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US inflation eases to 3.3pc in May as Fed meets

  • : Agriculture, Crude oil, LPG, Metals, Natural gas
  • 24/06/12

US consumer inflation eased slightly in May for a second month, a sign Federal Reserve rate hikes are having some success in reining in inflation pressures after a spurt of gains earlier this year.

The consumer price index (CPI) slowed to an annual 3.3pc in May from 3.4pc in April, the Bureau of Labor Statistics reported today. So-called core inflation, which strips out volatile food and energy prices, increased by 3.4pc over the past year, the lowest reading in three years, from 3.6pc through April.

The energy index rose by an annual 3.7pc, compared to a 2.6pc rise in April, while the gasoline index rose by 2.2pc versus 1.2pc in April. Energy services rose by an annual 4.7pc.

Headline inflation had ticked up from 3.1pc in January amid stronger than expected economic data, prompting the Federal Reserve to delay widely expected rate cuts as it pledged it needed to see more evidence of a "sustained" slowing in inflation.

The inflation report, which came in slightly under economists' median forecasts, comes hours ahead of a Federal Reserve policy announcement today expected to reveal projections on whether Fed members still expect to begin cutting the target rate this year and by how much. Fed policymakers today are widely expected to keep their target rate unchanged.

The Fed hiked its target rate to a 23-year high of 5.25-5.5pc in July 2023 and has kept it there since as it has battled to bring down inflation that hit a high of 9.1pc in June 2022.

After the report, the CME's FedWatch tool signaled a 73pc probability that the Fed will cut its target rate in September from near 53pc odds Tuesday.

CPI was unchanged from the prior month, the first flat monthly reading in two years, following a 0.3pc monthly gain in April and 0.4pc gains in the prior two months. Core CPI was up by 0.2pc for the month after a monthly gain of 0.3pc in April.

The energy index fell 2pc in May on the month after rising 1.1pc the prior month. The food index rose by 0.1pc in May after being unchanged the prior month.

By Bob Willis


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Williams to resume Louisiana gas line construction


24/07/19
24/07/19

Williams to resume Louisiana gas line construction

New York, 19 July (Argus) — US natural gas pipeline company Williams on Friday told federal energy regulators it will proceed with construction of its delayed 1.8 Bcf/d (51mn m³/d) Louisiana Energy Gateway (LEG) gas gathering line in Louisiana. Williams' letter of intent to the US Federal Energy Regulatory Commission (FERC) is the culmination of a series of lawsuits across multiple Louisiana parishes brought by US midstream rival Energy Transfer, which seeks to stop Williams and two other pipeline companies from crossing its own gas line in the Haynesville shale. While Williams is still waiting on a final ruling over two crossings in Vernon Parish, its recent legal victories over Energy Transfer and acquisition of necessary federal permits and easements from landowners have made it possible to commence construction of LEG, Williams said. The final ruling out of Vernon Parish will be decided "soon," Williams said. Williams said it intends to release its contractor to resume pre-construction activities along its right-of-way as early as 25 July, then proceed with construction. "But for the crossing litigation with Energy Transfer, construction of [LEG] would be well underway," Williams said. The litigation has pushed Williams' expected in-service date for LEG from late 2024 to the second half of 2025. Williams prevailed over Energy Transfer earlier this month in DeSoto Parish and in early June in Beauregard Parish . By Julian Hast Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

New Libyan firm starts exporting crude


24/07/19
24/07/19

New Libyan firm starts exporting crude

State-owned NOC subsidiary Agoco appears to be paying for work at its fields with crude, writes Aydin Calik London, 19 July (Argus) — A little-known Libyan firm has begun exporting crude, according to sources, official documents and ship-tracking data seen by Argus . Arkenu Oil, which describes itself as a private oil and gas development and production firm, exported 1mn bl of Sarir/Mesla from the port of Marsa el-Hariga on 10 July on the Zeus, a Suexmax . Shipping agent and port reports list Chinese trading firm Unipec as the charterer. The Zeus' bill of lading lists Libyan state-owned NOC as the sender of the consignment on behalf of Arkenu. Libyan crude sales have historically been the preserve of NOC and a handful of international oil firms that hold stakes in the country's upstream, including Italy's Eni, TotalEnergies and Austria's OMV. Turkey-based commodities trader BGN, which does not have upstream production in Libya, also regularly appears on loading programmes as a seller of the country's crude. According to a document dated 10 July, NOC allocated to Arkenu an unspecified share of production from its subsidiary Agoco's Sarir and Mesla fields in return for Arkenu carrying out development work at the sites. This implies that Agoco is paying Arkenu for the work in crude. Arkenu's 1mn bl cargo is worth around $84mn at prevailing market rates, Argus estimates. Arkenu, set up in early 2023 in the eastern city of Benghazi, says it owns modern drilling rigs and has a team of experts "who have held high positions in major oil production and development companies". It is unclear what work Arkenu has carried out for Agoco. Sarir and Mesla accounted for most of Agoco's roughly 280,000 b/d of output in 2023. Libya is politically divided between an internationally recognised administration in the west, which has historically controlled oil revenues, and a rival administration in the east, which is home to around three-quarters of the country's production capacity. Agoco is based in the east, and NOC in the west. Arkenu, NOC and Unipec have been contacted for comment. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Von der Leyen faces new Green Deal challenges


24/07/19
24/07/19

Von der Leyen faces new Green Deal challenges

The president promises a ‘clean industrial deal', but will need to make compromises over climate policy, writes Dafydd ab Iago Brussels, 19 July (Argus) — Ursula von der Leyen's re-election by the European Parliament as president of the European Commission on 18 July promises to see a doubling down on climate and energy policy, with her 2024-29 mandate stipulating greenhouse gas (GHG) emissions cuts of at least 90pc by 2040 compared with 1990. "I have not forgotten how [Russian president Vladimir] Putin blackmailed us by cutting us off from Russian fossil fuels. We invested massively in homegrown cheap renewables and this enabled us to break free from dirty Russian fossil fuels," von der Leyen says, promising to end the "era of dependency on Russian fossil fuels". She has not given an end date for this, nor specified if this includes a commitment to ending Russian LNG imports. Von der Leyen went on to detail political guidelines for 2024-29. She has pledged to propose a "clean industrial deal" in the first 100 days of her new mandate, albeit without giving concrete figures about how much investment this would channel to infrastructure and industry, particularly for energy-intensive sectors. The clean industrial deal will help bring down energy bills, she says. Von der Leyen told parliament that the commission would propose legislation, under the European Climate Law, establishing a 90pc emissions-reduction target for 2040. Her political guidelines also call for scaling up and prioritising investment in clean technologies, including grid infrastructure, storage capacity, transport for captured CO2, energy efficiency, power digitalisation and a hydrogen network. She plans to extend aggregate demand mechanisms beyond gas to include hydrogen and critical raw materials, and notes the dangers of dependencies and fraying supply chains — from Putin's energy blackmail to China's monopoly on battery and chip raw materials. Majority report Passing the necessary legislation to implement her stated policies will now require approval from EU states and parliament. Unless amplified by Germany's election next year, election victories by far-right parties in France and elsewhere appear not to threaten EU state majorities for specific legislation. Parliament's political centre-left S&D and liberal Renew groups, as well as von der Leyen's own centre-right European People's Party (EPP), have elaborated key policy requests. These broadly call for the continuation of the European Green Deal — a set of legislation and policy measures aimed at 55pc GHG emissions reductions by 2030 compared with 1990. A symbolic issue for von der Leyen to decide on — or compromise on — is that of internal combustion engine (ICE) vehicles. EPP wants to stick to technological neutrality and revise the current mandate for sales of new ICE cars to be phased out by 2035, if they cannot run exclusively on carbon-neutral fuels. The EPP wants an e-fuel, biofuel and low-carbon fuel strategy. Von der Leyen's guidelines reflect the need to gain support from centre-right, centre-left and greens. She says the 2035 climate neutrality target for new cars creates investor and manufacturer "predictability" but requires a "technology-neutral approach, in which e-fuels have a role to play". She has not mentioned carbon-neutral biofuels. It will be impossible for von der Leyen to satisfy all demands in her second mandate. This includes policy requests put forward by the EPP, ranging from a "pragmatic" definition of low-carbon hydrogen and market rules for carbon capture and storage, to postponing the EU's deforestation regulation. EU member states are expected to propose their candidates for commissioners in August, including for energy, climate and trade policy, with von der Leyen's new commission subject to a final vote in parliament in late October. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Trump vows to target 'green' spending, EV rules


24/07/19
24/07/19

Trump vows to target 'green' spending, EV rules

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