2024-05-21 21:01

WASHINGTON, May 21 (Reuters) - President Joe Biden's administration will sell nearly 1 million barrels of gasoline in the U.S.-managed stockpile in northeastern states as required by law, the Department of Energy said on Tuesday, effectively closing the near decade-old reserve. The department created the Northeast Gasoline Supply Reserve in 2014 after Superstorm Sandy left motorists scrambling for fuel. But storing refined fuel is costlier than storing crude oil, so closing the reserve was included in U.S funding legislation signed in March by Biden, a Democrat. Bids are due on May 28 and the Treasury Department's general funds gets proceeds from the sale, the department said. The volumes will be allocated in quantities of 100,000 barrels with each barrel containing 42 gallons, the department said. The gasoline should flow into local retailers ahead of the Fourth of July holiday, it said. While the sale was mandated by bipartisan legislation, both the Biden administration and Republican presidential candidate Donald Trump tried to score points from it. Energy Secretary Jennifer Granholm said the Department of Energy had timed the sale to coincide with the runup to peak summer driving demand. “By strategically releasing this reserve in between Memorial Day and July 4th, we are ensuring sufficient supply flows to the ... northeast at a time hardworking Americans need it the most,” Granholm said in a release. U.S. gasoline prices have fallen for four weeks in a row to $3.58 a gallon amid plentiful supplies but remain about a nickel above year-ago levels, according to the Energy Information Administration. Trump said Biden was using the reserve to push down retail gasoline prices for political reasons. "And so he's trying to stop that because high gasoline prices are not good for elections," Trump said outside the New York courtroom where his hush-money trial is taking place. U.S. gasoline prices are about 30% cheaper now than in June 2022 when they hit a record above $5.00 a gallon. Prices have fallen as U.S. crude oil output has hit a record under Biden. Trump said Biden was selling the gasoline, "because he's unable to drill properly." The energy department will be selling into a well-supplied market, where pump prices fell for the fourth straight week on Monday despite the run up to the Memorial Day weekend that kicks off the summer driving season. Higher refinery output and weak fuel demand this year have helped ease some of the supply constraints that U.S. consumers have faced since the pandemic. Gasoline inventories along the U.S. East Coast stood at 55.5 million barrels, 6% higher year-on-year, but around 8% below the historical average for this time of the year. The companies buying the gasoline, likely retailers and fuel terminals, will have the fuel transferred or delivered no later than June 30, it said. Some 900,000 barrels will be sold from the reserve's Port Reading, New Jersey, site, and nearly 99,000 barrels from the South Portland, Maine, site. Once the reserve is closed, the energy secretary cannot establish any new regional petroleum product reserve unless funding is requested in advance of an annual budget submitted by the president and approved by Congress. Bob McNally, president of consultancy Rapidan Energy, said unlike the Strategic Petroleum Reserve that holds hundreds of millions of barrels of crude oil, the gasoline reserve was "too tiny to provide much energy security and won't be missed." Sign up here. https://www.reuters.com/business/energy/us-close-northeast-gasoline-reserve-with-1-million-barrel-sale-2024-05-21/

2024-05-21 20:48

May 21 (Reuters) - The U.S. Centers for Disease Control on Tuesday advised states to aid in H5N1 bird flu surveillance by increasing testing of influenza A virus samples during the summer season to help detect even rare cases of transmission of the virus in humans. CDC's Principal Deputy Director Nirav Shah asked for the increased vigilance ahead of the typical seasonal decline in influenza activity and testing due to the ongoing outbreak of H5N1 among poultry and U.S. dairy cattle. Bird flu has been found in dozens of dairy herds in nine states. One person from Texas who had contact with dairy cows was infected with H5N1 bird flu and suffered conjunctivitis. Public health laboratories handle flu samples from local jurisdictions and subtype them to identify them as either a common virus or a novel virus like H5N1. The CDC earlier in May had met with state health officials and asked them to facilitate distribution of protective gear for farm workers to avoid infection against bird flu. Sign up here. https://www.reuters.com/world/us/us-cdc-asks-states-keep-flu-testing-high-this-summer-2024-05-21/

2024-05-21 20:39

May 21 (Reuters) - The leaders of three big U.S. oil companies will host a fundraising luncheon in Houston on Wednesday benefiting Donald Trump’s presidential campaign, according to a copy of an invitation seen by Reuters. Drillers tend to back Trump’s pro-fossil fuel and anti-regulation agenda and have been critical of President Joe Biden’s efforts to phase out oil and gas in favor of renewables. The luncheon, which will be held at Houston’s Post Oak Hotel, is hosted by Harold Hamm, founder of Continental Resources; Kelcy Warren, executive chairman of Energy Transfer Partners; and Vicki Hollub, CEO of Occidental Petroleum (OXY.N) New Tab, opens new tab, according to the invitation. Trump is scheduled to speak. Asked about the luncheon, Hollub told Reuters she is speaking with policymakers from both parties to express Occidental’s support for federal subsidies for carbon capture technologies that can keep greenhouse gases from the atmosphere. Carbon capture is expensive and has yet to be proven commercially at scale. Some environmental groups oppose it, arguing it risks extending the fossil fuel era. Biden expanded carbon capture subsidies in his 2022 Inflation Reduction Act, part of a suite of measures to fight climate change. Occidental has invested in carbon capture projects that siphon carbon out of smokestacks, and last year announced plans to build the world’s largest direct air capture facility to suck carbon out of the open air. Officials for Continental and Energy Transfer Partners did not provide comment on the luncheon. Hamm and Warren are longtime supporters of Trump, having backed his previous presidential bids. Hamm served as an informal adviser to Trump during his 2017-2020 term at the White House. Trump last month had met with other oil executives at his luxury Mar-a-Lago hotel in Florida and asked the industry for $1 billion to support his current run for president, according to media reports. Sign up here. https://www.reuters.com/world/us/oil-executives-host-trump-fundraiser-houston-2024-05-21/

2024-05-21 19:46

HOUSTON, May 21 (Reuters) - The lead contractor building a Texas liquefied natural gas (LNG) plant for QatarEnergy (QATPE.UL) and Exxon Mobil (XOM.N) New Tab, opens new tab on Tuesday filed for Chapter 11 bankruptcy protection, citing challenges at the project. Zachry Holdings (ZHII.UL), which held the lion's share of the $10 billion construction project called Golden Pass LNG, said it was pursuing a "structured exit." Exxon said it would review construction timing and provide an update in the future. Golden Pass LNG is being built at the site of a former gas-import terminal that has been converted to process natural gas for LNG exports. It is one of two large U.S. LNG terminals whose startup will significantly expand exports in the next 12 months. "We, along with the other stakeholders, are considering all available options to implement a smooth transition and minimize any impacts," an Exxon spokesperson said. "We plan to continue to fully support Golden Pass LNG through completion." Exxon, which owns a 30% stake in the project, earlier this year said it expected first LNG production in the first half of 2025. "Because we have been unable to find a path forward, we have been forced to take action to protect our business," John Zachry, CEO of the San Antonio, Texas-based company, said in a statement on Tuesday. Zachry Holdings said it faced cost challenges over a change order and billings schedule, and it engaged in negotiations with Golden Pass LNG for additional funding without success, according to its filing in U.S. Bankruptcy Court for the Southern District of Texas. Zachry's share of the project was valued at $5.8 billion. Prior to April 2024, Zachry said it was incurring weekly expenses of $30 million to $40 million for payroll, vendor payments, equipment and other costs, but was receiving approximately $70 million per month from Golden Pass LNG. “In March of this year, Golden Pass began direct-paying vendors, and clawed back much of those funds from advance progress payments due to Zachry,” the filing said. Rival LNG developer Venture Global LNG "does not anticipate any material impacts" on work at its Plaquemines LNG export facility in Louisiana as a result of the Zachry bankruptcy filing, a spokesperson said. Its plant is being constructed by a KBR (KBR.N) New Tab, opens new tab and Zachry joint venture. According to court filings, Golden Pass on May 8 notified Zachry of default of its engineering, procurement and construction contract, citing, among other factors, Zachry’s inability to pay subcontractors and vendors promptly, the court filing showed. Zachry that same day received a notice of default from another Golden Pass contractor, Chiyoda International, the company said. Unable to reach an agreement with Golden Pass, Zachry said it had no choice but to file for Chapter 11 protection. Golden Pass LNG had warned earlier this month of possible impacts on construction of the first three trains of the project, which was designed to produce up to 18 million metric tons per annum of LNG. The project is one of two large LNG export plants that had been expected to expand U.S. exports in the next 12 months. The United States is the largest exporter of LNG. Sign up here. https://www.reuters.com/markets/deals/zachry-files-bankruptcy-amid-challenges-golden-pass-2024-05-21/

2024-05-21 19:15

Canadian dollar falls 0.2% against the greenback Touches a one-week low at 1.3675 Canada's annual inflation rate slows to 2.7% 10-year yield eases 4.9 basis points to 3.576% TORONTO, May 21 (Reuters) - The Canadian dollar weakened to a one-week low against its U.S. counterpart on Tuesday as investors priced in a greater than evens chance the Bank of Canada would cut interest rates in June after domestic data that showed further cooling of inflation. Canada's annual inflation rate slowed to a three-year low of 2.7% in April, matching estimates, and core measures continued to ease. "Swap-implied odds on a Bank of Canada rate cut at the June meeting are rising beyond the 50-percent threshold, sending the Canadian dollar sharply lower against the greenback," Karl Schamotta, chief market strategist at Corpay, said in a note. Investors see a 56% chance that the BoC would begin a rate cutting campaign at its next policy decision on June 5, up from roughly 40% before the inflation data, swaps market data showed. "It is clear that economic downside risks should now outweigh inflation in determining policy settings. The Canadian dollar could remain under selling pressure until the U.S. joins the country in exhibiting signs of a slowdown," Schamotta said. The BoC would be willing to cut interest rates three times ahead of the Federal Reserve's first move before a declining currency threatens to endanger the inflation outlook, the median estimate of seven analysts in a straw poll showed. The Canadian dollar was trading 0.2% lower at 1.3650 to the U.S. dollar, or 73.26 U.S. cents, after touching its weakest intraday level since last Tuesday at 1.3675. Adding to headwinds for the Canadian currency, the price of oil settled 0.7% lower at $79.26 a barrel. Oil is one of Canada's major exports. Canadian bond yields moved lower across the curve. The 10-year was down 4.9 basis points at 3.576%, while it was trading 2.8 basis points further below the U.S. equivalent at a spread of 84 basis points. Sign up here. https://www.reuters.com/markets/currencies/c-weakens-inflation-data-fuels-june-rate-cut-bets-2024-05-21/

2024-05-21 18:46

LONDON, May 21 (Reuters) - Bank of England Governor Andrew Bailey said on Tuesday that the central bank would consider a proposal by the International Monetary Fund that it should hold a press conference after each of its Monetary Policy Committee meetings. "More press conferences? What a great thing, more press conferences! I can't wait," Bailey said when asked about the IMF proposal. IMF Managing Director Kristalina Georgieva said earlier on Tuesday that the BoE had said it would consider "very carefully" the Fund's suggestion that it should hold a press conference after each rate-setting meeting, rather than four times a year. "We will roll that question that the IMF have given to us into our thinking about implementing Ben Bernanke's changes," Bailey added, referring to recent suggestions for change at the BoE made by the former Federal Reserve chief. Sign up here. https://www.reuters.com/world/uk/boe-will-consider-imfs-call-more-press-conferences-bailey-says-2024-05-21/