed Aug. 16 — a disappointment to environmentalists who worry about the climate impacts of offshore drilling, but praised by industry as a return to longstanding practice after an 18-month delay imposed by the Biden administration.The bill had a 30-day deadline for accepting the bids. It also requires the bureau to reschedule three sales that had been put on hold by a moratorium ordered by President Joe Biden, with the first of them to be held by Dec. 31. “We are pleased that the Department of the Interior has finally offered the first offshore leases of this administration, but it is disappointing that it took 19 months and an act of Congress to get us to this point,” said Cole Ramsey, vice president of upstream policy for the American Petroleum Institute. The Bureau of Ocean Energy Management said Wednesday that it had accepted 307 valid high bids totaling just under $189.9 million from the November 2021 sale “in compliance with congressional direction.” Companies bid on about 2% of the tracts offered for sale in the Gulf of Mexico.
Where the New Climate Law Means More Drilling, Not Less - The New York Times - A compromise built into the law ensures oil and gas leasing in the Gulf of Mexico for the next decade. Activists say the region has been “sacrificed” to fossil fuels. — Justin Solet planted his foot on the edge of his boat and pointed to a natural gas rig protruding from the waters ahead. A web of pipelines and rusted storage tanks jutted up from the marsh behind him as a shrimp boat floated past and markers for crab traps bobbed on the water’s surface. “We are water people,” said Mr. Solet, 37, a member of the United Houma Nation, a Native community with many shrimpers, oyster farmers and crab fishers who depend on the Gulf of Mexico’s bounty. “This is their livelihood. And it’s right next to these tanks that I don’t think have been fixed or serviced in years.” Oil and gas wells and drilling equipment are a persistent threat to the fishing industry in the Gulf. In addition to the 2010 Deepwater Horizon disaster, there have been dozens of less-noticed oil spills. Last month, on the first day of Louisiana’s inshore shrimp season, a tank platform collapsed, pouring 14,000 gallons into Terrebonne Bay and ruining the catch. Now, more drilling may be on the way. Under a new climate and tax law, the federal government will lease hundreds of millions more acres for offshore drilling in the Gulf in the next decade, even as it invests $370 billion to move the country away from fossil fuels and develop wind, solar and other renewable energy. More Gulf leasing was among the concessions that Democrats and President Biden made to Senator Joe Manchin III of West Virginia, a Democrat who champions fossil fuels and whose vote for the legislation was crucial in the evenly divided Senate. It came despite Mr. Biden’s promise as a candidate to end new drilling on public land and in federal waters “period, period, period.” And it came even though Deb Haaland, who will oversee the leasing as the interior secretary, said as a congresswoman in 2020 that “we need to act fast to counteract climate change and keep fossil fuels in the ground.” The leasing also follows a warning from the International Energy Agency that nations must stop approving new fossil fuel projects if the world has any hope of keeping the average global temperature from increasing 1.5 degrees Celsius above preindustrial levels. That’s the threshold beyond which scientists say the likelihood of catastrophic climate impacts increases considerably. The planet has already warmed 1.1 degrees Celsius. The new law condemns communities like Houma, which are already dealing with storms made more intense by climate change, to continued reliance on oil and gas drilling, even as other parts of the United States race toward renewable power, said Cynthia Sarthou, executive director of Healthy Gulf, an environmental organization based in New Orleans.
How oil companies could thrive under the climate law - At first glance, the Inflation Reduction Act would seem like a financial problem for the U.S. oil and gas industry. The fine print suggests otherwise.The bill, signed into law by President Joe Biden last month, imposes a new minimum tax on high-earning companies and a tax on corporations that buy back shares of their own stock. It came just weeks after top U.S. oil producers reported record earnings and billions in share purchases.A funny thing happened on the way to the president’s desk, though. Lawmakers shaved off the tax provision’s rough edges and added a couple of breaks that will allow oil producers to benefit — potentially — from one of the industry’s worst-ever years.“It gives them a gimme for one year,” said Trey Cowan, an oil and gas analyst at the Institute for Energy Economics and Financial Analysis, which aims to accelerate an energy transition.The upshot is that some companies that lost money during the oil price crash of 2020 will be able to use those losses to ease their tax liability in 2022, when the industry has reported record profits. It’s unclear how many companies will benefit because many of them will pay their taxes under the conventional tax law, rather than the Inflation Reduction Act’s minimum-tax provision.The new minimum-tax system requires corporations to pay their federal taxes based on their financial statement income, sometimes called book income. Companies that earn more than $1 billion will either have to pay their standard tax bill or 15 percent of their book income, whichever is greater, according to the text of the law.But the law allows companies to take a couple well-known tax breaks when calculating their minimum-tax payments, including one that former President Donald Trump used in his real estate business. And it also calculates the $1 billion earnings threshold based on a three-year average, which could significantly cut oil companies’ liabilities for 2022.Companies will be able to use a maneuver called the net operating loss carryover when they calculate their bills under the minimum tax. The loophole allows a company that has a loss in one year to “carry” the loss into a future year and reduce its taxable income by the same amount.Those types of carryovers have been used for decades in the energy industry and other businesses. Trump declared a net operating loss from his casinos and other businesses of $916 million for 1995, which would have been enough to offset $50 million in income for the next 18 years, The New York Times reported.The Inflation Reduction Act will allow companies to carry forward their book income losses starting at the end of 2019 and offset up to 80 percent of their company’s minimum-tax bill in any given year, said Wes Poole, Americas oil and gas tax leader at the consulting firm EY.The law also allows a couple of other important tax breaks when calculating what a company owes under the minimum-tax provision. Companies can deduct the depreciation of their assets, and certain foreign taxes, both of which are important to the oil industry.It’s unclear how much the industry could carry forward in offsets, but it’s potentially a large amount. Collectively, a sample of 36 top oil and gas producers lost $91 billion in 2020, according to research Cowan provided. Companies that wind up paying the minimum tax can also use any losses from 2020 to smooth out their tax bills for the next two years under the law’s averaging clause.
Michigan's abandoned oil and gas wells to get plugged up with $25 million federal grant - Michigan has been plugging away at plugging abandoned oil and gas wells for decades. A new grant from the U.S. Department of Interior will help boost the state’s efforts. Michigan has 447 documented orphan wells, which can leach harmful chemicals into waterways and release toxic vapors. The state typically works with a million-dollar annual budget to plug up wells and has closed 400 wells over the last 30 years. But a new $25 million federal grant should ramp up progress. Scott Dean with the Michigan Department of Environment, Great Lakes, and Energy said the state can now hire additional staff and start more cleanup projects. “We're really pleased to have this infrastructure funding, and we're committed to cleaning up as many of these oil and gas wells, allowing these lands to go back into productive use," Dean said. "We're quite excited about this project, it's really gonna help jumpstart our program.” Dean said no goals or timeline have been developed yet. He said the state hopes to close “as many wells as possible.”
Wisconsin Line 5 trespass ruling may influence Michigan legal fight - Legal observers closely watch a suit between the Bad River Band tribe and Enbridge over its Line 5 pipeline in Wisconsin for any implications in a Michigan case. A federal judge said Enbridge has been trespassing for years with its Line 5 pipeline on sovereign tribal lands in Wisconsin… · In Michigan, state officials are fighting to evict a nearly 70-year-old section of Line 5 from a revoked Great Lakes bottomlands easement...
Kinetik and WaterBridge to join the Permian Strategic Partnership - The Permian Strategic Partnership (PSP) announced today the addition of two new companies, Kinetik and WaterBridge Resources, bringing its member company count to 19."We are thrilled to welcome Kinetik, WaterBridge and their respective board members Matt Wall and Jason Long to our team,” said Tracee Bentley, President and CEO of the PSP. “These companies bring tremendous talent and passion for the Permian Basin to the table. They are joining the PSP at a time when we have seen transformational initiatives in our three short years. We look forward to maintaining our momentum and making lasting impacts across the Permian Basin together." Adding these two new members will help PSP continue its vital work to improve the quality of education, workforce development, healthcare, and road safety in the Permian Basin. Since its inception, PSP has helped to transform $106 million in member contributions into $950 million in community-led investments. This is a significant achievement, and it would not have been possible without the support of PSP members. By pooling their resources, PSP members have leveraged their investment power to create real and lasting change in their communities.
As EPA Fails to Fine Oil and Gas Polluters, New Mexico Officials Demand Answers - New Mexico officials are asking the federal government to explain why it decided not to impose fines on oil and gas producers it caught violating the Clean Air Act in the state. In May, Capital & Main reported that the Environmental Protection Agency (EPA) found that 24 companies had 111 leaks from wells and other equipment, following an airborne monitoring program over New Mexico’s portion of the Permian Basin in 2019. However, only 11 companies were given violation notices, and only one received a fine for Clean Air Act (CAA) violations. Another company was fined for a permitting violation.Now, James Kenney, secretary of the New Mexico Environment Department (NMED), and U.S. Senator Martin Heinrich have asked the regional EPA office to explain the paltry number of violation notices and fines. “Within a week [of the Capital & Main story], I was on the phone with EPA leadership, both in Dallas and D.C.,” said Kenney. He was concerned that New Mexico’s ability to enforce its own clean air rules would be “put in jeopardy by EPA’s ‘no penalty’ settlements.” Whitney Potter, deputy chief of staff to Sen. Heinrich, said that he has taken a strong interest in the case as well. “The senator’s office is following this really closely,” Potter said, “at the highest levels.”For the story published in May, an EPA spokesperson explained the lack of fines by saying that “an administrative settlement is based on several factors, including the number and type of violations as well as a facility’s compliance history.” But Kenney shared an email exchange between the senator’s office and the EPA Region 6 office, which covers New Mexico. In it, the senator’s office asked the EPA to “explain why a penalty was not assessed” for most of the violations. The EPA regional office responded, “Our enforcement efforts specific to the 2019 flyovers focused on returning facilities to compliance quickly through the issuance of nonpenalty administrative compliance orders. Such orders are for compliance and only consist of corrective action and do not include penalty authority.”But Kenney, who worked for years at the EPA before heading NMED, said, “There’s penalty authority that EPA has, in and of itself, on its own — period. EPA can do that.”
New Mexico set to get $43 million to clean up abandoned oil wells -New Mexico will receive $25 million next month to clean up abandoned oil wells and another $18.7 million later for its portion of $560 million the Department of the Interior is divvying to 24 states to tackle a widespread hazard. The distributions are part of $4.7 billion total the agency will dispense through the federal infrastructure law to clean up orphaned wells on state and private lands nationwide. Orphaned wells can leak methane, a potent greenhouse gas, into the air and contaminate groundwater.M
Zephyr Acquires Assets Around Its Paradox Project In Utah - Zephyr Energy has put pen to paper on a binding agreement to purchase oil and gas assets on and around its Paradox project in Utah, the United States. The agreement will see Zephyr acquire 21 miles of natural gas gathering lines, the Powerline Road gas processing plant, rights of way for additional gathering lines, active permits, five existing wellbores and additional acreage which is partly contiguous to the company’s operated White Sands Unit. The consideration for the acquisition is $750,000 and will be satisfied by a payment from Zephyr's existing cash resources and as the new owner, Zephyr will assume responsibility for all eventual decommissioning and plugging and abandonment liabilities for the assets acquired (estimated to be approximately $2.5 million in today’s terms). Once the acquisition is completed, which is expected by 7 October 2022, Zephyr will operate approximately 45,000 gross acres in the Paradox Basin, the majority in which the company holds a 75 percent or greater working interest. The asset package will allow Zephyr to substantially reduce the capital required to build the necessary gas export infrastructure for its forecast gas production from the Paradox project. Given Zephyr’s potential significant gas resource, strong current pricing and increasing demand for U.S. domestic natural gas, the Board is delighted to have secured this opportunity ahead of commencing its further development of the Paradox project. The plant acquired under the agreement, is not currently in operation, bit it is well suited for brownfield redevelopment and contains useable pre-existing infrastructure and related permits. It has an estimated replacement cost value of $1.8 million. "We’ve often compared our Paradox project development to a jigsaw puzzle with a number of requisite pieces to be assembled prior to the commencement of commercial production - and today’s announcement is another substantial piece now in place. By acquiring this package of surface infrastructure, we are moving rapidly from a program of value delineation to a tangible development program which is expected to facilitate cashflows from the project in a more rapid timeframe,” said Colin Harrington, Zephyr's Chief Executive. Harrington went on to say that the acquired wellbores provide the company with multiple re-use options over the short to medium term. “Along with the wells comes a proprietary well database from the Cane Creek and overlying reservoirs (including wells with notable hydrocarbon shows and prior production). Wellbores that do not become work over candidates have potential as water supply and/or salt water disposal wells, which can substantially reduce our future operating and completion costs as the development progresses,” concluded Harrington.
Black Hills announces 2035 net-zero goal for gas distribution system - Black Hills Corp. will seek to achieve net-zero greenhouse gas emissions by 2035 across its natural gas distribution systems that span six states in the Central and Western U.S. The Sept. 13 announcement showed the growth of Black Hills' ambitions. Nearly two years ago, the company said it would aim to reduce its gas grid emissions intensity by 50% from 2005 levels by 2035. To go beyond this goal, Black Hills plans to further drive down emissions by refining its leak detection and damage prevention programs, and it expects to reach net-zero status through renewable fuel blending, carbon offsets and technological innovation. "Our net-zero target by 2035 builds on our natural gas system safety and integrity initiatives and expands upon strategies underway to strengthen our system," Black Hills President and CEO Linn Evans said in a press release announcing a sustainability report. The new target encompasses all Scope 1 methane emissions sources across the company's distribution system, including mains and service lines, transfer stations, meters and pressure relief valves, and damage to this equipment. As defined by the U.S. Environmental Protection Agency, the Scope 1 category covers direct greenhouse gas emissions from sources controlled or owned by the company, including emissions from infrastructure and vehicles. Scope 2 emissions are indirect greenhouse gas emissions associated with the purchase of electricity, steam, heat, or cooling, and Scope 3 emissions come from activities or assets not owned or controlled by the company but that impact the company's value chain, including customers' use of the company's products. Scope 3 by definition is the most difficult emissions category for a company to manage, and many companies in the U.S. gas industry have said this category is not their responsibility. By 2035, Black Hills will try to replace all unprotected steel pipe with less leak-prone protected steel and plastic pipe. These materials already make up nearly 99% of the company's roughly 42,200 miles of gas distribution mains and service lines, according to the sustainability report. The company plans to expand its leak surveys and pursue advanced leak detection methods. Paired with aerial mapping, the advanced methods would allow Black Hills to prioritize large leaks and identify trends across its systems, the company said.
North Dakota oil output unexpectedly dips in July --North Dakota's oil production unexpectedly fell 2.5% in July due to a dearth of new wells coming online. "It was a surprise to myself and to my staff," Lynn Helms, North Dakota's mineral resources director, told reporters Thursday. "We were anticipating a slight increase." North Dakota, the nation's third largest oil-producing state, pumped out 1.07 million barrels per day in July, down from 1.1 million the previous month. Natural gas production, however, increased 1.3% to 3.1 million MCF. (An MCF is 1,000 cubic feet of natural gas.) Helms said the oil decline stemmed from "very low well completions" in June. The number of completed wells jumped in late July, but not enough to bring production up to expected levels, he said. The number of drilling rigs in North Dakota — a harbinger of future production — currently stands at 45, down one from August and even with July. "Rig count has pretty much stalled out in the mid-40s," Helms said. "We are just not able to attract the skilled labor we need to drill more wells and deploy more frack crews." Fracking entails blasting a torrent of water, sand and chemicals underground to free up oil in shale rock. North Dakota's gas production rose — even though oil fell — as the gas-to-oil ratio from wells continues to increase. As oil fields age, that ratio climbs. The state set a volume record in July for natural gas that was "captured" and sold. Gas that isn't captured is burned off, a process that wastes resources and emits carbon dioxide. North Dakota oilfield operators captured 94% of all gas produced during July; only 6% was flared. The state has had a historically high gas capture rate of 93% to 94% for the past 10 months.
Judge restores oil lease on land sacred to US, Canada tribes (AP) — A federal judge on Friday ordered the Biden administration to reinstate a drilling lease that has been in dispute for decades on land near the Blackfeet Indian Reservation that is considered sacred to Native American tribes in the U.S. and Canada.The 10-square-mile (25-square-kilometer) oil and gas lease in the Badger-Two Medicine area of northwestern Montana was first issued in 1982. It was cancelled in 2016 under then-U.S. Interior Secretary Sally Jewell, at the request of the Blackfoot tribes and conservation groups.There have been efforts to declare the area a national monument or make it a cultural heritage area, and tribal leaders have bitterly opposed drilling in recent decades. But U.S. District Judge Richard Leon said Jewell lacked the authority to withdraw the lease so many years after it was sold and after several prior studies examined the environmental and other impacts of drilling in the area
California Removes Incentive to Use Natural Gas in New Buildings - California regulators on Thursday took away a key incentive for builders to use natural gas in new homes and commercial buildings as the state seeks to reduce greenhouse gasses and reach its climate goals. Utilities won’t be allowed to bill customers for part of the cost of extending a natural gas line to a new residential or commercial building starting in July, according to a decision by the California Public Utilities Commission. The regulation is designed to discourage the use of gas in buildings, which accounts for 10% of the state’s overall emissions.
D.C. Circuit leans toward FERC in NEPA dispute - Federal judges Wednesday pressed energy regulators for an update on their plans to use a contested metric to evaluate the costs of spewing planet-warming emissions from natural gas projects. During oral arguments over the Federal Energy Regulatory Commission’s assessment of the climate risks of a liquefied natural gas export facility in Alaska, three judges of the U.S. Court of Appeals for the District of Columbia Circuit appeared skeptical of green groups’ argument that the agency should have explained its views on the social cost of greenhouse gas estimates in its National Environmental Policy Act review. “There is a lurking question here, and that is: whose estimate?” said Senior Judge A. Raymond Randolph. “The Obama administration was the first to introduce the concept, and they estimated $43 per ton.” Meanwhile, he said, the Trump administration set the social cost estimate — which assigns a dollar value to the damage caused by a metric ton of emissions — at $3 per ton, and the Biden administration set the cost at $51 per ton. “Which social cost of carbon should prevail?” asked Randolph, a George H.W. Bush appointee. Environmental advocates have called for FERC in recent D.C. Circuit cases to adopt the metric, or a similar approach, as part of the agency’s plans to evaluate projects deemed to have significant climate impact. The Biden administration’s use of an interim social cost value is embroiled in separate litigation as the federal government works to finalize a new estimate. In the Alaska LNG case, the Center for Biological Diversity and the Sierra Club argued that a prior D.C. Circuit ruling required FERC to at least offer an explanation of why it was not using the metric to assess the project. The groups also raised other concerns about the agency’s NEPA analysis of the proposed Alaska Gasline Development Corp. project, which the environmental challengers say is the largest natural gas facility ever approved by FERC. The project would transport 3.9 billion cubic feet of natural gas per day produced in Alaska’s North Slope via an 800-mile pipeline to liquefaction facilities in the Kenai Peninsula. Altogether, the facility could export up to 20 million metric tons of LNG per year. FERC attorney Matthew Glover told the D.C. Circuit that there was “no quantifiable number” for FERC to use for a social cost of carbon estimate. He noted that the agency had previously stated that it did not think the metric would be helpful for addressing specific project impacts. “By quantifying the social cost of carbon, we don’t think the social cost of carbon, at a project level, will impact global warming or sea-level rise,” Glover said.
Chinese Study Looks at Heating Shale Rock to Produce More O&G - Marcellus Drilling News -This one is a “learn from your enemies” lesson. It has long been known that heating shale rock can free up oil and gas–something called in situupgrading (ISU). But such a practice has not been economic, at least that was the thinking. A new study published by researchers from (get this) Northeast Petroleum University in China (no way an American university would ever name itself after fossil energy!) looked at the different techniques that can be used to heat shale rock–the most economical ways–and published their findings in a paper for the world to read. It is just Chinese Communist propaganda? We don’t think so. The Chicoms know the West is so thoroughly brainwashed against using fossil energy that our own scientists and citizens won’t even pay attention to this important new study that discusses how to get more mileage from existing shale deposits.
Natural Gas Futures in Europe Plunge 44% from Peak - By Wolf Richter - The prices of natural gas futures in Europe, after increasing 20-fold since March 2021, have plunged amid falling demand, above-target gas-storage increases, a growing list of floating LNG import terminals, and surging imports of LNG from the US and other parts of the world.The front-month October TTF contract in the Netherlands – a benchmark for northwest Europe – plunged by 8% on Monday from Friday, and by 44% from the peak on August 26, to €191.02 per megawatt-hour (MWh) at the close today (data via Investing.com). The spike in futures prices was driven by speculation following Russia’s threats to cut, and then by its actual cuts, of gas deliveries to Europe. But those sky-high prices caused large shifts, not only lowering demand but also lining up new supply. And with this type of huge spike, and then plunge, there may well be some big energy speculators and assorted hedge funds that ended up on the wrong side with massively leveraged positions. On Thursday, two floating liquefied natural gas (LNG) import and storage terminals entered operations in the port of Eemshaven in the Netherlands, when they received their commissioning shipment of LNG from the US. The EemsEnergyTerminal, as the two vessels are called, will receive its first commercial shipment this week.These floating storage and regasification units (FSRU) receive the LNG, store it, re-gasify it, and then send the natural gas via pipeline into the land-based distribution network in the Netherlands, from where it can also be distributed to other countries.The capacity of an FSRU is much smaller than that of a large land-based import terminal, but it’s a start. The terminal at Eemshaven is expected to receive about 18 LNG cargoes by December 31, according to Bloomberg.Germany, which had become recklessly dependent on cheap natural gas from Russia and had failed to build a single LNG import terminal as alternative, is now getting the drift. It takes years to build a large LNG import terminal, so that won’t resolve today’s crisis. But the German government has chartered five FSRUs, three of which will start operating this winter. Private entities will charter an additional two FSRUs.Germany has embarked on drastic efforts to cut natural gas consumption by 20%, which includes just about anything, from asking people to forgo showers altogether, or take cold showers, to closing indoor heated pools, to production cuts by industrial users. Europe overall is aiming for a 15% cut in natural gas consumption.In Germany, gas storage facilities have been filling at record pace and are 87.9% full, according to data from Gas Infrastructure Europe. For the EU overall, storage facilities are 83.6% full, well above the 80% target set out by the European Union.
Imports of crude oil to Spain grow 22.1% between January and July - Crude oil imports to Spain increased by 22.1% between January and July compared to the same period in 2021, reaching 38,221 kilotonnes (kt), according to data from the Strategic Resource Reserves Corporation Petroleum (Cores). In July, imports of crude oil in Spain increased by 27% compared to the same month of the previous year and stood at 6,132 kt, while in the moving year, from August 2021 to July 2022, the registered growth was 17 ,3 %. In July, Spain imported 34 types of crude from 19 countries, with Brazil as the main supplier with 1,075 kt, 701.7% more than a year earlier and 17.5% of the total; Next comes crude oil from the United States, whose shipments have increased by 27.5% since the same month of 2021 and have reached 699 kt, equivalent to 11.4% of the total. In third position is Nigeria, whose imports have decreased by 57.4% to 565 kt, 9.2% of the total. Crude oil imports from OPEC member countries grew by 22.3% in July and represent 48.8% of the total, 18,704 kt; The increase in shipments from Algeria stands out, which increased by 228.9%, while those from Saudi Arabia grew by 83.9%. Likewise, imports of crude oil from countries that are not part of OPEC increased, which grew by 31.8%. In the annual accumulated, by geographical areas, in the first seven months of the year Spain received 12,900 kt of oil from Africa, of which 5,538 came from Nigeria; 9,327 kt were received from North America, of which 4,718 came from the United States, 3,106 from Mexico, and 1,504 from Canada.
Germany’s Jan-June oil imports rose 15.5%, bill more than doubled --German crude oil import volumes rose 15.5% in the first six months of 2022 year-on-year as the economy recovered from the COVID-19 pandemic and the bill more than doubled due to higher prices, official data showed on Thursday. Russia remained the top supplier, holding a 31.8% share of Germany’s oil imports in the period, monthly statistics from the BAFA foreign trade office showed. This was followed by 23.4% from the British and Norwegian North Sea, while imports from members of the Organization of the Petroleum Exporting Countries (OPEC) contributed 16.6%. The rest was shared among other sources including Kazakhstan and the United States. BAFA releases import data with a two-month delay. The impact of Russia’s invasion of Ukraine on Feb. 24, which has led to economic sanctions on Russia and counter actions in energy flows, is therefore showing only gradually. Oil imports in January through June from all origins increased to 43.5 million tonnes from 37.7 million in the same months of 2021, BAFA said. Germany spent 30.0 billion euros ($29.85 billion) on crude imports in the six months, 105% more than a year earlier. The average price paid per tonne on the border rose by 77.5% over the same period a year earlier, standing at 688.51 euros, BAFA said. Brent oil prices rose on Thursday after Russia threatened to halt supplies to some buyers, although weighing on the market were concerns that China’s extension of COVID-19 lockdowns would slow global economic activity and hit fuel demand.
Germany's neighbors are avoiding committing to a gas-sharing deal as Europe's energy crisis deepens - Energy-strapped Germany is struggling to persuade neighboring countries to sign off on a gas-sharing agreement as Europe heads toward the winter months scrambling to fill its store of energy supplies. Denmark and Austria are the only EU countries to jump on board, with Belgium, Poland, Luxembourg, and the Netherlands refusing to sign agreements to share their natural gas supplies ahead of winter to prevent supply interruptions, according to Germany's economy minister Robert Habeck in a report shared with Bloomberg.Habeck said the four countries have avoided "constructive negotiations" about the agreement, largely because they do not want to compensate their suppliers for redirecting natural gas to Germany.Germany is also in negotiations with Italy and the Czech Republic, but Italy is postponing talks until after September elections, and the Czech Republic has said they would only agree to share supplies if there was a cap on the compensation its government would have to provide gas suppliers."There is currently no progress to be expected from negotiations about bilateral solidarity agreements," Habeck added. Fatih Birol, the leader of the International Energy Agency, previously emphasized that the 27-country bloc would need to come togetherand coordinate in order to get past the energy crisis safely, especially if Russia completely cuts off Europe from its gas supplies.Although Germany reached its 80% gas storage goal nearly two months ahead of schedule, it's still suffering from soaring energy prices, which have the potential to inflict serious pain on households and plunge the German economy into a recession. With few alternatives, the country is turning to coal and nuclear power, but even those have yet to provide households with relief from sky-high energy bills. Shortly after Russia indefinitely halted flows on the Nord Stream 1 pipeline, German baseload year-ahead power, the European benchmark, jumped 23% to 625 euros per megawatt hour, more than three times what households were paying for electricity in January and 12 times what they were paying in January 2021.
Germany's Power Grid Faces Collapse As Millions Stock Up On Inefficient Electric Heaters For The Winter - A few weeks after we reported that google searches for "firewood" exploded in Germany, ground zero of what is sure to be a very cold winter... ... the country whose electric grid will be crippled for the foreseeable future after Russia's decision to halt nat gas supplies via the Nord Stream 1 pipeline, is now facing another crisis. According to Reuters, Germans could overload their power grid as they switch to inefficient electric heaters in an attempt to avoid gas shortages this winter, utilities warned in an article published on Sunday. Fearing the worst, German households have been stocking up on electric fan heaters, including portable devices, sales figures show, amid fears that Russia could cut or further limit gas supplies in the wake of its war in Ukraine. The managing director of the German association of energy and water utilities, BDEW, told daily Handelsblatt that customers could be left with even heftier power bills if they do not use the devices sparingly. "And they can overburden the power grids, for instance when many households switch on their fan heaters in one part of town at the same time on a cold winter's night," BDEW director Kerstin Andreae was quoted as saying. She said she understood people's fears of cold homes, but some of the coping mechanisms could backfire.
Germany Weighs Nationalizing Uniper The German government may increase its stake in Uniper SE above 50% and is open to taking the historic step of fully nationalizing the country’s biggest gas importer to prevent a collapse of the energy system. Dusseldorf-based Uniper needs more help from the state after already tapping into a support package that could be worth as much as 20 billion euros ($20 billion), according to people familiar with the matter. A surge in natural-gas prices and Russian supply cuts have triggered millions in daily losses, prompting the government to step in with a rescue package in July which included a 30% stake. Chancellor Olaf Scholz’s administration is ready to inject more capital and increase its stake above the 50% threshold, said one of the people, who asked not to be identified because the information is confidential. A full nationalization is also under discussion, and Uniper’s Finnish parent company Fortum Oyj would have a say in that decision, the person said. Talks with the Finnish government -- Fortum’s majority owner -- are ongoing, and Germany has previously said it isn’t willing to buy out the Finnish stake. Uniper confirmed on Wednesday that one of the options being discussed is the German government taking a “significant majority” stake. Beate Baron, a spokeswoman for Germany’s economy ministry, declined to comment. Uniper shares were down 9.6% as of 12:19 p.m. in Frankfurt after earlier surging as much as 10.6%, while Fortum shares were down 0.9% after rising as much as 7.1%. Fortum said in a statement Wednesday that no decisions have been made “beyond what was agreed in the stabilization package in July” but added that “alternative solutions” are being considered. “The deteriorating operating environment and Uniper’s financial situation have to be taken into account while Fortum, the German government and Uniper continue their discussions on a long-term solution,” Fortum said, adding that it would “update the market as and if necessary.” Germany is determined to ensure Uniper’s survival in coming months, when the energy crunch could worsen as temperatures fall heading into winter. Russian supply curtailments have forced the company to buy gas in the expensive spot market to fulfill contracts, pushing it to the edge of insolvency. Gas futures are about three times higher than a year ago as Russia retaliates for sanctions over its war in Ukraine. Rising energy prices have rocked energy companies, with margin calls -- the collateral required to back trades -- surging to unsustainable levels.
Europe's energy crisis needs immediate action or else the economy will come to a 'full stop,' says Belgian Prime Minister - The European Union must take immediate action to address the energy crisis or else face dire economic consequences, according to Belgian Prime Minister Alexander De Croo. "A few weeks like this and the European economy will just go into a full stop," he told Bloomberg on Thursday. "Recovering from that is going to be much more complicated than intervening in gas markets today. The risk of that is de-industrialization and severe risk of fundamental social unrest."In his view, the EU would benefit from imposing a price cap on gas trading, and it should be implemented as soon as possible in order to stave off catastrophe. De Croo's idea comes as Europe's top energy ministers convene in Brussels on Friday to discuss potential government responses in the energy market.A price cap will be on the table, along with other possibilities such as mandated reductions of electricity use and new taxes on fossil fuel companies. De Croo said he sees no other option than to impose such market interventions. What you are seeing today is a massive drainage of prosperity out of the European Union," he said.Since Russia began cutting supplies to Europe, natural gas prices have soared, and are trading at 10 times the price of the five-year average, according to Bloomberg data. That demands extreme urgency from government officials, the prime minister noted, and it's not something that officials can take a long time to deliberate before taking action.
The Energy Weapon Will Backfire - The rout of Russia’s army in northeast Ukraine over the past few days has many hoping momentum has shifted decisively away from Moscow. In the energy war, Vladimir Putin’s brigades actually look in better shape. Europe is paying many times more than normal for gas supplies, putting its currency on the skids and the economy on the verge of recession. But look beyond this winter and it’s possible to see how Putin’s energy weapon will backfire. It’s easy to forget now, but the biggest beneficiaries of the oil embargoes of the 1970s weren’t Riyadh or Tehran. Oil production from Middle Eastern countries fell by about 4.6 million daily barrels between 1972 and 1982. Ironically, Moscow was the biggest winner: Soviet production rose by 4.3 million barrels. By cutting off almost all gas supply to Europe, Putin all but guarantees a similar outcome to the Gulf five decades ago — losing market share to alternative suppliers and new energy sources. The ways Putin is squandering his energy dominance are the subject of a fascinating two-part interview between Georgetown University energy expert Thane Gustafson and my colleague Liam Denning. In the longer run, commodity consumers always have the option of substitution, a fact that hydrocarbon states perennially underestimate in trying to extract leverage. Moscow doesn’t just face rivals in the form of giant gas exporters from Qatar to the US — supplies that will flow even faster once new import terminals start opening — it’s also challenged by affordable alternatives. Take hydrogen. The availability of Russia’s dirt-cheap pipeline gas was one reason why green hydrogen seemed unlikely to displace methane in Europe’s energy system — even at a targeted 1.80 euros ($1.82) per kilogram by 2030, or a bit less than 17 euros a megawatt-hour. Today, it’s been about 18 months since we’ve seen benchmark gas futures so cheap. The Middle East paid for using energy as a weapon in the 1970s with punishing recessions in the early 1980s, followed by a multidecade struggle to regain the upper hand. Russia faces the eventual prospect of an even more resounding economic defeat.
Why The EU Is Struggling To Bring Its Energy Crisis Under Control - Last Friday, the energy ministers of the 27 EU members met for an emergency discussion of the energy supply situation in the bloc. The one thing they agreed on was implementing a ceiling on the revenues of power utilities that do not use gas to generate power. What they did not agree on was everything else the Commission suggested last week, including a price cap on Russian gas, a cap on final energy prices, and a direct intervention in EU electricity markets. It’s hard to get 27 countries to agree on so many things without any compromise. This is why the EU’s survival plans for the winter may never work as intended.Last week, the European Commission, headed by Ursula von der Leyen, proposed that EU member states impose a price cap on Russian natural gas imports, a mandatory cut in energy consumption across the bloc, and a cap on the revenues of power utilities that do not use gas. The Russian gas price cap was one of the items that divided the EU at the Friday discussions after Russia’s President, Vladimir Putin, warned that any country imposing a price cap on Russian oil or gas would stop receiving them. Some EU members argued in favor of a gas price cap for all gas imports into the bloc, following a similar suggestion made by Poland earlier this month. Some 15 members of the EU were in favor of such a move, but others were skeptical. And they were right to be skeptical: Norway, the EU’s gas savior, has signaled it would not accept a cap on the price it gets for its gas. “That’s not a solution we’d propose, we don’t think it answers the EU’s challenges,” Prime Minister Jonas Gahr Stoere said, adding, “I tell my European colleagues that I’m not the one who sells the gas.” The problem is that the European Union does not have all the time in the world to discuss how to go about saving its economy and its citizens from blackouts this winter. And as Bloomberg pointed out in a recent analysis of the situation ahead of the energy ministers’ meeting, speed is not among the things the European Union is known for. Belgium’s Prime Minister put it bluntly. “A few weeks like this and the European economy will just go into a full stop. Recovering from that is going to be much more complicated than intervening in gas markets today,” he told Bloomberg last week. “The risk of that is de-industrialization and severe risk of fundamental social unrest.”Protests are already a fact. Tens of thousands took to the streets in the Czech Republic earlier this month to protest the energy and foreign policy of the government. Thousands are protesting against high energy prices in Germany and Italy, too. In France, police broke up an illegal protest this weekend, arresting several dozen people.As the weather begins to get colder, these protests might grow and multiply, too. This makes the task of the EU governments all the more urgent. Yet there are already internal differences that would be difficult to resolve in a short time.Croatia, for instance, plans to ban natural gas exports, which has set its neighbor – and gas client – Hungary on edge. Germany’s neighbors are not happy, either, after Berlin declared it would not change its mind about its remaining nuclear reactors and will retire them as planned.“I want to make sure that we can provide everything to pass the winter,” the EU’s internal markets commissioner Thierry Breton said last week. “I think it’s important that every country, which has a capacity to do it for this very period, that they do whatever they can. And that’s also a matter of solidarity.”Germany clearly does not see things the same way, and it seems the only one currently seeing things the way Germany does is its neighbor France: the two sealed a deal that will see France send Germany gas and Germany send electricity back. The rest of Germany’s neighbors, however, remain reluctant to ink solidarity deals with the EU’s largest – and currently most vulnerable – economy.Even at the best of times, decision-making in the European Union takes quite a while. This is perfectly understandable: getting 27 states with their own national interests to agree on one course of action is often a challenge, and compromises need to be made.This time, there is little space for compromise and even less time to settle on a course of action. Agreement on a gas price cap appears to be off the table if the EU wants to move fast. The only thing left that can be agreed upon quickly would be an intervention into energy markets to cap prices because consumption caps would be a challenge to negotiate.
Russia's Gazprom Doubled Oil & Gas Revenue This Year (Despite Volume Dropping In Half) --This year, Gazprom supplied 43 percent less gas to Europe than last year, but raised prices by three times on average. This translated to the company’s European export revenue increasing from $53 billion dollars to $100 billion dollars, wrote Olivér Hortay, head of the energy and climate policy research at Hungarian think tank Századvég Konjunktúrakutató, in his Facebook post in response to an article published in the Financial Times. According to the paper, the higher gas prices will help the Russian natural gas extraction company Gazprom offset the decrease in supply. In an article published on Friday, the Financial Times reported that the company Gazprom is keeping its revenues from gas sales stable, as rising prices have compensated for its decision to reduce deliveries to Europe. The Kremlin said this week that it would keep the Nord Stream 1 gas pipeline, which carries gas to Europe across the Baltic Sea, closed as long as the West maintains its economic sanctions. This means that Gazprom is now delivering approximately 84 million cubic meters of gas to Europe via Ukraine and Turkey per day, compared to last year’s average of 480 million cubic meters per day, the British newspaper pointed out. However, the drop in supplies is expected to push prices this year to an average of three times that of 2021, which BCS Global Markets oil and gas industry analyst Ron Smith said would help Gazprom increase its total revenue by 85 percent to $100 billion.
A new Gazprom plant is shipping its first liquefied natural gas cargo to Greece just 6 months after the EU vowed to drastically reduce Russian gas imports -- - Following Russia's invasion of Ukraine, the European Union pledged to reduce the bloc's reliance on natural gas from Russia. But it appears new deals are still pushing through.The first cargo from Russia's Portovaya liquefied natural gas, or LNG, plant, which is near the shut Nord Stream 1 pipeline, will be going to EU nation Greece, Bloomberg reported on Saturday, citing a person with direct knowledge of the situation.The identity of the buyer and size of the cargo was not reported, but Greece has only one LNG facility that supplies the domestic market, as well as Bulgaria — also an EU country — and North Macedonia.This is at odds with EU plans, rolled out in March, that aim to cut the bloc's dependency on Russian gas by two-thirds by the end of 2022 and end its reliance on Russian supplies of the fuel "well before 2030."Europe depends on Russia for 40% of its natural-gas needs, such as cooking in homes and firing up power stations. It's fretting over a winter energy crisis, as Russia has reduced natural-gas flows to the continent, citing sanctions-related challenges.Challenges abound, particularly in the short-term after Russiahalted natural-gas supply via the key Nord Stream 1 pipeline. Europe is busy setting up LNG terminals to counter the energy crisis, as these facilities will turn the super-cooled fuel to gas.Sweden, another EU nation, is also still importing Russian LNG. Last week, activists from Greenpeace Nordic protested Russian imports by blocking an LNG tanker from unloading Russian fuel in Sweden."The fact that Russian fossil gas is still allowed to flow into Sweden, more than six months after Putin began his invasion of Ukraine, is unacceptable," Karolina Carlsson, a campaign leader at Greenpeace Nordic, said in a statement on September 8.
Nigeria-Morocco pipeline approaches ability to provide gas to Europe — Nigeria and Morocco signed an agreement that inches a long-standing proposal for a gas pipeline between the two countries closer to reality, raising the possibility of a new energy-supply route for West Africa and Europe.The Nigerian National Petroleum Co. and Morocco’s National Office of Hydrocarbons and Mines signed a memorandum of understanding in Rabat on Thursday, Nigeria’s state oil company said in a statement. While the project could take decades to complete and cost billions of dollars if it goes ahead, the ceremony comes with European nations increasingly hungry for new sources of gas following Russia’s invasion of Ukraine.The 5,600-kilometer (3,840-mile) conduit along West Africa’s coast would provide gas to the 15-country Economic Community of West African States, which also signed the agreement, and permit fuel to be shipped to Spain and the rest of Europe. The Saudi Arabia-based Islamic Development Bank and the OPEC Fund for International Development have committed nearly $60 million to finance feasibility and engineering studies for what would be one of the longest pipelines ever built.Nigeria possesses Africa’s largest proven gas reserves at about 200 trillion cubic feet, most of which is untapped, flared or reinjected into oil wells. The government says it wants to monetize much more of that resource to replace crude as the country’s key commodity. Nigeria’s oil production is in sharp decline, hampered by massive theft from pipelines and a lack of investment in new capacity.If the Nigeria-Morocco pipeline advances, it will be many years before it delivers any gas. Signing a previous agreement in 2018, the two government said the project could take 25 years to finish. It’s projected to cost billions of dollars, though it’s unclear where that investment will come from. Nigeria’s deputy oil minister said in June that the final price tag will not be determined until the project is designed.
Israeli natural gas revenues boom - The Israeli government is seeing record income from natural gas sale royalties. Data released recently by the Royalties Department at the Ministry of Energy shows that in the first half of 2022, a significant jump of about 48% was recorded in the total royalties collected from natural gas. Between January and June 2022, royalties reached NIS 824 million (roughly $250 million), compared to about NIS 557 million ($165 million) during the first half of 2021. This increase comes thanks to record production of natural gas from the Leviathan and Tamar reservoirs, which amounted to 10.85 billion cubic meters (BCM), compared to production of 8.9 BCM in the first half of 2021, an increase of 21.9%; 6.26 BCM have been directed for the domestic market and 4.59 BCM for export. In addition to the production increase, the dollar exchange rate hike has also contributed to a significant increase in Israel's total royalties. According to the Ministry of Energy, royalties collected from the Leviathan reservoir, Israel's largest natural gas reservoir, amounted to NIS 453 million ($137 million) and production reached 5.62 BCM, a 27.5% jump compared to the same period last year. The volume of exports constituted about 68% of total production from the Leviathan reservoir, while the value of royalties originating from exports constituted 77.4% of the total royalties. The growing activity is well reflected in the latest results for the quarter ending in June, reported by NewMed Energy (formerly known as Delek Drillings), which holds 45.34% of the Leviathan reservoir. According to the company, exports to Egypt and Jordan continue to constitute the main growth engine. The net revenues (minus royalties paid to the state) from the sale of natural gas in the second quarter jumped by about 32% and amounted to $249 million, compared to $189 million in the corresponding quarter last year. Net revenues in the first half of 2022 reached approximately $460 million, compared to $373 million in the corresponding period last year, an increase of 23%. Meanwhile, production from the Tamar reservoir, located 90 kilometers west of Haifa, amounted in the first half of 2022 to 5.23 BCM with total royalties collected reaching NIS 366 million ($111 million), an 85% leap compared to the figure recorded in the same period last year. The increase in revenues was mainly due to a significant increase of 53.8% in production quantities. One of the main controversial issues surrounding the Israeli gas sector after the discovery of the reservoir was the value of taxes that will be collected by the state from the producers. After in-depth discussions, the taxation on the gas sector was divided into three layers: income tax on owners of the reservoirs, royalties, and an additional special tax on oil and gas. All in all, the total revenue from royalties from the natural gas reservoirs collected by the Ministry of Energy came to NIS 9.8 billion (nearly $3 billion) from 2004 to June 30, 2022. In fact, Amir Foster, executive director of the Israeli Natural Gas Trade Association, asserted that Israel's revenues from natural gas are much higher. Speaking to Al-Monitor, he estimated that to date, NIS 17 billion ($5 billion) has entered the state coffers from all three types of tax. According to Foster, the future is also promising. “Depending on gas prices, my estimate is that within five years the state's revenues from gas will reach a value of between NIS 700 million and NIS 800 million ($207-237 million) per month.”
Abundant Middle East supplies drag Asia LPG prices lower ahead of winter -Rising Middle East supply since May, along with steady exports from the US and Africa ahead of winter, have dragged Asia LPG prices down from 18-year highs in March, shipping and trade data showed. LPG inventory with Middle Eastern producers has been building amid higher OPEC crude production, although this could change as OPEC and allies have decided to cut output quotas by 100,000 b/d for October at the Sept. 5 meeting. Other than term supply, Middle East producers have been selling spot cargoes. Producers have been accepting largely in line with lifters' monthly term cargo nominations this year, while Qatar Petroleum and Abu Dhabi National Oil Co., or ADNOC, have been advancing loading dates to clear swelling inventory, traders said. In its October-loading term nomination acceptances, ADNOC did not announce cuts or delays, but loadings were advanced by five to 10 days. ADNOC also advanced loadings for September, August, and July cargoes. Qatar's acceptances of October-loading nominations had most lifting dates advanced too, traders said. Qatar was heard to have offered up to three October-loading spot cargoes, one of which was sold at a $30/mt discount to Saudi Contract Prices to China Gas, traders said, underscoring recent deep discounts of FOB Middle East cargoes. Kuwait Petroleum Corp., or KPC, has regularly offered via spot tenders in recent months and in early-August sold 44,000 mt of evenly split LPG for Oct. 7-8 loading, at around $15/mt discount to October CPs, after selling a similar cargo for Sept. 11-12 loading. In its previous tenders, KPC sold similar lots for Sept. 2-3, Aug. 7-8 and June 19-20 loadings, sources said. Other than moving term cargoes at earlier-than-nominated dates, Middle East producers can offer spot cargoes on CFR basis, traders said. Saudi Aramco's trading arm, Aramco Trading Co., or ATC has been offering CFR spot LPG, which could be up to seven cargoes, on top of baseload volumes, traders said. For September-loading, ATC was heard offering three to four cargoes, traders added.
Russia continues to export oil products to Europe, evading EU ban – Skhemy -- Russian oil tankers are continuing to export oil products to Europe, despite a ban on them entering EU ports, journalists from Ukrainian television’s Skhemy investigative program reported. According to Skhemy’s investigation, Russia uses two schemes to circumvent the ban. In the first case, loaded Russian tankers leaving Russian ports stop in the Black Sea off the coast of Romania, where their cargo is transshipped onto vessels flying the flags of EU countries. After that, these vessels deliver Russian oil products to the ports of other countries, including European ones. The second scheme uses the Liberian-flagged large capacity tanker New Legend, which has been at sea near the port city of Constanta, Romania, for five months. Russian tankers have been regularly loading it since June, and New Legend then transships the oil and oil products to other vessels, which then enter a European port or “continue the relay” until a fourth vessel in the chain enters a EU port. The journalists revealed that Russian tankers in these schemes belong to the Volga Shipping company owned by businessman Vladimir Lisin, who, according to Russian Forbes, topped the list of the richest people in Russia in 2022. In April 2022, the European Union announced a fifth package of sanctions against Russia over its full-scale war against Ukraine. Among other things, the sanctions include a ban on Russian and Russian operated vessels from accessing EU ports.
The G7’s price cap on Russian oil begins to take shape - Officials in G7 countries, including U.S. Treasury Secretary Janet Yellen, say the unprecedented measure, set to begin Dec. 5, will cut the price Russia receives for oil without reducing its petroleum exports to world consumers. Russian President Vladimir Putin could push back, causing stress in oil markets even as the plan comes together. The G7 wealthy nations — the United States, Japan, Germany, Britain, France, Italy and Canada — and the EU are hammering out details of the plan. The G7 wants to enlist other countries, including India and China, which have been snapping up heavily-discounted oil from Russia since its Feb. 24 invasion of Ukraine. Moscow has managed to maintain its revenues through those increased crude sales to India and China. But even if India and China don’t join, a cap could help force down prices for Asia and other consumers. U.S. Treasury Assistant Secretary for Economic Policy Ben Harris said on Sept. 9 that if China negotiates a separate 30%-40% discount on Russian oil because of the price cap “we consider that a win.” The consensus on the price cap level will be reached with the aid of a “rotating lead coordinator,” the U.S. Treasury Department said in guidance issued on Friday suggesting that countries in the coalition will have a temporary leadership role as the plan proceeds. It will likely be weeks before the price of Russian crude oil and two oil products will be decided, Harris said. Washington-based ClearView Energy Partners has said officials have been talking about a $40-$60 per barrel range for crude. The upper end of that range is consistent with historical prices for Russian crude, while the lower end is closer to Russia’s marginal production cost, analysts say. Coalition members with long economic and military relations with Russia could push for a higher cap, while a limit too low could take market share away from Saudi Arabia and other oil producers. “The level will be determined by both quantitative and qualitative reasons,” said Bob McNally, president of Rapidan Energy Group. Russian crude is priced at a discount to the international Brent benchmark and the G7 wants to keep that spread wide, to keep down Russian oil revenue. However, achieving a wide spread could mean higher prices for Western consumers as Russia is the world’s second largest crude exporter, after Saudi Arabia. The plan agreed by the G7 calls for participating countries to deny Western-dominated services including insurance, finance, brokering and navigation to oil cargoes priced above the cap. To secure those services, petroleum buyers would make “attestations” to providers saying they bought Russian petroleum at or below the cap. Maritime services providers will not be held liable for false pricing information provided by buyers and sellers of Russian petroleum, the U.S. Treasury said. G7 officials believe the plan will work because the London-based International Group of Protection & Indemnity Clubs provides marine liability cover for about 95% of the global oil shipping fleet. Traders point to parallel fleets that can handle Russian oil using Russian and other non-Western insurance that could be used to sidestep enforcement efforts. It remains uncertain how many ports around the world will accept Russian-insured ships. Craig Kennedy, an associate at Harvard University’s Davis Center for Eurasian and Russian Studies, said the G7 has long term leverage because Moscow is constrained by a small tanker fleet versus the vast scale of exports it needs to get out. If Russia doesn’t want to sell at the cap, it may have to shut in production, which could impose long-term costs on its oilfields. Putin has said Russia will withhold exports to countries that enforce the cap, and fears about the threat could cause petroleum markets to rise before December. Higher prices could also be risky for U.S. President Joe Biden ahead of midterm elections in November when his fellow Democrats hope to keep control of Congress. Some analysts worry Moscow could respond by taking actions beyond Russia’s borders before the cap takes effect. “My biggest concern is I think Putin is going to make it very, very painful on the way to Dec. 5,” Helima Croft, head of global commodity strategy at RBC Capital Markets, told a Brookings Institution event on Sept. 9. “They also have assets in other producing countries, whether it be Libya, whether it be Iraq, and they have an ability to cause some problems in other producer states.” HOW WILL THE CAP BE ENFORCED? The U.S. Treasury warned service companies to be vigilant about red flags indicating potential evasion or fraud by Russian oil buyers. Those could include evidence of deceptive shipping practices, refusal to provide requested price information, or excessively high services costs. Deputy U.S. Treasury Secretary Wally Adeyemo said on Friday that those who falsify documentation or otherwise hide the true origin or price of Russian oil would face consequences under the domestic law of jurisdictions implementing the price cap.
Countering G7 price cap proposal, Russia offers discounted oil to India - In a bid to counter the growing clamour among the G7 nations to enforce a price cap on Russian oil, Moscow has told New Delhi it is willing to provide petroleum at even lower rates than before to India, officials said. “In principle, the ask in return is that India should not support the G7 (Group of Seven) proposal. A decision on this issue will be taken later following talks with all the partners,” an official with the Ministry of External Affairs (MEA) said. These “substantial discounts” will be steeper than those offered by Iraq in the past two months, officials said. In May, Russian crude oil was cheaper by $16 a barrel for India as compared to the average Indian crude import basket price of $110 a barrel. The discount was reduced to $14 a barrel in June, when the Indian crude basket averaged $116 a barrel. As of August, Russian crude oil costs $6 less than the average crude import basket price, officials said. India’s biggest oil supplier Iraq undercut Russia beginning in late June, by supplying a range of crudes that on average cost $9 a barrel less than Russian oil. The extremely price-sensitive market, therefore, has shifted heavily back in favour of Iraq. As a result, Russia slid to the third position in the list of nations from which the bulk of India’s oil originates, meeting 18.2 percent of all the country’s oil needs. Saudi Arabia (20.8 per cent), and Iraq (20.6 per cent) are the top two suppliers. Even without the price argument, officials feel a stable supply of crude oil should be established from outside the West Asian region. “While oil imports from Iraq have remained a mainstay of our purchases, given global complications and Iraq’s volatile internal situation, India needs to create alternative mechanisms,” another official said. Price cap push The G7 nations, namely Canada, France, Germany, Italy, Japan, the UK, and the US, along with the European Union are currently pushing to institute a cap on the price of Russian oil. The Western allies hope to financially squeeze out Moscow, which has continued to benefit from soaring energy prices, and cut off its means of financing the invasion of Ukraine. Media reports suggest the oil cap plan will be implemented at the same time as the EU embargo takes effect. There will be two price caps — one for crude and the other for refined products. The crude oil cap shall apply from December 5, 2022; that on refined products shall apply from February 5, 2023. India, being the second-largest oil importer globally, has been requested multiple times to join the price cap. “Any artificial changes to the established global price mechanism may have unintended consequences later. India will continue to weigh its options,” another official said. Russian oil here to stay The share of Russian crude oil, which was less than 1 per cent of India’s crude oil import volume, prior to Russia’s invasion of Ukraine in February, rose to 8 per cent in April, 14 per cent in May and 18 per cent in June, according to industry estimates and official Commerce Department data.In August, India imported 7,38,024 barrels per day from Russia, 18 per cent lower than in July, estimates made by London-based commodity data analytics provider Vortexa, which tracks ship movements to estimate imports, shows. Since July, India’s crude oil imports from Russia have declined. But, the overall import of crude oil has also fallen.
Using the Payments System to Enforce an Russian Oil Price Cap Likely to Cause Supply Shock --The G7-led idea of putting a price cap on Russian oil may look brilliant in theory, but it would likely be very messy in practice, potentially sending oil prices soaring. Surging oil prices are exactly what the price cap is meant to avoid, as it aims to keep Russian oil flowing but at a lower price.For weeks now, the G7 has been discussing exempting Russian oil from the maritime insurance and financing ban only if that oil is sold at or below a certain price that the group has yet to agree to.This would require a lot of coordination with EU, UK, and U.S.-based providers of maritime insurance and financing. But it would be the easiest part of implementing the price cap. Russia could intensify its already ongoing efforts to have non-Western tankers and insurers agree to ship Russian oil and products. Or Putin can simply make good on hispromise to halt all energy supply – including crude, fuels, natural gas, and coal – to the countries that sign up to cap the price of Russian oil.In any case, oil prices will likely go much higher as the EU embargo on Russian oil – which excludes oil sold at or below the price cap – enters into force at the end of this year.Russia will continue selling its oil to Asian buyers such as India and China using non-Western fleets of tankers and maritime services while choking supply to the West. Russia is also expected to increase its covert oil exports, taking a leaf out of Iran’s playbook of below-the-radar exports by switching off transponders and/or hiding the origin of the oil, analysts say.Still, the non-Western fleet of tankers that Russia can rely on is not enough, Energy Intelligence’s John van Schaik and Emily Meredith write.If Russia refuses to use any maritime services associated with G7 countries, “Russian oil will have to sail on non-Western tankers – and there aren’t enough vessels to handle Russia’s millions of barrels,” they argue.“The result: less oil, higher prices, and less pain for Russia.”According to Energy Intelligence, Russian oil going to Asia from Russia’s Far East is already shipped there on Russian or Asian tankers. But Russia is estimated to be exporting 4.45 million barrels per day (bpd) from its ports in the Arctic, the Baltic Sea, and the Black Sea – and this is done mostly on EU-linked vessels. Finding tankers and insurance coverage not linked to the EU, the G7, or other countries that may join the price cap mechanism for that amount of oil could be next to impossible.The G7 reiterated in early September that they would finalize and implement “a comprehensive prohibition of services which enable maritime transportation of Russian-origin crude oil and petroleum products globally – the provision of such services would only be allowed if the oil and petroleum products are purchased at or below a price (‘the price cap’) determined by the broad coalition of countries adhering to and implementing the price cap.”In guidance on the upcoming price cap, the U.S. Department of the Treasury said last week that the price cap policy has three objectives: “maintain a reliable supply of seaborne Russian oil to the global market; reduce upward pressure on energy prices; and reduce the revenues the Russian Federation earns from oil after its own war of choice in Ukraine has inflated global energy prices.”While clever in theory, the price cap plan could actually lead to much higher oil prices because trade flows will be upended again, tankers are in short supply, and Russian oil exports – still remarkably resilient – would plunge, analysts say.The global oil market will have to prepare itself for a loss of 2.4 million bpd supply when the EU embargo kicks in, the International Energy Agency (IEA) said in its Oil Market Report this week. An additional 1 million bpd of products and 1.4 million bpd of crude will have to find new homes, which could result in deeper declines in Russian oil exports and production. The IEA expects oil production in Russia to fall to 9.5 million bpd by February 2023, which would be a plunge of 1.9 million bpd compared to February 2022. Then there is the very real threat from Putin to simply stop selling oil – and all other energy products – to countries that join the price cap on Russian oil.
Russia could find new markets for half the oil the EU won’t buy — Russia could find new markets for about half of the crude exports that will be banned by the European Union from December, according to energy-data firm Kpler. Indonesia, Pakistan, Brazil, South Africa, Sri Lanka and some countries in the Middle East could together buy as much as 1 million barrels a day of crude from Russia in the coming winter, Kpler said in a research note. Russia’s oil industry, which accounts for roughly 10% of the global production and is a key source of revenue for the Kremlin, already faces significant sanctions after its invasion of Ukraine. EU members are still buying some of the country’s oil, but in December will ban most imports of Urals crude, followed by a prohibition on oil products in February. That could slash Russia’s oil output by nearly 2 million barrels a day compared with the pre-invasion levels, unless the flows are distributed elsewhere, the International Energy Agency estimates. Russian companies have already been redirecting their cargoes to Asia, mainly to India and China, as some European buyers voluntarily shun their oil. This has come at a cost, with Urals trading at deep discounts to global benchmarks. A redistribution of global crude flows could partially displace exports from other OPEC+ members. In Indonesia, “one of the prime candidates to be supplanted is Nigeria,” while in Pakistan “we would not be surprised to see lower Arab Light flows” from Saudi Arabia, Kpler said. The Middle East, which, could take as much as 500,000 barrels per day of Russian crude this winter, could redirect oil previously used domestically to export markets, according to Kpler. “The temptation might be to feed Urals into the refineries and let the likes of Arab Light flow freely in Asia,” it said.
India to source most crude supplies from Gulf in near future: Hardeep Puri - Most of India’s crude oil supplies will come from Gulf countries, including Saudi Arabia, Iraq and the UAE, in the near future the world’s third largest oil importer seeks a secure and affordable energy base, India’s minister of petroleum and natural gas, Hardeep Singh Puri, said. Crude oil imports from Saudi Arabia by the world’s third consumer nation rose in July by more than 25 per cent after Saudi Arabia lowered the official selling price in June and July compared with May. Saudi Arabia stayed at the third spot among India’s suppliers. “As far as India is concerned, I see for the foreseeable future much of our crude oil supplies will be coming from Saudi Arabia, Iraq, Abu Dhabi, Kuwait, among others,” Puri was quoted in an interview on the sidelines of the Gastech conference in Milan. India consumes around 5 million barrels of oil per day and this largely comes from Iraq, Saudi Arabia, Kuwait and the UAE. Although oil imports from Russia declined by 7.3 per cent in July from the June levels, Moscow remained the country’s second biggest oil supplier after Iraq. Even as the European Union is mulling over a ban on Russian oil, India is gaining from the discounts offered by the country. As of August, India is receiving oil from Russia at a discount of $5-6 per barrel. In August, Russia was India’s third-largest oil supplier, meeting 18.2 per cent of all the country’s oil needs. Saudi Arabia was India’s largest oil supplier at 20.8 per cent and Iraq at 20.6 per cent. Supplies from Iraq fell 18 per cent in August, as compared to July. Puri said that by the end of the fiscal year on March 31, 2022, India’s purchases from Russia represented only 0.2 per cent, but rose later as the global situation became problematic. “We started to buy a little more, but we still buy a fraction of what Europe buys from Russia. A democratically elected government like what we have in India will make sure that the consumers are provided with energy (not only) on a secure basis, but also on an affordable basis,” he said. Indian refiners have been snapping up relatively cheap Russian oil, shunned by Western companies and countries since sanctions were imposed against Moscow for what it calls a “special military operation” in Ukraine. India’s imports from Russia oil rose by 4.7 times, or more than 400,000 barrels per day, in April-May, but fell in July. During the June quarter, crude imports from Russia valued at $3.02 billion contributed 71 per cent of the total imports from the country ($4.2 billion). China and India have increased their purchases of Russian oil following the Kremlin’s attack on Ukraine, benefiting from discounted rates.
Diesel Margins Tank -The cost of diesel is plunging around the world as traders weigh the impact of a potential new quota for Chinese fuel exports. Europe’s ICE gasoil crack, which measures the price of diesel futures relative to crude oil contracts, plummeted to its lowest in more than a month earlier on Wednesday. Margins for diesel-type fuel also fell sharply in the US and Singapore. China’s Ministry of Commerce may issue a fuel export quota of 1.5 million tons in a fourth batch allocation, industry consultant OilChem said earlier. It’s unclear how much of this fuel quota would be diesel. While the volume is relatively small compared with overall China fuel exports, the extra quota signals a weakening outlook for oil demand in Asia’s largest economy, said traders. Beijing’s strict Covid Zero policy means the threat of more virus lockdowns is ever-present. Diesel is regularly shipped around the world on oil tankers, so higher supply and any subsequently weaker prices in one region affects other markets. Even though margins have tumbled, they remain elevated by historical standards. In Europe, the ICE gasoil crack stood at about $35 a barrel around 11.45 am Singapore time -- roughly triple the five-year seasonal average. The Singapore 10ppm gasoil crack over Dubai crude was near $33 a barrel. A potential export quota of 1.5 million tons would equate to about 11.2 million barrels, if it were all diesel. This year, the world’s daily demand for diesel-type fuel is pegged at a little over 28 million barrels a day by the International Energy Agency. China’s gross exports of diesel, gasoline and kerosene have trailed year-ago levels by about 580,000 barrels a day so far this year, the IEA said. The agency revised down its expectation for this year’s Chinese refinery runs in its monthly oil market report on Wednesday, and also expects an annual drop in the country’s overall demand. The predicted annual decline in refinery throughputs is “unprecedented,” and the consequent lack of supply was expected to be made up by lower product exports. Along with potential Chinese supplies, the diesel market is also facing demand-side pressures. “In Europe there is the potential for energy rationing in the winter which will also impact commuting and industry, key demand sectors for diesel,” said Jonathan Leitch, an oil analyst at Turner, Mason & Co. “There are also worries that high inflation with rising interest rates will be recessionary, cutting industrial output and therefore the demand.”
42 US gallons of crude leaked into Guyana’s waters- ExxonMobil – -- The ExxonMobil-controlled Esso Exploration Production and Guyana Limited (EEPGL) on Saturday said at least one barrel (42 US gallons) of crude oil leaked into Guyana’s Atlantic Ocean waters, but sought to downplay the severity of the incident. “On Friday, September 9, 2022, the team on the Liza Unity FPSO observed a sheen on the water in the vicinity of the vessel. Initial investigations indicate that approximately one barrel of crude oil was released during a maintenance activity on the vessel. The activity was immediately stopped and the leak isolated,” ExxonMobil said. The company suggested that its latest visual observation shows that there is no sign of oil in the water. “Earlier today, additional surveillance by helicopter confirmed that there was no sheen in the area; only a light sheen was perceptible approximately 20 km (13 miles) North West of the vessel. By midday on September 10th, a support vessel in the area confirmed no further sign of a sheen,” Exxon said. The first indication that something had gone wrong at one of ExxonMobil’s operations offshore Guyana came some time Friday when most of the technical staff began returning to shore. The company, according to well-placed sources, has since flown in experts to address the first reported oil spill. While ExxonMobil said “we notified all relevant government agencies including the Environmental Protection Agency,” none of the government agencies such as the Ministry of Natural Resources, Environmental Protection Agency and the Civil Defence Commission said anything about the incident. The Civil Defence Commission has received several training sessions and material support to prepare its oil spill response capacity.
FG loses 13.21m-barrels oil worth N603.64bn in 2022 - Nigeria lost about 13.21 million barrels of crude oil with an estimated worth of N603.64bn between January and August this year, an analysis of the monthly reports of the country’s crude oil and condensate production showed. Figures contained in the reports, obtained from the Nigeria Upstream and Downstream Petroleum Regulatory Commission in Abuja on Sunday, indicated that the country’s oil production only increased in two months, but crashed in others. Total crude oil production (without condensates) in January, for instance, was 43.35 million barrels, but this dropped to 35.22 million barrels in February, indicating a loss of 8.13 million barrels. It moved up in March, increasing by 3.14 million barrels to close at 38.36 million barrels in the third month of 2022. This, however, was not sustained, as production dropped to 36.58 million barrels in April and the country lost 1.78 million barrels in that month. The losses continued in May after oil production crashed to 31.76 million barrels, representing a loss of 4.82 million barrels when compared to what was produced the preceding month. It increased in June to 34.75 million barrels, representing an oil production gain of 2.99 million barrels, but that was short-lived, as output fell again in July to 33.6 million barrels, meaning the country lost 1.15 million barrels in July. The oil production losses persisted in August, crashing further to 30.14 million barrels, representing a loss of 3.46 million barrels. It was observed that the total losses stood at 19.34 million barrels, while what was gained was 6.13 million barrels, leaving a cumulative loss of 13.21 million barrels during the review period.
Oil spill from SPDC's facility in Bayelsa caused by equipment failure, says NOSDRA --The National Oil Spills Detection and Response Agency (NOSDRA) has traced an oil spill from a Shell Petroleum Development Company of Nigeria (SPDC) facility at Peremabiri community, Bayelsa state, to equipment failure. A JIV is carried out by oil company representatives, community representatives, and appropriate government agencies to agree on the cause, impact, and scale of spill incidents. According to Thisday, this is contained in a field report of the joint investigation visit (JIV) by NOSDRA. According to NOSDRA, the JIV showed that the incident, which occurred on August 24, was due to an operational mishap that discharged crude oil within SPDC’s operational area with no impact on the third party area. Return Koma, who represented the Peremabiri community on the JIV, on Tuesday, said officials of SPDC, as well as regulators, were unanimous that the incident was traced to equipment failure. “We have conducted the JIV, and they accepted responsibility for the leak incident at the flow station and another one at nearby Well 6, both were due to equipment failure,” he said. “We were unable to agree on the volume of spilled crude and so did not sign the report.”
Nigeria’s oil output plummets amid theft and export terminal issues— Nigeria’s crude oil production fell below 1-million barrels per day in August, figures from its regulator show, as the nation grappled with rampant theft from its pipelines and years of underinvestment. The decline is a further threat to strained finances in Africa’s most populous nation and cuts global oil supply amid soaring energy costs due to the war in Ukraine. Nigeria’s total oil and condensates output dropped to an annual low of 1.18-million barrels per day in August, data from the Nigerian Upstream Petroleum Regulatory Commission showed. Richard Bronze, head of geopolitics for consultancy Energy Aspects, said exports were the lowest since at least 1990 as issues at the Forcados export terminal worsened already weak supply. Data from oil cartel Opec showed that output never fell below 1.4-million barrels per day, even amid what were considered at the time to be crippling militant attacks in the Niger Delta. Industrial-scale oil theft poses an “existential” threat to what is typically Africa’s largest oil exporter, a Shell executive said in July, while President Muhammadu Buhari has said the problem is affecting state finances “enormously”. Nigeria slipped behind Angola as Africa’s largest exporter in July, according to Opec figures. Both countries are also dealing with years of low investment that impinged production. Its highest crude and condensate output this year, recorded in January, was 1.68-million barrels per day, though the country has the capability to export close to 2-million. Last month, the head of Nigerian National Petroleum Company said 700,0000 barrels per day were missing from its exports as thieves stole some oil and companies shut operations in other fields to avoid the thieves.
Kazakhstan's oil output fell 13% in August vs July – sources --Kazakhstan’s oil output, excluding condensate, fell by 13% to 1.196 million barrels per day (bpd) (5.077 million tonnes) in August from 1.378 million bpd (5.850 million tonnes) in July, two sources citing daily output data said on Monday. The fall in output was due to a sharp decline in production in the giant Kashagan oil field after a gas leak early in August, as well as planned output curbs in the Tengiz field due to regular maintenance. Kazakhstan’s Energy Ministry did not immediately respond to a Reuters’ request for comment. Kazakhstan uses a conversion rate of 7.3 barrels for 1 tonne of crude oil.
Libyan oil production rises to 1.205 million bpd - Libya’s production of crude oil has climbed to one million and 205 thousand barrels per day during the last 24 hours, the state-owned National Oil Corporation (NOC) announced on Sunday.The NOC also reported that the total domestic consumption of natural gas has reached one billion and 103 million cubic feet during the past 24 hours.The General Electricity Company of Libya (GECOL) is the biggest consumer of natural gas in the country followed by the NOC and the Libyan Iron and Steel Company, according to the oil company’s data.
Angola, Libya overtake Nigeria in crude production – OPEC - Nigeria’s oil production plunged to 972,000 barrels per day in August 2022, as Angola and Libya overtook Nigeria by producing higher volumes of crude during the review month, the Organisation of Petroleum Exporting Countries has said.OPEC disclosed this in its September 2022 report, confirming the figures released recently by the Nigeria Upstream Petroleum Regulatory Commission.The PUNCH had reported last week that Nigeria’s crude oil production slumped below one million barrels per day in August 2022, the lowest ever in several years.The report revealed that oil production in Nigeria dropped in August 2022, crashing below one million barrels per day to 972,394 bpd, the lowest ever recorded in years. It stated that figures from the NUPRC indicated that the country’s oil production dropped from 1,083,899 bpd in July to 972,394 bpd in August.Confirming this in its September 2022 oil sector report released on Tuesday, OPEC stated that the drop in Nigeria’s oil production made Angola and Libya to overtake Nigeria in oil output.The report stated that Angola was Africa’s highest crude oil producer for the month under review with an average production of 1.187mb/d.It said Libya’s crude oil production averaged also 1.123mb/d for the month of August.“According to secondary sources, total OPEC-13 crude oil production averaged 29.65 mb/d in August, higher by 618,000 month-on-month,” it stated.The report added, “Crude oil output increased mainly in Libya and Saudi Arabia, while production in Nigeria declined.”
N.Asian refiners to get full allocation of Saudi crude in October - Saudi Aramco has notified at least three North Asian buyers that it will supply full contractual volumes of crude in October, sources with knowledge of the matter said on Monday. The world’s top oil exporter has slashed its official selling prices (OSPs) to Asian buyers for the month, the first reduction in four months. The price cut was overall in line with the market expectation as the spot premiums for the Middle Eastern crude dipped since mid-August amid an increasing number of arbitrage cargoes flowing into Asia. “The market (in Asia) is still holding up. The pressure is now more on Europe instead of Asia,” said a Singapore-based trader. Spot premium for Dubai rebounded from as low as $3.53 a barrel over the Dubai quotes on Aug.23 to stand at an average of $5.6 a barrel in September. The major oil producers last week has agreed to lower oil production by 100,000 barrels per day, or 0.1% of global demand, from October to bolster oil prices which have slid on fears of an economic slowdown.
BlackRock courts investors ahead of Aramco gas pipelines bond sale –sources (Reuters) – BlackRock Inc has held meetings with investors in London to drum up interest in a bond sale to begin refinancing a $13.4 billion loan that backed the asset manager’s deal to buy a stake in Saudi Aramco’s gas pipelines network, two sources said on Tuesday. A consortium led by BlackRock agreed to a $15.5 billion lease-and-leaseback agreement with Aramco last year which gives the investors a 49% stake in newly formed subsidiary Aramco Gas Pipelines Co, which will lease usage rights in Aramco’s gas pipelines network and lease them back to Aramco for 20 years. BlackRock held meetings with investors in London, both sources, who are familiar with the matter, said. The world’s biggest asset manager also held meetings in Dubai and New York, one of the sources said. BlackRock ran the investor meetings itself, without the help of a bank, the second source said. BlackRock and Aramco did not immediately respond to Reuters’ requests for comment. A debut bond sale – expected to be the first of several – is anticipated before the end of the year, the sources said. In a similar deal last year, Aramco agreed a $12.4 billion deal to sell a 49% stake in its oil pipelines company to a consortium led by U.S.-based EIG Global Energy Partners. The EIG-led investors in Aramco Oil Pipelines Co sold bonds in January to begin refinancing the $10.8 billion loan that backed the deal. They raised $2.5 billion, falling short of a self-set target of $3.5-4.4 billion amid choppy markets. Both consortia are now expected to refinance the loans over longer timelines than previously envisioned. They may also explore other refinancing options, such as extending the existing loans or taking new bank debt, the sources said.
Iran Increases Oil Production From Joint Field With Saudi Arabia – The CEO of Petropars Oil Company Shamsuddin Mousavi announced on Monday that drilling of the second oil well of Forouzan Oilfield is being completed, and Iran increases oil extraction from the oilfield as joint field with Saudi Arabia. Mousavi said that the oil well number 12-03 has been drilled and oil production from this oil well is started. He added that his operation has been completed and according to the Seabed conditions, 950 meters of its 3,379 meters length is being horizontally drilled. The CEO said that based on the initial capacity of the oil well, 1,000 barrels of oil will be extracted per day. Forouzan Oilfield is located 100 kilometers Southeast of Khark Island at the Persian Gulf region and joint Marjan Oilfield of Saudi Arabia. The Saudi Arabian portion of the field is known as the Marjan Field, which is being expanded by Saudi Aramco. More than 80 percent of the hydrocarbon reserves of the field lie in the Saudi Arabian waters.
Iran Probes $170 Million Fraud In Petrochemical Firm - A $170 million apparent embezzlement case has left one of Iran’s natural gas producers in serious trouble and might reduce production at the onset of winter. The issue of possible fraud or some sort of corruption is not straightforward as one might expect in a typical Western company. There are Iranian nuances in the case that makes it a bit different. Mehr Petrochemicals produces the highest-grade polyethylene in the Middle East but it stands at the verge of bankruptcy, according to Eghtesad Online (Economy Online) a recognized website in Iran reporting on economic issue. The firm belongs to Persian Gulf Holding, a large Iranian quasi-governmental company that claims to be an independent entity, with 15 subsidiaries. Mehr Petrochemicals, as an Iranian company is supposed to repatriate its foreign currency earnings according to law, as it exports products and receives government dollars at preferential rates when it for importing equipment or chemicals. The problem is that it has failed to bring back $170 million to the country and apparently the money has simply vanished. The Iranian Inspector General’s office has issued a report saying that Mehr owes close to $100 million locally and its export revenues are missing. The danger in the company going bankrupt and shutting down is loss of gas output in the South Pars fields in the Persian Gulf, Iranian media say. Mehr plays a role in gas production because it needs it for producing petrochemicals.
China Mulling U-Turn for More Fuel Exports -China is considering allowing its oil refiners to export more fuel in an attempt to help revive its economy, which would be a reversal from a focus on minimizing emissions. Refiners and traders have applied for an extra 15 million tons of fuel export quota that includes gasoline and diesel, according to people familiar with the matter. If approved, that would increase the allocations so far this year to a similar level for the whole of 2021. Beijing maintains strict control over how much both its state-owned and private refiners can export. It’s been curbing shipments recently to reduce pollution and help consolidate the sector, with the amount of quota allocated so far in 2022 about 40% less than last year. China’s desire to boost economic activity could be behind the possible increase in quota, said the people who asked not to be identified as the discussions are private. The Covid Zero policy and a property crisis have weighed on Asia’s largest economy this year, with several major banks forecasting growth will be less than 3%. The Ministry of Commerce didn’t immediately reply to a fax seeking comment. The application for the additional export allocations comes as a batch of 1.5 million tons of quota is expected to be granted to Chinese refiners later this week. If the 15 million tons are approved that would take this year’s total to 39 million tons, compared with about 38.6 million tons last year. Increased fuel exports and more efficient use of refining capacity are ways to support the economic recovery, Fu Xiangsheng, an official from the China Petroleum and Chemical Industry Federation, said at an industry conference last month. The country’s state-owned refiners were running at 75.3% of capacity in the week through Sept. 10, according to CITIC Futures Co., a much lower level than in the US. China has exported a monthly average of 1.95 million tons of diesel, gasoline and kerosene in first seven months of this year, according to customs data. That compares with at least 5 million tons a month of exports that would be possible in the last three months of the year under the potential new quota, if it is confirmed. The nation exported an average 3.4 million tons of the fuels in 2021 on a monthly basis.
IEA Cuts Oil Demand Forecast As China's COVID Crisis Continues - Global oil demand is set to grow by 2 million barrels per day (bpd) this year, the International Energy Agency (IEA) said on Wednesday, revising down its growth estimate by 110,000 bpd from last month as it expects China’s oil demand to fall for the first time in more than three decades. “Growth in global oil demand continues to decelerate, weighed down by renewed Chinese lockdowns and an ongoing slowdown in the OECD,” the Paris-based agency said in its closely-watched Oil Market Report on Wednesday. The slowdown in China will be partly offset by “large-scale switching from gas to oil,” which is estimated to average 700,000 bpd in the fourth quarter of 2022 and the first quarter of 2023, double the level from a year ago, according to the IEA. Oil demand in China is expected to fall by 2.7%, or by 420,000 bpd, this year compared to last year, per IEA estimates. If the estimates are correct, this could be the first yearly decline in Chinese oil demand since 1990 and only the second such drop in IEA records since 1984.The IEA’s new estimate is now in line with several analyst forecasts that anticipate sudden Covid lockdowns will weigh on China’s oil demand this year as people avoid mass travel around holidays, dragging fuel consumption in the world’s top crude importer down for 2022 for the first time in two decades.Elsewhere in the IEA report today, figures show still very resilient Russian oil exports. Russian total oil exports actually rose by 220,000 bpd in August to 7.6 million bpd, which is down by just 390,000 bpd from pre-war levels. Estimated export revenues for Russia fell by $1.2 billion from July to $17.7 billion in August. However, the EU embargo on Russian crude oil and product imports that comes into effect in December 2022 and February 2023, respectively, is expected to result in deeper declines as an additional 1 million bpd of products and 1.4 million bpd of crude will have to find new homes, the IEA said.
World oil demand to reach 100.6m bpd in Q3: OAPEC | Arab News - The global oil demand is expected to increase over the third quarter to approximately 100.6 million barrels per day, according to a report on petroleum developments in global markets issued by the Organization of Arab Petroleum Exporting Countries. This is in line with expectations that the Organisation for Economic Co-operation and Development group's demand would rise to about 47 million bpd, and the rest of the world’s demand would rise to about 53.6 million bpd. This is also despite the fact that preliminary estimates indicate global oil demand fell to about 98.3 million bpd during the second quarter, down by 1 percent from the same period last year. The report also revealed that OECD demand fell 0.7 percent during the second quarter to about 45.5 million bpd, whereas the remainder of the world’s demand fell 1.2 percent to about 52.8 million bpd. The monthly average price of OPEC crude oil fell to $108.32 per barrel in July 2022, about 8 percent below the previous month. OPEC has projected that in 2022 the common annual value of a basket of crude oil will rise to $105.71, an increase of 51.3 percent over the previous year. The report indicated that the common value of an OPEC crude oil basket reached $117.7 per barrel in June 2022, up 3.3 percent compared with May 2022. This is primarily due to strong fundamentals in the oil market, high refiner demand, high profit margins, as well as supply disruptions in several key production areas, such as Libya and Ecuador.
Oil Gains as Traders Assess G7 Plan to Cap Russian Price -- Oil futures advanced in starting the new trading week, as investors refocused on the risk of supply disruption from Russia amid G7 talks aimed at capping the price on Russian crude and refined products exports in a move that could prompt the government of Vladimir Putin to throttle back oil output. More details for a G7 plan to cap the price of Russian oil exports began to emerge and the industry appears to be on edge over the possible risks the novel measure could entail. U.S. Treasury Department on Sunday issued an early guidance of compliance that bars financial institutions and shipping companies in G7 countries from providing tankers, insurance, and other critical financial services for seaborne shipments of Russian oil unless the sales fall under a set price cap. The measure will offer three different price controls, one for crude oil and two for refined petroleum products. The exact level of the price cap has yet to be finalized, but it has been stressed that it must be set above the breakeven costs for Russian producers and shipping and insurance costs. For reference, an average cost for Russian oil production varies between $30 and $40 barrel (bbl), although remote basins in Eastern Siberia and Arctic have a much higher price tag due to harsh climate and infrastructure challenges. The measure is likely to override the European Union ban on purchases of Russian oil and refined products that is set to take place on Dec. 5 and Feb. 5, 2023, respectively, which should in theory allow for more Russian oil available on the global market. The risk, however, is that Putin could retaliate by cutting oil production, tearing down export contracts that would send global oil prices higher. Such a decision by the Russian president would be catastrophic for the country's oil industry that might never recover from such a heavy blow but highlights the enormous uncertainty for global oil markets. According to International Energy Agency, Russia currently is the world's third largest oil producer, pumping around 10.9 million barrels per day (bpd), behind only Saudi Arabia with 11 million bpd and the United States with 12.1 million bpd. In the first half of 2022, Russia supplied over 8.2 million bpd of crude and refined products to the global market. A complete shutdown of Russian oil exports makes it extremely difficult to calculate the associated risks to the global economy, markets and geopolitics. Near 7:30 AM ET, NYMEX October West Texas Intermediate futures advanced $0.68 to $87.46 bbl, while Brent for November delivery climbed to $93.74, up $0.91. NYMEX October RBOB futures rallied 1.86 cents to $2.4525 gallon, and NYMEX October ULSD futures gained 4.75 cents to $3.6262 gallon. Liubov Georges can be reached at
Oil prices rise as supply uncertainty mounts -- Oil prices rose on Monday as Iranian nuclear talks appeared to hit obstacles and an embargo on Russian oil shipments loomed, with tight supply struggling to meet still robust demand. Brent crude futures ended the day at $94 per barrel, for a gain of 1.25%. U.S. West Texas Intermediate crude settled 99 cents, or 1.1%, higher at $87.78 per barrel. Prices were little changed last week as gains from a nominal supply cut by the Organization of the Petroleum Exporting Countries and allies including Russia, a group known as OPEC+, were offset by lockdowns in China, the world's top crude importer. France, Britain and Germany on Saturday said they had "serious doubts" about Iran's intentions to revive a nuclear deal, in a development which might keep Iranian oil off the market and keep global supply tight, Global oil prices may rebound towards the end of the year as supply is expected to tighten further when a European Union embargo on Russian oil take effect on Dec. 5. The G7 will implement a price cap on Russian oil to limit Russia's lucrative oil export revenue following its invasion of Ukraine in February, and plans to take measures to ensure that the oil could still flow to emerging nations. In more bearish news for markets, China's oil demand could contract for the first time in two decades this year as Beijing's zero-COVID policy keeps people at home during holidays and reduces fuel consumption. "The lingering presence of headwinds from China's renewed virus restrictions and further moderation in global economic activities could still draw some reservations over a more sustained upside," Also, the European Central Bank and the Federal Reserve are prepared to increase interest rates further to tackle inflation, which could lift the value of U.S. dollar against currencies and make dollar-denominated oil more expensive for investors.
Oil Prices Climb As Dollar Weakens Ahead Of US Inflation Report -- Oil prices rose on Tuesday as focus shifted to U.S. inflation data and the OPEC's monthly outlook report both due later in the day. Rising speculation about the impact of Ukraine's offensive around Kharkiv on supply of Russian oil and uncertainty about revival of the Iranian nuclear deal also supported prices. Benchmark Brent crude futures rose 1.1 percent to $95.02 per barrel, while WTI crude futures were up 1.2 percent at $88.81. The dollar was on the backfoot ahead of U.S. inflation data due later in the day that could show some signs of softening in August. The U.S. inflation report is expected to show a continued slowdown in the annual rate of consumer price growth to 8.1 percent in August from 8.5 percent in July. German harmonized inflation released earlier in the day was confirmed at 8.8 percent in August, unrevised from the preliminary reading. Traders await the OPEC's monthly outlook report for cues on global demand. The oil producer group surprised markets with a small production cut last week while many expected the cartel to stay the course with its production policy.
Oil dips, reversing gains after bearish U.S. economic data - Oil prices fell on Tuesday in choppy trading, reversing earlier gains as U.S. consumer prices unexpectedly rose in August, giving cover for the U.S. Federal Reserve to deliver another hefty interest rate increase next week. Brent futures for November ended the day at $93.17 per barrel, for a loss of 0.88%. U.S. crude settled 47 cents, or 0.5%, lower at $87.31 per barrel. The consumer price index gained 0.1% last month after being unchanged in July, the U.S. Labor Department said. Economists polled by Reuters had forecast a 0.1% fall. Fed officials are set to meet next Tuesday and Wednesday, with inflation way above the U.S. central bank's 2% target. "The Fed may have to raise rates quicker than expected which could cause a 'risk back off' sentiment in crude and further strength to the dollar," Oil is generally priced in U.S. dollars, so a stronger greenback makes the commodity more expensive to holders of other currencies. Renewed COVID-19 curbs in China, the world's second-largest oil consumer, also weighed on crude prices. The number of trips taken over China's three-day Mid-Autumn Festival holiday shrank, with tourism revenue also falling, official data showed, as COVID-linked restrictions discouraged people from travelling. Both contracts rose by more than $1.50 a barrel earlier in the session, supported by concerns over tighter inventories. "The oil market's structural outlook remains one of tightness, but for now, this is offset by cyclical demand headwinds," Morgan Stanley said in a note. The U.S. Strategic Petroleum Reserve (SPR) fell 8.4 million barrels to 434.1 million barrels last week, the lowest since October 1984, according to government data on Monday. The United States may begin refilling the SPR when crude prices fall below $80 per barrel, a Bloomberg reporter said on Twitter. U.S. commercial oil stocks were forecast to have risen 800,000 barrels last week, analysts forecast in a Reuters poll. Prospects for a revival of the West's nuclear deal with Iran remained dim. Germany expressed regret on Monday that Tehran had not responded positively to European proposals to revive the 2015 agreement. U.S. Secretary of State Antony Blinken said that an agreement would be unlikely in the near term. The Organization of the Petroleum Exporting Countries on Tuesday stuck to its forecasts for robust global oil demand growth in 2022 and 2023, citing signs that major economies were faring better than expected despite headwinds such as surging inflation.
WTI Steady Above 'Biden Floor' Despite Another Big Crude Build - Oil prices ended modestly lower on the day - about the only asset that didn't get destroyed - as chatter that the Biden admin will bid crude at $80/bbl to refill the SPR sent prices rebounding higher after they were crushed by the hawkish shift from hot CPI.“It may not be a catalyst for $100 crude but does offer a buffer to the downside risk that the market is worrying about,” said Rebecca Babin, a senior energy trader at CIBC Private Wealth Management.Separately, US Secretary of State Antony Blinken said it was “unlikely” the US and Iran would reach a new nuclear deal anytime soon, echoing recent comments from France, Germany and the UK, and pushing back the likelihood of any substantial increase in Iranian oil shipments in the near term.But for now, any hints that last week's unexpectedly large build in crude stocks continues has all eyes focused on API tonight ahead of tomorrow's official data. API
- Crude +6.035mm (-200k exp)
- Cushing +101k
- Gasoline -3.23mm
- Distillates +1.75mm
For the second week in a row, if API data is confirmed tomorrow, US Crude inventories built dramatically... WTI was hovering around $87.50 ahead of the API print and remained stable after the crude build...
Oil Wobbles After IEA Lifts 2022 Demand Outlook, USD Slips - In early trading Wednesday, ULSD futures accelerated a sell-off on concern higher interest rates would push the U.S. economy into recession, while West Texas Intermediate softened in pre-inventory trade after the International Energy Agency raised its global demand outlook for the remainder of the year, citing soaring oil use for power generation and gas-to-oil switching across large economies in Asia and the European Union. In its closely watched monthly Oil Market Report released Wednesday morning, IEA raised its global demand forecast by 380,000 barrels per day (bpd) this year for annualized growth of 2.1 million bpd. World oil demand is now seen at 99.7 million bpd in 2022 and 101.8 million bpd in 2023. "With several regions experiencing blazing heatwaves, the latest data confirm increased oil burn in power generation, especially in Europe and Asia. Fuel switching is also taking place in European industry, including refining," said IEA. Relative gains in global oil demand come despite weakness in other areas of the global economy and sharp slowdown in China's fuel consumption where COVID-19 restrictions shaved 400,000 bpd from oil demand this year and 300,000 bpd in 2023. China's oil consumption is still seen recovering to a pre-pandemic high of 16 million bpd next year. At the same time, the agency estimates Russian oil exports fell by 115,000 bpd in July to 7.4 million bpd and from about 8 million bpd at the start of the year. Russian crude and oil product flows to the United States, United Kingdom, EU, Japan, and Korea have slumped by nearly 2.2 million bpd since the outbreak of the war, two-thirds of which have been rerouted to other markets, notably Asia. Lower exports to G7 economies come ahead of an expected price cap agreement on Russian seaborne crude and petroleum products exports that could further slash Russian oil volumes on the global market. On the supply side, IEA estimates worldwide oil output reached post-pandemic high of 100.5 million bpd in July as maintenance ended in the North Sea, Canada and Kazakhstan. OPEC+ ramped up total oil production by 530,000 bpd in line with higher targets and non-OPEC+ rose by 870,000 bpd. World oil supply is set to rise by a further 1 million bpd by year-end. In its report, IEA revised its forecast for Russian oil output but have lowered the outlook for North America. Further weighing on the complex, the American Petroleum Institute reported on Tuesday commercial crude oil inventories in the United States surged 6.035 million barrels (bbl) for the week ended Sept. 9, six times estimates for a 1-million-bbl build. Stocks at the Cushing, Oklahoma, tank farm, the delivery point for WTI futures, also added 101,000 bbl. API reported distillate inventories increased 1.75 million bbl in the week ended Sept. 9, well above calls for an increase of 100,000 bbl. Gasoline stocks, meanwhile, tumbled 3.23 million bbl in the week profiled, more than five times estimates for a 600,000 bbl decrease. The risk higher interest rates could tip the U.S. economy into recession pressured ULSD futures, which correlates closely with the economy's performance. NYMEX October ULSD futures plummeted 15.83 cents to $3.3848 gallon. Meanwhile, the prospect of a national rail strike that could upend ethanol deliveries underpinned strength in the gasoline contract, with NYMEX October RBOB futures adding 1.56 cents in early trading to $2.4964 gallon. NYMEX WTI for October delivery was flat near $87.35 bbl, and Brent crude on ICE traded little changed near $93.20 bbl.
WTI Holds Gains Despite Big Distillates Build, Record SPR Release - Oil prices are up this morning, but off their highs following the IEA's cut to its global demand growth outlook (due to China lockdowns). Price drifted lower overnight after the surprise crude build reported by API, but the 'Biden Bottom' under prices remains in place (SPR refill bid) and seems to be sustaining a BTFD nature in the crude complex and reports that the Chinese megacity of Chenddu announced it would gradually loosen lockdowns - a bullish sign for demand - provided some support this morning.“The market seems to be well and truly stuck with no clear direction for the time being,” said Ole Hansen, head of commodities strategy at Saxo Bank. “The market is getting even more concerned central banks led by the FOMC could tip the global economy over the edge in their pursuit of lower inflation.” This morning's official inventory and demand data may be the algo's catalysts for the next leg one way or the other. DOE
- Crude +2.442mm (+1.83mm exp)
- Cushing -135k
- Gasoline -1.768mm
- Distillates +4.219mm (biggest build since Dec 2021)
US Crude inventories built for the second week in a row and distillates stocks exploded higher...As a reminder, the Biden admin released a record 8.4mm barrels of oil from the SPR last week so the net commercial crude draw was actually around 6mm barrels... Gasoline demand plunged further below 2020 levels, despite the fact that prices continue to ease and shelved summer road trips are no longer a factor. The four-week moving average of product supplied is down to 8.56 million barrels a day, nearly 200,000 barrels below where it was at this time two years ago. Even with demand floundering, the EIA reported a huge 1.8 million barrel draw in gasoline inventories, bringing them to their lowest seasonal level since 2014. US Crude production was flat as rig counts have started falling (drilling activity in the US shale patch has reversed course for the first time since its collapse in 2020)... WTI had slipped below $88.50 ahead of the official data and rallied modestly after the data... Finally, Bloomberg Intelligence Senior Oil & Gas Analyst Fernando Valle notes that "a potential US rail strike may have significant consequences for diesel demand, helping to restore depleted inventories, but at a major cost to the economy. Demand may see an impact of up to 600,000 barrels a day, we calculate, close to 15% of US consumption if there’s a strike. But its long-term effects may be even greater, given the potential to disrupt supply chains and push further declines in construction and durable goods orders. Reduced economic activity may also affect gasoline demand over the coming months. "
Oil Falls on Demand Concerns as DOE Clarifies SPR Refill Plan -Oil fell with demand concerns at the fore as the US Department of Energy walked back expectations of its plan to restock petroleum reserves and China considered allowing more fuel exports. West Texas Intermediate futures dropped 3.8% to settle at $85.10 a barrel. The DOE said its plan to replenish the nation’s emergency oil supply doesn’t include a trigger price and isn’t likely to occur until after fiscal 2023. Earlier this week prices rallied after Bloomberg News reported that administration officials have discussed refilling the Strategic Petroleum Reserve should crude dip below $80, suggesting a potential floor for prices. “The White House sending mixed messages on the strategic reserve has pushed this market up and down,” said Phil Flynn, senior market analyst at Price Futures Group. “They’re putting out some trial balloons to see how their buying is going to impact prices.” Meanwhile, China is considering exporting more fuel, a move designed to boost the economy but which also raises questions about how much domestic consumption is falling amid Covid-19 lockdowns. The news comes after the International Energy Agency said Wednesday the country will see its biggest drop in demand for oil in more than three decades. Oil is on course for the first quarterly loss in more than two years as central banks including the Federal Reserve tighten monetary policy to tame inflation, hurting the outlook for energy consumption. The retreat has erased all the gains seen in the wake of Russia’s invasion of Ukraine, with prices earlier this month hitting the lowest since January. Refined product prices have declined significantly in the few past days on seasonal demand drops while China prepares to ramp up fuel exports. Diesel’s prompt spread shrank to $2.77, down from $7.45 earlier this month. The diesel crack, which measures diesel futures relative to crude oil contracts, fell to its lowest in over a month. WTI for October delivery fell $3.38 to settle at $85.10 in New York. Brent for November settlement slid to $3.26 to $90.84 at market close. Widely watched oil-market time spreads have been volatile. Brent’s prompt spread -- the difference between its two nearest contracts -- was $1.23 a barrel in backwardation. That compared with 90 cents a week ago, while the measure was more than $2 as recently as last month.
Oil up by 1% to $94.10 a barrel on supply concerns, expected fuel switching (Reuters) -Oil edged up 1% on Wednesday as an international energy watchdog expects an increase in gas-to-oil switching due to high prices this winter, even though the outlook for demand remains gloomy. Brent crude futures settled up 93 cents, or 1%, at $94.10 a barrel, while U.S. West Texas Intermediate crude ended $1.17, or 1.3%, higher at $88.48. The International Energy Agency (IEA) expects the deepening economic slowdown and a faltering Chinese economy to cause global oil demand to grind to a halt in the fourth quarter of the year. That has kept prices under pressured of late, and may inhibit further rallies. The IEA also said it expects widespread switching from gas to oil for heating purposes, saying it will average 700,000 barrels per day (bpd) in October 2022 to March 2023 - double the level of a year ago. That, along with overall expectations for weak supply growth, helped boost the market. Global observed inventories fell by 25.6 million barrels in July, the IEA said. In the United States, however, crude inventories rose last week for a second week in a row, once again boosted by the ongoing releases from the Strategic Petroleum Reserve (SPR), latest government data showed. Commercial stocks rose by 2.4 million barrels as 8.4 million barrels were released from the SPR, part of a program scheduled to end next month. [EIA/S] "The crude number suggests that once we wind down the clock on the Strategic Petroleum Reserve release, we're going to see substantial drawdowns in inventories so that's keeping oil high," Traders also said the lack of certainty around a possible U.S. rail stoppage due to an ongoing labor dispute is adding a bit of support to the market. Three unions are negotiating for a new contract that could affect rail shipments, which are important for crude and product deliveries. The Organization of the Petroleum Exporting Countries (OPEC) on Tuesday said global oil demand in 2022 and 2023 will come in stronger than expected, citing signs that major economies are faring better than expected despite challenges such as surging inflation..
Oil Prices Surge On Weakening Dollar, Potential Supply Disruptions (Reuters) -Oil prices edged upwards in early Asian trade on Thursday, as supply concerns and a looming rail stoppage in the United States, the world's biggest crude consumer, supported markets. Brent crude futures rose 38 cents, or 0.4%, to $94.48 a barrel by 0013 GMT, while U.S. West Texas Intermediate crude rose 46 cents, or 0.5%, to $88.94. The dollar index slipped 0.14% on Wednesday, dialing back the previous session's gains, lifting demand for dollar-denominated commodities such as crude oil from holders of other currencies. The International Energy Agency (IEA) said Wednesday it expects widespread switching from gas to oil for heating purposes, saying it will average 700,000 barrels per day (bpd) in October 2022 to March 2023 - double the level of a year ago. That, along with overall expectations for weak supply growth, also helped boost the market. The increasing likelihood of a U.S. rail stoppage due to an ongoing labor dispute is also adding support to the market. Three unions are negotiating for a new contract that could affect rail shipments, which are important for crude and product deliveries. TotalEnergies SE cut production at its 238,000 barrel-per-day (bpd) Port Arthur, Texas, refinery because of the planned shutdown of two sulfur recovery units (SRUs) on Wednesday, said sources familiar with plant operations.
Oil slumps 3% on U.S. rail agreement, demand concerns Oil futures fell about 3% to a one-week low on Thursday on a tentative agreement that would avert a U.S. rail strike, expectations for weaker global demand and continued U.S. dollar strength ahead of a potentially large interest rate increase.Brent futures fell $2.70, or 2.95%, to $91.40 a barrel by 1:18 p.m. EDT (1718 GMT), while U.S. West Texas Intermediate (WTI) crude fell $2.79, or 3.2%, to $85.69. Major U.S. railroads and unions secured a tentative deal after 20 hours of intense talks brokered by President Joe Biden’s administration to avert a rail shutdown that could have hit food and fuel supplies across the country and beyond. The prospect of a strike lent the market some support on Wednesday. That rail deal also helped pressure U.S. diesel and gasoline futures to drop more than 5% earlier in the session. “The oil complex is drafting back down on U.S. dollar strength and the tentative agreement that would avert a U.S. rail workers strike,” The U.S. 3:2:1 crack spread – a measure of refining profit margins – was on track for its lowest close since early March. Downside risks continue to dominate the global economic outlook and some countries are expected to slip into recession in 2023, but it is too early to say if there will be a widespread global recession, according to the International Monetary Fund (IMF). Some Wall Street indexes were in the red while the dollar held near the 20-year high it hit on Sept. 6 as investors digested stronger-than-expected economic data and prepared for an aggressive interest rate hike from the Federal Reserve next week. A strong dollar reduces demand for oil by making the fuel more expensive for buyers using other currencies. The International Energy Agency (IEA) said this week that oil demand growth would grind to a halt in the fourth quarter. Crude prices have dropped substantially after a surge close to its all-time highs in March after Russia’s invasion of Ukraine added to supply concerns, pressured by the prospects of recession and weaker demand. Other factors weighing on oil prices included an increase in U.S. crude inventories and an expected reduction in energy use by the Ethereum blockchain. U.S. crude stocks rose by a more than expected 2.4 million barrels, boosted by a record weekly release from the Strategic Petroleum Reserve, which is scheduled to end next month. The European Union’s executive, meanwhile, plans to raise more than 140 billion euros ($140 billion) to shield consumers from soaring energy prices by skimming off revenue from low-cost electricity generators and making fossil fuel firms share windfall profit.
Oil Futures Head for Third Weekly Loss on Recession Fears - Oil futures nearest delivery moved mixed early Friday, although all petroleum futures contracts are heading for a third weekly loss amid persistent fears that higher interest rates from the Federal Reserve in coming months will push the U.S. economy into a recession, denting demand growth for oil and petroleum products. This week's economic data solidified the case for at least a 75-basis-point rate increase at the Federal Open Market Committee meeting on Sept. 20-21, with odds rising for the central bank to hike rates even more aggressively. The odds for a 100-basis-point move from the Fed next week, which would be the biggest since 1984, are currently holding around 20%, based on data reflected in the CME Group's Fed Watch, with bets on follow-up hikes likely to lift the Fed Funds rate to between 4.25% and 4.5% by the end of February. Inflation in the U.S. shows no signs of abating, with core consumer prices accelerating by 0.6% in August, double the increase seen over the month of July, even as gasoline prices declined in both months. U.S. retail sales for August showed continued demand for goods and services despite rapidly tightening financial conditions and high inflation. Americans spent more on groceries, cars, and apparel as gasoline prices fell for the second month through August, potentially boosting inflation for core consumer goods. Excluding gas stations, actual retail sales rose by 0.8% in August, up sharply from a negative 0.2% seen in the previous month. Continued strong job growth and rising wages are likely giving consumers a tailwind, even as they grapple with rapidly rising prices for everyday goods. Economists say that alone would keep the Federal Reserve on track to raise the benchmark federal funds rate in an effort to slow demand and inflation. The World Bank this week forecasted the global economy would see the steepest slowdown since the early 1970s, adding that a "moderate hit to the global economy over the next year could tip it into recession." The expected slowdown of the business cycle and potential for recession is evident in diesel markets where demand for the middle of the barrel fuel that closely correlates with economic performance plunged more than 35 cents this week. Diesel supplied to the U.S. market slumped 17% last week alone to the lowest level since December 2020 at 3.132 million barrels per day (bpd). Over the past four weeks, distillate fuel consumption averaged 3.6 million bpd, down by more than 11% from the same period last year. Near 9:00 a.m. EDT, NYMEX West Texas Intermediate added $0.15 to trade near $85.12 barrel (bbl), while the international crude benchmark for November delivery gained to $91.19 bbl. NYMEX October RBOB futures declined by 1.54 cents to $2.4152 gallon, while the front-month ULSD futures gained 0.66 cents to $3.1788 gallon.
Oil Prices up After Basra Spill, but Log Weekly Decline (Reuters) -Oil prices rose slightly on Friday as a spill at Iraq's Basra terminal appeared likely to constrain crude supply, but remained down on the week on fears that hefty interest rate increases will curb global economic growth and demand for fuel. Brent crude futures settled at $91.35 a barrel, up 51 cents, while U.S. West Texas Intermediate (WTI) crude futures settled at $85.11 a barrel, up 1 cent. Both benchmarks were down by nearly 2% on the week, hurt partly by the U.S. dollar's strong run, which makes oil more expensive for buyers using other currencies. The dollar index was largely flat on the day but up for its fourth week in five weeks. In the third quarter so far, both Brent and WTI are down about 20% for the biggest quarterly percentage declines since the start of the COVID-19 pandemic in 2020. Oil exports from Iraq's Basra oil terminal are being gradually resumed after they were halted last night due to a spillage, which has been contained, Basra Oil Company said. The spill at the port, which has four loading platforms and can export up to 1.8 mln barrels per day, drove up prices on the prospect of lower global crude supply. Investors are bracing for a large increase to U.S. interest rates, which could lead to a recession and reduce fuel demand. The Federal Reserve is widely expected to raise its benchmark overnight interest rate by 75 basis points at a Sept. 20-21 policy meeting. The market also was rattled by the International Energy Agency's outlook for almost zero growth in oil demand in the fourth quarter owing to a weaker demand outlook in China. "Both the IMF and World Bank warned that the global economy could tip into recession next year. This spells bad news for the demand side of the oil coin and comes a day after the IEA forecast (on) oil demand," Other analysts said sentiment suffered from comments by the U.S. Department of Energy that it was unlikely to seek to refill the Strategic Petroleum Reserve until after the 2023 financial year. On the supply side, the market has found some support on dwindling expectations of a return of Iranian crude as Western officials play down prospects of reviving a nuclear accord with Tehran. Oil prices could also be supported in the fourth quarter if OPEC+ members cut production, which will be discussed at the group's October meeting. Europe faces an energy crisis driven by uncertainty on oil and gas supply from Russia. U.S. crude supply appeared headed for an increase, as energy firms this week added oil and natural gas rigs for the first time in three weeks as relatively high crude prices encouraged some firms to drill more, mainly in the Permian Basin, according to energy services firm Baker Hughes Co.
Oil Posts Third Weekly Loss as Recession Fears Rise | Rigzone - Oil settled at its third weekly loss as mounting evidence of an economic slowdown overshadows supply-risk concerns. West Texas Intermediate futures settled at $85.11 a barrel, down 1.9% from the prior week. Hotter-than-expected inflation figures fanned expectations that more interest-rate hikes will crimp growth, while a warning from FedEx Corp. Friday was seen as proof that the US economy has started slowing. “This was the week that energy traders started to believe that the US economy is headed for a rough patch,” “Global recession fears are becoming the consensus view and that is troubling for the short-term crude demand outlook.” Nonetheless, the potential for more supply disruptions from Russia remains a risk, while China’s economic data suggested stimulus measures there were having some success ramping up demand. Taken together with OPEC’s recent moves to support prices, traders said they see $85 a barrel as basic footing for the oil market. Global oil consumption is being threatened by a darkening economic outlook. A hawkish US Federal Reserve, the risk of a recession in Europe due to a severe energy crisis, and China’s continued Covid-19 lockdowns are all adding pressure to the commodity. Diesel prices -- often correlated to the global growth outlook -- have slumped this week and several banks have cautioned on the outlook. Also restraining oil price gains, the Bloomberg dollar gauge traded near a record this week on the outlook for tighter monetary policy. A rising greenback makes commodities more expensive for buyers outside of the US. Despite the more ominous economic picture, Russian supply disruptions remained a wildcard in oil markets. In an effort to stave off a looming energy crisis this winter stemming from curtailed Russian flows, Germany seized the local unit of Russian oil major Rosneft PJSC, including stakes in three refineries. One of the plants, PCK Schwedt, is now preparing for potential retaliation from Russia such as short-term restrictions in the crude supplied via the Cold War-era Druzhba pipeline. WTI for October delivery rose 1 cent to settle at $85.11 a barrel in New York. Brent for November settlement rose 51 cents to $91.35 a barrel..
UN Rights Official Blasts U.S. Sanctions on Iran -- A senior UN human rights official has issued her final report on her visit to Iran, criticiz- ing unilateral sanctions imposed on the country, calling for the re- moval of unilateral coercive meas- ures (UCMs), and asking the world body to come up with mechanisms of compensation for victims of such measures. Alena Douhan, UN special rap- porteur on the negative impact of unilateral coercive measures on the enjoyment of human rights, paid an 11-day visit to Iran in May, meeting with the country’s human rights officials and members of nongovernmental organizations. She said at that time that her visit was aimed at gathering information on the impact of sanctions in order to hold countries imposing such unilateral measures to account. On Monday, Iran’s High Coun- cil for Human Rights released the main highlights of Douhan’s report, in which she has given a detailed account of the impact of unilateral sanctions on various economic, fi- nancial, medical, and humanitarian aspects of Iranians’ life, calling for countries imposing those sanctions to remove them in accordance with the rules of international law. “Since 1979, the U.S. has im- posed economic, trade and finan- cial sanctions, with a compre- hensive trade ban since 1995 and significant measures to isolate Iran from the international commercial and financial system... However, since the mid-2000s, a series of executive orders and specific laws have created a broad and compli- cated framework of prohibitions and bans, which intensified after 2010 and extended to the energy sector and other key economic sec- tors,” she said.
Israeli Prime Minister Announces In Berlin: Iran Nuclear Talks "Dead" --In yet more confirmation that the long-running attempt to reach a restored JCPOA Iran nuclear deal has failed, a senior Israeli official representing Prime Minister Yair Lapid on Monday declared that Iran talks are "dead". This comes as the Israeli government has been touting its "successful" lobbying of the US administration to not go through with a 'bad deal': A senior Israeli official called on Europe and the US on Monday to begin talking about demands for a "longer, stronger" nuclear agreement with Iran, saying current talks aimed at reviving a 2015 pact were dead after Jerusalem provided proof that Tehran had not been forthright during negotiations.Lapid and his top aides were in Berlin Monday, where the Israeli Prime Minister says he passed German Chancellor Olaf Scholz "sensitive and relevant intelligence information" on Iran’s nuclear programThe day prior, Germany, France, and the UK issued a joint statement calling out Iran's sincerity and motives in seeking a restored nuclear agreement, citing "serious doubts" the Western signatories to the original JCPOA have. A senior Israeli official traveling with Lapid told reporters: "We gave information to the Europeans that proved that the Iranians are lying while talks are still happening." "There’s not going to be a JCPOA, say the Americans and most Europeans. They say, ‘We have a lot of reservations about the possibility of a nuclear agreement,'" the official added, as quoted in The Times of Israel. "There are no talks right now with Iran. There is no one in Vienna."
To extend offensive, Ukraine demands tanks but says Germany won't help - - — Ukraine’s ability to expel Russian forces from its country as soon as possible now depends largely on Germany and its willingness to send desperately needed armor, a senior adviser to President Volodymyr Zelensky said Tuesday. We're following changes at the palace after the passing of Queen Elizabeth II. Get the Post Elizabeth newsletter for updates. But Germany is balking, causing deep frustration in Kyiv. It is an echo of the earliest days of the invasion, when Berlin was derided for offering helmets when Ukraine needed heavy weapons. “Germany needs to understand that the timeline for the end of the war is dependent on its position,” Mykhailo Podolyak, a top adviser to Zelensky, told The Washington Post in an interview on Tuesday. A sweeping counteroffensive in the northeastern Kharkiv region has forced Russian soldiers into a hasty retreat and returned more than 1,100 square miles to Ukrainian control, a potential turning point more than six months into the war. Kyiv believes the requested heavy armor — including battle tanks and personnel carriers — could help shift that turning point into a tipping point. Ukrainian officials are now urging their Western partners to provide them with more weapons immediately. “The faster we receive this or that weapon from Germany, the faster Germany finally breaks this feeling of closeness with Russia, the faster the war will end,” Podolyak said. He said that Ukraine is specifically asking for armored personnel vehicles and tanks to be able to support its battlefield momentum. But Germany, so far, has been unwilling to grant the request. The German government did not respond to a request for comment on Tuesday night, but has emphasized it is coordinating its response with allies. “No country has delivered Western-built infantry fighting vehicles or main battle tanks so far,” German Defense Minister Christine Lambrecht said in an event in Berlin this week. “We have agreed with our partners that Germany will not take such action unilaterally.”
Armenia Requests Russian Military Assistance As Fighting Breaks Out With Azerbaijan -- The overnight outbreak of fighting in multiple spots along the Armenian-Azerbaijan border is serious enough for Yerevan to have asked for its powerful ally Russia's help. This has been revealed hours after Armenian Prime Minister Nikol Pashinyan held a late night telephone conversation with President Vladimir Putin. The Armenian government has since confirmed it has requested Russian military assistance to repel Azerbaijan aggression and shelling, according to a statement (machine translation):"During the meeting, further steps were discussed to counter the aggressive actions of Azerbaijan against the sovereign territory of Armenia that began at midnight. In connection with the aggression against the sovereign territory of the Republic of Armenia, it was decided to officially appeal to the Russian Federation in order to implement the provisions of the Treaty of Friendship, Cooperation and Mutual Assistance, as well as to the Collective Security Treaty Organization and the UN Security Council. Armenia is basing the request on the Collective Security Treaty Organization pact it has with Russia, and under which Russia previously sent peacekeeping forces to Nagorno-Karabakh after the Fall 2020 conflict. Independent geopolitical analyst and Russia watcher Clint Ehrlich concludes of the hugely significant request at a time the Ukraine war is raging: "If Russia accepts, we could see a second NATO-Russia proxy war explode."
Speculation Over What Russia Does Next by Yves Smith --A curious community that doesn’t buy conventional wisdom on the conflict in Ukraine has been following it attentively and offering often ahead-of-the curve views and information that doesn’t get into the Washington Post. I’ll shortly turn to its latest hot topic, how much if at all Russia will change course after the much-lambasted pullback out of Kharkiv (which some argue persuasively isn’t strategically important but is at a minimum a big PR blow in a very much PR driven conflict).I’ve been arguing privately with Lambert for some time that time is on Russia’s side, from a military and even more an economic perspective. There’s no particular reason Russia has to pick up the pace absent the West doing something actually game-changing, as opposed to touted as such, or the Russian hawks getting the upper hand.1Russia is conducting a war of attrition on multiple fronts: military with Ukraine; military with NATO, the US, and Europe; economic with the “collective West”; and geopolitical by using the Ukraine conflict as a case study in how the European powers are still able to engage in colonialism through the self-serving “rules based order”.But there’s a robust debate among contrarian kinetic/economic war watchers, such as Alexander Mercouris and Alex Christaforu of The Duran, Brian Berletic of New Atlas, Dima of Military Summary, Moon of Alabama, Andrei Martyanov, Larry Johnson, and particularly on the topic of whether and how hard Russia should respond 2 This group often, in a much smaller version of the Iraq War and pre-financial crisis blogospheres, promote and critique each other’s work. There are some other prominent commentators who present their own views and don’t interact much/at all with these YouTube and blog commentators, such as Scott Ritter, Douglas MacGregor, and the Twitterati like Russians with Attitude and @AZmilitary1. This group also has very different relationships with Russian Telegram, which if nothing else seems to have a lot of gossip and war porn. Some clearly make heavy use of it while others like Andrei Martyanov are dismissive or like Ritter and Macgregor, rely on other sources.And it was Alexander Mercouris, at the end of his broadcast on Wednesday, made an articulate and integrated case for what I’ve been saying in fits and starts. Russia can carry on the war at its current pace indefinitely. It has the production capacity to do so. The toll in dead and wounded is tolerable. By contrast, Western material support to Ukraine is falling despite efforts to pretend otherwise. The latest NATO, really US, package, was $2.2 billion, half going to 18 other nations, and the half for Ukraine consisting mainly of training, not weapons. Similarly, it is an open question about what happens in Europe as the energy crisis goes from bad to critical. The current non-response is to try to limit consumer power prices. That still won’t stop the most desperate from being harmed. And artificially low prices amounts to subsidizing consumption, which means the acute phase will hit earlier and harder than it would otherwise. What happens when businesses and families suffer rolling blackouts? At a bare minimum, it will be hard to work up much enthusiasm for the Ukraine project.In addition, Ukraine’s focus on PR priorities, like never falling back to regroup and save lives, has made the war even more costly than it should have been, and that’s still pretty pricey. Even this bizarrely slow-tempoed war has chewed through pretty much all of Ukraine’s initial armored vehicles and artillery. It only has a pretense of an air force left. The Ukraine skeptics argue, and can point to strikes on command centers and broken battalions being recombined as proof, that the war has depleted Ukraine’s experienced fighting men, particularly the seasoned ones. Those losses can’t be replaced on the fly. And even fairly new armed force members are still much more effective than raw recruits.
Brazilian corn exporters face bureaucracy to ship corn to China - Brazil is still processing the documentation from firms interested in exporting corn to China, as well as preparing to inspect grain warehouses at ports, the agriculture ministry said. Once this process is concluded and the information is sent to the Chinese, Brazil will remove the final obstacles to be able to export, the ministry added. In addition to corn, Brazilians are also getting ready to sell other agricultural products such as soymeal to China, a country that is already the largest importer of soy, meat and sugar from Brazil. “Depending on the number of requests (for registrations) and our capacity to respond (document analysis and inspections), a deadline will be set for sending the first lists (of approved companies) to China,” the ministry said to answer a question from Reuters. The ministry also noted that corn exports to China “are already authorized” but hinge on these final bureaucratic procedures. Companies interested in exporting corn, soymeal, citrus pulp and soy protein to China had until Aug. 26 to submit applications for registration in the ministry’s general registry of classification. Of these products, corn is seen as the one with the greatest potential to command the largest export volumes. “It’s in the bureaucratic phase… These warehouses have to be inspected by ministry, authorized and registered,” said a source in the export sector, on condition of anonymity. According to this person, inspections are expected to kick off at Santos port, Brazil’s biggest. The sale of Brazilian corn to China marks a historical moment in bilateral trade relations, and come as grain supplies from Ukraine are blocked because of the war. Still, Brazil’s corn exports to China are unlikely to be as large as those of soybeans, as the Chinese are also big corn producers.
India’s rice export curbs trap 1 mln T at ports as buyers refuse to pay duty Rice loading has stopped at Indian ports and nearly one million tonnes of grain are trapped there as buyers refuse to pay the government’s new 20% export levy on top of the agreed contract price, five exporters told Reuters. India banned exports of broken rice and imposed a 20% duty on exports of various other types on Thursday as the world’s biggest exporter of the grain tries to boost local supplies and calm prices after below-average monsoon rainfall curtailed planting. “The duty became effective from midnight, but buyers are not ready to pay the duty,” said B.V. Krishna Rao, president of the All India Rice Exporters Association (AIREA). “We have stopped loading vessels.” India ships around two million tonnes of rice every month, with large amounts loaded from eastern ports such as Kakinada and Visakhapatnam in Andhra Pradesh state. In similar circumstances, New Delhi has in the past provided exemptions for contracts backed by letters of credit (LCs), or payment guarantees, issued until the day the government made a policy change, said Himanshu Agarwal, executive director at Satyam Balajee, India’s biggest rice exporter. But that has not happened this time. “Margins are wafer-thin in rice business and exporters can’t afford to pay 20% duty. The government should allow exports against already issued LCs,” Agarwal said. New Delhi allowed exports against already-issued LCs when it banned wheat exports earlier this year. Around 750,000 tonnes of white rice are lying at ports, which attracts 20% duty from Friday, traders estimate. As for the broken rice ban, India has allowed the loading of consignments that have been handed over to customs or where the ship anchored before Thursday’s notification. But loading needs to be completed before Sept. 15. At least 350,000 tonnes of broken rice lying at various ports do not meet these criteria, and moving cargoes back to the hinterland is not possible, said a New-Delhi based dealer with a global trading firm. Stuck broken rice shipments were heading to China, Senegal, Senegal and Djibouti, while other grades of white rice were bought by buyers in Benin, Sri Lanka, Turkey and the United Arab Emirates, exporters said.
Alarm Bells Sound As World's Second Largest Appliance Company Reports Demand Plunge - Swedish appliance maker Electrolux AB announced a cost reduction program after reporting a plunge in demand for its home appliances across Europe and the US. The world's second-largest home appliances manufacturer after Whirlpool said, "market demand for core appliances in Europe and the US so far in the third quarter is estimated to have decreased at a significantly accelerated pace compared with the second quarter, driven by the impact of high inflation on consumer durables purchases and low consumer confidence." It noted: "High retailer inventory levels have amplified the impact of the slowdown in consumer demand." Remember, there's a massive inventory glut of consumer goods at retailers. Electrolux warned a combination of snarled supply chains had pressured the company, which is expected to report an even more significant operating loss in the third quarter. "In combination with supply chain imbalances resulting in significant production inefficiencies and increased costs, the third quarter earnings for the Group are expected to decline significantly compared to the second quarter 2022 also excluding the one-time cost to exit the Russia market. This has been driven mainly by Europe and North America. Business Area North America is expected to report an operating loss in the third quarter exceeding the loss in the second quarter."
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