The Headquarters of the Organisation of the Petroleum Exporting Countries (OPEC) in Vienna, Austria on 17 December, 2018.
Beata Zawrzel | NurPhoto | Getty Images
LONDON — A group of some of the world’s most powerful oil producers will likely agree to continue increasing their output at a meeting on Tuesday, analysts say, as oil prices climb amid growing optimism over the fuel demand outlook.
OPEC and its non-OPEC partners, an alliance often referred to as OPEC+, will meet via videoconference to discuss the next phase of production policy.
It comes as the Middle East-dominated group, which is responsible for over one-third of global oil production, seeks to balance an expected upswing in demand with the potential for an increase in Iranian output.
OPEC+ announced massive crude production cuts in 2020 in an effort to support prices when the coronavirus pandemic coincided with a historic demand shock.
In April, the group opted to return 2.1 million barrels per day of supply back to the market over the May to July period, reflecting an optimistic outlook for improved mobility despite ongoing concerns about Covid worldwide.
OPEC+ is expected to reiterate this decision to gradually increase output during this week’s meeting.
“I think the event itself is going to be a non-event. We expect them to basically re-confirm the plan that they laid out on April 1,” Jeffrey Currie, global head of commodities research at Goldman Sachs, told CNBC’s “Street Signs Europe” on Tuesday. “I think the bigger issue underlying this is: How are they going to deal with Iran?”
Iran is currently in discussion with six world powers to revive its 2015 nuclear deal. The restoration of a deal could lead to more oil on the global market in the coming months.
“It’s too early to give specific numbers around Iran … So, I think the best you can hope for in terms of how they are going to deal with Iran is the indication that they are willing to offset any increases in Iran. That could be the positive upside surprise coming out of this meeting,” Currie added.
The flag of Iran is seen in front of the building of the International Atomic Energy Agency (IAEA) Headquarters ahead of a press conference by Rafael Grossi, Director General of the IAEA, about the agency’s monitoring of Iran’s nuclear energy program on May 24, 2021 in Vienna, Austria.
Michael Gruber | Getty Images News | Getty Images
OPEC Secretary-General Mohammad Barkindo on Monday said in a statement that he did not believe higher Iranian supply would be a cause for concern.
“We anticipate that the expected return of Iranian production and exports to the global market will occur in an orderly and transparent fashion,” Barkindo said.
International benchmark Brent crude futures traded at $70.75 a barrel on Tuesday morning in London, up around 2%, while West Texas Intermediate crude futures stood at $68.11, more than 2.7% higher from Friday’s close — with no settlement price on Monday due to a U.S. public holiday.
Oil prices have climbed more than 30% since the start of the year.
Iran likely to act ‘constructively’
“I think everybody is expecting Iran to add a lot of volume. So, beyond the July increase, they aren’t likely to come out with any commitment,” Amrita Sen, chief oil analyst at Energy Aspects, told CNBC’s “Squawk Box Europe” on Tuesday.
“We know that as demand rises, we will need more OPEC barrels, but I think Iran is going to be the big question mark for them,” Sen said.
OPEC+ initially agreed to cut oil production by a record of 9.7 million barrels per day last year as global fuel demand collapsed, before easing cuts to 7.7 million and eventually 7.2 million from January. As of July, the group’s production cuts are on track to stand at 5.8 million.
“The most consequential issue for OPEC+ over the short term relates to the potential rise of Iranian production as a result of the US and Iran returning to JCPOA compliance,” analysts at Eurasia Group said in a research note, referring to the acronym for the nuclear deal: the Joint Comprehensive Plan of Action.
Analysts at the risk consultancy said it believed progress in successive rounds of talks made a return to the deal likely in the third quarter of 2021.
“Over the medium term, OPEC+ will most likely adjust its policy to prevent the addition of Iranian barrels from derailing its market balancing strategy,” they continued. “Saudi Arabia will likely lean on Russia to better understand the scope of Iranian policy to work on adjustment plans. Iran would also probably act constructively as higher oil prices serve its own interests.”
Just like it says on the tin – retailers are advertising killer deals on the fun-to-drive Kia Niro EV, with one midwest auto dealer reporting more than $10,000 off the sticker price of the Niro EV Wind. That’s nearly 25% off the top line price!
The Kia Niro EV gets overshadowed by its objectively excellent EV6 and EV9 stablemates – both of which are currently available with substantial lease cash and 0% APR financing, in fact – but that doesn’t mean it’s not an excellent little electric runabout in its own right.
The last time I had a Niro EV tester, my kids loved it, I liked that it was quicker and more tossable than I expected it to be, and my wife liked the fact that “it doesn’t look electric. It looks normal.” And, with well over 200 miles of real world range (EPA-rated range is 253 miles), it was more than up to the task of commuting around Chicago and making the trip up to the Great Wolf Lodge in Gurnee and back without even needing to look for a charger.
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It’s not the primary family hauler I’d choose – but as a second car? As a primary car for a slightly smaller family (1-2 kids, instead of 3-4)? The Kia Niro EV Wind, with a $42,470 MSRP, seems like a solid, “can’t go wrong” sort of choice. You know?
You won’t even have to pay that much, though. Raymond Kia in Antioch, Illinois is advertising a $42,470 Niro EV for $32,431 (that’s $10,039, or about 24% off the MSRP), and several others are advertising prices in the $33,000 range.
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Many school districts who used EPA funding to help purchase Lion Electric school buses are now stuck with broken down or unsafe vehicles – but Lion’s new Canadian investors seemingly have no plans to make things right.
“All four Lion buses that we own are currently parked and not being used,” Coleen Souza, interim transportation director of Winthrop Public Schools, told Jay Traugott over at Clean Trucking. “Two of them are in need of repairs which would cost us money which we are not willing to invest in because the buses do not run for more than a month before needing more repairs.”
As bad as the revelations of safety and drivability issues and $250 million in unresolved debt have been, it’s the objectively stupid design choices that have been the most shocking.
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“Lion built an auxiliary diesel heater to heat the bus, essentially writing the manual as they went,” explained a school superintendent in the midwest, who asked not to be named. “It was fascinating to watch but there were design flaws with the heater. For example, the intakes pointed downward and we’re driving across rural roads and the intake sucks in that dirt.”
“Using a diesel-powered heater to warm an electric bus also somewhat defeats the purpose of going 100% zero-emissions,” added Traugott.
Despite a new electric school bus rebate and a fresh cash injection from Vincent Chiara, president of Quebec real estate powerhouse Groupe MACH, and Lion director Pierre Wilkie, however, it seems like no help is coming.
It just gets worse and worse
Decommissioned Lion electric buses; via Winthrop Public Schools.
The US school districts who spent tens of millions of taxpayer dollars in the hopes that Lion buses would help decarbonize their fleets and reduce students’ exposure to harmful diesel emissions? Many of them are back to using diesel, while others are trying to get their deposits back so they can buy something else.
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Mitsubishi is partnering with Ample and Yamoto Transports to deploy an innovative new battery swap network for electric cars in its Japanese home market — but it’s not just for electric cars. Mitsubishi Fuso commercial trucks are getting in on the action, too!
Despite a number of early EV adopters with an overdeveloped concept of ownership, battery swap technology has proven to be both extremely effective and extremely positive to the overall EV ownership experience. And when you see how simple it is to add hundreds of miles of driving in just 100 seconds — quicker, in many cases, than pumping a tank of liquid fuel into an ICE-powered car — you might come around, yourself.
That seems to be what Mitsubishi thinks, anyway, and they’re hoping they’ll be your go-to choice when it’s time to electrify your regional and last-mile commercial delivery fleet(s) by launching a multi-year pilot program to deploy more than 150 battery-swappable commercial electric vehicles and 14 modular battery swapping stations across Tokyo, where the company plans to showcase its “five minute charging” tech in full view of hundreds of commercial fleets and, crucially, the executives of the companies that own and manage them.
How battery swap works for electric trucks; via Mitsubishi Fuso.
A truck like the Mitsubishi eCanter typically requires a full night of AC charging to top off its batteries, and at least an hour or two on DC charging in Japan, according to Fuso. This joint pilot by Mitsubishi, Mitsubishi Fuso Trucks, and Ample aims to circumvent this issue of forced downtime with its swappable batteries, supporting vehicle uptime by delivering a full charge within minutes. The move is meant to encourage the transport industry’s EV shift while creating a depository of stored energy that can be deployed to the grid in the event of a natural disaster — something Mitsubishi in Japan has been working on for years.
The pilot is backed by Tokyo Metropolitan Government’s “Technology Development Support Project for Promoting New Energy,” with local delivery operator Yamato Transport testing swappable EVs for delivery operations on both its eCanter light-duty trucks and Mitsubishi Minicab kei-class electric vans.
Electrek’s Take
Fuso eCanter battery swap; via Mitsubishi.
Electrifying the commercial truck fleet is a key part of decarbonizing city truck fleets – not just here in the US, but around the world. I called the eCanter, “a great product for moving stuff around densely packed city streets,” and eliminating the corporate fear of EV charging in the wild just makes it an even better product for that purpose.
Here’s hoping we see more “right size” electric solutions like this one (and more battery swapping tech) in small towns and tight urban environments stateside somewhat sooner than later.
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