Oil fell to the lowest in a week as output slowly resumed in Texas, while margins for processing gasoline surged as Gulf Coast refineries are seen taking weeks to restart operations after the deep freeze.
West Texas Intermediate (WTI) for March delivery on Friday fell US$1.28 to US$59.24 a barrel, its biggest decline in US dollar terms since late December last year.
Producers including Marathon Oil Corp are using restored power from grids or generators to resume output that was halted by the frigid weather this week in the Eagle Ford shale basin.
Photo: Reuters
Meanwhile, fuel margins jumped with four of the biggest refineries in Texas seen taking several weeks to resume operations, raising the potential for fuel shortages.
EXCESS CRUDE
“Gasoline crack spreads have exploded, and for good reason,” said Andrew Lebow, a senior partner at. “Crude production is going to come back up a lot faster than refineries, leaving more crude available than there will be demand for it coming up over the next few weeks.”
Oil is still up more than 20 percent this year due to Saudi Arabia’s unilateral output cuts in February and March and an improving demand outlook.
SAUDI OUTPUT CUTS
The market largely expects Saudi Arabia to roll some of the output cuts back, “but how much they try and bring back is the question mark we’re all waiting for,” said Gary Cunningham, director at Stamford, Connecticut-based Tradition Energy. “We don’t see them discontinuing the cut entirely. We still haven’t seen the recovery in global demand, even though there’s all kinds of positive outlooks.”
There should be only a small and transitory impact on global oil prices from the US freeze as the supply and demand impacts balance out, Goldman Sachs Group Inc said.
Still, Brent’s nearest timespread remains at one-year highs in a structure indicating tighter supplies and WTI’s discount to Brent has widened further past US$3 a barrel this week, as replacements are sought for US crude exports.
Brent crude for April delivery declined US$1.02 to at US$62.91 a barrel.
The cold snap and power cuts affected more than 20 refineries in Texas, Louisiana and Oklahoma. Crude-processing capacity fell by about 5.5 million barrels a day, Energy Aspects Ltd chief oil analyst Amrita Sen said.
Google on Thursday restructured its responsible artificial intelligence (AI) efforts to centralize teams under a single executive, Marian Croak, a move by the Internet giant to stabilize groups working on ethics research and products after months of chaos. Croak, a vice president of engineering, would be the lead for the Responsible AI Research and Engineering Center of Expertise, she said in a YouTube video announcing her appointment. The Alphabet Inc unit has sought to defuse employee rancor stemming from the acrimonious departure of a prominent black researcher, Timnit Gebru. Croak, a black Google executive who is currently focused on site-reliability matters, would report
‘LESS DUMB’ LIQUIDITY: If more companies start to speculate in cryptocurrency, ‘we’re going to be in bubble territory before you know it,’ a market analyst said Bitcoin is closing in on a market value of US$1 trillion, a surge that is helping cryptocurrency returns far outstrip the performance of more traditional assets such as stocks and gold. The largest token has added more than US$415 billion of value this year to about US$956 billion, data compiled by Bloomberg showed. The Bloomberg Galaxy Crypto Index, which includes bitcoin and four other coins, has more than doubled. Speculators, corporate treasurers and institutional investors are thought to have stoked bitcoin’s volatile ascent. Crypto believers are dueling with skeptics for the dominant narrative around the climb: The former see an asset being
PUNCTURE-PROOF: Air Fom tires are made of material used in sports shoe soles and offer a comfortable ride, although people are still skeptical about solid tires Getting a flat tire is a nightmare for cyclists, sending home early any rider who had ventured outdoors without a repair kit or spare inner tubes. Although punctured tires have long been a pain point for cyclists, the problem has never been effectively resolved, despite the bicycle industry going back centuries. A few products have been developed to help reduce the likelihood of flat tires: puncture-resistant tires, which are thicker than usual tires or come with a protective layer; anti-puncture tapes, which are placed between the tire and inner tube to offer extra protection; and tubeless systems that use sealant to close
LONG-TERM PLAN: The company expects growth in revenue from its automotive business this year and that it would contribute meaningfully to sales from 2023 Hon Hai Precision Industry Co’s (鴻海精密) new electric vehicle (EV) platform is expected to help launch vehicles later this year, chairman Young Liu (劉揚偉) said on Saturday, signifying major progress in the electronics giant’s push into the automotive industry. Two light vehicles designed using the company’s MIH Open Platform would be unveiled in the fourth quarter, Liu told reporters at the company’s headquarters in New Taipei City’s Tucheng District (土城). Hon Hai might at the same time also help launch an electric bus, he said. Hon Hai has been seeking to expand its automotive capabilities at a time when technology companies including
RSS