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Tag: Oil and gas industry

  • Here’s why you should always wait for the earnings call | CNN Business

    Here’s why you should always wait for the earnings call | CNN Business

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    A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here. You can listen to an audio version of the newsletter by clicking the same link.


    New York
    CNN
     — 

    Investors are pretty bad at living in the moment. We’re currently in the thick of fourth quarter earnings reports, but traders don’t seem to care about how companies fared during the final months of 2022. They’re more focused on what’s going to happen in the future.

    Case-in-point: Earnings calls, where top execs pontificate about their economic outlook, have been moving markets more than earnings-per-share and revenue reports.

    What’s happening: The mantra on Wall Street has become, as Ritholtz Wealth Management CEO Josh Brown puts it, “ignore the numbers, wait for the call.”

    Microsoft reported great fourth quarter earnings last Tuesday that beat Wall Street’s expectations, but the stock dropped 4% the next day. That’s because CEO Satya Nadella got on an earnings call with investors and warned of a slowdown in the company’s cloud business and software sales. His negative outlook came just as the company announced it was letting go of 10,000 employees, further spooking investors. 

    Other tech companies are following suit — while things are fine for the time being, they’re reporting that the future is foggy.

    IBM stock sank 4.5% last Thursday even as the tech titan beat Wall Street’s Q4 expectations. The reason for the drop might be because Jim Kavanaugh, IBM’s finance chief, warned on the conference call that it would be wise to expect the company’s total 2023 revenue growth to be on the low end. IBM also announced layoffs – the company said it plans to cut around 3,900 jobs or 1.5% of its total workforce. 

    The economic environment is rapidly changing. CEOs on earnings calls are talking more about recession than inflation now, according to an analysis by Purpose Investments.

    Wall Street is also beginning to fear an economic downturn more than painful rate hikes and as a result investors are putting more weight on CEO and CFO forecasts.

    And they’re looking bleak. As of Friday, 19 companies in the S&P 500 had issued forward earnings-per-share guidance for the first quarter of 2023, according to FactSet data. Of these 19 companies, 17, or 89%, issued negative guidance. That’s well above the 5-year average of 59%.

    “My best guess is that cautious tones on conference calls will be the norm, not the exception,” wrote Brown in a recent post. These slowdowns have been partially factored into stock prices, he said, “but not necessarily in full.”

    The upside: Market reaction appears to go both ways. American Express missed on earnings last week but said that credit card spending was hitting new records and that the future looks bright. The stock shot up more than 10%. 

    Prices at the pump typically fall during the coldest months as wintry weather keeps Americans off the roads. But something unusual is happening this year, reports my colleague Matt Egan. Gas prices are rocketing higher.

    The national average for regular gas jumped to $3.51 a gallon on Friday and remained there through the weekend, according to AAA. Although that’s a far cry from the record of $5.02 a gallon last June, gas prices have increased by 12 cents in the past week and 41 cents in the past month.

    All told, the national average has climbed by more than 9% since the end of last year – the biggest increase to start a year since 2009, according to Bespoke Investment Group.

    Why are gas prices jumping? It’s not because of demand, which remains weak, even for this time of the year. Instead, the problem is supply.

    The extreme weather in much of the United States near the end of last year caused a series of outages at the refineries that produce the gasoline, jet fuel and diesel that keep the economy humming. US refineries are operating at just 86% of capacity, down from the mid-90% range at the start of December, according to Bespoke.

    Beyond the refinery problems, oil prices have crept higher, helping to drive prices at the pump northward. US oil prices have jumped about 16% since December partially due to expectations of higher worldwide demand as China relaxes its Covid-19 policies and also because oil markets are no longer receiving massive injections of emergency barrels from the Strategic Petroleum Reserve.

    What’s next: Expect more pain at the pump. Patrick De Haan, head of petroleum analysis at GasBuddy, worries the typical springtime jump in prices will be pulled forward.

    “Instead of $4 a gallon happening in May, it could happen as early as March,” De Haan told CNN. “There is more upside risk than downside risk.”

    A return of $4 gas would be painful to drivers and could dent consumer confidence. Moreover, pain at the pump would complicate the inflation picture as the Federal Reserve debates whether to slow its interest rate hiking campaign.

    Goldman Sachs had a rough time in 2022, and the investment bank’s CEO, David Solomon, is being punished for it. Well, kind of. 

    The investment banking giant said in a Securities and Exchange Commission filing Friday that Solomon received $25 million in annual compensation last year. While that is still a very large amount of money, it’s down nearly 30% from the $35 million that Solomon raked in during 2021, reports my colleague Paul R. La Monica. 

    Solomon’s $2 million annual salary is unchanged. But the company said that his “annual variable compensation,” paid in a mix of performance-based restricted stock units and cash, was well below 2021 levels.

    Goldman Sachs (GS) shares fell more than 10% in 2022. The company also  reported a 16% drop in revenue in the fourth quarter and profit plunge of 66% earlier this month, mainly due to the lack of merger activity and initial public offerings.

    Maybe Solomon can make that extra $10 million with payouts from his burgeoning DJ career. 

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    January 30, 2023
  • Chevron earnings soar to a record | CNN Business

    Chevron earnings soar to a record | CNN Business

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    New York
    CNN
     — 

    Chevron reported a record full-year profit of $36.5 billion, buoyed by high oil prices.

    Adjusted earnings for the year more than doubled from the $15.6 billion Chevron earned in 2021 and up 36% from its previous record profit set in 2011.

    The oil company’s fourth-quarter earnings came in at $7.9 billion, up 61% from a year earlier but less than the record quarterly income of $11.4 billion it reported for the second quarter.

    The fourth quarter earnings per share of $4.09 fell short of the forecast of $4.38 a share from analysts surveyed by Refinitiv. But revenue in the quarter of $56.5 billion topped forecasts by nearly $2 billion and was up 17% from a year earlier.

    Full-year revenue of $246.3 billion was up 52% from 2021.

    Shares of Chevron

    (CVX)
    were down slightly more than 1% in premarket trading.

    Ahead of Friday’s report Chevron, the nation’s second largest oil company, behind only ExxonMobil, had announced it was hiking its dividend by 6% along with a massive $75 billion share repurchase plan. The decision brought criticism from those who said oil companies should be investing their money in producing more oil and gasoline to increase supply and drive down prices for inflation-weary drivers.

    “For a company that claimed not too long ago that it was ‘working hard’ to increase oil production, handing out $75 billion to executives and wealthy shareholders sure is an odd way to show it,” said Abdullah Hasan, assistant press secretary at the White House, in a tweet Wednesday evening after the share repurchase was announced.

    Chevron said Friday its investments in operations increased by more than 75% from 2021, and annual US production increased to the equivalent of 1.2 million barrels of oil a day.

    The amount it spent on capital spending and exploration in 2022 was $12.3 billion, up 43% compared with $8.6 billion spent in 2021, but only slightly more than the $11 billion it spent on dividends or the $11.3 billion on share repurchases during the year.

    The record profit came primarily from the soaring oil prices during the year, not its increased production.

    Chevron and other major oil companies all benefited from the spike in oil and gasoline prices during 2022, in the wake of Russia’s invasion of Ukraine. While Russia, one of the world’s leading oil exporters, sent relatively little oil to the United States, sanctions placed on Russia following the invasion roiled global commodity prices which set the price of oil.

    Futures for a barrel of Brent crude oil, the global benchmark, hit a record of $123.58 close in early June, up more than 50% from six months earlier ahead of the war, and the average price of a gallon of regular gas in the United States broke the $5 mark a week later to reach a record $5.03.

    But oil and gas prices have fallen substantially since then. Brent closed Thursday at $87.47, slightly below the year-earlier level, while the average price of a gallon of regular gas stands at $3.51 a gallon, only slightly higher from the $3.35 average of a year ago.

    But prices have started to rise once again, partly because Covid lockdown rules in China have been lifted. Traders believe that’s a bullish sign for global demand for oil and gasoline. Refinery problems caused by winter weather are also pushing prices higher.

    The average US price of a gallon of regular gasoline is up nearly 12 cents in just the last week and up 41 cents, or 13%, in the last month. Brent oil is up 12% in the last three weeks.

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    January 27, 2023
  • Israel’s democracy on the brink amid supreme court showdown with Netanyahu | CNN

    Israel’s democracy on the brink amid supreme court showdown with Netanyahu | CNN

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    Editor’s Note: A version of this story appears in today’s Meanwhile in the Middle East newsletter, CNN’s three-times-a-week look inside the region’s biggest stories. Sign up here.


    Jerusalem
    CNN
     — 

    Israel’s highest court this week ordered Prime Minister Benjamin Netanyahu to fire a key ally, a dramatic move amid an unprecedented confrontation between his government and the judiciary.

    The High Court ruled 10-1 on Wednesday that it was unreasonable for Aryeh Deri, leader of the Sephardic ultra-Orthodox party Shas, to serve as a minister. He was appointed interior and health minister just three weeks ahead of the ruling.

    But so far, Netanyahu has not taken any action, as political tensions mount. Israel media reported Friday Deri and Netanyahu are in the midst of negotiations over the situation.

    Deri has several convictions on his record, most recently on tax charges. Last year he struck a plea bargain with the courts, which saw him serve a suspended sentence after he resigned from parliament and pledged not to return to public office.

    Under Israeli law, people convicted of crimes cannot serve as ministers. But Netanyahu’s government passed an amendment to that law earlier this month that essentially created a loophole for Deri.

    In Wednesday’s ruling, the justices narrowly focused on Netanyahu’s appointment of Deri despite his assertion he would leave political life as part of the deal for the suspended sentence.

    But less than a year after that plea bargain was struck, Netanyahu has now been told he needs to fire Deri – whose 11 seats in parliament he needs to stay in power.

    “This is a dramatic decision. The decision is aimed at the prime minister, not Deri,” said Yaniv Roznai, an associate professor and co-director at the Rubinstein Center for Constitutional Challenges, Reichman University in Israel.

    Since the ruling, Netanyahu hasn’t reacted much beyond going to see Deri and issuing general words of support. CNN has reached out to his office for further comment.

    “When my brother is in distress – I come to him,” Netanyahu said as he went to visit Deri after the ruling on Wednesday.

    In a joint statement the same day, the heads of the coalition parties led by Netanyahu’s party Likud said: “We will act in any legal way that is available to us and without delay, to correct the injustice and the serious damage caused to the democratic decision and the sovereignty of the people.”

    Deri has seemingly vowed to find a way around the ruling, proclaiming: “They will close the door for us, we will enter through the window. They will close the window for us, we will break through the ceiling.”

    But most political and legal experts believe it’s extremely unlikely that Netanyahu or Deri would defy the court’s ruling, or that Deri will pull his Shas party out of Netanyahu’s coalition, a move that would cause the government to fall.

    Yonatan Green, executive director of the Israel Law and Liberty Forum, told reporters in a briefing that while he thinks Netanyahu is expected to follow the court order in this case, it sets the stage for future defiance.

    “Each successive case of this kind probably brings us a little bit closer to that particular brink,” Green said.

    And so experts say one of the most likely paths forward is for Netanyahu to fire Deri, and for the government to bulldoze through judicial reforms that it has already announced.

    The Deri ruling comes amid an ongoing battle that has been raging over the judiciary. Netanyahu’s justice minister, Yariv Levin, announced in early January a series of judicial reforms that would give parliament (and by extension the parties in power) the ability to overturn supreme court rulings, appoint judges, and remove from ministries legal advisers whose legal advice is binding.

    If parliament gets such powers, it could create a path for Deri to return. But critics say it could also help Netanyahu end his ongoing corruption trial. Netanyahu has repeatedly denied in multiple interviews that the changes would be for his own benefit.

    Backers of the reforms have long accused the high court of overreach and elitism. They say the changes would restore balance between the branches of government.

    But opponents including former Prime Minister Yair Lapid and the President of the Israeli supreme court Esther Hayut say it will erode Israel’s independent judiciary, weaken the checks and balances between the branches and spell the beginning of the end of Israel’s democracy.

    “If Aryeh Deri is not fired, the Israeli government is breaking the law. A government that does not obey the law is an illegal government,” Lapid tweeted.

    It was these proposed judicial reforms that drove some 80,000 people onto the streets of Tel Aviv in pouring rain on Saturday to protest the changes.

    Organizers hope the protest spurs a movement and mounting public pressure on Netanyahu to back off or limit the scope of the proposed reforms.

    UAE and India discussing settling non-oil trade in rupees

    The United Arab Emirates is in early discussions with India to trade non-oil commodities in Indian rupees, Reuters cited Emirati Minister for Foreign Trade Thani Al Zeyoudi as saying on Thursday.

    • Background: The UAE last year signed a wide-ranging free trade agreement with India, which, along with China, is among the biggest trade partners for Gulf Arab oil and gas producers, most of whose currencies are pegged to the US dollar. The large majority of Gulf trade is conducted in US dollars but countries such as India and China are increasingly seeking to pay in local currencies for reasons including lowering transaction costs.
    • Why it matters: Other countries, including China, have also raised the issue of settling non-oil trade payments in local currencies, the minister said, but discussions weren’t at an advanced stage. China’s president in December visited Saudi Arabia where he participated in a Gulf Arab summit and called for oil trade in yuan as Beijing seeks to establish its currency internationally. The Saudi finance minister said this week that the kingdom would be open to trade in other currencies aside from the US dollar.

    Turkey’s opposition to announce presidential candidate to challenge Erdogan

    Turkey’s opposition alliance is set to announce in February their presidential candidate to challenge President Tayyip Erdogan’s 20-year rule in elections set for May, Reuters cited an opposition party official as saying on Friday. The six-party alliance is seeking to forge a united platform but has yet to agree a candidate to challenge Erdogan for the presidency.

    • Background: Turkey’s two main opposition parties, the secularist CHP and center-right nationalist IYI Party, have allied themselves with four smaller parties under a platform that would seek to dismantle Erdogan’s executive presidency in favor of the previous parliamentary system.
    • Why it matters: Turkey is heading towards one of the most consequential votes in the century-long history of the modern republic and Erdogan signaled on Wednesday that the presidential and parliament elections would be on May 14, a month ahead of schedule.

    Kuwaiti leader frees jailed critics in effort to build political cohesion

    Kuwait’s Emir Sheikh Nawaf al-Ahmad al-Sabah has pardoned dozens of jailed critics under a new amnesty in an effort to end political feuding that has hampered fiscal reforms as tensions surface between the new government and parliament, Reuters reported. The amnesty pardoned 34 Kuwaitis, most of them convicted for voicing public criticism.

    • Background: Kuwait has the region’s liveliest parliament and tolerates criticism to a degree that is rare among Gulf Arab states, but the emir has the final say in state affairs and criticizing him is a jailable offence. The cabinet on Tuesday voiced hope that the latest amnesty, which followed the pardoning of dozens of political dissidents in 2021 in a nod to opposition demands, would “create an atmosphere of fruitful cooperation”.
    • Why it matters: Opposition members made big gains in elections held in September. Tensions recently resurfaced as lawmakers pressed the government for a debt relief bill under which the state would buy citizens’ personal loans – a measure that past governments have taken but which comes as the oil producer seeks to push through fiscal reforms to bolster state finances.

    Conservative Gulf Arab states rarely send contestants to international beauty pageants, many of which include segments where women are presented in revealing swimsuits.

    But one contestant from the tiny Gulf state of Bahrain avoided that taboo by participating in this year’s Miss Universe in New Orleans in a pink burkini swimsuit that covered her from the neck down, including her arms.

    As 24-year-old Evlin Khalifa walked down the catwalk, she unfurled a cape with a flag of Bahrain and the word “equality” in Arabic. A message in English read: “Arab women should be represented… A Muslim woman can also become a Miss Universe.”

    The pianist and taekwondo black-belt told the UAE’s The National newspaper that she decided to participate in order to “break stereotypes.”

    “Arab women are kind, passionate and brave and they are ready to embrace the challenges of life,” she said. “They can become beauty queens in modesty and can shine in modern pageantry.”

    The only other Arab country to send a participant was Lebanon. Miss USA won the pageant.

    Iraqi players celebrate after winning the 25th Arabian Gulf Cup final against Oman on Thursday in Basra, Iraq.

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    January 20, 2023
  • Europe’s ban on Russian diesel could send pump prices even higher | CNN Business

    Europe’s ban on Russian diesel could send pump prices even higher | CNN Business

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    London
    CNN
     — 

    Europe is scrambling to buy diesel fuel from Russia before a ban on imports comes into force in early February, but the frantic stockpiling is unlikely to prevent a new price shock for truckers, drivers and businesses.

    In the first two weeks of January, European countries snapped up almost 8 million barrels of Russian diesel, according to energy data provider Vortexa, roughly on par with imports this time last year before Russia invaded Ukraine. Imports in the fourth quarter of 2022 were up nearly 19% on the same period the previous year.

    Since Russia’s invasion in February last year, the European Union has made a huge effort to wean itself off Moscow’s oil and natural gas supplies. That has included a ban on all Russian seaborne crude oil imports, which came into force in December.

    EU countries drastically reduced their imports of crude from Russia ahead of the ban, but that isn’t happening with diesel because it’s much harder to find alternative sources of the fuel.

    Russia is the bloc’s biggest supplier, making up 29% of its total diesel imports last year, data from Rystad Energy shows. The fuel is the continent’s “economic workhorse,” Mark Williams, a research director at Wood Mackenzie, told CNN.

    It is used to power the “vast majority” of transportation for goods and commodities around Europe, he said, as well as fueling the bloc’s fleet of diesel cars. About 91% of vans and 96% of all trucks run on diesel, as well as roughly 42% of passenger cars, according to the European Automobile Manufacturer’s Association.

    “The main difference we see is that Europe was, for months, reducing Russian crude imports before the December deadline began,” Jay Maroo, a senior analyst at Vortexa, told CNN.

    “On diesel we see the opposite, where imports have picked up — almost a final dash before the finish line,” he added.

    In the last three months of 2022, the bloc imported an average of 604,000 barrels per day of Russian diesel via seaborne tankers, compared to the 508,000 barrels per day imported during the same period the year before, Vortexa data shows.

    The EU ban will tighten the global market for diesel, Williams said, unless Russia can successfully divert its cargoes to Latin America and Africa, regions which typically import from the United States. That would free up US barrels to be sent to Europe, plugging the gap left by Moscow, he said.

    But importing diesel from suppliers further afield, including the United States and Saudi Arabia, will push up freight costs, feeding into higher consumer prices, he said.

    “We are expecting diesel prices to rise in Europe. We’re expecting a spike sort of February, March time,” Williams said.

    According to Wood Mackenzie’s estimates, the price of a barrel of diesel will average $40 for the first three months of this year. That’s up a whopping 470% from the average price for the whole of 2021, before Russia’s invasion sent prices soaring.

    The average EU cost of a liter of diesel at the pump hit €1.77 ($1.92) on January 9, up from €1.50 ($1.63) the same time last year, data from the European Commission shows.

    France could be hit especially hard. Europe’s second largest economy is also its biggest buyer of diesel, responsible for 22% of all seaborne imports over the past three years, according to Vortexa data.

    But Jorge León, a senior vice president at Rystad Energy, told CNN that the impact of the ban won’t be felt immediately in Europe because of the large amount of diesel in its stocks.

    The European Union has also “done its work to find alternative suppliers,” he said, including Kuwait, which opened a massive oil refinery in November capable of producing 600,000 barrels per day of diesel. That could help cushion the impact of losing Russian supplies.

    But if Europe sees a strong rebound in demand as the economy picks up, consumers can expect price rises, he added.

    “Deliveries are going to be a bit more expensive… filling up [a] car is going to be a bit more expensive,” León said.

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    January 18, 2023
  • Kevin McCarthy, the view from home | CNN Politics

    Kevin McCarthy, the view from home | CNN Politics

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    CNN
     — 

    The young man smiling in the last Bakersfield High School student newspaper for the 1983 school year was captioned – “Most Likely to Succeed.”

    That graduating student wasn’t then-senior Kevin McCarthy, the California Republican who on Saturday became the House speaker for the 118th US Congress, a powerful position that puts him second in line to the American presidency.

    “I was most likely to succeed,” laughs Marshall Dillard, McCarthy’s classmate and friend. “I’m sure he’s surprised some of his teachers. You’d have never thought this if you saw Kevin in high school.”

    The lighthearted teasing traces back to Dillard and McCarthy on the high school football field in Bakersfield, California. The team was and is still called “The Drillers,” a reference to the oil industry of the district. Bakersfield sits in the southern end of California’s Central Valley and is one of the largest cities in the state’s 20th Congressional District.

    It’s the district McCarthy represents as one of the most powerful Republican lawmakers in the country. With House Republicans holding a slim majority in the 118th Congress, a group of GOP hard-liners prompted a messy and historic floor fight for control of the speaker’s gavel. After voting had spilled into a fifth day, McCarthy broke through by conceding to a series of demands that weakened the power of the speakership. But ultimately, he won the gavel.

    This was the sort of well-worn political knuckle fight of the DC scene – but far from the region that raised a young Kevin McCarthy.

    Here, he’s known as the son of a firefighter whose less-than-stellar grades would suggest a far less powerful career path. But like the working town that raised him, the lack of polish would impart lessons that follow McCarthy today and offer clues into his speakership.

    Marshall Dillard played football with Kevin McCarthy at Bakersfield High School in Bakersfield, California.

    “He made up for it because he was scrappy, and he worked hard,” says Dillard. “In football, he wasn’t the biggest person. He wasn’t the fastest person. He wasn’t the strongest person. But he was going to give it his all.”

    Rather than being seen by classmates as most likely to succeed, McCarthy was voted one half of Bakersfield High’s “Best Couple.” His girlfriend, Judy, would become his wife.

    “Before he was going to ask her out, that’s the only time I saw him nervous,” remembers Dillard. The rest of the time, McCarthy charged into classes, sports or clubs with an ambition that eclipsed his apparent credentials.

    Fellow students gravitated to McCarthy, not just for his humor and confidence, but for his friendship.

    Kevin McCarthy and his wife, Judy, pose in front of Air Force One in 1992.

    Dillard, now the principal of William Penn Elementary in Bakersfield, says a single moment from their teenage years speaks to the man who now leads the US House of Representatives. Dillard, who is Black, was the star player on the Bakersfield High School football team. He recalls a time when their high school was scheduled to play against a team from a notoriously racist rival high school. McCarthy and a couple of other White football teammates reassured Dillard, “They’re going to have to come through us before they get to you.”

    “That cemented our bond,” says Dillard. The men have remained friends through the years, sharing their struggles, successes and tales of parenthood. Dillard declined to share his political leanings or say if he even agrees with McCarthy’s politics: “He always gets my vote. Politics is politics. They do what they do. I know Kevin on a personal level.”

    On the 1983 yearbook’s local business sponsorship pages, “McCarthy’s Frozen Yogurt” takes up half a page. McCarthy has spoken about the yogurt shop belonging to his uncle and the place where he opened his first small business, “Kevin O’s Deli.”

    In pictures: House Speaker Kevin McCarthy


    Dillard, who would attend Stanford University, remembers Kevin O’s as a couple of tables in the corner of the yogurt shop. When Dillard would return home on school breaks, his friend always gave him a free sandwich.

    Catherine Fanucchi, a farmer in Bakersfield, also grew up with McCarthy and calls him a friend today. She, like Dillard, left the Central Valley for school and a career – hers was as a lawyer. But home beckoned, and she joined her family farm, which traces its Bakersfield origins 100 years back.

    “I would never see him staying down,” Fanucchi says of McCarthy. “He’s not that guy. He sees the sunny side of the street, and he’ll manage to find it.”

    McCarthy would not stay at that sandwich shop long, sending in an application while he was in college to be a 1987 summer intern in Washington with then-Rep. Bill Thomas, a Republican from California.

    Cathy Abernathy, who used to be chief of staff for US Rep. Bill Thomas, hired Kevin McCarthy as an intern in 1987.

    His application came across the desk of Thomas’ chief of staff, Cathy Abernathy.

    “He didn’t make the cut for summer,” recalls Abernathy, who would hire him for the fall in the Bakersfield district field office. “He will mention in speeches often: ‘I’m the congressman from the district that turned me down to be an intern.’ It’s a true story.”

    McCarthy became Thomas’ protégé, learning about constituent work and then the politics of Sacramento and Washington. Ambition and an ability to engage with nearly everyone separated him from others.

    “Well, he’s probably the best homegrown candidate for public office that we have. Born and raised, then community college, college, and his masters’ degree – all from here,” says Abernathy, who remains a longtime ally. They have a symbiotic political, yet deeply personal, relationship. She recalls how just months after her husband died, McCarthy officiated her daughter’s wedding, offering counsel and solace to the family.

    “He’s in a bigger job, but he hasn’t forgotten small town America.”

    Kevin McCarthy marries Cathy Abernathy's daughter Margaret and Josh Brost in 2018.

    Thomas left Congress in 2007 and was succeeded by McCarthy. In the December 26 issue of The New Yorker, Thomas blasted his former protégé, saying, “Kevin basically is whatever you want him to be. He lies. He’ll change the lie, if necessary.”

    “The Kevin McCarthy who is now, at this time, in the House, isn’t the Kevin McCarthy I worked with,” Thomas was quoted as saying.

    The criticism came on top of Thomas’ first harsh public comments about his former staffer and friend shortly after the January 6, 2021, insurrection at the US Capitol. Thomas gave an interview to a local TV station accusing McCarthy of rolling over for Donald Trump and his election lies for political expediency.

    McCarthy declined to speak with CNN for this story.

    McCarthy did condemn Trump soon after the attack on the Capitol, saying, “The president bears responsibility for Wednesday’s attack on Congress by mob rioters.”

    But not long after, McCarthy made a stunning reversal, saying, “I don’t believe he (Trump) provoked if you listened to what he said at the rally.”

    Since then, McCarthy has catered to some of his party’s contentious members, vowing to reinstate Reps. Paul Gosar of Arizona and Marjorie Taylor Greene of Georgia on committees if Republicans won back the House.

    And despite the back-and-forth on Trump, the former president supported McCarthy’s run for speaker and made calls on his behalf for the holdout votes. Trump has publicly referred to McCarthy as “My Kevin.”

    The political malleability is familiar to Bakersfield conservative Paul Stine. The men have known each other since 1995, battling when they were young Republicans. “Kevin is the most adaptable politician I have ever seen in my life,” says Stine.

    Bakersfield conservative Paul Stine has known Kevin McCarthy since 1995.

    When they were younger, Stine viewed McCarthy as too centrist, like Thomas and Arnold Schwarzenegger.

    “If the Kevin of today had been the Kevin of the 1990s, I doubt he and I would have ever had an adversarial relationship. I think he knows how to evolve his positions enough to stay viable in the political game. Do I consider him a conservative ideologue? No, not at all,” Stine says.

    Dave Noerr, the mayor of Taft, a city in McCarthy’s district, brushes off the criticism, calling it a part of today’s politics. Noerr, who has worked with McCarthy since the early 2000s, calls him “unique and thorough in understanding energy and agriculture.”

    Noerr has worked in and around the oil industry for most of his life. His town and the entire district relies on the energy industry for jobs and money but is seeing a rapid evolution as oil production gets slammed.

    “By Kevin McCarthy coming from this area, understanding the need and the opportunity to integrate all those resources for the betterment of mankind, that is going to be critical to getting rid of the fantasies being peddled of some and the misunderstanding of so many,” says Noerr.

    Dave Noerr is the mayor of Taft, a city in Kevin McCarthy's district.

    Fanucchi, the Bakersfield farmer, declines to express her politics and state whether she agrees with McCarthy’s positions. More important to her is having a powerful representative in Washington who understands the challenges of feeding the nation in today’s economy.

    “He comes from here,” Fanucchi says of McCarthy. “We have direct access to him, and he has access to people to help us tell our story. Our story is that the lifeblood of the Central Valley, of California, is Ag, which requires water and requires space. I don’t ascribe to the belief that you have to be like me to think like me, to do something great for us in Kern County or for our nation. I think you have to have clear eyes and a strong mind and work hard.”

    Catherine Fanucchi, a farmer in Bakersfield, grew up with Kevin McCarthy.

    A Republican, Noerr has hopes that the slim majority his party now holds in the House will be a blessing to help his district, rather than a challenge.

    “The deep rifts that currently exist and unfortunately have been exacerbated recently, he’s (McCarthy) got to get rid of. We can find the common ground,” Noerr says. “Instead of having arguments, we have conversations. We will find that common ground. Do I think he can do that? Absolutely, I think he can.”

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    January 8, 2023
  • Gas prices had a wild ride this year, making 2023 tough to predict | CNN Business

    Gas prices had a wild ride this year, making 2023 tough to predict | CNN Business

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    New York
    CNN
     — 

    US drivers have never seen a year quite like 2022.

    Wild price swings at the gas pump throughout the year make predicting prices for 2023 even more difficult.

    Russia’s invasion of Ukraine and the sanctions that it sparked on Russian oil sent the price of crude soaring in February at the beginning of the conflict. And even though relatively little Russian crude oil was ever exported to US refineries, the fact that oil prices are set on global commodity markets meant that US drivers were not spared a spike in gas prices.

    Prices were far more volatile throughout 2022 than they were in other recent years, both during and before the pandemic roiled oil markets.

    By June, the average US gas price crossed $5 a gallon for the first time ever, hitting a record $5.02 on June 14. But after that came a prolonged slide in gas prices, prompted by a number of factors, including the release of oil from the US Strategic Petroleum Reserve, concerns about the possibility of a recession in both the US and global economies, and a surge in Covid cases that caused renewed lockdowns in Asia. By the end of the year, the national average price of a gallon of regular gas had fallen to just over $3, well below the pre-invasion price, back to the average price of late summer of 2021.

    But there was not the same level of relief for the price of diesel. Diesel prices fell 20% from their peak in June, only about half the decline for gasoline during the same period. And while gasoline is cheaper than it was a year ago, diesel remains close to the pre-2022 record price set in 2008. Greater demand for North American diesel by Europe in the wake of the war in Ukraine kept diesel prices so high.

    While relatively few US drivers use diesel for their private cars, it is still the fuel used by most heavy trucks, so it had an impact on the average American’s wallet. Most trucking companies charge a fuel surcharge to their customers when diesel prices increase. Because virtually all goods purchased by Americans are on a truck at some point before those purchases, that was a factor driving inflation higher.

    The wild swings in oil and gasoline prices were a major factor in battered consumer confidence during the year. But those swings were not felt evenly across the nation and throughout the year. Many of the western states faced much higher gas prices because of more limited refining capacity. But there were a number of refinery accidents throughout the year that caused spikes in other regions as well. So, everyone saw wide swings in prices, though not always at the same time.

    There is also the wide variation in gas taxes, from 68 cents a gallon in California to only 15 cents a gallon in Alaska. Some states temporarily halted their state gas taxes during the year in the face of high prices.

    But the difference in average income in the different states meant that drivers in some of the states with relatively low prices had to work almost as many hours to buy 15 gallons of gas as those drivers in high-priced states.

    For example, in Mississippi, where the hourly average wage in November was $24.52, according to the Labor Department, it took 1 hour and 41 minutes of work to earn enough to pay for 15 gallons at $2.75 a gallon at year’s end. In California, where the average price of regular was $4.38 a gallon, or about 60% more than in Mississippi, the average hourly wage of $37.61 meant that they only had to work four more minutes to buy those 15 gallons.

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    December 29, 2022
  • Oil and Turkish stocks were 2022 market winners. Russia funds and crypto tanked | CNN Business

    Oil and Turkish stocks were 2022 market winners. Russia funds and crypto tanked | CNN Business

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    New York
    CNN
     — 

    Oil stocks skyrocketed in 2022, so it’s no surprise funds that track the energy sector were Wall Street winners this year. But the top fund of the year is a surprising one: It invests in a variety of companies based in Turkey.

    The iShares MSCI Turkey exchange-traded fund had more than doubled as of December 19, according to data from Morningstar Direct. The fund has big stakes in Turkish financial giant Akbank, Istanbul-based retailer Bim and the parent company of Turkish Airlines.

    Turkey has been hit hard by inflation, like the rest of the world, and its currency, the lira, has plummeted against the US dollar and other leading global currencies.

    So why the big gains?

    Turkey’s stock market thrived because the country is doing something most others aren’t: Its central bank has been slashing interest rates to prop up consumer spending. Turkish President Recep Tayyip Erdogan wants to keep rates super low. He has even fired several central bankers in the past few years who refused to lower rates.

    The Turkish economy has slowed recently as unemployment has risen, but the instability has not hurt Turkish stocks. The iShares Turkey ETF has also had a lift from higher energy prices, as refinery Tüpraş is a top holding.

    Other US and international oil funds and ETFs were also at the top of Morningstar Direct’s list. (Morningstar Direct provided CNN Business with a ranking of the best and worst mutual funds and ETFs for 2022, excluding so-called leveraged funds that make outsized bets on stock market indexes.)

    The United States 12 Month Natural Gas

    (UNL)
    , Energy Select Sector SPDR

    (XLE)
    and several oil/energy funds run by top investing firms like Fidelity, Vanguard and BlackRock’s

    (BLK)
    iShares are all up between 50% and 80% for the year.

    In this rocky year for stocks, there were significantly more losers than winners in the mutual fund and ETF world in 2022. The SPDR S&P 500 ETF

    (SPY)
    and Invesco QQQ

    (QQQ)
    , which track the S&P 500 and Nasdaq 100, were down 19% and 31% respectively.

    But no funds were hit harder than ETFs with exposure to Russia.

    Most funds with investments in top Russian companies either liquidated or halted trading following Vladimir Putin’s decision to invade Ukraine in late February, an act that essentially forced the United States, Europe and rest of the Western world to cut ties with Moscow and Russian businesses.

    Investments in Russia ETFs from iShares, VanEck and Voya were pretty much wiped out.

    The carnage in cryptocurrencies also hit several funds hard. Bitcoin prices were plunging even before the collapse of former crypto unicorn FTX. But the stunning demise of Sam Bankman-Fried’s company sent further shock waves throughout the industry.

    Funds from Osprey, Grayscale, VanEck (again), Global X, Bitwise, First Trust, Invesco and many other institutional investment firms all tumbled more than 70% in 2022.

    Other once-trendy funds were also hit hard this year.

    Several of the Ark ETFs run by Cathie Wood, which had significant exposure to Tesla

    (TSLA)
    , Coinbase, Zoom

    (ZM)
    , Roku

    (ROKU)
    and other momentum tech stocks that have dropped precipitously in 2022, were among the biggest fund losers.

    Numerous funds focusing on cannabis stocks also, ahem, went to pot this year. Cannabis ETFs from AdvisorShares, Global X and Amplify all plunged more than 60%. Even though more states are legalizing recreational and medicinal weed, intense competition in the business is making it difficult for cannabis companies to generate profits.

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    December 27, 2022
  • Biden begins to refill Strategic Petroleum Reserve, while Keystone Pipeline leak prompts new emergency exchange | CNN Business

    Biden begins to refill Strategic Petroleum Reserve, while Keystone Pipeline leak prompts new emergency exchange | CNN Business

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    New York
    CNN
     — 

    The Biden administration announced plans Friday to provide nearly 2 million barrels of oil to refineries through an emergency exchange and simultaneously begin efforts to replenish the Strategic Petroleum Reserve early next year.

    The new emergency exchange is aimed at addressing “potential supply disruptions” caused by the shutdown of the Keystone Pipeline due to a leak earlier this month, the Energy Department said. Part of that key pipeline remains shuttered and no timeline has been issued for a full reopening.

    Emergency exchanges allow oil refineries to borrow oil from the SPR for a short period due to supply disruptions such as hurricanes or pipeline outages. Unlike with emergency sales such as the record-setting release of 180 million barrels announced in March, this oil must be returned.

    In this case, the Energy Department agreed to provide 1.2 million barrels of oil from the SPR to ExxonMobil and 600,000 barrels to Phillips 66.

    At the same time, the Biden administration is beginning plans to repurchase crude oil for the SPR for the first time since that unprecedented release earlier this year.

    The Energy Department is planning to solicit bids to repurchase up to 3 million barrels of oil for the SPR to be delivered in February, the senior administration official said. The repurchase will pilot a new approach to buy back the oil at a fixed price, the official said.

    “Small but a signal that pledges to refill are credible,” former Obama energy official Jason Bordoff said on Twitter in response to the new steps.

    The senior administration official conceded it will take months or even years to refill the SPR, whose stockpiles are at the lowest level in 38 years.

    Comprised of underground salt caverns in Texas and Louisiana, the SPR is the world’s largest supply of emergency crude oil. It has been used during times of war and natural disaster to ease supply crunches.

    The move to begin to refill the SPR — and to lock in a price — comes as oil prices have plunged to one-year lows amid recession fears.

    “This repurchase is an opportunity to secure a good deal for American taxpayers by repurchasing oil at a lower price than the $96 per barrel average price it was sold for, as well as to strengthen energy security,” the Energy Department said in a statement.

    The administration announced in October that it planned to repurchase oil for the SPR when prices are at or below roughly $67-$72 a barrel. Officials said at the time such a move would help boost demand and provide the oil industry with an incentive to keep pumping even during times of stress.

    Oil prices dropped nearly 4% on Friday morning to as low as $73.33 a barrel. Oil trimmed its losses after the Energy Department announced the SPR moves, with crude recently trading down 1.5% to $75 a barrel.

    Prices are currently in a “very useful” range to begin the process of refilling the SPR, the senior administration official said.

    Officials stressed that the efforts to refill the SPR won’t prevent future emergency releases in the future, if necessary.

    “The SPR remains ready to respond to energy security needs today. We will be prepared and as nimble as we can to make sure the SPR is doing everything it can on behalf of energy security and American consumers,” the senior administration official said.

    The Energy Department also took a bit of a victory lap for the decision to release 180 million barrels of oil following Russia’s invasion of Ukraine.

    Noting that gas prices are now at 15-month lows, the senior administration official said that historic release “helped provide some breathing room for American families at the pump,” the official said.

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    December 16, 2022
  • California regulators approve plan to achieve carbon neutrality by 2045 | CNN

    California regulators approve plan to achieve carbon neutrality by 2045 | CNN

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    CNN
     — 

    California’s air regulators approved an aggressive plan Thursday for the state to reach carbon neutrality by 2045 – in line with legislation signed by Governor Gavin Newsom earlier this year.

    The plan, approved by the California Air Resources Board, looks to move one of the largest economies in the world to renewable energy and away from fossil fuels.

    Known as the Scoping Plan, the actions and policies aim to slash fossil fuel usage to less than a tenth of current consumption by decreasing demand for liquid petroleum by 94% by 2045, mainly driven by a move away from gas-powered vehicles.

    The board also says the plan will cut air pollution by 71% and gas emissions by 85% to below 1990 levels. Both goals are consistent with targets laid out in Governor Gavin Newsom’s $54.1 billion climate commitment intended to protect residents from wildfires, extreme heat and drought while moving away from big oil.

    The plan will create four million jobs and save Californians some $200 billion in health costs for pollution-related illnesses by 2045, the board said, providing a path for California to meet its climate targets.

    “California is leading the world’s most significant economic transformation since the Industrial Revolution – we’re cutting pollution, turning the page on fossil fuels and creating millions of new jobs,” said Newsom in a press release after the plan was approved.

    After a public comment session, board members acknowledged that this plan is a roadmap to cutting greenhouse gases, and that not all of what is laid out may come to fruition.

    One focus of the plan is a move to zero-emission transportation, including both personal vehicles and mass transit. While fossil fuels used in homes are also targeted, the state said gas-powered vehicles and other transportation are currently the largest source of carbon emissions.

    In August, the board approved a rule requiring all passenger vehicles sold in the state to be zero-emission by 2035.

    Beginning in 2026, all new residential buildings will be required to install electric appliances and in 2029, the requirements will begin extending to commercial buildings, according to the plan. For existing residential buildings, all appliance sales are required to be electric by 2035. Ten years later, all commercial buildings in the state will have to follow suit, the plan said.

    While the board called the plan “achievable” some critics say the plan relies too much on what some of the board members acknowledged is an unproven method of carbon capture and sequestration instead of relying on natural and working lands to also house some of that carbon.

    “This plan is failing the people of California and our planet – first by endorsing carbon capture, a faulty climate scheme promoted by the fossil fuel industry,” said Chirag Bhakta, the California state director for Food & Water Watch, in a statement to CNN.

    “Carbon capture is a completely unproven and unworkable technology that only serves to provide cover for oil and gas drillers to continue business as usual,” Bhakta said.

    The scoping plan also targets wildfires which are not only responsible for the destruction of forests, buildings and property, but also emit copious amounts of carbon dioxide.

    In recent years, human-driven climate change has spurred massive blazes. The board pointing out that of the 20 largest wildfires in California, nine happened in 2020 and 2021.

    The plan sets a goal of treating one million acres a year by 2025 through actions like prescribed burns and increased forest management. Currently, about 100,000 acres are treated a year.

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    December 15, 2022
  • 5 key takeaways from Xi’s trip to Saudi Arabia | CNN

    5 key takeaways from Xi’s trip to Saudi Arabia | CNN

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    Editor’s Note: A version of this story appears in CNN’s Meanwhile in today’s Middle East newsletter, a three-times-a-week look inside the region’s biggest stories. Sign up here.


    Abu Dhabi
    CNN
     — 

    Years of progressing ties between oil-wealthy Saudi Arabia and China, an economic giant in the east, this week culminated in a multiple-day state visit by Chinese President Xi Jinping to Riyadh, where a number of agreements and summits heralded a “new era” of Chinese-Arab partnership.

    Xi, who landed on Wednesday and departed Friday, was keen to show his Arab counterparts China’s value as the world’s largest oil consumer, and how it can contribute to the region’s growth, including within fields of energy, security and defense.

    The trip was widely viewed as yet another snub to Washington, which holds grievances toward both states over a number of issues.

    The United States, which has for more than eight decades prized its strategic alliance with Saudi Arabia, today finds its old partner in search of new friends – particularly with China, which the US worries is expanding its sphere of influence around the world.

    While Saudi Arabia was keen to reject notions of polarization or “taking sides,” it also showed that with China it can develop deep partnerships without the criticism or “interference” for which it has long resented its Western counterparts.

    Here are five key takeaways from Xi’s visit to Saudi Arabia.

    During Xi’s visit, Saudi Arabia and China released a nearly 4,000-word joint statement outlining their alignment on a swathe of political issues, and promising deeper cooperation on scores of others. From space research, digital economy and infrastructure to Iran’s nuclear program, the Yemen war and Russia’s war on Ukraine, Riyadh and Beijing were keen to show they are in agreement on most key policies.

    “There is very much an alignment on key issues,” Saudi author and analyst Ali Shihabi told CNN. “Remember this relationship has been building up dramatically over the last six years so this visit was simply a culmination of that journey.”

    The two countries also agreed to cooperate on peaceful uses of nuclear energy, to work together on developing modern technologies such as artificial intelligence and innovate the energy sector.

    “I think what they are doing is saying that on most issues that they consider relevant, or important to themselves domestically and regionally, they see each other as really, really close important partners,” said Jonathan Fulton, a nonresident senior fellow at the Atlantic Council think tank.

    “Do they align on every issue? Probably not, but [they are] as close as anybody could be,” he said.

    Xi Jinping, who landed on Wednesday and departed Friday, was keen to show his Arab counterparts China's value as the world's largest oil consumer.

    An unwritten agreement between Saudi Arabia and the US has traditionally been an understanding that the kingdom provides oil, whereas the US provides military security and backs the kingdom in its fight against regional foes, namely Iran and its armed proxies.

    The kingdom has recently been keen to move away from this traditional agreement, saying that diversification is essential to Riyadh’s current vision.

    During a summit between China and countries of the Gulf Cooperation Council (GCC) in Riyadh, Xi said China wants to build on current GCC-China energy cooperation. The Chinese leader said the republic will continue to “import crude oil in a consistent manner and in large quantities from the GCC, as well as increase its natural gas imports” from the region.

    China is the world’s biggest buyer of oil, with Saudi Arabia being its top supplier.

    And on Friday, the Saudi national oil giant Aramco and Shandong Energy Group said they are exploring collaboration on integrated refining and petrochemical opportunities in China, reported the Saudi Press Agency (SPA).

    The statements come amid global shortages of energy, as well as repeated pleas by the West for oil producers to raise output.

    The kingdom this year already made one of its largest investments in China with Aramco’s $10 billion investment into a refinery and petrochemical complex in China’s northeast.

    China is also keen to cooperate with Saudi Arabia on security and defense, an important field once reserved for the kingdom’s American ally.

    Disturbed by what they see as growing threats from Iran and waning US security presence in the region, Saudi Arabia and its Gulf neighbors have recently looked eastward when purchasing arms.

    Chinese leader Xi Jinping and Arab counterparts pose for a group photo during the China-Arab summit in Riyadh on December 9, 2022.

    One of the most sacred concepts cherished by China is the principle of “non-interference in mutual affairs,” which since the 1950s has been one of the republic’s key ideals.

    What began as the Five Principles of Peaceful Coexistence between China, India and Myanmar in 1954 was later adopted by a number of countries that did not wish to choose between the US and the Soviet Union during the Cold War.

    Today, Saudi Arabia is keen to adopt the concept into its political rhetoric as it walks a tightrope between its traditional Western allies, the eastern bloc and Russia.

    Not interfering in one another’s internal affairs presumably means not commenting on domestic policy or criticizing human rights records.

    One of the key hurdles complicating Saudi Arabia’s relationship with the US and other Western powers was the repeated criticism over domestic and foreign policy. This was most notable over the killing of Washington Post columnist Jamal Khashoggi, the Yemen war and the kingdom’s oil policy – which US politicians accused Riyadh of weaponizing to side with Russia in its war on Ukraine.

    China has had similar resentments toward the West amid international concerns over Taiwan, a democratically governed island of 24 million people that Beijing claims as its territory, as well as human rights abuses against Uyghurs and other ethnic groups in China’s western Xinjiang region (which Beijing has denied).

    The agreed principle of non-interference, says Shihabi, also means that, when needed, internal affairs “can be discussed privately but not postured upon publicly like Western politicians have a habit of doing for domestic political purposes.”

    For both China and Saudi Arabia, not interfering in one another's internal affairs presumably means not commenting on domestic policy or criticizing human rights records.

    During his visit, Xi urged his GCC counterparts to “make full use of the Shanghai Petrol and Gas Exchange as a platform to conduct oil and gas sales using Chinese currency.”

    The move would bring China closer to its goal of internationally strengthening its currency, and would greatly weaken the US dollar and potentially impact the American economy.

    While many awaited decisions on the rumored shift from the US dollar to the Chinese yuan with regards to oil trading, no announcements were made on that front. Beijing and Riyadh have not confirmed rumors that the two sides are discussing abandoning the petrodollar.

    Analysts see the decision as a logical development in China and Saudi Arabia’s energy relationship, but say it will probably take more time.

    “That [abandonment of the petrodollar] is ultimately inevitable since China as the Kingdom’s largest customer has considerable leverage,” said Shihabi, “Although I do not expect it to happen in the near future.”

    John Kirby, Coordinator for Strategic Communications at the National Security Council in the White House, said the US is

    The US has been fairly quiet in its response to Xi’s visit. While comments were minimal, some speculate that there is heightened anxiety behind closed doors.

    John Kirby, the strategic communications coordinator at the US National Security Council, at the onset of the visit said it was “not a surprise” that Xi is traveling around the world and to the Middle East, and that the US is “mindful of the influence that China is trying to grow around the world.”

    “This visit may not substantively expand China’s influence but signal the continuing decline of American influence in the region,” Shaojin Chai, an assistant professor at the University of Sharjah in the United Arab Emirates, told CNN.

    Saudi Arabia was, however, keen to reject notions of polarization, deeming it unhelpful.

    Speaking at a press conference on Friday, Saudi Foreign Minister Prince Faisal bin Farhan Al Saud stressed that the kingdom is “focused on cooperation with all parties.”

    “Competition is a good thing,” he added, “And I think we are in a competitive marketplace.”

    Part of that drive for competitiveness, he said, comes with “cooperation with as many parties as possible.”

    The kingdom feels it is important that it is fully engaged with its traditional partner, the US, as well as other rising economies like China, added the foreign minister.

    “The Americans are probably aware that their messaging has been very ineffective on this issue,” said Fulton, normally “lecturing” partners about working with China “rather than putting together a coherent strategy working with its allies and partners.”

    “There seems to be a big disconnect between how a lot of countries see China and how the US does. And to Washington’s credit, I think they are starting to realize that.”

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    December 10, 2022
  • Big Oil has engaged in a long-running climate disinformation campaign while raking in record profits, lawmakers find | CNN Politics

    Big Oil has engaged in a long-running climate disinformation campaign while raking in record profits, lawmakers find | CNN Politics

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    CNN
     — 

    Big Oil companies have engaged in a “long-running greenwashing campaign” while raking in “record profits at the expense of American consumers,” the Democratic-led House Oversight Committee has found after a year-long investigation into climate disinformation from the fossil fuel industry.

    The committee found the fossil fuel industry is “posturing on climate issues while avoiding real commitments” to reducing greenhouse gas emissions. Lawmakers said it has sought to portray itself as part of the climate solution, even as internal industry documents reveal how companies have avoided making real commitments.

    “Today’s documents reveal that the industry has no real plans to clean up its act and is barreling ahead with plans to pump more dirty fuels for decades to come,” House Oversight Committee Chair Carolyn Maloney told CNN in a statement.

    For example, lawmakers reported, BP has stated it strives to “be a net zero company by 2050 or sooner,” but the committee found internal BP documents that show the company’s recent plans do not align with the company’s public comments.

    In a July 2017 email between several of the company’s high-level officials about whether to invest in curbing emissions from one of its gas projects off the coast of Trinidad and Tobago, BP’s vice president of engineering stated that BP had “no obligation to minimize GHG [greenhouse gas] emissions” and that the company should only “minimize GHG emissions where it makes commercial sense,” as required by code or if it fits into a regional strategy.

    The committee said documents uncovered also showed the fossil fuel industry has presented natural gas as a so-called “bridge fuel” to transition to cleaner sources of energy, all while doubling down on its long-term reliance on fossil fuels with no clear plan of action to full transition to clean energy.

    A strategy slide presented to the Chevron Board of Directors from CEO Mike Wirth and obtained by the committee states that while Chevron sees “traditional energy business competitors retreating” from oil and gas, “Chevron’s strategy” is to “continue to invest” in fossil fuels to take advantage of consolidation in the industry.

    In a 2016 email from a BP executive to John Mingé, then-Chairman and President of BP America, and others, about climate and emissions, an employee assessed that the company often adopted an obstructionist strategy with regulators, noting, “we wait for the rules to come out, we don’t like what we see, and then try to resist and block.”

    “The fossil fuel industry has of late been involved in extensive “greenwashing”—misleading claims in advertisements, particularly on social media, claiming or suggesting that they are “Paris aligned,” and that they are committed to meaningful solutions,” Naomi Oreskes, a Harvard professor who has studied the fossil fuel industry’s rebuke of climate science, told CNN. “Numerous analyses shows that these claims are untrue.”

    BP, Chevron, Exxon, Shell, the American Petroleum Institute and the U.S. Chamber of Commerce were the focus of Democratic lawmakers’ investigation. The companies have denied engaging in a disinformation campaign surrounding climate change and the role the industry has played in fueling it for decades. CNN has reached out to the companies and organizations for comment on the committee’s findings.

    Todd Spitler, a spokesperson for Exxon, said in a statement the committee took internal company communications out of context.

    “The House Oversight Committee report has sought to misrepresent ExxonMobil’s position on climate science, and its support for effective policy solutions, by recasting well intended, internal policy debates as an attempted company disinformation campaign,” Spitler said. “If specific members of the committee are so certain they’re right, why did they have to take so many things out of context to prove their point?”

    Democratic lawmakers had hoped the committee’s hearings would be the fossil fuel industry’s “Big Tobacco” moment — a nod to the famous 1994 hearings when tobacco CEOs insisted that cigarettes were not addictive, triggering accusations of perjury and federal investigations.

    The impact of House Oversight’s investigation into Big Oil will not be as immediate, but Rep. Ro Khanna, a Democrat and the chair of Oversight’s environmental subcommittee, said the findings have added to the historical record for the industry and its role in global warming.

    “These hearings and reports have been historic because we succeeded in bringing in the heads of Exxon, Chevron, Shell, BP, API, and the U.S. Chamber of Commerce to testify under oath for the first time ever about efforts to mislead the public on climate and forced them to provide explosive internal documents” Khanna told CNN in a statement. “I have no doubt that this work will be analyzed for years to come and help deepen our understanding about the entire industry’s role in funding and facilitating climate disinformation.”

    Democratic lawmakers said the oil and gas industry obstructed their investigation throughout the more than year-long process. Many of their requests for internal documents were heavily redacted by the companies, which did not specify reasons for withholding the information.

    In other cases, documents were heavily redacted because companies like Exxon said the information was “proprietary and confidential,” though the lawmakers noted that is not a valid reason to withhold information in a committee subpoena.

    “These companies know their climate pledges are inadequate but are prioritizing Big Oil’s record profits over the human costs of climate change,” Maloney said. “It’s time for the fossil fuel industry to stop lying to the American people and finally take serious steps to reduce emissions and address the global climate crisis they helped create.”

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    December 9, 2022
  • Why we think we’re in a recession when the data says otherwise | CNN Business

    Why we think we’re in a recession when the data says otherwise | CNN Business

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    A version of this story first appeared in CNN Business’ Before the Bell newsletter. Not a subscriber? You can sign up right here. You can listen to an audio version of the newsletter by clicking the same link.


    New York
    CNN Business
     — 

    It seems like you can’t go anywhere these days without colliding headfirst into another ominous prediction of imminent recession. CEOs, portfolio managers, politicians, news pundits, second cousins and even Cardi B are sounding the alarm: Hear ye! Hear ye! Economic downturn awaits all who dare enter 2023!

    But those predictions contradict the slew of positive economic data we’ve seen: The job market is healthy, wages are growing, Americans are spending and GDP is strong. Business is also good: Companies are largely beating revenue expectations and reporting positive earnings results.

    The Federal Reserve’s regimen of painful interest rate hikes meant to tame persistent inflation could certainly cool the economy — as could events in Eastern Europe and China — but the economy has been able to successfully endure nearly a year of hikes and war in Ukraine with barely a dent.

    It’s possible that recession chatter is just that. Chatter.

    What’s happening: No one would ever accuse investors of shying away from their emotions: Passions run high on trading floors where feelings are often as valid as facts and fear and greed can sometimes run the show. Economists, on the other hand, are a data-dependent, stoic bunch. The US economy is not Wall Street, and market downturns are not recessions — but sometimes they get jumbled together in the public eye and their borders become hazy.

    That appears to be the case: The Fed’s attempts to tamp down sky-high inflation are having an outsized impact on markets — the S&P 500 is down about 18% so far this year — but there has so far been little impact on the US economy as a whole.

    This week, a number of top executives warned of an economic slowdown in 2023. CEOs from Goldman Sachs, JPMorgan, General Motors, Walmart, United and Union Pacific all said they were making plans for less-profitable times ahead. But hidden behind those “CEO PREDICTS RECESSION” headlines lies a lot of uncertainty.

    Rising interest rates and geopolitical chaos are pointing towards storm clouds on the horizon, JPMorgan CEO Jamie Dimon told CNBC on Tuesday: “When you look out forward, those things may well derail the economy and cause this mild-to-hard recession that people are worried about.” When pressed to predict what was coming, he deflected. “It could be a hurricane. We simply don’t know,” he said. What was left unsaid was that sunny days are also a possibility.

    Feedback loop: United Airlines CEO Scott Kirby also told CNBC on Tuesday that “we’re probably going to have a mild recession induced by the Fed.” He then went on to say that demand in his industry is higher than ever and United entered the fourth quarter with profit margins near all-time highs. He doesn’t see any indication of a slowdown on the horizon, either.

    So why does he think a recession is coming? “If I didn’t watch CNBC in the morning, the word ‘recession’ wouldn’t be in my vocabulary,” he said. “You just can’t see it in our data.”

    It’s almost as though Kirby predicted recession was imminent because other prominent voices predicted that recession was imminent. And it’s possible that we’re all stuck in a feedback loop that amplifies unjustified fear.

    Prophecies are often self-fulfilling. If CEOs believe recession is coming, they preemptively batten down the hatches — and that means less spending and more layoffs, which in turn can trigger an economic downturn.

    Goldman CEO David Solomon said Tuesday that the bank may soon terminate staff and exercise caution with its financial resources due to the mounting economic uncertainty. Morgan Stanley will reportedly slash its workforce by about 1,600 people, roughly 2% of the total.

    The upside: Some parts of Wall Street seem to be avoiding the recession fervor. ​​A recent study by Goldman Sachs found that smart money is betting on a soft landing. Money managers have been favoring industrial and commodity stocks that are sensitive to economic downturns. Stocks that act as a buffer during economic downturns like consumer staples and utilities have fallen out of favor at investment funds with assets totaling almost $5 trillion, Goldman strategists found.

    “Current sector tilts are consistent with positioning for a soft landing,” they wrote.

    Oil prices have tumbled to their lowest level since Christmas as worries about the health of the economy weigh on crude, overshadowing concerns about new restrictions imposed on Russian energy, reports my colleague Matt Egan.

    Brent crude, the world benchmark, lost nearly 3% on Thursday to around $77.45 a barrel.

    The oil selloff comes after the West hit Russia with new restrictions that, so far at least, do not appear to be derailing global energy markets.

    The European Union on Monday imposed a ban on seaborne oil imports from Russia, while the West placed a $60 cap on Russian oil. Both moves are designed to hurt Russia’s ability to finance its war in Ukraine, without hurting consumers by causing Moscow to slash oil production.

    “Russia oil is still on the market. As of now, it appears Russia is willing to play ball,” said Robert Yawger, vice president of oil futures at Mizuho Securities.

    The tame reaction from energy markets is a welcome gift for Americans heading on long drives this holiday season, as prices at the gas pump are expected to continue their recent plunge.

    US oil this week hit its lowest level since December 23, 2021, before recovering a little on Thursday to trade up 2% at $73.60 a barrel. That leaves oil down by 43% since briefly topping $130 a barrel in March amid fears about Russia’s invasion of Ukraine.

    The national average price for regular gasoline dipped by three cents to $3.33 a gallon on Thursday, according to AAA. Gas prices have dropped 14 cents in the past week and 47 cents in a month. The national average is a cent lower than a year ago when they averaged $3.34 a gallon.

    Britain is bracing for further disruption from strikes heading into the Christmas period, as ambulance drivers and nurses join rail operators and postal workers in the worst wave of walkouts the country has endured for at least a decade, reports my colleague Hanna Ziady.

    More than 20,000 ambulance workers, including paramedics and call handlers, are expected to strike on December 21 in a dispute over pay, according to statements from labor unions GMB, Unison and Unite.

    The strike will involve just under half of all ambulance drivers in England, Wales and Northern Ireland, although unions have said they will cover life-threatening emergencies during the walkouts. More than 10,000 ambulance workers represented by the GMB Union will strike again on December 28.

    Strikes have swept the United Kingdom this year, as workers grapple with a cost-of-living crisis and stagnating wages. Consumer prices rose by 11.1% in the year to October, a 41-year high. Once inflation is taken into account, average wages fell by the biggest drop on record earlier this year, and were still declining in the June-September period.

    According to The Times newspaper, one million UK workers are set to strike in December and January. Data from the Office for National Statistics shows Britain has already lost at least 741,000 days to strike action this year, putting it on track for its worst year of labor disputes in at least a decade.

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    December 8, 2022
  • When China and Saudi Arabia meet, nothing matters more than oil | CNN Business

    When China and Saudi Arabia meet, nothing matters more than oil | CNN Business

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    Hong Kong
    CNN Business
     — 

    Chinese President Xi Jinping is visiting Saudi Arabia this week for the first time in nearly seven years, during which he is expected to sign billions of dollars of deals with the world’s largest oil exporter and meet leaders from across the Middle East.

    The visit is a sign that China and the Gulf region are deepening their economic relations at a time when US-Saudi ties have crumbled over OPEC’s decision to slash crude oil supply. As Xi wrote in an article published in Saudi media, the trip was intended to strengthen China’s relations with the Arab world.

    China is Saudi Arabia’s biggest trading partner and a source of growing investment. It’s also the world’s biggest buyer of oil. Saudi Arabia is China’s largest trading partner in the Middle East and the top global supplier of crude oil.

    “Energy cooperation will be at the center of all discussions between the Saudi-Chinese leadership,” said Ayham Kamel, head of Eurasia Group’s Middle East and North Africa research team. “There is great recognition of the need to build a framework to ensure that this interdependence is accommodated politically, especially given the scope of energy transition in the West.”

    Governments around the world have committed to drastically cutting carbon emissions over the coming decades. Countries such as Canada and Germany have doubled down on renewable energy investments to expedite their transition to net-zero economies.

    The United States has significantly increased domestic oil and gas output since the 2000s, while accelerating its transition to clean energy.

    The Russian invasion of Ukraine in February has triggered a global energy crisis that has left all countries racing to shore up supplies. And the West has further scrambled the oil markets by slapping an embargo and price cap on the world’s second biggest exporter of crude.

    Energy security has also increasingly become a key priority for China, which is facing significant challenges of its own.

    Last year, bilateral trade between Saudi Arabia and China hit $87.3 billion, up 30% from 2020, according to Chinese customs figures.

    Much of the trade was focused on oil. China’s crude imports from Saudi Arabia stood at $43.9 billion in 2021, accounting for 77% of its total goods imports from the kingdom. That amount also makes up more than a quarter of Saudi Arabia’s total crude exports.

    “Stability of energy supplies, in terms of both prices and quantities, is a key priority for Xi Jinping as the Chinese economy remains heavily reliant on oil and natural gas imports,” said Eswar Prasad, a professor of trade policy at Cornell University.

    The world’s second largest economy is heavily reliant on foreign oil and gas. 72% of its oil consumption was imported last year, according to official figures. 44% of natural gas demand was also from overseas.

    At the 20th Party Congress in October, Xi stressed that ensuring energy security was a key priority. The comments came after a spate of severe power shortages and soaring global energy prices following Russia’s invasion of Ukraine.

    As the West shunned Russian crude in the months that followed the invasion, China took advantage of Moscow’s desperate search for new buyers. Between May and July, Russia was China’s No. 1 oil supplier, until Saudi Arabia regained the top spot in August.

    “Diversity is a key ingredient for China’s long-term energy security because it cannot afford to put all of its eggs in one basket and turn itself into a captive of another power’s energy and geostrategic interests,” said Ahmed Aboudouh, a nonresident fellow with the Middle East Programs at the Atlantic Council, a research institute based in DC.

    “Although Russia is a source of cheaper supply chains, nobody can guarantee, with utmost certainty, that the China and Russia relationship will continue to shore up 50 years from now,” Aboudouh said.

    The Saudi Press Agency cited Saudi energy minister Prince Abdulaziz bin Salman as saying Wednesday that the kingdom would remain China’s “credible and reliable partner in this field.”

    Saudi Arabia also has strong motivations to deepen energy ties with China, according to Gal Luft, co-director of the Institute for the Analysis of Global Security.

    “The Saudis are concerned about losing market share in China in the face of a tsunami of heavily discounted Russian and Iranian crude,” he said. “Their goal is to ensure China remains a loyal customer even when the competitors offer [a] cheaper product.”

    Oil prices have fallen back to where they were before the Ukraine war on fears of a sharp global economic slowdown. The extent to which the Chinese economy can pick up pace next year will have a huge bearing on how bad that slump will be.

    Beyond security of supply, Saudi Arabia could offer Beijing another prize with bigger geopolitical ramifications.

    Riyadh has been in talks with Beijing to price some of its oil sales to China in the Chinese currency, the yuan, rather than the US dollar, according to a Wall Street Journal report. Such a deal could be a boost to Beijing’s ambitions to expand the Chinese currency’s global influence.

    It would also hurt the long-standing agreement between Saudi Arabia and the United States that requires Saudi Arabia to sell its oil only for US dollars and to hold its reserves partly in US Treasuries, all in return for US security guarantees. The “petrodollar system” has helped preserve the dollar’s status as the top global reserve currency and payment medium for oil and other commodities.

    Although Beijing and Riyadh never confirmed the reported talks, analysts said it was logical that the two sides would be exploring the possibility.

    “In the near future, Saudi Arabia could sell some of its oil and receive revenues in Chinese yuan, which makes economic sense as China is the kingdom’s top trading partner,” said Naser Al Tamimi, senior associate research fellow at ISPI, an Italian think tank on international affairs.

    Some believe it’s already happening, but that neither China nor the Saudis want to highlight it publicly.

    “They know too well how sensitive this issue [is] for the United States,” said Luft. “Both parties are overexposed to the US currency and there is no reason for them to continue to conduct their bilateral trade in a third party’s currency, especially when this third party is no longer a friend of either.”

    Xi’s visit could mark another step “in the erosion of the dollar’s status” as reserve currency, he added.

    Nonetheless, there are limits to the growing ties between Riyadh and Beijing.

    “The Biden administration’s approach to the Middle East has concerned the Saudis, and they see a growing relationship with China as a hedge against potential US abandonment and a tool for leverage in negotiations with the United States,” said Jon B. Alterman, director of the Middle East Program at the Center for Strategic and International Studies, a Washington DC-based think tank.

    The Biden administration has reoriented its policy priorities with a focus on countering China. At the same time, it has indicated its intention to downsize its own presence in the Middle East, sparking worries among allies there that the United States may not be as committed to the region as it used to be.

    “All that being said, Chinese-Saudi ties pale in both depth and complexity to Saudi-US ties,” Alterman said. “The Chinese remain a novelty to most Saudis, and they are additive. The United States is foundational to how Saudis see the world, and how they have seen it for 75 years.”

    Despite the possibility of shifting to yuan transactions, it’s too early to say Saudi Arabia would ditch the dollar in pricing its oil sales, analysts said.

    Eurasia Group’s Kamal believes it’s “highly unlikely” that Saudi Arabia would take such a step, unless there is an implosion on the US-Saudi relationship.

    “In essence there could be discussion on pricing of barrels to China in yuan, but this would be limited in size and probably only correspond to bilateral trade volumes,” he said.

    Prasad from Cornell University said countries like China, Russia, and Saudi Arabia are all eager to reduce their dependence on the dollar for oil contracts and other cross-border transactions.

    “However, in the absence of serious alternatives and with few international investors willing to place their trust in these countries’ financial markets and their governments, the dollar’s dominant role in global finance is hardly under serious threat,” he said.

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    December 7, 2022
  • Chinese President Xi Jinping lands in Saudi Arabia amid tensions with US | CNN

    Chinese President Xi Jinping lands in Saudi Arabia amid tensions with US | CNN

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    CNN
     — 

    Chinese President Xi Jinping landed in the Saudi Arabian capital Riyadh on Wednesday for a multiple-day visit, China’s official news agency Xinhua reported, amid frayed ties between the two countries and the United States.

    Saudi state TV showed Xi walking down the steps of his presidential aircraft at King Khalid International Airport, where he was received by Saudi Prince Faisal bin Bandar bin Abdulaziz, governor of the Riyadh region, and Prince Faisal bin Farhan bin Abdullah, Saudi foreign minister.

    A purple carpet was rolled out for the Chinese president, and canons were fired.

    The visit will include a “Saudi-Chinese summit,” a China-Arab and a China-Gulf Cooperation Council (GCC) summit, the official Saudi Press Agency (SPA) previously reported.

    Rumors of a Chinese presidential visit to the US’ largest Middle East ally have been circulating for months as the nations have solidified their ties, possibly to Washington’s dismay.

    The trip comes against the backdrop of a number of disagreements harbored by the US toward both Beijing and Riyadh, including grievances about oil production, human rights and other issues.

    But Saudi Arabia’s grand reception of the Chinese president is only emblematic of the magnitude of their growing relationship, specifically around oil, trade and security. The two countries are expected to sign deals worth more than $29 billion during this week’s visit, according to SPA.

    China is today Saudi Arabia’s largest trading partner, with the value of the kingdom’s exports to China having exceeded $50 billion last year, constituting more than 18% of Saudi Arabia’s total exports in 2021. Bilateral trade between the two states is more than $80 billion dollars, SPA reported.

    Saudi Arabia has also traditionally been China’s top oil supplier, with Saudi barrels making up around 17% of total Chinese oil imports as of last year, according to the Saudi-backed Arab News.

    While the kingdom remains a key supplier for its Chinese partner, oil relations may have been slightly on edge this year as sanctioned Russia pours its discounted barrels into the Asian market.

    Apart from oil exports, Saudi Arabia has this year ramped up its Chinese investments, which culminated in Aramco’s whopping $10 billion dollar investment into a refinery and petrochemical complex in China’s northeast.

    These close ties have been years in the making as both countries have sought to diversify their security and energy sources, experts say.

    “Now it is the height of the bilateral relations between the two since their establishment of diplomatic relations in 1992,” Shaojin Chai, an assistant professor at the University of Sharjah in the United Arab Emirates, told CNN.

    “They become closer as both sides need each other in many areas: energy transition, economic diversification, defense capacity building for KSA and climate change, to name just a few,” said Chai, referring to the Kingdom of Saudi Arabia, and adding that “the diversification of security risk entails KSA including rising China in its hedge.”

    While China and Saudi Arabia’s friendship has blossomed over the decades, they seem to have become closer as both find themselves in precarious positions in regard to the US.

    A strong American ally for eight long decades, Saudi Arabia has become bitter over what it perceives to be waning US security presence in the region, especially amid growing threats from Iran and its armed proxies in the Middle East.

    An economic mammoth in the east, China has been at odds with the US over Taiwan, the democratically governed island of 24 million people that Beijing claims as its territory despite never having controlled it.

    US President Joe Biden has repeatedly vowed to help Taiwan in the event of an attack by China, which has not ruled out the use of force to “reunify” with the island.

    The thorny topic has gravely aggravated a precarious relationship between Washington and Beijing, who are already competing for influence in the volatile Middle East.

    China has also been cementing its ties with other Gulf monarchies, as well as with US foes Iran and Russia.

    “If they’re signaling anything to the rest of the world, I suspect it’s mainly that they are two important countries with a deep, interest-based relationship,” said Jonathan Fulton, a nonresident senior fellow at the Atlantic Council think tank.

    “At a time when negative perceptions of China dominate in much of the West, Xi will be lavishly welcomed in Saudi Arabia, the most important Arab state, the most important country in global Islam, and a major actor in global energy markets,” Fulton told CNN.

    “And the Saudis can show that they remain important to extra-regional powers, even if their relationship with Washington is rocky,” he added.

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    December 7, 2022
  • Swiss climate activists lament election of oil lobbyist

    Swiss climate activists lament election of oil lobbyist

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    BERLIN — Swiss environmentalists criticized the election Wednesday of a top car- and oil-industry lobbyist to the new government, calling it a “disaster for climate policy.”

    Lawmakers picked Albert Roesti of the nationalist Swiss People’s Party as one of two new members of the Cabinet, or Federal Council.

    The election was necessary following the retirement of two long-serving members in the seven-seat government, which traditionally includes politicians from all the country’s major parties.

    Roesti was until recently the president of Switzerland’s fuel importer association Swissoil. He remains the president of Auto Schweiz, the association of car importers in Switzerland. As part of his lobby work, Roesti successfully campaigned against a bill designed to reduce the Alpine nation’s greenhouse gas emissions.

    “In the middle of the climate crisis the Swiss Parliament has elected the top car and oil lobbyist to the Federal Council,” the group Climate Strike said in a statement. “This is a disaster not just for Switzerland, but our entire generation.”

    It called on other members of the government not to let Roesti head the Ministry for Environment, Energy and Transport. That post became vacant with the retirement of Simonetta Sommaruga, one of two departing ministers.

    Also elected to the council Wednesday was Elisabeth Baume-Schneider, a member of the left-leaning Social Democrats.

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    December 7, 2022
  • The clean energy company turning city blocks greener | CNN Business

    The clean energy company turning city blocks greener | CNN Business

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    New York
    CNN Business
     — 

    BlocPower, a Brooklyn-based clean energy company, is bringing eco-friendly, all-electric heating and cooling systems to older buildings in lower income communities, with the goal of reducing carbon footprints and energy bills.

    Backed by investors like Goldman Sachs’ Urban Investment Group and Microsoft’s Climate Innovation Fund, BlocPower brings all-electric smart technology to heating, cooling and hot water systems that save building owners between 20% and 40% annually and ups property values, according to the company’s website. By replacing dated equipment like gas powered furnaces with heat pump systems, the company says it is able to dramatically change a building’s environmental footprint.

    “We turn buildings into Teslas,” CEO Donnel Baird told CNN. “Just like Tesla rips the fossil fuel engines out of vehicles and replaces that with smart, modern, all electric engines, we now can rip all of the fossil fuel equipment out of our homes and schools and buildings and replace it with smart, modern, all electric, healthy equipment that’s good for the planet and good for our families.”

    Having completed energy projects in over 1,200 buildings since its founding in 2014, BlocPower is now mapping all 125 million buildings across America with a grant from billionaire Amazon founder Jeff Bezos’s Bezos Earth Fund. The startup will then analyze which are the most environmentally sustainable. Based on that, buildings will get a sustainability plan to figure out how to best decarbonize.

    “Every American family that lives in their home or church or synagogue or mosque or school is going to get a free plan from us about how they can green their individual buildings based on what our computer software recommends,” said Baird. “Building that recommendation engine using the latest greatest technology from Silicon Valley is how we’re going to scale this thing.”

    In addition to using “the latest greatest technology” to make much of the country greener, BlocPower is also taking a more traditional approach: going block by block, building by building, to speak directly with owners about installations.

    “I was just taught that one-on-one conversations and one-on-one relationships were the most important kind of communication in order to move people into action,” said Baird on how his time as a community organizer in the poorest sections of Brooklyn informed his company’s approach. “Greening buildings can be really difficult and complicated and hard and a little scary and expensive….What we find after we’ve had thousands and thousands of one-on-one conversations is that it does form a block or a portfolio or a network of relationships and buildings of people who are connected with one another.”

    Part of the challenge is BlocPower must convince building owners to make a sizable bet. A ductless air source heat pump like the one from BlocPower could require an investment of $25,000-$30,000 for a 2,000 square foot home, according to the company’s website, though this varies home by property. But BlocPower says the investment pays off over time in savings and other benefits.

    Building owners that have turned to BlocPower say they see a real difference. Lincoln Eccles, an apartment building owner who installed the eco-friendly tech, had been looking to overhaul his heating system when his boiler died in the middle of the pandemic. BlocPower lowered bills, made the energy system quieter, cleaned the air and offered cooling solutions that tenants are thrilled with.

    “This is hero status work,” Eccles told CNN Business. “I’ve literally had tenants come up to me and thank me for the system and tell me that they see a real savings in their actual electricity unit use with the the rate that we have from Con Edison.”

    Through energy and heat pump technology, BlocPower is confident in its ability to upend the energy sector while reducing carbon footprints and bills. The company’s goal is to limit greenhouse gas emissions and lift up local communities through changing out older energy systems that rely on burning fossil fuels and employing local workers to complete the green construction projects, according to Baird.

    “What needs to happen now is we need to shift gears and move the entire infrastructure of energy systems and buildings away from fossil fuels to clean energy,” said Baird. “We can’t persuade everybody that saving the planet is their top priority — although it should be — but ensuring that people are healthy, comfortable, saving money, those are top priority items, and these heat pumps allow us to do all of those things”

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    December 7, 2022
  • US trade deficit edged up to $78.2 billion in October | CNN Business

    US trade deficit edged up to $78.2 billion in October | CNN Business

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    New York
    CNN Business
     — 

    The US trade gap edged only slightly higher in October than the month before, to $78.2 billion.

    The latest reading was up just 5.4%, less than half the pace of increase from the revised September reading, when the trade deficit jumped by 12.7% to $74.1 billion.

    A strong dollar and weaker global demand weighed on exports both months. A strong dollar makes US goods more expensive to foreign buyers and it also makes imports more affordable for US buyers. But economic slowdowns in overseas markets also hit US exports in the most recent readings.

    The latest report shows exports fell 0.7% in October compared to the month before, and are down nearly 2% from the record exports set in August. Most of the drop was in the export of goods, rather than services, which fell 4.4% compared to August.

    Oil prices have come down since earlier this year, according to data released in the report. The average price of crude oil imports in the month was $82.05 a barrel, down 5.7% from September, and down 21.7% from the peak in June.

    But the United States now exports more petroleum products, by dollars, than it imports. So a lower price of crude no longer helps the trade deficit the way it might have done in the past, when crude and petroleum product imports vastly exceeded exports.

    The deficit in the movement of goods between the United States and China narrowed significantly in the latest report, falling 22.6% to $28.9 billion from $37.3 billion, one factor in the smaller trade gap increase.

    Although most of that narrowing was due to a 31.3% jump in the export of US goods to China, compared to September, a 9.5% decline in US imports of Chinese goods was also a factor in the smaller trade deficit between the two countries.

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    December 6, 2022
  • US stocks lose ground as markets ponder the Fed’s next moves

    US stocks lose ground as markets ponder the Fed’s next moves

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    NEW YORK — Stocks fell in morning trading on Wall Street Tuesday as markets ponder the Federal Reserve’s next moves on fighting inflation.

    The S&P 500 fell 0.9% as of 10:15 a.m. Eastern. The Dow Jones Industrial Average fell 139 points, or 0.4%, to 33,801 and the Nasdaq fell 1.4%.

    Technology stocks and retailers had some of the biggest losses. Apple fell 1.5% and AutoZone fell 5%,

    Bond yields mostly held steady. The yield on the 10-year Treasury fell slightly to 3.57% from 3.58% late Monday.

    European markets were mostly lower and Asian markets closed mixed.

    Several companies made big moves following financial updates and buyout announcements.

    Utility NRG Energy slumped 11.4% after announcing it is spending $2.8 billion in cash and assuming $2.4 billion in debt to buy Vivint Smart Home.

    Jewelry company Signet rose 18.6% after raising its profit and revenue forecasts for the year.

    The broader market’s dip comes a day after stocks pulled back as stronger-than-expected readings on the economy raised worries that the Fed has a ways to go in getting inflation under control. The Fed is doing that by intentionally slowing the economy with higher interest rates.

    Investors are closely watching economic data and company announcements to get a better sense of how the economy is handling stubbornly hot inflation. They are also trying to determine whether inflation is easing at a pace that will allow the Fed to ease up on interest rate increases. The Fed’s policy risks hitting the brakes on the economy too hard and sending it into a recession.

    Wall Street will get a weekly update on unemployment claims on Thursday. The job market has been one of the stronger pockets in the economy.

    Investors will get important updates on inflation and how consumers are dealing with high prices later in the week.

    On Friday, the government will release its November report on producer prices. That will give investors more insight into how inflation is impacting businesses.

    The University of Michigan will release its December survey on consumer sentiment on Friday.

    With growing concern about a recession, Fitch Ratings revised its forecasts for world economic growth downward to reflect the Fed’s and other central banks’ interest rate hikes.

    The ratings agency’s Global Economic Outlook report estimated global growth at 1.4% in 2023, revised down from 1.7% in its September forecast. It put U.S. growth in 2023 at 0.2%, down from 0.5%, as the pace of monetary policy tightening increases.

    ———

    Elaine Kurtenbach and Matt Ott contributed to this report.

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    December 6, 2022
  • Atlanta house fire kills 2 during gas leak in front yard

    Atlanta house fire kills 2 during gas leak in front yard

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    ATLANTA — An Atlanta house fire killed two people over the weekend and the National Transportation Safety Board is investigating, the agency announced Sunday.

    The fire involved natural gas, according to a tweet from the NTSB, which investigates pipeline mishaps.

    A fire department statement said crews responded to a northwest Atlanta home around 8:30 a.m. on Dec. 3, the Atlanta Journal-Constitution reported. Atlanta Fire Rescue Department officials said a gas leak was found in the front yard after crews extinguished the heavy blaze.

    Other news reports said Atlanta Gas Light, the largest natural gas distributor in the Southeast, attributed the cause of the fire to the leak. Fire officials said the origins were still under investigation.

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    December 4, 2022
  • OPEC+ oil producers face uncertainty over Russian sanctions

    OPEC+ oil producers face uncertainty over Russian sanctions

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    FRANKFURT, Germany — The Saudi-led OPEC oil cartel and allied producing countries, including Russia, are expected to decide how much oil to supply to the global economy amid weakening demand in China and uncertainty about the impact of new Western sanctions against Russia that could take significant amounts of oil off the market.

    The 23-country OPEC+ alliance are scheduled to meet Sunday, a day ahead of the planned start of two measures aimed at hitting Moscow’s oil earnings in response to its war in Ukraine. Those are a European Union boycott of most Russian oil and a $60-per-barrel price cap on Russian exports imposed by the EU and Group of Seven democracies.

    Russia rejected the price cap approved Friday and threatened to stop supplying the nations that endorsed it.

    Oil has been trading lower on fears that coronavirus outbreaks and China’s strict zero-COVID restrictions would reduce demand for fuel in one of the world’s major economies. Concerns about recessions in the U.S. and Europe also raise the prospect of lower demand for gasoline and other fuel made from crude.

    That uncertainty is the reason OPEC+ gave in October for a slashing production by 2 million barrels per day starting in November, which some saw as a possible move to help Russia weather the European embargo. The impact had some limitations because OPEC+ countries already can’t meet their quotas.

    With the global economy slowing, oil prices have been falling since summertime highs, with international benchmark Brent closing Friday at $85.42 per barrel, down from $98 a month ago. That has eased gasoline prices for drivers in the U.S. and around the world.

    On the other side, the price cap and EU boycott could take an unknown amount of Russian oil off the global market, tightening supply and driving up prices. To prevent a sudden loss of Russian crude, the price cap allows shipping and insurance companies to transport Russian oil to non-Western nations at or below that threshold. Most of the globe’s tanker fleet is covered by insurers in the G-7 or EU.

    Russia would likely try to evade the cap by organizing its own insurance and using the world’s shadowy fleet of off-the-books tankers, as Iran and Venezuela have done, but that would be costly and cumbersome, analysts say.

    Facing those uncertainties for the global oil market, OPEC oil ministers led by Saudi Arabia could leave production levels unchanged or cut output again to keep prices from declining further. Low prices mean less revenue for governments of producing nations.

    “We feel that the meeting will be fairly short, and the alliance will stick to the current output targets,” said Gary Peach, oil markets analyst with Energy Intelligence. Standing pat makes sense “all the more so because oil is at $87 per barrel (earlier Friday), which is a good price for everybody. … Of course, $98 is better, but right now I think they see the market as adequately priced, adequately supplied and there’s no reason to rock the boat.”

    Analysts at Clearview Energy Partners, on the other hand, expect OPEC+ to announce a production cut of 1 million barrels per day. Some members are underproducing, so that would more likely amount to a production cut of roughly 580,000 barrels per day.

    A cut of that magnitude wouldn’t cause a problem with global supplies, even when taking into consideration the EU ban on Russian oil, which is expected to pull another 1 million barrels off the market, said Jacques Rousseau, managing director at Clearview Energy Partners. Oil use declines in the winter, in part because fewer people are driving.

    But the G-7 price cap could prompt Russia to retaliate and take more oil off the market. The Saudis are “likely to share the Kremlin’s interest in quashing the G-7’s rising buyers’ cartel,” said Kevin Book, another managing director at Clearview.

    The cap of $60 a barrel is near the current price of Russian oil, meaning Moscow could continue to sell while rejecting the cap in principle.

    “If Russia ends up taking off more oil than about a million barrels per day, then the world becomes short on oil, and there would need to be an offset somewhere, whether that’s from OPEC or not,” Rousseau said. “That’s going to be the key factor — is to figure out how much Russian oil is really leaving the market.”

    ———

    Bussewitz reported from New York.

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    December 4, 2022
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