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.
The Corvette CX making its debut at this weekend’s The Quail, a Motorsports Gathering, generates more than 2,000 combined hp from its four, individually controlled and torque-vectoring electric motors. It’s staggering power, draped in beautiful bodywork, at a point in time when Corvette is rapidly climbing through the supercar ranks. There’s only one problem with this latest rendition of America’s motorsports icon: China’s has 1,000 more hp.
The specs for the Yangwang U9 Track Edition that leaked last week in BYD filings with the Ministry of Industry and Information Technology (MIIT) read like something out a middle schooler’s journal. 3,000 hp. 0-60 in one second. An electric motor for each wheel. A top speed approaching 300 mph. If it’s real (and there is absolutely zero reason to believe that it isn’t), the BYD will be the performance car benchmark against which all others are measured, like the Ferrari F40 of the 1980s, McLaren F1 of the 1990s, or Bugattis of the twenty-first century.
And that 3,000 hp BYD? That’s a production car, if limited. Meanwhile, the latest no production intent, pie-in-the-sky, no-holds-barred, you can just say shit and no one will ever question it electric hypercar concept from GM falls more than 1,000 hp short, at “just” 2,000 hp.
But don’t count the Corvette out.
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More grease, bigger hammer
Callaway Sledgehammer, via Mecum Auctions.
Whatever you may think of poster-era supercars like the Lamborghini Diablo, Porsche Carerra GT, or Pagani Huayra – or even modern electric hypercars like the Tesla Model S Plaid and Xiaomi SU7 – the one thing they all have in common is that they are all objectively slower than the 255 mph Callaway Corvette Sledgehammer from 1988, above.
I won’t go into the specs of that car (this isn’t that kind of car blog), but the point is that while the Corvette is often overlooked, there is a reason GM’s top-shelf sporty car carries that “King of the Hill” nickname – and the new Corvette CX concept is similarly, undoubtedly, more than just a list of specs in a magazine.
And those specs are seriously impressive. The new Corvette CX concept packs four independent electric motors putting out a combined 2,000 hp and some ungoldy amount of Earth-moving torque under advanced software controls that enable four-wheel torque vectoring for maximum grip and cornering performance, as well as precise steering control under even the heaviest of braking.
Power to those motors comes from the Corvette CX’ 90 kWh lithium-ion battery that’s centrally mounted low in the chassis, giving the car a low center of gravity and, crucially, ideal 50/50 front-rear weight distribution.
Plus: it’s gorgeous
The Corvette team says the CX concept draws from more more than seventy (!) years of Corvette heritage while being a forward looking concept, not a retro piece. Stylistically, the concept seems more visually mature and subdued than its in-production C8 cousin, and seems to promise a return to the C3-5 eras’ cleaner, less busy aesthetics.
Phil Zak, executive design director for Chevrolet, is very rightly proud of the CX’ design. “While the shape of a Corvette has always been expressive and forward-looking, each crease and line has its roots in the generations that came before it. It is aspirational, it is cultural, it is the reason people want to come and work at Chevrolet,” says, Zak. “The CX … demonstrate(s) our design teams stepping away from the constraints of production vehicles and unleashing their creativity. Through this exercise, we’ve added to Corvette and defined the design direction for Corvette moving forward.”
Aggressively futuristic, yet unquestionably a Corvette, the CX concept shows what an uncompromised future sports car can be. The athletic exterior design, highlighted by the fighter-jet-inspired cockpit canopy, isn’t just about looking powerful – it was shaped in collaboration with the GM Motorsports Aero Group. Every angle was designed with ultimate performance in mind.
On the inside, every aspect of the CX concept was designed to provide an unmatched driving experience. The forward-opening fighter-jet-style canopy automatically raises as you approach. Driver and passenger settle into seating finished in Inferno Red ballistic textile, bolstered to help hold occupants in place during high-g cornering maneuvers. Premium silicone leather, milled aluminum, and low-gloss forged carbon fiber accents give an elevated feel to the driver-focused cabin.
The digital windscreen transforms the windshield into an immersive surround display with real-time performance data. Every major control is elegantly integrated into the steering wheel, keeping the driver’s focus on the road ahead.
The innovations continue underneath the skin with the Vacuum Fan System. Built-in fans draw air through the open-channel bodywork, generating massive downforce and adjusting the airflow over the rear diffuser to refine aerodynamic balance in real-time. The front diffuser and rear wing are both active, adjusting automatically in response to the driver’s inputs to generate maximum grip. The integrated understructure of the CX concept is visible through the aero channels in the bodywork, and the suspension A-arms are wing-shaped to enhance airflow and reduce front-end lift.
All in all, the new Corvette CX concept is an impressive piece of engineering and rolling art. It’s also a statement from GM that, while the Corvette may very well be going all-electric in its next iteration, it won’t be going any slower. In fact, the first electric Corvette might even be the best one ever – but don’t say that one too loud (you’ll upset the New Balance crowd).
That said, as a pure concept that almost no one will ever drive and which might never get publicly strapped on to a dyno, it is absolutely baffling that Chevy wouldn’t have just claimed 3,000 hp. Even if it was just to match BYD’s claims and continue to build on a century of hype for American exceptionalism, you know?
That’s my take, anyway – what’s yours? Watch the Corvette CX Concept hype video from Chevrolet, below, then let us know what you think of the latest GM concept in the comments.
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Tesla has raised Model S and Model X prices by $10,000, but it decided to include its ‘Full Self-Driving’ package, free Supercharging for life, ‘Premium Connectivity’, and a new ‘Premium Service’ for 4 years.
The automaker is now updating pricing and included features to try to shake things up.
Tesla is now making a new ‘Luxe Package’ standard on all Model S and Model X vehicles:
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Full Self-Driving (FSD), previously priced at $8,000, is now included in all Model S and Model X vehicles. The automaker claims that FSD will eventually result in unsupervised autonomous driving, but for the meantime, it is a level 2 driver assistance system.
Tesla is also introducing a new “Four-year Premium Service”:
Includes tire and windshield protection plan plus maintenance. Covers scheduled services including wheel alignment, tire rotations, front camera cleaning and replacement of HEPA filter, cabin filter and wiper blades.
The automaker is also bringing back included Supercharging for life.
Tesla used to offer free Supercharging for life as a perk on Model S and Model X vehicles.
In the new terms, Tesla mentioned that it can’t be used for commercial purposes, such as if you use the vehicle as an Uber, and it is not transferable to a new owner if you sell the vehicle:
Charge for free at 70,000+ Superchargers worldwide. You are still responsible for Supercharger fees, like idle and congestion fees, when applicable. May only be redeemed at Tesla-owned Superchargers. Cannot be used for commercial purposes (e.g., taxi, rideshare or delivery services). If Tesla determines in good faith at its sole discretion that the vehicle is being used for commercial purposes, Tesla may remove the free Supercharging from the vehicle. The vehicle will then default to Pay Per Use Supercharging. Not transferable to subsequent vehicle owners or to another vehicle.
Initially, free Supercharging was tied to the vehicle rather than the owner, but this was later changed.
Finally, Tesla is also including ‘Premium Connectivity’, which enables Tesla owners to use some features that require more bandwidth, such as live traffic visualization, satellite-view maps, and video streaming, amongst other things.
It usually is $10 per month or $100 per year.
All of that comes with a significant price increase. The Model S now starts at $94,990 and $109,990 for the Plaid version.
Model X now starts at $99,990 and goes up to $114,990 if you want the quicker Plaid version.
Electrek’s Take
As the name implies, this looks like Tesla is trying to position Model S and Model X more as luxury vehicles.
A $10,000 price increase is significant, but the added features offer considerable potential value, depending on whether you plan to utilize them.
FSD sells for $8,000, but it only has an impact if you want FSD. If you don’t, Model S and Model X likely became a bad deal for you.
Free Supercharging is hard to value because it depends on how often you need to fast charge on the road.
Personally, I do it a couple of times a month, a little more when I go on road trips. It can take a while to accumulate $1,000 in Supercharger costs like that, but if you are someone who relies more on Supercharger, you can make it worth it fairly quickly.
However, you should take into account that this doesn’t add any resell value to your vehicle as you can transfer the inlcuded Supercharging.
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Sometimes on Alibaba, you find something that makes you stop, scratch your head, and wonder whether the designer started with a golf cart and added a pickup truck bed… or started with a farm truck and grafted on the front half of a golf cart. Either way, the end result is this glorious mashup of country club chic and back-forty practicality.
It’s also the perfect candidate for this week’s edition of the Awesomely Weird Alibaba Electric Vehicle of the Week – a chance to dumpster dive through some of the coolest and most innovative EVs on the internet.
Up front, you’ve got what looks like your standard neighborhood golf cart – small tires, stubby hood, upright windshield, and a seating arrangement that says, “I could drop you off, but you’re carrying the clubs.”
But move your eyes toward the rear and suddenly you’re on a rural Chinese farm. It’s basically the epitome of the classic Chinese farm truck… and I’ve walked the line at Chinese farm truck factories. That short golf cart chassis has been stretched into a full-blown flatbed mini-truck, complete with drop-down side gates and a tailgate to turn it into a flatbed. It’s ready to haul hay bales, tools, or apparently, livestock (as our graphics department so tastefully demonstrated above).
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The pièce de résistance? That big, plastic laundry basket bolted to the hood with “SPORT” proudly embossed on it. Who needs a glove box when you’ve already got a whole hamper right in front of you? Perfect for golf balls, groceries, or the world’s most precariously placed toolbox.
Despite the hybrid identity crisis, the specs are no joke. Wel, ok – they’re a little funny. This little utility cart boasts a 72V, 1,500W rear-axle motor that can whisk you along at up to 38 km/h (about 24 mph). That’s quick enough to get you in trouble on the fairway or make a speedy feed run at the farm. It can even climb a 20-degree grade, meaning you’ll have no problem hauling a load of goat feed up your driveway. Range is listed at 70 km (43 miles), so you can spend all day zipping between barn and bunker without a recharge.
Weighing in at 317 kg (just under 700 lb), it’s heavy enough to feel stable but light enough that you could probably push it out of a sand trap with a couple of buddies if you really had to. It’s also got a key start, built-in speakers, and of course, that open-air cabin that’s perfect for warm days and questionable weather decisions.
And the price? Just $2,300… if you happen to be standing on the factory floor in China with cash in hand (or just $2,000 if you buy 100 of them!). That’s the factory floor (EXW) price, which means by the time you pay for shipping, import duties, and a customs officer’s confused glare, you’ll be spending a lot more to get one into your driveway. And with tariffs the way they are, now it’s around 40% more than “a lot more.”
Is it a golf cart? Is it a truck? Is it a lifestyle? Yes. It’s all of those things. And in a world where we usually have to choose between impractical fun and functional utility, this weird little contraption says, “Why not both?”
Whether you’re hauling mulch around your garden, running parts around a warehouse, or pulling up to the clubhouse looking like you just came from a tractor pull, this Alibaba gem has you covered. Just be prepared for the stares – not everyone is ready for the future of cross-genre utility vehicles.
A casual warning
As always, a friendly reminder before you start reaching for your credit card: don’t actually go buying one of these things. Seriously. These bizarre Chinese EVs are a blast to gawk at, but this column is just a lighthearted weekend stroll through Alibaba’s wildest listings. I’ve scored a few fun wins on the site, but I’ve also taken some expensive lumps (there’s an electric excavator scam story that has yet to be told…), so this is definitely not a shopping guide for anyone faint of heart or who values their hard-earned money.
Sure, some daring (or just plain stubborn) readers have ignored my advice and rolled the dice anyway, but please don’t be the one who ends up with a sad story and a thinner bank account. Consider this your official “you’ve been warned” notice.
For now, let’s just enjoy how wonderfully absurd it is that a golf cart–pickup truck hybrid even exists, and leave the gambling to the pros. Until next week’s weird Alibaba EV, this is Micah signing off.
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