Answering this question is harder now than ever…
Answering this question is harder now than ever:
Forcing prices up:
- Saudi Arabia and Russia (the second and third largest producers in the world) are planning production cuts along with OPEC
- US embargo on Iran (which has more exceptions than expected)
- Canada cutting production
- At some point shale drilling becomes uneconomical – but producing from existing wells (sunk costs) will continue albeit the well life is relatively short
Bringing prices down:
- US shale producers. When more pipelines are built in – for example the Permian Basin – expect oil production to jump. Of interest is the producers there, constrained by regulation about how much byproduct gas they can flare (burn off) are paying to get it taken away…this at a time when gas is at one of its highest prices in years
- Slowing global demand
In the Thanksgiving rush, UPS delivered 98.3% on time. FedEx delivered 98.9%. It seems that the new infrastructure has resulted in the best on-time delivery performance in the last 5 years.
