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June 4, 2021 / 3:00 PM New York (CNN Business) America's truck driver shortage is driving pay higher. But it's not solving the scarcity of truckers.

Massive increases in online ordering during the pandemic have sent demand for delivery truck drivers through the roof. That's increased competition for those willing to be long-haul truckers, forcing those trucking companies to hike pay. But that hasn't persuaded enough people to take the long-distance driving jobs that the industry needs to fill.

Huge turnover

The pay hikes are instead prompting many drivers to bounce from company to company.

The average annual turnover rate for drivers is about 95% for truckload carriers, the segment of the industry that moves trailer-size shipments long distances. Truckload carriers are experiencing the industry's most severe driver shortages.

Drivers appreciate the increased pay, but they're keeping an eye on what's being offered elsewhere, said Daniel Walton, a 47-year-old truck driver at Roehl Transport, a Wisconsin-based trucking company with 2,300 drivers,

"Everybody loves getting more money," said Walton. "You hear numbers thrown at you, there is a temptation to go elsewhere." Recently he had one friend go to Walmart (WMT), another to FedEx (FDX), which have more regular routes and time at home for their drivers.

The opposite effect

Ironically, rising pay itself may be exacerbating the shortages it's designed to solve. Many drivers are using the larger paychecks to cut down on their driving. "Drivers want to be home more. They have expressed that to us," said Tim Norlin, vice president of driver employment at Roehl.

Walton said he knows drivers who are using the increased pay to cut back their time on the road."You see guys with young children, they were out there working," he said. "This affords them the opportunity to be home a little more with their children."

A tough life on the road

Walton is on the road about four weeks out of every five, but after a 22-year career in the merchant marine before becoming a truck driver, he said his family is used to him being away for long stretches.

And while Walton says he enjoys life on the road, he acknowledges it's not for everyone. He helps train new drivers at Roehl, and he's had drivers quit soon after joining because of stress or homesickness.

"In a truck you are alone, and it takes a fair amount of fortitude," he said.

The greatest shortage of truckers is in the segment known as truckload carriers, which move trailer-size shipments of freight long distances. Drivers working for those companies are often on the road for weeks at a time, taking one load after another, driving the maximum hours allowed and sleeping in their trucks when they're off.

So companies like FedEx, UPS, Amazon and Walmart that can offer more regular routes and time at home have an edge beyond pay when competing for those drivers.

Another source of competition for drivers comes from the hot construction market, where workers don't have to be on the road.

Rising pay to stay competitive

Trucking companies are boosting pay to keep drivers on their payrolls. This week, Roehl put in place its second pay increase of this year, which together should increase driver pay at the company about $4,000 to $6,000 a year, or about 9% to 11%.

"We have to offer that additional pay to be competitive," said Norlin..

Another truckload company, CR England, announced in April its third pay hike in the last three years, increasing its drivers' pay by more than 50% compared to 2018.

The trucking companies are charging higher rates to customers and taking on more work when the drivers are available.

"Our customers have been very understanding that it's necessary to raise rates," said Norlin. "I could literally hire 500 to 1,000 more drivers -- we have the business offerings from customers to keep them busy."

Walton said that he's seen his pay increase from about $40,000 a year a few years ago to probably $70,000 this year.

 

Source: cnn.com

June 3, 2021 / 5:50 PM Oil prices steadied on Thursday following two straight days of gains that took oil futures to highs not seen in a year, after weekly U.S. crude stocks fell sharply while fuel inventories rose more than expected.

Brent futures settled at $71.31 a barrel, down 4 cents after touching its highest since May 2019 earlier in the session. U.S. crude settled at $68.81 a barrel, losing 2 cents. WTI prices rose as high as $69.40, the strongest since October 2018, after gaining 1.5% in the previous session.

U.S. crude inventories dropped by 5.1 million barrels last week, compared with expectations for a decrease of 2.4 million barrels, while gasoline stocks grew by 1.5 million barrels and distillate stockpiles jumped by 3.7 million barrels.

"They burned through a lot of crude oil though, and we had builds in gasoline and distillate," Bob Yawger, director of energy futures at Mizuho in New York. "You don’t want to be burning that much crude and then the customers don't want it."

Gasoline demand jumped last month on panic buying following the closure of the Colonial Pipeline, the largest U.S. refined products line, which meant drivers were less likely to need to fill up their tanks over Memorial Day weekend, the start of peak summer driving season.

"Gasoline demand was off week-over-week which may disappoint some people, but it’s still solid," said Phil Flynn, senior analyst at Price Futures Group in Chicago.

Oil prices have risen in recent days on expectations from forecasters, including the Organization of the Petroleum Exporting Countries (OPEC) and its allies, that oil demand will exceed supply in the second half of 2021. 

OPEC+ agreed on Tuesday to continue with plans to ease supply curbs through July, giving oil prices a boost, in anticipation of improved consumption. 

The OPEC+ meeting lasted 20 minutes, the quickest in the group's history, suggesting strong compliance among members and the conviction that demand will recover once the COVID-19 pandemic shows signs of abating.

Also supporting prices was a slowdown in talks between the United States and Iran over Tehran's nuclear program, which reduced expectations for a return of Iranian oil supplies to the market this year.

Source: Reuters.com

June 1, 2021 / 2:50 PM The Panama Canal would play a vital role in enhancing trade between the State of Qatar and its partner countries in Latin America, according to Panama’s top diplomat in Qatar.

Ambassador Musa Asvat said the Panama Canal has improved world trade, transportation, and connectivity for over a century, and connects 144 maritime routes that reach up to 160 countries worldwide.

He said the expanded canal doubled the tonnage capacity of the waterway, enabling the transit of up to container ships and 90% of the liquefied natural gas (LNG) carrier fleet, offering significant time savings for LNG producers in the US when exporting to Asia.

“For instance, the Panama Canal serves as a perfect point of connectivity and trade relations between the State of Qatar and the Americas, in particular Latin America, since it becomes the perfect trade connection for goods and commodities, such as LNG between the State of Qatar and Latin America,” Asvat told Gulf Times.

Asvat noted that Panama also has the adequate infrastructure that enhances its connectivity and allows commercial activities to flourish and expand throughout the Americas.

Elaborating further on Panama’s ports and logistics infrastructure, Asvat said Panama has ports in both the Pacific and Atlantic Ocean, and a major free zone – the Colon Free Zone, as well as special economic zones.

“We have an international airport that serves as the hub of the Americas, and the Panama Canal railroad, which connects ports in the Pacific and the Atlantic, thus in terms of trade and commercial activities, Panama can a great partner to the State of Qatar,” Asvat emphasised.

He added: “In addition to offering safe, reliable, and efficient service, the Panama Canal is committed to global efforts to reduce emissions from the maritime industry, including the IMO’s initial GHG strategy, IMO 2020, and the UN Sustainable Development Goal 13 (SDG), which calls for urgent action to combat climate change and its impact.

“By offering a shorter route for ships, the Panama Canal contributed to a reduction of more than 13mn tonnes of carbon dioxide equivalent emissions in 2020, in comparison to the most likely alternative routes. In addition, the Panama Canal launched its process of decarbonising its operations, with aims of becoming carbon neutral by 2030.”

 

Earlier, Asvat pointed out that Panama is keen to strengthen its economic ties with Qatar through the exchange of best practices and knowledge-sharing in various fields, including ports management and logistics.

June 2, 2021 / 3:00 PM The ship swerved left and right before becoming lodged in the canal’s bank, chief investigator says. Egyptian officials made their most specific allegations against the captain of a container ship that blocked the Suez Canal for nearly a week in March, accusing the skipper of losing control of the Ever Given and hitting the vital waterway’s bank.

The ship swerved left and right before becoming lodged in the bank of the canal, said Sayed Sheisha, the chief investigator for the Suez Canal Authority. “The captain issued eight commands within 12 minutes as he tried to bring the ship back into alignment.”

The question of who is to blame for the accident is at the heart of a dispute over how much compensation the ship’s owners should pay. Egyptian authorities seized the ship in April and are now demanding $550 million to cover lost revenues, damage to the canal and the cost of rescuing the ship.

The Japanese company that owns the ship, Shoei Kisen Kaisha Ltd., didn’t respond to calls and emails seeking comment. The company that manages the ship, Bernhard Schulte Shipmanagement Ltd., also didn’t immediately respond to a request for comment. A lawyer for the Japanese company has previously blamed the Suez Canal Authority for allowing the ship to enter the canal during a massive sandstorm that was taking place in Egypt at the time. Initial investigations into the accident had focused on a sudden gust of wind.

Earlier this month, an appeals chamber at Ismailia Economic Court heard recordings showing disagreements between Suez Canal Authority pilots and its control center over whether the ship should enter the canal, according to people familiar with the matter.

Lawyers representing Shoei Kisen Kaisha said the authority shouldn’t have allowed the ship to enter the waterway and that the ship should have been accompanied by at least two tug boats. The Ever Given’s insurer, UK P&I Club, said that the insurer and the ship’s owners are committed to a fair and amicable resolution of the matter, in comments made on Saturday before Egyptian authorities made the allegations against the captain.

The Ever Given, one of the largest cargo ships in the world, ran aground in the Suez Canal on March 23, causing global supply-chain chaos as hundreds of ships piled up in a backlog on either side of the canal.

The ship was freed on March 29 after six days of work by Egyptian engineers and sailors with help from a Dutch specialized salvage company.

Egyptian authorities impounded the ship on April 12 and are refusing to allow the ship to leave until its Japanese owners agree to pay compensation. The Suez Canal Authority initially demanded more than $900 million but later reduced the amount it sought as compensation.

“We first estimated the value of the ship’s cargo at $3 billion. Our share of that value was established at $912 million for the above mentioned costs. When the shipowners got back to us saying the value of the cargo was $750 million, we lowered our demand,” said Mr. Sheisha.

The ship, along with its cargo of some 18,000 containers and its crew of Indian sailors, remains at anchor in the Great Bitter Lake, which separates two segments of the canal.

Mr. Sheisha told reporters at the Suez Canal Authority’s headquarters on Sunday that the institution had concluded its own investigation into the cause of the accident, blaming the incident on errors made by the captain.

He said the ship was veering to the right as it entered the canal and that the captain tried to pull the ship back to the center. He said the captain accelerated when the ship’s response was too slow. The ship veered instead to the left, and then to the right again before slamming into the bank of the canal, Mr. Sheisha said.

The case in the Ismailia Economic Court over the fate of the ship is continuing, but both parties have asked to adjourn the proceedings until June 20.

The Suez Canal Authority has sent the results of its investigation to the International Maritime Organization, Mr. Sheisha said, but said Egyptian officials wouldn’t release the full report to the public during continuing negotiations over compensation.

The ship’s crew haven’t been allowed to leave the ship since it ran aground. Union leaders representing the crew have said the sailors have been treated well but have expressed concern that they could be trapped in Egypt indefinitely if the dispute isn’t resolved quickly.

 

Two members of the crew were granted permission to leave on April 15 for urgent personal reasons, according to the Suez Canal Authority.

May 28, 2021 / 2:50 PM Thousands of new oil wells and hundreds of new oil fields will be needed to meet global demand even if it falls sharply towards the middle of the century, Oslo-based consultancy Rystad Energy said on Friday.

Its analysis stands in sharp contrast to the conclusions of the International Energy Agency (IEA), which said last week that investors should not fund new oil, gas and coal projects if the world wants to reach net-zero emissions by mid-century. 

The IEA's scenario sees oil demand declining to 24 million barrels per day (bpd) by 2050, while Rystad sees oil demand falling to 36 million bpd by the same time.

"Given that output from oil wells declines by an average of more than 20% per year, the international oil industry will still need to drill thousands of new wells in existing fields, as well as developing around 900 new oil fields with collective resources of about 150 billion barrels of oil," the consultancy said in a note.

Most of these projects were expected to be redevelopment, extensions or tie-backs to existing platforms, meaning the required investments will be moderate as existing infrastructure is reused, it added.

Rystad said developments were needed to deliver about 10 million bpd in 2030s, as it saw a slower fall in demand than the IEA, which the consultancy said was overestimating the impact of biofuel growth and behavioural changes.

Even if oil demand remains at 36 million bpd in 2050, it should be possible to reach the target of limiting the temperature rise to 1.5 degrees Celsius compared to pre-industrial times, it added.

Rystad's analysis is likely to be welcomed by oil companies and oil producing countries, such as Norway, which have questioned the IEA's analysis as it undermines the case for the industry to carry on producing oil in the medium term. 

The Organization of the Petroleum Exporting Countries (OPEC) has said a lack of investments in new projects could lead to more volatile prices.

 

Source: Reuters.com

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