U.S. Shale’s New Recovery

The United States’ oil and gas sector has proved to be incredibly resilient time and time again and following the devastating effects from COVID-19 in 2020 they’ve shown a new discipline to strengthen balance sheets, pay down debt and pay dividends to their shareholders.  Traditionally the U.S. shale patch would immediately start boosting production after getting out of a downturn, but the current approach is already turning out to be successful.  The U.S. continues to have low interest rates to help spur the economic recovery, and U.S. shale companies are taking advantage of the low rates to reduce existing liabilities as opposed to drilling more wells. Read More

Pipeline Disruption

Earlier this week, the U.S. and Germany announced they would come to an agreement resolving the long dispute over Russia’s $11 billion Nord Stream 2 pipeline project. The project is an offshore natural gas pipeline that runs under the Baltic Sea from Russia to Germany. The project began in 2018, with plans for completion sometime this year. The U.S., Poland, and Ukraine fear that it could give Russia too much leverage in Europe.

The pipeline spans 764 miles and will double the current capacity of the original Nord Stream pipeline which was completed back in 2011. The pipeline is planned to supply gas to Germany where they are heavily dependent on gas and oil imports. Read More

Will Rush Hour Gas Demand Return this Fall?

Gas Demand

As the summer heats up, the question remains, will  Americans eventually return to the office? And will the rush hour gas demand return?

According to Gallup, in April 2020 70% of Americans worked remotely.  As of June of 2021, the number decreased to 56% of Americans working remote.  According to a study by LaSalle Network, 70% of companies want employees back in the office in some capacity by this fall.

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Talks of Iranian Nuclear Deal

Today the Biden Administration discussed easing sanctions against Iran which would include oil as a key element. After a five day talk in Vienna this week, leaders returned home feeling optimistic after discussions that President Biden wants to return to the 2015 nuclear agreement that the U.S. withdrew from during the Trump administration in 2018.
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Return To The Deal?

Last week, several world powers convened in Vienna, Austria to revive the 2015 Iran nuclear deal. Senior officials from the governments of Iran, United States, France, United Kingdom, Germany, Russia, China, and the European Union aim to determine the next steps the United States and Iran need to take to get back into compliance. The United States has not been in direct talks with Iran but is relaying messages mainly through European members in attendance. Read More

How much ethanol is headed for China?

Last week, three ships carrying ethanol from the U.S. Gulf Coast were headed to China. Reuters confirmed, from multiple sources, that this is a sign that fuel exports were increasing from the U.S. to China. These ethanol shipments may be enough to surpass the total amount of ethanol exported from the U.S. to China in 2020.

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U.S. Blacklists More Chinese Firms

As President Trump’s term comes to an end, the administration continues to tighten restrictions on Chinese companies as the U.S. Department of Commerce blacklisted CNOOC (China National Offshore Oil Corporation) on Thursday. CNOOC was blacklisted for helping China intimidate neighbors in the South China Sea which threatened U.S. national security. The Department of Commerce stated, “CNOOC has repeatedly harassed and threatened offshore oil and gas exploration and extraction in the South China Sea, with the goal of driving up the political risk for interested foreign partners, including Vietnam.” The Commerce Secretary Wilbur Ross also said, “CNOOC acts as a bully for the People’s Liberation Army to intimidate China’s neighbors, and the Chinese military continues to benefit from government civil-military fusion policies for malign purposes”. The South China Sea has been a lasting point of contention due to the oil contained in that area.

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U.S. and China Relations at a New Low?

United States and Chinese trade relations appear to have hit a new low after White House trade adviser Peter Navarro said that the trade deal was “over” on Fox News last night. Navarro later walked back his comments and said that his comments were taken out of context and, “was simply speaking to the lack of trust we now have of the Chinese Communist Party after they lied about the origins of the China virus and foisted a pandemic upon the world.”

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Continuous COVID-19

With California reporting a new daily high for new COVID-19 cases, 4,515 new cases on Sunday, the continual concern for virus spread should still be at the top of everyone’s priority list. Over just the last two weeks The United States has seen a 15% case increase. Typical travel destinations in the southeast and on the west coast seem to be the most dramatically affected. The work we have all put in to “flatten the curve” may all be for naught if we, as a nation, continue to jump back to the norm too early. Hospitals are feeling the effects of the dramatic spike in cases already. The White House is making efforts to concentrate on stocking up supplies to combat a potential COVID-19 case rise this coming Fall as lower temperatures may increase the spread.

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Unemployment Rates Surprisingly Fall and Post-Corona Recovery Begins

Unless you’ve been living under a rock since February 2020, you’ve probably noticed the economic impact worldwide of the novel corona-virus, Covid-19. There has been little to no positive news even as Governors ease restrictions and states/counties move from red to yellow to green phases, until the May 2020 unemployment rates were released days ago. According to the Bureau of Labor Statistics, May saw an increase of 2.5 million jobs and an unemployment rate of 13.3%, down from April’s 14.7%. This number came as a overwhelmingly positive shock as most experts had predicted it to increase to near 20%, the worst figure since the Great Depression.[1]

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