Tom Kaye of Plymouth, Pennsylvania tops off his neighbor’s gas tank for them on at a gas station in Wilkes-Barre, Pennsylvania, U.S. October 19, 2022.
Aimee Dilger | Reuters
Oil prices are defying expectations and are barely higher on the year, as the outlook for oil demand continues to deteriorate for now.
West Texas Intermediate crude futures for January settled higher Monday at $77.24 per barrel, following a drop to $73.60 per barrel, the lowest price since last December. WTI was up 2.2% for the year, after briefly turning negative earlier Monday.
Gasoline prices at the pump have also been falling dramatically and could be cheaper than last year for many Americans by Christmas, according to an outlook from the Oil Price Information Service. On Monday, the national average was $3.546 per gallon of regular unleaded fuel, down from $3.662 a week ago but still higher than the $3.394 a year ago, according to AAA.
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‘Macro headwinds rather than tailwinds’
China’s lockdowns and the rare protests against Beijing this weekend have raised more doubt about the outlook for the country’s already weakened economy.
“We think the recessionary [forces] around the world, particularly in the three largest economies, are dominating the macro environment for the year as a whole, and we think that the issues we’ve been identifying as relatively bumpy in the period ahead are going to remain,” said Ed Morse, global head of commodities research at Citigroup. “Right now, we are looking at macro headwinds rather than tailwinds.”
Morse was one of the more bearish strategists on Wall Street in 2022, but he said the latest market developments and the hit to major economies made even his forecast too bullish. He had revised his outlook higher at the end of the third quarter, based on the shift by OPEC+ to focus on prices and the pending ban of Russian crude by Europe.
The oil market has been focused on those two potential catalysts for higher prices, but the impact on demand from the slowdown in China and new lockdowns has outweighed concerns about supply for now. The European Union’s ban on purchases of seaborne Russian oil takes place Dec. 5. The EU is also expected to announce price caps for Russian crude.
“We’re waiting to see if they signal even deeper cuts. There were rumors in the market about that happening,” said John Kilduff, partner with Again Capital. After dipping to the day’s lows, oil rebounded on Monday as speculation circulated about new OPEC+ cuts, he said.
Brent futures, the international benchmark, was lower Monday afternoon at $83.19 per barrel, recovering from $80.61 per barrel, the lowest price since January.
“Right now the target is below $60 [for WTI]. That’s what the chart is indicating… this is a new low for the move because previously the low for the year was late September and now we’ve broken that,” said Kilduff. “It all depends on what happens in China. China is as important on the demand side, as OPEC+ is on the supply side.”
Higher oil prices next year?
Analysts expect oil prices to increase next year. JPMorgan predicts Brent will average $90 per barrel in 2023.
Morgan Stanley expects the return of much higher prices mid-year, after China ends lockdowns.
“Our balances point to modest oversupply in coming months. Hence, we see Brent prices range-bound in the mid-80s to high-90s first,” the firm’s analysts wrote. “However, the market will likely return to balance in 2Q23 and undersupply in 2H23. With limited supply buffer, we expect Brent to return to ~$110/bbl by the middle of next year.”
Kilduff said he does not expect OPEC+ to make a big market impact this year with its cuts, though it is a wild card. Another factor that could drive prices would be if the war in Ukraine were to escalate.
“I’m not that worried about an OPEC+ cut just because the reality of it is most of the countries aren’t going to be cutting. It’s only going to be Saudi Arabia dialing back on the edges,” he said. “Everyone is so far into their quota. It’s a numbers game.”
Morse said market dynamics have changed and oil demand growth will be smaller as a percentage of gross domestic product. “We’re seeing a significant slowdown in global growth,” he said.
Oil demand growth for China turned out to be much less than expected. “We were thinking demand was sluggish. It turned out to be significantly more sluggish… We had thought this year was going to see 3.4 million barrels of demand growth. It actually grew by 1.7 million barrels,” Morse said. He noted that Europe’s demand is down by several hundred thousand barrels, and the U.S. was flat in 2022.
Morse said the demand decline is also part of bigger trend, tied in part to the energy transition toward renewables. “We are also looking for the peak of oil demand in this decade. It’s part of a longer term story,” he said.
The weather’s influence
Kilduff said La Niña’s weather pattern has also affected prices, with warmer weather in North America. He and other analysts say it could continue to impact the market.
“We keep getting cold outlooks, and then it falters. This is La Niña. You will get cold days, but then you get balmy stretches,” Kilduff said. He said concerns about winter heating fuel supplies have abated with a build in supplies in Europe.
The result for consumers could be a windfall at the pump during the holiday season. OPIS expects prices to keep falling into January before turning higher again.
“If you combine the Chinese demonstrations with the warm weather in the northern hemisphere, that’s kind of a double-barreled assault on the energy price at the moment,” said Tom Kloza, global energy analyst at OPIS. He said he expects gasoline to average between $3 and $3.25 per gallon at its low, but it will be below $3 in many parts of the country.
Kloza said by Christmas, the U.S. national average should be slightly below the $3.28 level it was at last year.
Diesel prices have also been falling. According to AAA, diesel averaged $5.215 per gallon nationally Monday, off by about 8 cents per gallon from a week ago.
“We’ve been counter-seasonally building distillate fuel supply so that’s been easing things. If the weather stays relatively benign here, we’re going to lose that upside catalyst and grind lower still,” said Again’s Kilduff.
In a high-tech move that we can all get behind and isn’t dystopian at all, the City of Barcelona is feeding camera data from its city buses into an advanced AI, but they swear they’re not using the footage to to issue tickets to bad drivers. Yet.
UPDATE 06DEC2025: the ticket bot cometh to Chicago.
Last month, the Chicago Transit Authority (CTA) contracted with Hayden AI to equip six of its transit buses with AI-powered license plate readers intended to target illegally parked vehicles in an area bound by North Avenue, Roosevelt Road, Lake Michigan and Ashland Avenue.
As with similar pilots in Barcelona and NYC, the Hayden AI technology captures information from vehicles illegally blocking bus and bike lanes, then submits its “findings” to a human reviewer for confirmation. If the reviewer agrees with the AI, they can issue a fine of $90 for parking in a bus lane, $250 for bike lane obstruction, $50 for parking in expired meters outside of the central business district, and $140 for personal vehicles parked in commercial loading zones.
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Despite those hefty fines, Chicago Mayor Brandon Johnson is quick to point out that the goal of the program isn’t to generate revenue.
“Every Chicagoan deserves a transportation system that is safe, reliable, and efficient,” said Mayor Johnson, in a statement. “By keeping bus and bike lanes clear of illegally parked vehicles, the Smart Streets pilot helps us protect our most vulnerable road users while improving the daily commute for riders across the city.”
The official release makes no mention of the fact that Hayden AI’s system generated nearly $21 million in revenue for the city in just a few months, despite the fact that thousands of those ticketed weren’t doing anything wrong.
We wrote about some of these issues back in Jun. You can read that original article, below, and let us know what you think of Chicago’s “non-revenue” claims in the comments.
Barcelona ticketing AI; via Hayden AI.
Barcelona and its Ring Roads Low Emission Zone have earned lots of fans by limiting ICE traffic in the city’s core. The city’s latest idea to promote mass transit is the deployment of an artificial intelligence system developed by Hayden AI for automatic enforcement of reserved lanes and stops to improve bus circulation – but while it seems to be working as intended, it’s raising entirely different questions.
“Bus lanes are designed to help deliver reliable, fast, and convenient public transport service. But private vehicles illegally using bus lanes make this impossible,” explains Laia Bonet, First Deputy Mayor, Area for Urban Planning, Ecological Transition, Urban Services and Housing at the Ajuntament de Barcelona. “We are excited to partner with Hayden AI to learn where these problems occur and how they are impacting our public transport service.”
Currently operating as a pilot program on the city’s H12 and D20 bus lines, the system uses cameras installed on the city’s electric buses to detect vehicles that commit static violations in the bus lanes and stops (read: stopping or parking where you shouldn’t). The Hayden AI system then analyses that data and provides statistical information on what it captures while the bus is driving along on its daily route.
Hayden AI says that, while it photographs and records video sequences and collects contextual information of the violation, its cameras do not record license plates or people and no penalties are being issued to drivers or owners of the vehicles.
So far so good, right? But it’s what happens once the six mont pilot is over that seems like it should be setting off alarm bells.
Big Brother Bus is watching
“You are being recorded” sign in a bus; via Barcelona City Council.
The footage is manually reviewed by a Transports Metropolitans de Barcelona (TMB) officer, who reportedly reviewed some 2,500 violations identified by AI in May alone. But, while the system isn’t being used to issue violations during the pilot program, it easily could.
And, in fact, it already has … and the AI f@#ked up royally.
AI writes thousands of bad tickets
NYC issued hundreds of thousands of tickets; via NBC.
When AI was given the ability to issue citations in New York City earlier this year, it wrote more than 290,000 tickets (that’s right: two-hundred and ninety thousand) in just three months, generating nearly $21 million in revenue for the city. The was just one problem: thousands of those drivers weren’t doing anything wrong.
What’s more, the fines generated by the AI powered cameras were supposed to be approved only after being verified by a human, but either that didn’t happen, or it did happen and the human operator in question wasn’t paying attention, or (maybe the worst possibility) the violations were mistakes or hallucinations, and the human checker couldn’t tell the difference.
In OpenAI’s tests of its newest o3 and o4-mini reasoning models, the company found the o3 model hallucinated 33% of the time during its PersonQA tests, in which the bot is asked questions about public figures. When asked short fact-based questions in the company’s SimpleQA tests, OpenAI said o3 hallucinated 51% of the time. The o4-mini model fared even worse: It hallucinated 41% of the time during the PersonQA test and 79% of the time in the SimpleQA test, though OpenAI said its worse performance was expected as it is a smaller model designed to be faster. OpenAI’s latest update to ChatGPT, GPT-4.5, hallucinates less than its o3 and o4-mini models. The company said when GPT-4.5 was released in February the model has a hallucination rate of 37.1% for its SimpleQA test.
I don’t know about you guys, but if we had a local traffic cop that got it wrong 33% of the time (at best), I’d be surprised if they kept their job for very long. But AI? AI has a multibillion dollar hype train and armies of undereducated believers talking about singularities and building themselves blonde robots with boobs. And once the AI starts issuing tickets to the AI that’s driving your robotaxi, it can just call its buddy AI the bank to send over your money. No human necessary, at any point, and the economy keeps on humming.
But, like – I’m sure that’s fine. Embrace the future and all that … right?
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The Japanese agriculture equipment experts Kubota are partnering with Norwegian tech startup Kilter to co-develop, pilot, and promote the new Kilter AX-1 ultra high-precision weeding robot across Europe.
To accomplish those goals, the Kilter AX-1 uses a patented tech package it calls “Single Drop Technology.” Single Drop Technology combines AI weed recognition and ~6 mm placement accuracy to deliver micro-doses directly to weeds, protecting the crop and minimizing the impact to the surrounding soil.
Getting that 6 mm droplet application wasn’t easy. “You can’t buy a field-ready droplet applicator off the shelf,” Anders Brevik, CEO of Kilter, told AgTechNavigator. “We had to design one that survives years of dust, vibration, temperature swings, and long operating days, while keeping droplet size, timing, and placement consistent. That takes deep agronomy knowledge, a lot of engineering, and thousands of hours of field testing.”
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Kilter says growers can reduce herbicide use by up to 95% by adopting the new AX-1, shifting selectivity from chemistry to smart application.
Kubota Europe’s Smart Farming Solutions Division, launched back in 2024, is working with the company’s European dealer network to train up sales staff and integrate the Kilter robot into Kubota’s broader farm solutions portfolio. There’s no word, yet, on pricing or if/when we’ll get the Kilter in North America.
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Autonomous electric tractor concept; by John Deere.
Energy independence and cost control are top of mind for farmers, and more companies are rolling out electric equipment that can be charged by solar, wind, or even on-farm biogas. With the debut of its latest next-generation electric tractor at Agritechnica last month, John Deere is signaling that it intends to lead that revolution.
John Deere says the E-Power electric tractor prototypes that it’s been quietly teasing since 2022 will be as quiet as a car, as easy to drive as a golf cart, and require minimal upkeep – and all while providing the same performance as the company’s beloved diesel tractors.
“Our goal with the E-Power tractor is to ensure it performs the same jobs as its diesel counterparts and works with the same implements, while unlocking incremental value,” explains Derek Muller, business manager for battery electric vehicle systems at John Deere. “Through our electric lineup, we’ll look to reduce operational and maintenance costs, deliver powerful and reliable performance, and intuitive operation.”
The latest electric John Deere tractor prototype, recently unveiled at Agritechnica, is equipped with a 100 hp drive motor and two, additional motors. One 130 continuous hp electric motor for the PTO, and a third for the hydraulic pump. They’ll draw power from up to five KREISEL li-ion battery packs, allowing customers significant pricing flexibility based on their ability to determine how much power and run time they need (and are willing to pay for) to get their jobs done.
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Electric John Deere tractor
130 hp electric tractor shown at Agritechnica; by John Deere.
The customization will go well beyond just battery size. Deere plans to offer customers a number of different tractor and equipment options, and keep costs competitive by basing them on a vehicle common architecture.
“John Deere aims to develop a single electric concept that customers can configure to their own needs,” writes Bob Karsten, at Future Farming. “Buyers will be able to choose the number of batteries (up to five, totalling 195 kWh), the axle type (narrow or wide track), and the cab (either an orchard cab or the familiar 5M cab). In essence, buyers select their preferred battery capacity. With the largest battery (195 kWh), the tractor can operate for eight hours. The target is to enable fast charging up to 80% in 30 minutes.”
Deere revealed one version of that upcoming electric tractor (above) at Agritechnica last week, but despite being an early prototype, it’s a fully functional piece that’s already seen duty with some of John Deere’s most trusted customers.
Daniel, an orchard customer from California, said his experience with the electric tractor led him to believe it could help ease training new operators, “I do think the tractor is much easier for drivers to understand it and to drive it. It would take less time to teach them [operators] how to use it.”
Tyler, a vineyard customer in California, believes that a new electric tractor could help his operation meet its sustainability goals, “When we look at our carbon footprint, greenhouse gas emissions, we want to try and reduce those as we run our equipment to farm our vineyards, we want to be conscious of the community at large.”
You can check out a quick, virtual walkaround of John Deere’s E-Power electric tractor concept in this (admittedly older) video released around the ACT Expo, and expect more details and possible configurations at the upcoming CON/AGExpo conference in March.
John Deere E-Power configurations
SOURCE | IMAGES: John Deere.
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