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CANADA CRUDE-Western Canada Select trades at steepest discounts ever since March
The difference between the West Texas Intermediate benchmark futures and Western Canada Select futures, which is North American benchmark, has narrowed slightly on Thursday. However, it remains larger than ever before. CalRock reported that WCS for Hardisty, Alberta delivery in January settled at $12.85 per barrel, which is lower than the U.S. benchmark WTI. This compares to $13 Wednesday. The WCS discount on increased Canadian oil production has recently increased after spending most of the year in historically tight levels. This is largely due to the Trans Mountain expansion pipeline which has provided additional export capacity for Canadian oil producers. According to government statistics, the oil-producing province Alberta has set a record for production in 2024 with an average of 3.98 million barrels per day. The first 10 months of the year 2025 have been 3.8% higher than the same period of last year. * Oil prices fell globally on Thursday as investors waited for the Federal Reserve's interest rate cut. Meanwhile, the stalled Ukraine talks dampened expectations that a deal would be reached to restore Russian oil supplies. (Reporting from Amanda Stephenson, Calgary; Editing done by Maju Sam)
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Brazil 2026 Budget Sponsor proposes $1.9 Billion Exclusion for State-run Firms' Fiscal Target
Gervasio maia, the Brazilian congressman who sponsored the bill on budget guidelines for 2026, proposed to exclude up to 10 billion reals ($1.9 billion) of next year's fiscal goal for state-owned enterprises. According to Maia’s amendment, this amount will cover the expenses of companies that have an active and approved economic-financial plan. The proposal gives President Luiz inacio Lula da Silveira fiscal flexibility. It comes at a time when the postal service Correios is facing a cash crisis. Last month, it approved a restructuring program as its losses soared this year. This raised doubts over the viability of state-run Correios. The company reported a loss for the year to date of 6 billion reals ($1.13 billion), nearly three times the amount reported a year ago. The government has to compensate state-owned companies when they exceed their fiscal targets. This often means freezing federal spending. This is what happened with this year's Budget, when the government in November approved it. It was necessary to offset the 3 billion reais deficit that had been expected at state-owned firms due to Correios’ troubles. Maia removed from her proposal a clause on compensation. This effectively prevents the government from implementing it in the event that state-owned companies miss their targets next year. After the bill was passed, the change to the budget proposal for 2026 was announced ahead of the joint session of the Congress on Thursday. Committee approval is expected to be made on Wednesday. Correios stated earlier this week that the Treasury Blockage It was prevented from taking out a loan of 20 billion reais (3.67 billion dollars) from a bank consortium with a guarantee from the government because the interest rates exceeded the limit for deals backed by the state. ($1 = 5.3048 reales) ($1= 5.3133 reales) (Reporting and editing by Diane Craft; Marcela Ayres)
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Irish media reported that drones were spotted near Zelenskiy's flight path from Dublin.
Local media reported that an Irish navy ship saw up to five drones near the flight path for Ukrainian President Volodymyr Zelenskiy as he arrived in Ireland on Monday to make a state visit. Irish Times reported that the sighting caused a major alert due to fears of an attempted interference with the flight path. The Irish Times cited unnamed sources who said that the aircraft was not in danger, despite its arrival a little early. The Ukrainian delegation arrived on Monday late and left late the following day, as part of an effort to drum up support for Kyiv in Europe as Russia continues its war against Ukraine. Recent drone flights in Europe have disrupted airspace operations. Their origin is mostly unknown. Ursula von der Leyen, President of the European Commission, has called these incursions hybrid warfare. The Journal website first reported that drones were spotted at Dublin Airport. They said they arrived at the exact location where Zelenskiy’s plane had been expected to be, at the exact time it was due to pass. The authorities said they were conducting investigations to determine if the drones had taken off from a ship or landed on land. Both news outlets reported that they were first seen northeast of Dublin at a distance of around 20 km (12miles) from the airport. Ireland's Defence Forces stated that it could not comment on any specifics about any alleged incident for operational security purposes. A spokesperson stated that "however, the Defence Forces' support to An Garda Siochana's (police) security operation was successfully deployed by multiple means, ultimately leading to a successful and safe visit,"
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US investigations report that Waymo's self-driving car illegally passed 19 school buses in Texas
The U.S. government said Thursday that it had asked Waymo for more information after Texas officials claimed that Alphabet's self-driving cars had passed school buses illegally 19 times since the beginning of the school year. In October, the National Highway Traffic Safety Administration launched an investigation after an incident that occurred in Georgia. A Waymo was not stationary as it approached a school bus while its red lights were flashing and its stop arm was deployed. The Austin Independent School District posted a letter on November 20, 2018 by the NHTSA. In the letter, they stated that five incidents had occurred in November following the announcement from Waymo that it had updated its software to fix the problem. They asked the company not to operate around schools at pick-up or drop-off hours until it was able to ensure the vehicles wouldn't violate the law. Waymo didn't immediately respond to an inquiry for comment. A lawyer for the district wrote: "We cannot let Waymo continue to endanger our students as it tries to fix the problem." Citing an incident in which a Waymo was "recorded" driving past a school bus that had stopped only moments after the student who crossed in front, while still on the road, had been in front of the vehicle. A spokesperson for the school district did not respond immediately to whether Waymo had met this request. NHTSA was prompted by the letter to ask Waymo if it would comply to the request that self-driving vehicles cease operations during pick-up or drop-off hours for students. They also asked: "Was a software fix developed or implemented to mitigate this concern?" If so, will Waymo file a recall to fix the problem? In a letter sent to Waymo by the NHTSA on Wednesday, it demanded answers to questions about school bus incidents and software updates that address safety concerns. David Shepardson is reporting.
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US investigations report that Waymo's self-driving car illegally passed 19 school buses in Texas
The U.S. government said on Thursday that it had asked Waymo for more information after Texas officials claimed that Alphabet's self-driving cars had passed school buses illegally 19 times since the beginning of the school year. In October, the National Highway Traffic Safety Administration launched an investigation after a Georgia incident where a Waymo failed to remain stationary as it approached a school bus that had its red lights flashing with a stop arm deployed. In a letter published by NHTSA on Nov. 20, the Austin Independent Schools District stated that five incidents had occurred in November, after Waymo claimed to have made software updates to fix the problem. The district asked the company to stop operations near schools at pick-up or drop-off hours until it could be ensured the vehicles wouldn't violate the law. Waymo didn't immediately respond to an inquiry for comment. David Shepardson reports.
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Sources: Deutsche Bahn will return to profitability this year and next.
According to sources close the company, Deutsche Bahn will return to profitability this year and next, despite its underinvestment in trains and delays. After more than a decade underinvestment by the state-owned Deutsche Bahn, it has begun upgrading its tracks and overhead lines, as well as cutting administrative costs. This has led to major delays and cancellations across the country. Positive outlook is also a result of CEO Evelyn Palla's task to turn the company around. She took over on October 1. Palla will present her restructuring plan for the company at a meeting of the supervisory board scheduled to take place on Wednesday. Significant job cuts are expected. Deutsche Bahn has declined to comment. Sources said that the company expects a slightly positive profit before interest and tax (EBIT) in 2025 after a loss last year of 388 million euros. EBIT is expected to reach 500 million euros by 2026. The German Bahn also aims at reducing its net loss from 820 million euros to 180 million next year. Revenues are expected to stay stable, around 28 billion euro next year.
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Senators in the US want airlines to compensate passengers for delays with cash
A group of Democratic Senators introduced legislation on Thursday that would require airlines to compensate passengers for significant delays with cash. Mark Kelly, Ed Markey, and Richard Blumenthal, senators who are leading the charge, propose to mandate compensation that is in line with European Union (EU) and Canadian requirements. This includes mandating a minimum of $300 for delays of over three hours, and a minimum of $600 for delays of six hours or longer. This proposal was first reported on by after President Donald Trump's administration withdrew his predecessor's plan to force airlines to compensate passengers for flight delays caused by carriers. Kelly said that airlines must be held accountable for their actions when they leave travelers stranded and cost the American public money. "We are working to protect passengers so that they don't have to pay for cancellations or delays out of pocket." The U.S. Transportation Department, under the then-President Joe Biden in December 2024 sought public comments on writing rules that would require airlines to pay up to $775 per hour for delays exceeding three hours domestically. Airlines for America (a trade group that represents American Airlines, Delta Air Lines and United Airlines) had previously criticised Biden's plan for cash compensation, claiming it would increase ticket prices. USDOT stated last month that the rule would create "unnecessary regulations burdens," which is why it wouldn't go forward. In the United States, airlines are required to refund customers for cancelled flights but not compensate them for delayed flights. All four countries - the European Union, Canada and Britain - have rules on airline compensation for delays. No major U.S. airlines currently guarantee cash compensation for flight delays. USDOT announced in September that it would consider rescinding the Biden regulations, which required airlines and ticket agents disclose service fees along with airfares. The Trump administration plans to also reduce regulatory burdens for airlines and ticket agents. This will be done by writing new regulations that define a cancellation of flight, which entitles the consumer to a refund. It will also revisit rules regarding ticket pricing and advertising.
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Mercuria's copper takeover from LME Asia increases supply anxiety
Four sources with knowledge of the matter have confirmed that commodity trader Mercuria plans to remove significant quantities of copper from London Metal Exchange storage facilities in Asia. Prices are rising on account of expectations of a shortage. LME copper prices reached a record of $11,540 per metric ton Wednesday, partly because of anticipated shortages in the coming year due to disruptions to mine supplies including accidents and incidents in Indonesia and Chile. Mercuria, a Swiss company, has cancelled or designated for delivery over 40,000 tonnes of copper stored in LME facilities in South Korea. Taiwan Sources familiar with the situation say that copper was discovered on December 2. The value of copper at current prices would be $460,000,000. Mercuria declined comment. The LME approved warehouses that store copper for the construction and power industries have historically low inventories, which has contributed to an increase in prices in recent months. Copper is a major export from the LME, and prices in the United States are high. This is despite the fact that copper has been exempted from the import tariffs which came into effect on August 1. On December 2, the total amount of copper warrants that were cancelled - documents that confer ownership - was 56,875 tonnes or 35%. LME stocks Mercuria's action helped to boost the premium for cash copper contracts over the three-month ahead price . On Wednesday, premiums, which have been on an upward trend since November, reached $88 per ton, the highest level since October 13. Comparatively, a contango or discount of around $35 was offered on November 19, Last year, the premium per ton was around $38. As the settlement date of December 17 nears, traders expect even higher premiums on cash contracts. Companies with short positions must find copper in order to fulfill their contracts against them or roll them over - a process known as a "short squeeze". According to industry sources, cancellations are more frequent in contango markets where the prices of contracts with longer dates are higher than nearby contracts. It is rare to cancel warrants in a backwardated market, as the premium is usually intended to encourage deliveries at the LME.
China's weak diesel consumption squeezes outlook for oil demand
China's plunging consumption of diesel, as usage of LNGpowered trucks grows, is weighing on domestic fuel need, with forecasters alerting of additional risks from a slow economy hobbled by a prolonged crisis in the residential or commercial property sector.
While the world's second biggest economy was long the development engine for global oil need, its peaking cravings for transport fuel, as an energy transition collects pace in a sputtering economy, is now moistening world markets.
In the 2nd quarter, international oil need development was its slowest given that late 2022, driven by a contraction in Chinese consumption, the IEA's July oil market report revealed.
Weak demand from production and building and construction is anticipated to continue the second half as the world's leading importer of oil comes to grips with a listless realty sector that binds about 70% of its family wealth, while external risks grow.
China's manufacturing sector is beginning to slow down - going by PMI figures - specifically as its 'export-led' growth model is no longer tenable, stated Zameer Yusof, principal middle distillates analyst at analytics firm Kpler.
This is a function of both relatively slow worldwide economic development, and likewise continuous U.S. tariffs on Chinese products.
As gasoline use plateaus, oil need growth in the world's. second-largest consumer is set to slow to just under 3% in 2024,. analysts state, off the previous decade's average of 4.6% and last. year's rebound of 11.7% from three years of COVID-19 curbs.
Four of 5 analysts in a Reuters survey stated they expected. second-half diesel demand to fall, between 2% and 7% on an. yearly basis, to range from 3.81 million to 4.67 million barrels. per day (bpd).
The finding comes after China's oil intake contracted. in the 2nd quarter, pushing its refiners to cut fuel output. and imports of crude.
Diesel need is the most slow sector within oil need. in the 2nd half, with significant displacement ... in the. trucking sector, said consultant Xia Shiqing of Wood Mackenzie,. which anticipates China's second-half diesel need to fall about 2%. to 3.93 million bpd.
As increasing varieties of LNG-powered trucks wear down demand for. diesel, speeding up sales of electric vehicles suggest China's. need for transport fuel is nearing its peak. Gas and. diesel make up more than 40% of the nation's oil need.
The International Energy Agency has actually been modifying down its. 2024 oil product demand forecast for China each month since. January, while consultancies such as FGE and Kpler have also. trimmed some of their need projections.
Kpler expects second-half diesel need to grow by 4%. every year, a downgrade from its previous forecast, including that it. may even more cut its forecast in future.
In a note to customers, FGE experts said, Despite the end of. peak refinery upkeep, persistently weak diesel demand and a. downturn in gasoline usage supplied little reward for. refiners to increase.
They added, There is no pressing need for more products (of. the fuels) in the domestic market.
FGE changed its diesel need forecast downwards to a year. on year decrease of 5% in the second half, versus a drop of 1.2%. previously.
SHIFT TO LNG
Traditional fuel usage is slowing as sales of trucks running. on LNG soared 307% to 152,000 in 2015, information from Chinese. details supplier CV World showed.
An LNG-fueled truck costs about 80,000 yuan ($ 11,021) more. than a similarly-powered diesel truck, but fuel cost savings allow. the expenditure to be recouped in about 190 days, research firm. Horizon Insights stated.
Woodmac estimates fuel for an LNG heavy-duty truck costs. about 1.7 yuan a km, less than diesel's cost of 2.8 yuan. Each. LNG truck displaces 13 metric heaps (97 barrels) of annual diesel. need, the consultancy stated.
Kpler approximates LNG will displace 140,000 bpd of diesel in. the period from May to December, while FGE forecasts 110,000 bpd. to 120,000 bpd of diesel displacement from LNG in both 2024 and. 2025.
LNG-based trucks might make up nearly a tenth of the. heavy-duty truck fleet by 2025, state analysts at information. intelligence company ICIS.
FUEL, JET FUEL
Gasoline need, which accounts for a fifth of China's oil. intake, is expected to broaden partially in the 2nd. half, forecasts say, as EV sales continue to grow.
Rystad and Woodmac expect annual development of 1.2% and 1%. respectively, to 3.45 million bpd and 3.97 million bpd, in the. second half, while FGE anticipates need to remain flat.
Longzhong expects second-half demand to shrink 3.52% on the. year to 3.87 million bpd, as EVs represented nearly 40% of vehicle. sales in the 2nd quarter.
Fuel demand is now at the last leg of growth and upside. is restricted from next year, said Mia Geng, FGE's head of China. oil analysis, who forecasts intake to plateau within 12 to. 18 months.
Air travel fuel is the primary development sector for China's refined. fuel use, thanks to pent-up travel need, with experts. forecasting on-year growth of 8% to 15%, to between 870,000 bpd. to 1.04 million bpd, in the second half.
The number of domestic flights is already 10% higher than. before the pandemic, while international flights have recuperated. to 75%, WoodMac's Xia said, including that second-half need. ought to close 30,000 bpd greater than in the very same 2019 duration.
Although China has actually presented a raft of visa-free procedures. because December to further promote incoming travel demand,. foreign arrivals stood at simply 14.6 million in the very first half,. online travel bureau Trip.com stated.
That suggests bookings need to more than double in the 2nd. half to match 2019's figure of 49.1 million overseas visitors.
Reflecting weak need, Chinese refinery throughput in the. first half was down 0.4% on the year at 360.09 million metric. lots (14.44 million bpd), official information revealed, with Sinopec,. Asia's largest refiner, cutting diesel output 8.8% as domestic. sales of refined fuel fell 2.5%.
FGE expects refinery go to drop 200,000 bpd annually in. the 2nd half to 14.7 million bpd, while Kpler forecasts crude. intake averaging 15.9 million bpd from July to December, little bit. changed from 15.81 million bpd a year previously.
(source: Reuters)