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Oil Price Armageddon As OPEC Disintegrates – OilPrice.com

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Tom Kool

Tom majored in International Business at Amsterdam’s Higher School of Economics, he is Oilprice.com’s Head of Operations

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It appears that the OPEC+ alliance may soon be over as Russia refuses to cut and its oil minister hints at increasing production.

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Friday, March 6th, 2020

Oil prices plunged by more than 8 percent after the OPEC+ meeting broke up with no deal. Saudi Arabia and Russia negotiated behind closed doors in Vienna, but Moscow refused to sign on to deeper production cuts. Now there is uncertainty about whether the OPEC+ alliance will survive. A day earlier, OPEC essentially issued an ultimatum, calling for 1.5 mb/d of production cuts, but suggested that no deal would occur without Russia. At the time of this writing, oil prices were in freefall. WTI was below $43 and Brent near $46. 

OPEC+ facing demand “trap.”Moscow has balked at deeper production cuts not only because it has a stronger stomach for lower prices than Riyadh, but also because the oil market is suffering from a demand trap. That is, restraining supply may not rescue prices when global oil demand has fallen so sharply. 

What next? At the time of this writing, there is some speculation that not only has OPEC+ failed to agree on additional production cuts, but also that the current OPEC+ agreement – the one from December – is set to expire in March, after which producers can raise output. The entire OPEC/non-OPEC alliance is now on the rocks, although the group pledged to continue to talk going forward. 

Related: Iraq Plans Production Surge In The Face Of New OPEC Cut

Exxon maintains aggressive spending. Despite pressure from investors to focus on cash flow and only modest growth, ExxonMobil (NYSE: XOM) laid out its medium-term corporate strategy in an investor presentation this week, one that continues to rely heavily on production growth. Exxon trimmed its spending somewhat, but remains largely unbowed in its view that heavy spending will pay off. The company’s share price fell sharply on the news. Meanwhile, Chevron (NYSE: CVX) promised to earmark more money for shareholders, pledging $80 billion in payouts over five years. 

European and American oil majors diverge. European oil majors have adopted climate targets and have made initial investments in renewable energy, promising to gradually make a transition to a lower-carbon portfolio. The American oil majors are largely digging in and rejecting such strategies. 

IHS: Oil demand to fall by most in history. Global oil demand could fall by as much as 3.8 mb/d in the first quarter, the largest contraction in history, according to IHS Markit. A growing number of analysts now see negative oil demand for the full year in 2020. 

Airlines could lose $113 billion. Airlines could lose as much as $63 to $113 billion this year due to the coronavirus, according to the International Air Transport Association. 

CNPC declares force majeure on LNG. CNPC declared force majeure on prompt natural gas imports, the second Chinese buyer to do so. 

Gas industry seeks to block gas bans. A growing number of U.S. cities are exploring bans on natural gas hookups in new commercial and residential construction. In response, gas lobbyists are pressing state legislatures to preempt municipal bans. Arizona recently passed a law blocking cities from banning gas hookups.

Gas falling out of favor with investors. Bloomberg notes that investors are souring on natural gas, with local gas distributors now trading for less than electric utilities in relation to projected earnings. “Right now, anyway you look at it, natural gas is not seen as something that is very friendly,” Shahriar Pourreza, an analyst at Guggenheim Securities LLC, told Bloomberg. The poor performance reflects dim long-term prospects. 

Related: Are Oil Majors Facing A Terminal Decline?

Cargo at U.S. ports down 20 percent. Cargo volumes at U.S. ports could be down by as much as 20 percent in the first quarter.

Coal use falls fastest in 65 years.
U.S. coal consumption fell by 13 percent in 2019, the fastest decline rate since the 1950s. The EIA expects coal co decline at a similar rate this year. 

BNSF loses bid to ship shale oil across tribal land. BNSF Railway shipments of oil across tribal land in Washington state violated a right-of-way and easement agreement, according to a ruling from a federal court. 

ConocoPhillips exits DJ Basin. ConocoPhillips (NYSE: COP) agreed to sell its Niobrara assets for an estimated $380 million, exiting the basin.

Warren Buffet bails on Canadian LNG. Warren Buffet’s Berkshire Hathaway decided against investing $4 billion in an LNG and pipeline project in Quebec.

By Tom Kool for Oilprice.com

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New Brunswick to move to Green phase on July 30; reports three new COVID-19 cases Friday – CTV News Atlantic

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HALIFAX —
New Brunswick will move into the Green phase of its recovery plan on July 30, lifting all public health restrictions and opening the province to travel, Premier Blaine Higgs announced Friday.

“This morning, Cabinet and the all-party cabinet committee on COVID-19 agreed that New Brunswick’s mandatory order will not be renewed on July 30. This will lift all mandatory travel and public health restrictions that have been in place since the pandemic began,” said Higgs during Friday’s news update.

As of 11:59 p.m. on July 30, the following restrictions will be removed in the province.

  • Lift all mandatory travel and public health restrictions that have been in place over the course of the pandemic.
  • Lift all provincial border restrictions; provincial border checks will cease, and registration will no longer be required to enter New Brunswick from anywhere in Canada.
  • Lift all limits on gatherings and the number of people within facilities. Capacity limits in theatres, restaurants and stores will no longer be required.
  • End the requirement to wear face masks in public.

“We came to this decision because we have reached our goal of 75 per cent of our eligible population having received their first vaccine, and are now at 81 per cent,” said Higgs on Friday. “We know that there will be new cases, but thanks to the amount of people that are already vaccinated, we do not think that our health care system will be threatened.”

As of midnight on July 30, all provincial border restrictions will be lifted, provincial border checks will cease, and registration will no longer be required to visit New Brunswick from anywhere in Canada.

However, travellers will still be subject to Canada’s federal restrictions on International travel.

“We will be living with COVID-19, so we encourage New Brunswickers to continue to practise protective health measures such as hand-washing, coughing in your elbow, staying home when sick and wearing a mask if you so choose,” said Dr. Jennifer Russell, chief medical officer of health. “This virus is still with us and we should all expect to see cases as normal travel returns. If you have symptoms, get tested.”

During Friday’s news update, Higgs and Russell emphasized that some facilities and businesses may choose to maintain their own policies on protective health measures, even after restrictions are lifted. 

“When we move to Green, not everyone will feel ready to jump back into life as if nothing happened. We all will have to adapt to this new environment in our own way,” said Higgs. “For some, the return to normal will be at a fast pace. Others may want to ease out of the safety measures we have been surrounded by for so long. There is no right way to do this. Everyone must do what feels best for them while remaining safe.”

THREE NEW CASES ANNOUNCED FRIDAY

New Brunswick is reporting three new cases of COVID-19 on Friday, along with one recovery, as the active number of cases in the province rises to 10.

Two of the new cases were identified in the Saint John region (Zone 2), involving two people ages 19 and under, are both related to travel.

One new case was identified in the Fredericton region (Zone 3), involving an individual in their 20s, and remains under investigation.

New Brunswick has had 2,350 cumulative cases of COVID-19 since the start of the pandemic.

In total, 2,293 people have recovered, and 46 people have died in the province from COVID-19.

There is currently no one hospitalized in New Brunswick due to COVID-19.

“We are approaching having one-million COVID-19 vaccines in the province, a very important milestone in our fight against the virus for our province and the country,” said Russell. “While we are well on our way to getting as many New Brunswick’s vaccinated as we can, we must remember that the COVID-19 virus still exists and can still spread. While case numbers have been low, we are still encouraging anyone having symptoms to make an appointment to get tested.”

On Thursday, 727 tests were conducted in the province. A total of 376,470 tests have been conducted since the beginning of the pandemic.

The number of cases is broken down by New Brunswick’s seven health zones:

  • Zone 1 – Moncton region: 490 confirmed cases (six active cases)
  • Zone 2 – Saint John region: 300 confirmed cases (two active cases)
  • Zone 3 – Fredericton region: 449 confirmed cases (two active cases)
  • Zone 4 – Edmundston region: 754 confirmed cases (no active cases)
  • Zone 5 – Campbellton region: 185 confirmed cases (no active cases)
  • Zone 6 – Bathurst region: 133 confirmed cases (no active cases)
  • Zone 7 – Miramichi region: 39 confirmed cases (no active cases)

THOUSANDS OF VACCINE APPOINTMENTS AVAILABLE

In a release issued Tuesday, New Brunswick health officials say there are thousands of first and second dose Pfizer and Moderna appointments available at regional health authority clinics and participating pharmacies.

Vaccination clinics are taking place every day this week with appointments available in each region. New Brunswickers who have yet to be immunized with two doses of vaccine are encouraged to book an appointment through a participating pharmacy or at a Vitalité or Horizon health network clinic.

New Brunswick’s COVID-19 online dashboard provides an update on the amount of vaccines that have been administered to date.

As of Friday, 997,798 doses of COVID-19 vaccine have been administered in New Brunswick. The province says 81.2 per cent of the eligible population has received at least one dose, with 62.7 per cent now fully vaccinated.

All eligible New Brunswickers can book their second dose appointments if at least 28 days have passed since their first dose.

To receive their second dose, New Brunswickers are asked to bring a signed consent form, their Medicare card and a copy of the record of immunization provided after receiving their first dose.

Appointments for people who have not yet received their first dose continue to be available to all New Brunswickers aged 12 and older at regional health authority clinics and through participating pharmacies.

Public Health is also reminding New Brunswickers to keep a copy of their Record of Immunization form as their official proof of vaccination.

YELLOW LEVEL REMINDER

All of New Brunswick remains under the Yellow level of recovery under the province’s order, which will be lifted effective 11:59 p.m. July 30.

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International passengers at Pearson airport may have to line up by vaccination status – The Globe and Mail

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International travellers arriving at Canada’s largest airport may now be funnelled into different customs lines based on their vaccination status.

Toronto’s Pearson International Airport says it may be splitting passengers coming from the U.S. or other international destinations into vaccinated and partially or non-vaccinated queues.

A spokeswoman for the Greater Toronto Airports Authority says it’s a measure to help streamline the border clearance process since there are different requirements for both sets of travellers.

The Vancouver International Airport has instituted a similar policy.

Canada’s travel restrictions for vaccinated and unvaccinated people, explained

Fully vaccinated Canadian citizens and permanent residents are now able to skip a 14-day quarantine.

As of Aug. 9, fully vaccinated U.S. citizens and permanent residents will be allowed into Canada, followed by the rest of the world on Sept 7.

Ontario reported 170 new cases of COVID-19 on Saturday and three more deaths.

In Toronto, there were 44 new cases, with another 26 in Peel Region, 17 in Hamilton, 15 in the Region of Waterloo and 13 in Grey Bruce.

The numbers were based on 19,131 tests.

There were 132 patients in intensive care with critical COVID-related illness and 86 on ventilators.

More than 124,000 doses of vaccines were administered in the previous day, for a total of more than 18.8 million.

Of the 170 new cases, 122 of them are in people under age 40, while just one of the new cases is in someone 80 or older.

Our Morning Update and Evening Update newsletters are written by Globe editors, giving you a concise summary of the day’s most important headlines. Sign up today.

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Toronto Pearson Airport begins separating arrivals based on vaccination status – CP24 Toronto's Breaking News

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International passengers arriving at Toronto Pearson Airport will now be separated by vaccination status before heading through customs, the airport confirmed Saturday.

“Passengers entering Canada from the U.S. or another international destination may be split into vaccinated and non/partially-vaccinated queues prior to reaching Canada Customs,” Beverly MacDonald, Senior Advisor of Communications at Toronto Pearson told CTV News Toronto Saturday,

The airport said the decision was made to help streamline border clearance, as there are different entry requirements for vaccinated and non- or partially-vaccinated travellers.

Currently, fully vaccinated travellers entering Canada may qualify for certain exemptions to quarantine and testing requirements, while non- or partially-vaccinated travellers will not qualify for exemptions to quarantine and testing requirements.

Come Aug. 9, fully vaccinated U.S. citizens will be exempt from quarantine and testing requirements, much like their Canadian counterparts.

“We know that the arrivals experience is different for passengers than it was in pre-pandemic times, and we appreciate passengers’ patience,” MacDonald said.

Pearson isn’t the first Canadian airport to implement this strategy. Vancouver International Airport has also begun separating arrivals by vaccination status, installing signs directing vaccinated and non- or partially- vaccinated travellers into separate customs lines.

Recently, Ontario Premier Doug Ford shut down the idea of “vaccine passports” — proof of vaccination intended to help streamline international travel.

“The answer is no, we’re not gonna do it. We’re not gonna have a split society,” Ford told reporters last week.

However, the Ontario COVID-19 Science Advisory Table issued a 21-page briefing on the potential of a provincial vaccine certification program Wednesday, claiming that one “could be useful in reopening higher-risk settings … sooner.”

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