Guest “the gas tank is half-full” by David Middleton.
May 11, 2020 10:03 AM UPDATED 2 HOURS AGO
Commuters choose cars over public transport to avoid exposure to coronavirusJavier Blas, Vanessa Dezem and Sarah Chen
BloombergLONDON, BEIJING, FRANKFURT — James Li, a public relations account director, would rather spend an hour sitting in Beijing traffic than risk 30 minutes exposed to crowds on a train. “Traffic is as bad as it could be” but the subway is still too dicey,” he said.
In Frankfurt, real estate assistant Anna Pawliczek is driving to work for the first time in her career. “I definitely have always preferred to chill out in the train, instead of being stuck at traffic lights,” she said.
But days after Germany ended its lockdown, her company is asking returning employees to avoid public transportation at all costs.
Gasoline demand is rebounding, suggesting that the car — at least for now — is making a comeback. As lockdowns ease and parts of the world reopen for business, driving has emerged as the socially distant transportation mode of choice and is offering some near-term relief to an oil market fresh off its worst crash in history and reeling from an unprecedented collapse in energy demand.
“People are using more their cars because they are afraid to use public transportation,” Patrick Pouyanne, the CEO of French oil giant Total, said.
It’s too soon to say whether this change is permanent. In some parts of Asia that reopened earlier than the rest of the world, people are venturing back onto trains. And it’s unclear whether global gasoline demand will ever fully recover.
But on the streets of Beijing, Shanghai and Guangzhou, morning traffic is now higher than 2019 averages while subway use is well below normal, according to data compiled by BloombergNEF. Volume on Beijing’s metro system is 53 percent below pre-virus levels. Subway usage in Shanghai and Guangzhou is down 29 percent and 39 percent, respectively.
[…]
Automotive News Europe
Prior to the COVID-19 lockdown, US drivers consumed 9.7 million barrels of gasoline per day (week of March 13, 2020). By April 3, 2020, demand had collapsed to 5.1 million barrels per day as states imposed shelter in place orders. As of the week of May 1, 2020, demand had risen back up to 6.7 million barrels per day, and this was before most states began to reopen their economies.
The resurgence in the demand for fuel isn’t limited to automobiles. Carnival Cruise Lines reported a surge in bookings, when they announced that some cruises will resume in August.
Goldman Sachs’ global head of commodities research, Jeff Currie, expects a rapid recovery in all areas of petroleum demand, with the exception of air travel. Currie says that demand could exceed supply as soon as June 1…
“We believe demand will exhibit a V-shaped recovery, but supply will exhibit an L-shaped recovery,” he said, as wells need to come back online, and companies need to increase spending. This could mean demand rises above supply as early as June 1, he said.
But while demand returns to normal, it will be from a base with less business travel. “Before we used to have these internal meetings and things of that nature, and I think this is going to be way more Zoom-oriented, other types of substitutes,” he said.
“Look at the routes that the airlines are planning when they come back, they’re not going to be at the same level that they were previously.”
MarketWatch
While the recovery in petroleum demand has helped firm up oil prices, it will take a while for the built up surplus to be worked off.
However, there are some 1.2 billion barrels in storage, Currie added, that would need to be drawn down before prices improve for more than a couple of hours. This, according to Currie, will happen in three stages.
The first oil in storage to go would be the millions of barrels in floating storage. It is the most expensive kind of storage, so it would make sense that traders and producers would first aim to get rid of it to save on tanker fees. Currie says this will happen sometime in the third quarter of the year. The amount of oil removed from floating storage will be around 450 million barrels. In the fourth quarter of the year, oil stockpiles in onshore storage will begin to decline, Currie said, by up to 400 million barrels.
Oil Price Dot Com
The past two months have essentially been a trial run of the Green New Deal…
The COVID-19 Economy and a Taste of ‘Net Zero’
By ANDREW STUTTAFORD
May 7, 2020From a BBC report on the impact of the COVID-19 lockdowns on CO2 emissions:
To keep the world on track to stay under 1.5C this century, the world needs similar cuts for the foreseeable future to keep this target in view.
“If Covid-19 leads to a drop in emissions of around 5% in 2020, then that is the sort of reduction we need every year until net-zero emissions are reached around 2050,” said Glen Peters… from Cicero.
[Cicero is the Centre for International Climate and Environmental Research]
1.5C is the target that emerged from the Paris Agreement on climate change.
[…]
If something akin to the COVID-19 economy for decades is what you want, going for ‘net zero’ by 2050 may be a way to achieve it.
[…]
National Review
Unless people really like “the COVID-19 economy,” I don’t think they’ll want decades of it.
I just realized that today, May 12, is my 39th anniversary as an oil industry geoscientist. My first day as an Associate Geophysicist with Enserch Exploration in Dallas, Texas was May 12, 1981. How time flies!
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I think the inventory surplus, the 1.2 billion barrels, will be around longer and have a bigger impact on the market than we think. If it’s drawn down at the rate of 10 million bad, it will take 120 days, 4 months, to work it off. If it comes down at only 5 million bad, it will take twice as long. Compare this to the 2 – 3 million bpd cut that OPEC was discussing to balance the market before this whole thing started.
If the Chinese build a lot more storage tanks with their overcapacity in steel and go large with it, that will also be bad.
It is amazing how many “save the planet lifestyle items have turned out to be not only unnecessary but rather stupid.
Encouraging people into mass transit.
Car pools.
Expensive cars that catch on fire, are powered mostly by coal, have short range, and require hours to refuel.
Reusable shopping bags.
Those stupid water facets that only dribble out a few ounces of cold water if you move your hand just the right way under the nozzle.
No paper towels in public restrooms, but a door handle you must grip with your just washed hand, (or who knows how many unwashed hands) to exit the restroom………
Don’t forget the CAFE standards that forced the automakers to replace large, safe sedans with smaller, lighter, more easily crushed cars.
Bingo!!!
It is amazing though to watch consumers focus on MPG as they prepay for five years of gas consumption with their overpriced new purchase or buy less reliable and expensive to repair turbocharged 4 cylinders or ultralight cars with reliance only on airbags and plastic for safety. This culture shift forced on car companies and accepted by most consumers is interesting to watch. I guess it assumes the market will continue to be dominated by the throwaway generation of car buyers at 90 or 100k miles instead of 250k attainable in some older, less efficient models.
See various videos from the Scotty Kilmer channel on YouTube to see all the mistakes by car buyers from a mechanic with 52 years of experience.
I’m still having fun with my big V8 used Toyota. I’ll rev it up some more to celebrate 70s gas prices and no dependence on subways or light rails or high speed rails to nowhere.
“The cytokine storm (hypercytokinemia) is the systemic expression of a healthy and vigorous immune system …..”
If that is so, why does it occur more often in the aged and sick whose immune systems are failing. By the time you are 80, you will fail to produce a reaction to things like skin tests for measles and mumps. The reemergence of the chicken pox virus (shingles) is another sign of failing immune function.
“The cytokine storm (hypercytokinemia) is the systemic expression of a healthy and vigorous immune system …..”
If that is so, why does it occur more often in the aged and sick whose immune systems are failing. By the time you are 80, you will fail to produce a reaction to things like skin tests for measles and mumps. The reemergence of the chicken pox virus (shingles) is another sign of failing immune function.
No, definitely not. But cities without cars are a revelation to those who cannot remember life without them. What they are telling us is that we do not have to live like this. We do not have to live and work and shop on noisy streets with bad air where we cannot enjoy walking. We do not have to tolerate a means of mass transportation that kills millions globally every year and thousands in all Western countries, and which is incapable of handling rush hours.
The lockdowns are showing us what our cities can be like if we take the streets back from the car. Lets hope its a lesson we learn and act on.
Lockdowns have to end, the economy has to come back. We should not go to reduced auto traffic to limit CO2 emissions, that is idiotic. We should do so because our quality of life will be better if we do it, regardless of the effect on CO2 emissions.
It would be worth doubling CO2 emissions, if that is the price of removing cars from downtown city streets. It isn’t of course. Just to make the point that CO2 is irrelevant in this, the issue is noise, NO2, particulates, deaths and traffic jams. Its idiotic.
I grew up in a place with very few cars, now overrun by the things, and welcome it back.