An offshore oil platform is seen at sunset near Huntington Beach, California, on Feb. 9, 2024.
David Mcnew | Getty Images
Oil prices defied the announcement of extended supply cuts from the OPEC+ alliance with brisk declines, with analysts and traders faulting certain trading strategies and the demand picture for the downturn.
“There is a sentiment among traders of changing and repositioning their short versus their long positions, and that is how the price movement is actually giving the signals,” energy consultant Abdulaziz Almoqbel told CNBC’s Dan Murphy on Wednesday. In this case, short positions refer to activity in the futures markets that profits when prices decline, while their opposite long positions cash in when prices move higher over an extended period.
“I would say that what the market is going through currently is going into an oversold, technically oversold market that is pushing the prices down,” he noted.
On Sunday, the Organization of the Petroleum Exporting Countries and its allies — collectively known as OPEC+ — decided to extend its existing formal cuts that were due to end this year, as well as a roughly 1.66 million-barrels-per-day voluntary reduction that also covered the period. These curbs will now carry through into the whole of 2025.
Several OPEC+ members also stretched out 2.2 million barrels per day of additional voluntary cuts from the second quarter of 2024 into the third one, with a view to gradually return these volumes to the market by September 2025 thereafter.
“I think there is a great deal of commodity trading advisors … as well as [algorithms], and the options market, which is a substantially large market of contracts that is influencing the latest price movement,” Almoqbel added.
“If you look at every OPEC+ meeting that was held over the past 36 months, you will notice that following every meeting, there is a downward movement of prices.”
Oil prices bowed below $80 barrels per day despite this prospect of market tightness, with the Ice Brent contract with August expiry at $77.59 at 11:14 a.m. London time Wednesday, up 7 cents per barrel from the Tuesday close. The front-month Nymex WTI contract was at $73.28 per barrel, higher by 3 cents per barrel from the Tuesday settlement.
“Oil prices have fallen by almost USD 5/bbl since last Friday. While some blame the OPEC+ meeting for the drop, we believe other factors — such as the option market—have played a role,” UBS strategist Giovanni Staunovo said in a Tuesday note to clients.
“Prices are likely to remain volatile in the near term. Renewed inventory draws are needed to push oil prices higher, in our view.”
Within oil markets, options are often used as hedging mechanisms to protect against price changes.
Protective “put” and “call” contracts — types of financial derivatives — can set a downside and upside limit for the range in which a price can vary before a position is terminated. Futures hedging can also be applied to defend the value of crude production or of transacted cargoes in the physical market.
The OPEC+ weekend output strategy decision has so far failed to boost prices, given the voluntary cutters’ early announcement of how they plan to reinstate their 2.2 million barrels per day of supplies after the end of the third quarter. The meeting offered a “bearish surprise” to the market and has boosted the downside risk for Goldman Sachs’ forecast that Ice Brent will hit a range of $75 to $90 per barrel, Daan Struyven, head of oil research at the investment bank, told clients in a note.
Also looming large is an uncertain outlook for demand that has put the OPEC Secretariat and Paris-based IEA at opposite ends of a wide spectrum. OPEC’s latest Monthly Oil Market Report of May projects a 2.25 million barrel-per-day increase this year, while the IEA forecasts just a 1.06 million-barrel-per-day demand hike. Demand typically picks up during the summer because of higher gasoline consumption amid a seasonal increase in driving — and the end of maintenance at refineries in China, the world’s largest crude importer.
Yet three crude traders, who could only speak anonymously because of confidentiality agreements, told CNBC that the call on crude from Asia has been low, with one adding that a part of the forthcoming demand increase has already been “borrowed,” as some physical crude volumes would have been carried forward.
“If you look at the latest price movements, you are under the impression that we are in an oversupplied market. However, if you look at the supply restraints and the reroute of dynamic in the global energy supplies, you would clearly understand that this market is definitely not in a surplus,” Almoqbel said. “And so, it really depends on where you want to look, whether you’re focusing on the supply picture or the demand picture to really tell.”
Tesla and Rivian have been embroiled in a lawsuit in which the former accused the latter of having stolen battery technology by poaching Tesla employees.
It sounds like the two automakers are finally about to settle the lawsuit, which has been going on for 4 years.
When Tesla filed the lawsuit, it wasn’t clear what trade secrets Tesla was claiming Rivian had stolen. However, we noted that the employees listed in the lawsuits were two recruiters, an EHS manager, and a manager of Tesla’s charging networks.
The automaker claimed that these employees brought “documents consisting of highly sensitive trade secret, confidential, and proprietary engineering information” when they went to work for Rivian.
Over a year later, we now learn that Tesla had notified the court that it expects to file to get the lawsuit dismissed after reaching a conditional agreement with Rivian. The company didn’t disclose the details of the settlement (via Bloomberg):
Tesla didn’t disclose specifics about the agreement in a court filing, but told a California state judge that it expects to seek dismissal of the case by Dec. 24 upon satisfactory completion of the terms.
Neither Tesla nor Rivian have commented on the reported settlement.
While Tesla has claimed that it somewhat open-sourced its patents, we have previously noted that it’s not exactly the case. Tesla claims to let other companies use its patented technology as long as they themselves don’t sue them over patent rights.
And in this specific case, Tesla alleges that Rivian has specifically hired employees to steal technologies. Again, Rivian has denied the allegation.
Electrek’s Take
The terms are unknown, but in similar cases, it often involves things like some level of access to make sure that no proprietary technology is being used or has been used.
The lawsuit is not exactly clear, but based on the timeline and the allegations of “next-gen batteries”, Tesla could have been talking about its 4680 battery cells, although those are cells. It could also be the structural battery pack.
French infrastructure specialists Proviridis have partnered with EVSE manufacturer Kempower to deliver a novel, underground charging solution for electric semi trucks designed to easily integrate into existing truck depots.
By installing its high-powered charging cabinets underground and integrating the charging cables into a solid metal pipe, Kempower and Proviridis have been able to make room for high-powered charging points in an existing truck depot that didn’t have enough space to install either conventional EVSE or overhead “drop lines.”
For the pilot, the metal pipe is painted in a striking yellow color to make it easier to see while maneuvering the lot, and keeping the dispensers themselves more protected than conventional concrete bollards. The 600 kW power cabinet is positioned a few yards away – a typical space-saving Kempower solution – and connected to the charge points by underground cable.
Proviridis believes their solution provides enough of a competitive advantage that fleet buyers looking to electrify will be eager to give it a try.
“The product is durable across a wide spectrum of temperatures and conditions, requires minimal ventilation, and can cater for a wide range of customer needs,” explains Olivier Verdu, Technical Director at Proviridis. “These are features which perfectly place the Kempower solution for this type of charging configuration in a logistics environment.”
In honor of Black Friday and Cyber Monday, eBike specialist Buzz Bicycles is offering an exclusive discount for Electrek readers on its Centris Class 2 Folding Bike.
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Buzz Bicycles is back with an exclusive new deal
Buzz Bicycles has been a mainstay on Electrek for a few years now, as we have covered several of its electric bikes, which suit riders of all skill levels and help them “Buzz through life.” Buzz is an omnichannel eBike brand that prioritizes direct-to-consumerism and has found success in its mission to deliver ultimate transportation solutions at an excellent value for its growing base of eBike enthusiasts.
The company strives to deliver riders a “Wow moment,” which is usually brought on as they feel the pedal assist function kick in. This feature delivers all you need to conquer hills and longer rides while enjoying new adventures with friends.
The Buzz team has utilized decades of industry experience into its portfolio of eBikes, all conceived and designed in Dayton, Ohio. The company, which operates under the United Wheels umbrella alongside brands like Huffy Bicycles, Niner Bikes, and Batch Bicycles, has adopted an ethos that the freedom of riding should be fun and accessible for everyone, no matter what adventure lies ahead.
By leveraging the global presence of its parent company, Buzz Bicycles can make good on its promise to deliver affordable eBikes that are comfortable, powerful, and safe, much like the Centris Folding eBike, which is as versatile and compact as it is fun. The exclusive deal Buzz Bicycles is offering on the Centris makes it even more fun. You can take advantage of it below.
But first, you’ll want to learn about the capabilities of this foldable eBike to truly understand its value, as well as what accessories are available to level up your purchase.
The Buzz Centris is an easy to ride foldable eBike for all
The Buzz Centris is a Class 2 Folding eBike built for comfort and convenience no matter where you take it. At full size, the Centris’ step-through frame offers a low step-over height of just 16 inches, perfect for riders of all sizes, enabling easy transitions from ground to saddle for its riders.
When you’re not riding, the Centris from Buzz Bicycles folds neatly to 34 inches in length and 22 inches in height, making it easy to store at home or to carry in a vehicle on the way to your next ride. Furthermore, the assembled bike only weighs 68 pounds, making it easy to transport.
You can easily navigate tougher terrain on the Centris thanks to the eBike’s 20″ x 4″ knobby tires and front suspension. The bike is powered by a 48V, 500-watt-hour (Wh) battery pack that can propel it to a top speed of 20 mph for an all-electric range of up to 40 miles on a single charge.
Additionally, this folding model from Buzz Bicycles comes equipped with both a front and rear rack, offering versatile cargo-carrying options so you can customize your ride with a variety of Buzz accessories.
Like all Buzz eBikes, the Centris is tested and deemed compliant with the UL2849 standard. This standard covers the entire electric bicycle system, including the motor, battery, controller, and charger, offering the highest safety standards for added peace of mind.
The Centris Class 2 folding bike from Buzz is available in two colors: Gloss White or Matte Black. This $1,199 eBike is currently reduced to $899 – and you can score an additional $200 off with this exclusive promo, but only for a limited time.
With the purchase of any Buzz eBike, including the Centris, you are guaranteed the following:
10-year limited warranty (lightweight aluminum frame protected for full 10 years)
2-year limited warranty (electrical components covered by 2-year warranty for peace of mind)
6-month limited warranty (additional bike components protected by a 6-month warranty)
Are you interested in the Centris from Buzz Bicycles? You’ve come to the right place. Starting today, while supplies last, you can take advantage of an additional $200 off the sale price by using promo code “ELECTREK200.“ That’s a $500 discount in total!
We highly recommend perusing Buzz’s entire lineup of products. They are designed for commuters and casual riders, with technology and features that help you quickly feel comfortable riding. If you are new to the world of E-transportation, Buzz Bicycles is the brand for you.
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