Pump jacks operate in front of a drilling rig in an oil field in Midland, Texas.
Nick Oxford | Reuters
A panic-induced sell-off in the oil market triggered by virus concerns has thrown the commodity’s upward march into question — but energy experts at Goldman Sachs don’t appear to be rattled.
Fears over the surging delta coronavirus variant and a fresh supply boost agreement from OPEC+ sent oil prices tumbling down more than 7% as the trading week opened Monday.
The drop was the steepest since March, a rude awakening for oil bulls who’d been enjoying the commodities’ highest prices in 2½ years.
International benchmark Brent crude was trading at $68.42 a barrel at 2:15 p.m. in London on Tuesday, down just over 7% from its Friday close of $73.59 a barrel.
Oil analysts were quick to stress the uncertain road ahead for demand as new waves of Covid-19 infections ― many among communities that have high vaccination rates ― threaten the recent months of economic recovery.
“The market is clearly unsettled about the demand outlook. And rightly so. The rise in delta variant cases is raising questions about the sustainability of demand,” Stephen Brennock, a senior analyst at PVM Oil Associates in London, wrote in a research note Tuesday entitled “Oil takes a beating.”
But analysts at Goldman Sachs led by Senior Commodity Strategist Damien Courvalin see the current setback as merely a speedbump, with little concrete reason for oil bulls to be worried.
Supply driving the bulls?
Oil balances globally are tighter than they were before, despite the agreement between OPEC and its allies over the weekend to cumulatively increase crude production by 400,000 barrels a day on a monthly basis beginning in August.
The International Energy Agency estimated a 1.5 million barrel per day shortfall for the second half of this year compared to its demand predictions in the absence of an OPEC supply deal.
And Goldman predicts the impact from delta to be in the neighborhood of “a potential 1 mb/d (million barrels per day) hit for only a couple months, and even less if vaccines prove effective at lowering hospitalizations in DMs (developing markets), the origin of most summer demand improvements,” as per its latest report.
Goldman’s call is in line with its previously bullish stance, which saw it forecasting Brent hitting $80 per barrel in the second half of this year.
The optimistic recovery outlook, paired with what it sees as a “slower” production ramp-up than expected from OPEC and tighter supply, so far means that “our constructive view on oil prices remains intact.” But the immediate-term demand hit from delta fears triggered a swap in the lender’s quarterly forecasts: It now expects Brent to average $75 per barrel in the third quarter of this year and only reach $80 by the fourth quarter.
“Oil prices may continue to gyrate wildly in the coming weeks given the uncertainties of the Delta variant and the slow velocity of supply developments,” Goldman’s analysts wrote.
Nonetheless, they continued, “we believe that the oil market repricing to a higher equilibrium is far from over, with the bullish impulse shifting from the demand to the supply side.”
The China factor
A less talked-about factor in the future demand picture is the world’s biggest oil customer: China. The recovery of the planet’s second-largest economy is showing signs of losing momentum, which would throw a major wrench in the trajectory for crude.
China’s crude imports were down 2% in May from the previous month and the lowest monthly volume since the year began, according to PVM Associates, falling to 9.77 million barrels per day. In July, they fell further to 9.55 million barrels per day, according to Refinitiv Oil Research. The country’s imports for the first half of 2021 were down 3% from the same period in 2020, and the first contraction of that level since 2013.
“China’s latest GDP data suggest the nation’s V-shaped economic rebound from Covid-19 is cooling,” PVM’s Brennock wrote. “More worryingly, recent customs data out of China is giving the market some mixed signals that are tilted to the bearish side.”
The confluence of uncertain demand due to the delta variant, cooling import levels from China and re-introduced supply from OPEC and its allies, known as OPEC+, suggest bearish signals to the market. But how long the uncertainty will last and whether national vaccine campaigns can offset the mutating virus will ultimately drive the demand picture. In the meantime, supply dynamics, particularly current inventory tightness, continues to give some fuel to the oil bulls.
“Questions are being asked whether the recently announced increase in OPEC+ supply will overwhelm the recovery in demand,” Brennock wrote. “Currently, this seems unlikely, although the evidence from the world’s top oil importing nation appears to favour the bearish narrative.”
A coal plant in South Texas will shut down and convert to a solar + battery electricity generation facility, with the help of a $1.4 billion grant from the US Department of Agriculture meant to help clean energy while saving rural jobs.
The grant will go to San Miguel Electric Cooperative Inc (SMECI) headquartered in Atascosa County, Texas, south of San Antonio, and serving 340,000 customers 47 South Texas counties.
SMECI has operated a mine mouth lignite-fired coal plant (named due to its proximity to the mine that supplies it) since 1982. The plant is in the town of Christine, Texas, population 337.
But that coal-fired plant is one of the dirtiest in Texas. It’s the fourth-largest mercury polluter in the state, producing around 12 times as much mercury as is allowed by a new EPA rule.
It also has two coal ash ponds on site which leech into the local water table and create some of the most contaminated groundwater in the country. Here’s a passage from a 2022 Earthjustice report which analyzed contamination from coal plants:
Numerous constituents were found in concentrations exceeding relevant thresholds from the outset of monitoring in 2018—in wells both up- and downgradient from CCR units. These constituents include arsenic (up to 7 times the Maximum Contamination Level (MCL)), beryllium (up to 112 times the MCL), boron (up to 28 times its 10-day child health advisory), cadmium (up to 83 times the MCL), cobalt (up to 360 times its default GWPS in the CCR Rule), lithium (up to 82 times its default GWPS), selenium (up to 16 times the MCL), and radium (up to 6 times the MCL).
In particular, note that the coal plant resulted in 360x as much cobalt as is allowed in the groundwater protection standard – an element that people often associate with electric car batteries, but is also present in many fossil fueled applications (oil refining, for one).
So, moving away from this coal plant and to a cleaner option would definitely be a big win, given what an environmental stain it is on the area.
In September, SMECI was chosen as a finalist for a new USDA “Empowering Rural America” grant, and this week, was officially selected as one of the sites to receive part of grant, alongside 9 others. SMECI received the largest chunk of the $4.37 billion total, with other sites mostly getting grants in the hundreds of millions.
In total, the grants will support 5,000 jobs and reduced climate pollution by 11 million tons per year, according to the USDA. SMECI’s grant will reduce climate pollution by 1.8 million tons, as much removing 446,000 cars from the road, and support around 600 jobs.
The grant money will be used to convert the plant away from coal power and replace it with solar and battery storage. Solar is an abundant resource in sunny South Texas, and the plant already has grid connections to make this an easier drop-in than having to run new transmission lines.
But not only that, the site’s capacity will see a significant upgrade. The current coal plant can produce up to 410 megawatts of power, but the upcoming solar plant will be capable of 600 MW – nearly half again as much as its previous capacity.
And pairing this solar power with grid-tied batteries will help to make the grid more resilient, too. Thermal power plants tend to take time to turn off and on, meaning it’s harder to manage unexpected peaks and troughs in electricity demand – plus, equipment at the plants tends to wear when it heats up and cools down a lot, contributing to the high costs of coal power. There have been numerous studies showing that new solar plants are cheaper than old coal – and that’s even ignoring externalities.
While solar power is often considered intermittent – you are at the mercy of the sun, after all – batteries can solve that problem. These batteries can help to smooth out peaks and troughs in generation and demand, and can be dispatched to the grid within milliseconds, to better match supply with demand. They can also be used for energy arbitrage, by charging when supply is abundant and discharging when demand is high.
While there’s no announced timeline yet for exactly when the plant will complete its transition, SMECI will develop a Community Benefits Plan over the course of the next year as a provision of the grant process.
Once this transition is completed, Texas will be left with 14 coal plants. In 2023, Texas generated 71GWh of electricity through coal, down from a peak of 157GWh in 2011. Electricity generation in the state was 37.2% coal in 2000, and just 13.1% in 2023.
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From their cutting-edge tech to their planet-saving potential and just how fun they are to drive, EVs are here to stay. And as EVs rapidly become more mainstream, so do the unique demands they place on other components – like tires. The unsung heroes of every road trip, tires play a critical role in delivering the performance and efficiency EV drivers expect. Enter ERANGE, an EV tire series that’s specifically designed to meet those demands.
In this post, we spotlight four of the hottest EV models on the market, their go-to tire sizes, what matters most to EV drivers, and what ERANGE delivers when it’s time to replace the rubber.
Table of contents
Hottest EV models and tire sizes
Tesla Model Y This crossover powerhouse is the world’s best-selling EV for a reason. It offers impressive range, a roomy interior, and Tesla’s signature tech, making it a favorite for families and tech lovers alike.
Most popular tire size for the Tesla Model Y: Common tire sizes include 255/45R19 and 255/40R20, designed for optimal efficiency and grip.
Lucid Air If luxury and range had a baby, it would be the Lucid Air. With industry-leading range and a design that screams sophistication, this premium sedan is making waves among EV buyers who demand the best.
Most popular tire size for the Lucid Air: Premium models often sport 245/35R21 tires, perfect for performance and aerodynamics.
Ford Mustang Mach-E Who says EVs can’t have a muscle car vibe? The Mach-E blends style, performance, and affordability into a package that’s become a hit with mainstream drivers.
Most popular tire size for the Ford Mustang Mach-E: Sizes like 225/55R19 offer a balance of comfort and range.
Hyundai Ioniq 5 With its futuristic design and competitive price, the Ioniq 5 is quickly becoming a darling among urbanites and younger drivers looking to go electric without breaking the bank.
Most popular tire size for the Hyundai Ioniq 5: 235/55R19 tires are known for quiet operation and energy efficiency.
What EV drivers want in tires
EVs aren’t just regular cars with a battery – they bring a whole new set of challenges and opportunities for tire design. Here’s what matters most to EV drivers:
Low rolling resistance: Critical for squeezing out every mile of range and optimizing efficiency.
Durability: EVs are heavier and pack more torque than gas-powered cars, which means they’re tougher on tires. EV-specific compounds are a must for longevity.
Quiet ride: EVs are whisper-quiet, and the last thing you want is road noise ruining the vibe.
All-season performance: A solid tire should handle everything from summer downpours to light snow.
Sustainability: Eco-conscious EV owners want tires made with greener materials and manufacturing processes.
Why ERANGE tires deliver for EV drivers
ERANGE tires are designed with EVs in mind, and they deliver on every front that matters:
Optimized efficiency: Thanks to Sailun’s proprietary EcoPoint3 technology, ERANGE tires reduce rolling resistance, giving you more miles per charge without sacrificing performance.
Exceptional durability: These tires are built tough to handle the unique stresses of EVs, which means fewer replacements and better value over time.
Enhanced comfort: The tread design is tailored for EVs, minimizing road noise so you can enjoy that peaceful cabin.
Eco-friendly design: Made with sustainable materials and processes, ERANGE tires align perfectly with the green ethos of EV ownership.
All-season capability: Rain, shine, or snow, ERANGE tires keep you safe and steady year-round.
Final thoughts
The EV revolution is here, and it’s transforming everything from how we drive to the tires that carry us there. ERANGE EV is leading the way in tire innovation, offering products that enhance efficiency, durability, and sustainability. Backed by Sailun’s cutting-edge technology, ERANGE tires are a smart, reliable choice for EV drivers who demand the best.
So, if you’re looking for tires that can keep up with your EV’s performance and your eco-conscious values, ERANGE EV has you covered.
I’ve got a bit of a reputation for testing out some of the wildest, strangest, and most interesting non-car electric vehicles on the internet. In order to find many of these far-fetched electric steeds, all I have to do is pop open a few (dozen) Alibaba tabs in my browser and start window shopping through the world’s largest repository of creative EV engineering. That’s exactly how I found this week’s focus: a surprisingly fast and fun-looking suitcase that you can giddy-up and ride till the wheels fall off, which they very well might.
Now let me tell you right off the bat: I did not actually buy this awesome-looking scooter suitcase (scootcase?). This is part of a long series of posts where we enjoy the beauty (or horror) of some of Alibaba’s wildest EVs from the safe distance of our computer screens.
But this one is really tempting me. And that’s because for a mere US $733, this electric suitcase that nobody ever asked for could be yours!
It’s powered by a 400W motor – or perhaps two 400W motors, as the ad copy isn’t super clear. But either way, that single or double motor is apparently enough to send this suitcase careening around an airport terminal at a wholly irresponsible 30 km/h (18 mph).
If this seems like a half-baked idea, then you’re probably being generous. The last thing I want when I’m rushing to catch a flight is to be taken out at the knees by someone riding an 18 mph suitcase. But then again, the simple solution to that problem is to already be on my own electric suitcase! Problem solved – and race started!
The concept sounds far fetched, but the execution actually looks pretty decent, especially when shown off by the leggy model giving us the money shot, above.
The design is sort of fascinating, even if I’m not 100% sure I understand the engineering. Apparently it starts life as a normal carry-on suitcase. You know, the boring old kind that you can’t drift around a Cinnabon on your way to Gate 16A.
But then it transforms like Optimus Prime into a scooter, folding part of the suitcase back on itself and pivoting its trolley pull-handle 90 degrees into a set of handlebars. At that point you pop a fat squat right onto Scootimus Prime and you’re ready to fly around an airport at breakneck speeds. Based on the graphic below, I’m led to believe this transformation takes just five seconds.
I can’t imagine this does any favors to the storage space available inside of the suitcase. But hey, did you buy your suitcase to carry things, or did you buy it to race old folks on those Terminal 3 golf cart shuttles? Yeah, that’s what I thought. So quit complaining, go toss your laundry and neck pillow in a plastic shopping bag, and strap on your riding goggles because we’ve got some very narrow tire marks to lay down on some very squeaky airport linoleum.
The on-board battery is said to be enough for 13 km (8 miles) of range, which seems longer than necessary in any airport setting. It also powers some USB outlets on the suitcase, meaning you could recharge your phone in a pinch.
The 75Wh battery is compliant with pretty much any airline, falling below the 100Wh limit. So if you’re getting hassled at the airport about your new wheels, it won’t be by TSA, but rather all the teenagers laughing at you while posting it on TikTok.
But let ’em laugh, because they’re just haters in your non-existent rearview mirror. If they only knew what sweet loadout this scootcase had, they’d be singing a different tune.
There are surprisingly nice features like four speed settings, electronic braking, cruise control, and even a reverse feature. You might scoff, but my LiveWire electric motorcycle doesn’t even have reverse. Harley engineers could learn a thing or two from this silly little thing!
Some final thoughts
As interesting as this thing looks, I don’t think I’ll be dropping $733 on it anytime soon. I’ll have to stick with my trusty Cotopaxi travel backpack, which can neither ferry me around an airport nor charge my devices, but has served me well for boring old tasks like carrying my belongings.
And as many of my longtime readers will already know, this is very much a tongue-in-cheek post as part of a long series of other tongue-in-cheek Alibaba posts (which I hope to resurrect to a near-regular schedule again). Therefore, nothing in this post should be taken as an endorsement of this product. In fact, please do not buy this thing. You’ve been warned. If you do buy it, don’t complain to me when you get a speeding ticket from a mall cop or get banned from LaGuardia for causing a pileup outside of a Sbarro.
Let’s just let this thing exist in its own weird little corner of the internet with the rest of the finest electric vehicles that Alibaba has to offer.
And that, my friends, is a wrap. It’s good to be back.
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