U$ Fed Rate Cuts Ignite Construction Boom

By Metal Miner - Nov 20, 2024

The Federal Reserve's interest rate cuts have stimulated the construction industry by reducing borrowing costs for new projects.

Increased construction activity has led to a rise in demand for steel and other building materials.

Industry experts anticipate continued growth in the construction sector throughout 2024.


The Construction MMI (Monthly Metals Index) managed to break out of its sideways trend, moving up by 6.73%. Construction news indicates that the market could see more bullish sentiment if the Fed continues its dovish stance on interest rates, dropping them steadily (get weekly updates on macroeconomic news impacting your metal buy with our weekly newsletter).

However, companies should remain wary of potential tariffs coming from the new Trump administration in the upcoming years. If they come to fruition, they could add long-term pressure to the industry and cause some volatility.


Fed Interest Rate Cuts Shine Light on Construction Industry

The Federal Reserve recently implemented a series of interest rate cuts to stimulate economic activity amid signs of a slowing economy. These monetary policy adjustments have had a notable impact on the U.S. construction industry, invigorating project initiations and bolstering demand for construction materials, particularly steel.

Construction News: Project Initiatives Rise

The construction sector has welcomed the Federal Reserve’s interest rate cuts with optimism. Lower borrowing costs have made it easier to finance new projects, prompting developers to move forward with plans that were previously put on hold due to high financing expenses.

Construction news sources state that industry leaders remain optimistic about the impact of these rate cuts on growth. Les Hiscoe, CEO of Shawmut, highlighted that the Federal Reserve’s actions intend to create a more favorable lending environment. This signals a positive outlook for building projects and is an encouraging sign for building activity.

Steel Demand Strengthens Slightly

The rise in construction activity modestly increased the demand for construction materials, particularly steel. As new projects begin and old ones start back up, the need for steel in structural frameworks, reinforcements and various building components continues to grow. This heightened demand has boosted the U.S.’s domestic steel industry, which has faced challenges from unstable market conditions and international competition over the past couple of years.

Furthermore, lower financing costs have enabled developers to undertake larger and more complex projects, driving up the volume of steel required. This trend may persist as long as borrowing costs remain supportive of robust construction activity.
Construction News: Anticipated Trends for the Remainder of 2024

The U.S. construction industry is on track for continued growth through the end of 2024, driven by the momentum created by the Federal Reserve’s interest rate cuts.

Developers will likely take advantage of the favorable financing environment to initiate new projects, especially in urban areas experiencing population growth and infrastructure demands. In the housing sector, lower mortgage rates will likely stimulate an increase in new home construction, helping to meet the ongoing demand for housing in various regions.

Effects on Public Projects and Infrastructure

Public sector initiatives, such as transportation and utility infrastructure projects, could see increased progress as government agencies take advantage of reduced borrowing costs to finance critical developments. Analysts expect that stimulation in construction activity will sustain demand for materials like steel, cement and lumber in the short term, which may result in price changes influenced by supply and demand fluctuations.

By the Metal Miner team

Russia's Revised Nuclear Doctrine Raises Global Alarm

By RFE/RL staff - Nov 21, 2024

The US has approved the provision of anti-personnel mines and longer-range missiles to Ukraine, marking a significant shift in policy.

Russia has revised its nuclear doctrine, lowering the threshold for the use of nuclear weapons.

Experts are divided on the potential for escalation, with some expressing concern about the risk of a global conflict.


Since Moscow launched its all-out invasion of Ukraine in February 2022, Kyiv has complained that it is defending itself with one arm tied behind its back in the face of Russia's full might.

While Western partners like the United States provided billions of dollars in weapons, Ukraine was prevented from using them to strike deep into Russian territory, where Moscow's war machine largely sat out of harm's way.

That all changed on November 19, the 1,000th day of the war, when Moscow claimed Ukraine had fired U.S.-made longer-range missiles inside its territory, just after the White House reportedly granted Kyiv the green light.

The administration of outgoing U.S. President Joe Biden then announced another reversal to a longstanding policy, saying on November 23 that it would provide Kyiv with antipersonnel mines to help it blunt advancing Russian forces on Ukrainian territory

Russia, meanwhile, made changes to its own policies, with President Vladimir Putin signing into law a revised nuclear doctrine that significantly lowers the threshold for his country to use the nuclear option to counter even a conventional attack by an adversary.


Uncomfortable Questions

The successive changes to the battlefield rules, which Moscow had already altered with the recent addition of thousands of North Korean troops to buttress its own forces in southwestern Russia, now have pundits asking a slew of questions:

Why is this happening now, just two months before U.S. President-elect Donald Trump, who has claimed he can quickly end the war, returns to the White House?

Are Biden, or Putin -- or both -- suddenly taking unnecessary and reckless risks?

Can Washington's decisions save Ukrainian President Volodymyr Zelenskiy's "victory plan," which called for longer strike capabilities to hit the heart of Russia's war machine?

And the biggest question, the one that arguably prevented Washington from granting Zelenskiy the permission he sought in the first place: Are we headed for World War III between nuclear superpowers?

Experts are at odds over who might be the bigger risk-taker.

"The current situation offers Putin a significant temptation to escalate," Tatiana Stanovaya, founder of R.Politik, wrote on X in reference to Russia's potential to use nukes. "With Trump not yet in office, such a move would not interfere with any immediate peace initiatives but could instead reinforce Trump's argument for direct dialogue with Putin."

Nikolai Sokov, a former Russian diplomat and arms-control negotiator now with the Vienna Center for Disarmament and Nonproliferation, countered on X by saying, "I think, rather, Biden has suddenly displayed [a] big appetite for risk-taking after 2.5 years of being risk-averse."

Now, he added, "Putin may feel forced to react or Trump will take him to the cleaners."

Too Little, Too Late?

But when asked by RFE/RL whether the recent moves by Moscow and Washington have increased the risk of a nuclear escalation, Keir Giles, an expert on the geopolitical conflict between the West and Russia, said "not at all."

Giles, author of a new book called Who Will Defend Europe?, said the U.S. decision to grant Kyiv greater strike capabilities came "long after it would have had the maximum impact" and "is really not something about which Russia is going to be genuinely, legitimately concerned."

Moscow "will still indulge in the performative theatrics to do with the nuclear doctrine, getting enormous value out of the changes," Giles said. "They are milking this for all it is worth, because they get a very gratifying reaction abroad."

Ukraine, meanwhile, faces Russian and North Korean troops intent on retaking territory in Russia's southwestern Kursk region. The Ukrainian military's territorial gains within Russia came as the result of a surprise incursion in August that Zelenskiy said would give Kyiv more leverage in future negotiations.

Kyiv is also trying to stave off a massive assault by Russian troops in Ukraine's east that some observers say is aimed at seizing full control of the four regions of Ukraine that Moscow has illegally annexed when and if peace talks do take place.

But at the moment, Giles said, "there is no incentive for either Russia or Ukraine to enter negotiations."

"Ukraine knows that this is likely to be far more disastrous for them than fighting on, and Russia knows that it can extract far more from Ukraine than if they freeze the conflict at the present moment," he said.

Most observers agree that Ukraine's longer-range U.S. missiles, which are in short supply, are not going to seriously alter the course of the war in and of themselves.

Jack Watling, senior research fellow at the Britain-based Royal United Services Institute (RUSI), wrote that the developments "are less about the damage" the U.S. ATACMS missiles, or Army Tactical Missile System, can inflict.

It is "more about what they might enable, and whether their provision is a catalyst for others like Germany to provide similar kinds of support," he said.

Take A Deep Breath

As for the prospect of Russian retaliation for Ukraine using the U.S.-supplied missiles, Watling wrote that "it certainly will not" lead to a nuclear response.

"The reality is that Russia can escalate in a range of ways to impose costs on the West, from undersea sabotage to the employment of proxies to harass trade," Watling wrote.

Sam Greene, a professor at the Russia Institute at King's College London, called for "deep breaths, everyone."

"The fact that Russia published a revised nuclear doctrine on the same day that Ukraine first fired ATACMs across the border is the result of careful escalation management by both sides," Greene wrote on X on November 19. "We may eventually get to WWIII, but probably not tonight."

By RFE/RL

\

China's Solar Dominance Fuels Asia's Green Energy Shift

By ZeroHedge - Nov 21, 2024

China's affordable solar solutions are powering the rapid expansion of renewable energy in Southeast Asia, driven by demand from tech manufacturing and data centers.

Despite US tariffs and trade barriers, China's solar industry maintains a competitive edge due to economies of scale, advanced technology, and cost efficiency.

The speed and accessibility of solar energy compared to other renewable sources make it an attractive option for countries and companies looking to quickly transition to green energy.



If you're trying to implement green energy solutions in Asia, chances are you're going to need to rely on China one way or another.

Southeast Asia’s demand for renewable energy is rising, driven by tech manufacturing and data center growth, according to Nikkei. Solarvest, the region's leading renewable energy provider, plans to capitalize on this boom by increasing imports from China, according to a local manager.

That manager told Nikkei: "We aim to invest more in the next couple of years. Buying equipment and components from Chinese suppliers, who have mastered the supply chain and solar tech, gives us the best opportunity to generate green energy with a price that is low enough to compete against fossil fuels."




Through its Belt and Road Initiative, Beijing has extended its influence over power infrastructure in countries like Malaysia, Thailand, and Pakistan. However, the U.S. has criticized China for subsidizing manufacturers and underpricing goods, leading to tariffs and trade barriers.

The Nikkei report says that despite U.S. opposition, China maintains an edge with economies of scale and growing climate urgency. Solar energy, seen as the most accessible renewable source, attracted $500 billion in investment in 2024, surpassing all other energy types, according to the International Energy Agency.

Offshore wind projects take over eight years to complete, while solar plants can be built in under two, making solar a faster choice for companies transitioning to renewables, industry leaders told Nikkei.

This urgency is especially pronounced in emerging Asian economies like Malaysia and Thailand, which rely on fossil fuels but aim to attract tech giants like Apple and Google, committed to 100% renewable energy through the RE100 initiative.

China dominates the global solar energy market, housing leading players like Longi Green Energy, Tongwei, and Jinko Solar, as well as the top three inverter makers: Huawei, Sungrow, and Ginlong.




Despite efforts by the U.S. and India to localize production, China is projected to maintain over 80% of global photovoltaic manufacturing capacity by 2030, with its solar products costing 20-30% less than competitors, according to the IEA.

Analysts attribute China's edge to its economic scale, advanced technology, and cost efficiency. Even as countries impose trade barriers to curb dependence on Chinese products, demand for China’s affordable solar solutions remains strong globally.

Companies like Foxconn highlight that Chinese solar energy rivals fossil fuels in cost, driving its adoption worldwide, particularly in markets eager to expand renewable energy capacity.

China’s dominance in solar wasn’t always guaranteed. In the 2000s, Japanese and Taiwanese firms led the photovoltaic industry, but China’s massive scale and government subsidies allowed it to outpace competitors.

Now, China controls over 90% of the solar supply chain, from polysilicon production to module manufacturing.

By Zerohedge.com

AI's Insatiable Appetite for Energy Threatens Ireland's Grid

By Haley Zaremba - Nov 21, 2024

The rapid expansion of AI and its enormous energy demands are threatening to overwhelm Ireland's power grid.

Ireland's position as a European data center hub has attracted significant investment but is now facing challenges due to the energy-intensive nature of AI.

The situation highlights the need for a balance between technological advancement, economic growth, and sustainable energy solutions.



Ireland is set to become the next country to face a major threat to its power grid due to the rapid expansion of artificial intelligence. Dublin has emerged as the heart of Europe’s data center hub, and hyperscale cloud providers have quickly become a pillar of the country’s economy. But powering the data centers that house the cloud has become a monumental task with the runaway growth of AI.

Artificial intelligence requires a stunning amount of energy to train and power its complex computation systems. Currently, the approximate amount of energy needed to sustain the sector’s growth is doubling every 100 days. At a global level, the AI sector alone could be responsible for 3.5 percent of all energy consumption by 2030 according to expert projections. “When you look at the numbers, it is staggering,” Jason Shaw, chairman of the Georgia Public Service Commission, an electricity regulator, told the Washington Post earlier this year. “It makes you scratch your head and wonder how we ended up in this situation. How were the projections that far off? This has created a challenge like we have never seen before.”

Already, the yearly power consumption of AI is more than most entire countries – only 16 nations in the entire world consume more annually. Ireland is a hotspot country – along with Saudi Arabia and Malaysia – where existing energy supplies are simply insufficient to power the data centers currently planned. “The almost overnight surge in electricity demand from data centers is now outstripping the available power supply in many parts of the world,” Bloomberg reported in June.

This has major impacts – both adverse and otherwise – on the economy writ large, especially since the tech sector is frequently prioritized above other key market sectors and services. “That dynamic is leading to years-long waits for businesses to access the grid as well as growing concerns of outages and price increases for those living in the densest data center markets,” Bloomberg went on to say.

Ireland’s grid is wholly unprepared for this transition. Last year, data centers consumed 21 percent of all metered electricity, surpassing urban residential consumption. This runaway growth has put Ireland in a tough spot between energy security and keeping the lucrative data center sector within its borders. “There is a risk that the pace of demand growth is faster than the speed of which generation and network infrastructure can be built,” a spokesperson for the country’s energy regulator, the Commission for Regulation of Utilities, told Politico this month. The spokesman confirmed that this dynamic could ultimately result in “power shortages” and “increased costs for consumers” among other long-term negative externalities.

Ireland is not alone in this dilemma. The United Kingdom is expected to see a 500% increase of energy demand from AI over the next ten years. Sweden, which has a climate ideally suited to naturally cooling data centers, could see related power demand grow two-fold within the decade, followed by another two-fold increase by 2040. The United States, too, is already facing considerable power crunches due to AI expansion. At a global level, the energy consumption by data centers alone is expected to top 1,580 TWh – around the equivalent of the entire country of India, the most populated nation on Earth.

All this growth doesn’t only pose trouble for energy and the economy. It’s also a major issue for the climate. “The dramatic increase in power demands from Silicon Valley’s growth-at-all-costs approach to AI also threatens to upend the energy transition plans of entire nations and the clean energy goals of trillion-dollar tech companies,” Bloomberg reports.

However, AI could also prove to be the saving grace of the energy industry if employed strategically. The global clean energy transition, which represents an unprecedented process of planned rapid systems transformation, will require intelligent, responsive, and flexible computing systems able to rapidly recognize, respond to, and predict complex patterns of production and consumption. AI could therefore be invaluable in managing smart grids capable of handling huge inflows and outflows of variable energies like wind and solar. It’s a double-edged sword, and making sure that AI will be employed wisely is a monumental task that will be make or break for countries like Ireland.

By Haley Zaremba for Oilprice.com

Big Oil Pours Billions into Biofuel Production to Meet Decarbonization Goals

By Rystad Energy - Nov 20, 2024

Major oil companies are investing in biofuels as a key part of their decarbonization strategies, with a focus on HVO and SAF.

These companies are utilizing a mix of greenfield developments, co-processing, and refinery conversions to increase biofuel production capacity.

BP and Chevron are leading the charge in terms of announced production capacity, with other oil majors also making significant investments in the sector.


Under increasing pressure to decarbonize and shift away from traditional fossil fuels, the world’s leading oil and gas companies are ramping up investments in the biofuels sector. Major players such as BP, Chevron, Shell, TotalEnergies, ExxonMobil and Eni are incorporating biofuels into their broader energy transition strategies, recognizing the growing global demand for sustainable fuel sources. According to Rystad Energy’s research, these six oil majors have announced a total of 43 biofuel projects that are either already operational or are targeted to start up by 2030. While investments span various biofuel products, including biodiesel and ethanol, the focus is clearly on hydrotreated vegetable oil (HVO) and sustainable aviation fuel (SAF), which are expected to make up nearly 90% of the projected biofuel production.

Analyzing the implementation of these investments, which could add a combined 286,000 barrels per day (bpd) of production capacity, reveals that 31 projects are greenfield developments. Six involve co-processing — integrating bio feedstock into existing crude-oil refineries to produce a blended feedstock — while another six are full conversions of refineries to facilities dedicated exclusively to biofuel production. Co-processing stands out as a cost-effective option that allows companies to leverage existing infrastructure and reduce upfront investment, making it an appealing choice for oil majors entering the biofuels market.

Supermajors are accelerating investments in biofuels like HVO and SAF, recognizing their potential as low-carbon ‘drop-in’ fuels that can be swiftly integrated into existing aviation, heavy transport and marine fuel systems. As the energy transition progresses, these biofuels offer a practical, near-term solution to reduce emissions without requiring significant changes to current infrastructure. With increasing regulatory pressure to adopt SAF, such as Europe’s ‘ReFuel EU’ initiative and expanding mandates in Asia Pacific, biofuels have shifted from being a potential option to becoming an essential component of decarbonization strategies,

Lars Klesse, Analyst, BioEnergy Research, Rystad Energy





Learn more with Rystad Energy's newly launched BioEnergy Solution.

The 43 biofuel projects announced by oil majors signal promising developments in the industry. Chevron's Geismar project, the largest of the 31 greenfield initiatives, is set to produce 22,000 bpd of biofuel, marking a significant addition to global capacity. Additionally, Chevron’s El Segundo refinery, the largest in co-processing capacity, converted a diesel hydrotreating unit last year into a 10,000 bpd renewable facility. BP's Kwinana project, the largest announced refinery conversion, is also poised to significantly increase the production of sustainable fuels. By 2030, this project is expected to produce 50,000 bpd of HVO and SAF, a gamechanger that could be pivotal for meeting rising demand for biofuels in the near future.

Among the leading companies, BP stands out with the largest announced production capacity in its pipeline, reaching a combined 130,000 bpd of ethanol and HVO/SAF capacity and positioning BP as a global frontrunner in the bioenergy space. Other oil majors, including Chevron, Eni, Shell, TotalEnergies and ExxonMobil, are also making significant strides, particularly in the advanced biofuels sector, although many of these projects are still in development.

BP and Chevron hold significant positions in operational capacity. BP's acquisition of Bunge Bioenergia, a leading Brazilian biofuel producer, has substantially increased its production capacity to approximately 66,000 bpd. The acquisition has enabled BP to exceed its 2025 milestone of 50,000 bpd and positions the company to achieve its biofuel target of 100,000 bpd by 2030. Additionally, Chevron's purchase of Renewable Energy Group and Eni's operational advanced biofuel capacity of 22,000 bpd, driven by both co-processing and conversion projects, further solidify their positions in the expanding biofuels market.




TotalEnergies has also outlined aggressive biofuel targets, aiming to use waste biomass for 75% of its biofuel production by the end of 2024. To achieve this, the French integrated energy and petroleum company plans to prioritize waste and residues from the food industry, such as used oils and animal fats, to avoid land-use conflicts. Meanwhile, ExxonMobil is gearing up to start biofuel production at its Strathcona Refinery next year, with an initial capacity of 20,000 bpd. The company also plans to launch 12 additional biofuel projects to help it reach its goal of 200,000 bpd by 2030.

As oil majors shift to lower-carbon energy, there is a clear trend toward advanced biofuels, particularly HVO and SAF, with companies scaling up production to meet rising demand from the aviation and heavy transport sectors. Despite some project delays, biofuels are seeing a significant increase in investment and innovation as 2030 decarbonization targets loom and the market for fossil-fuel alternatives grows.

By Rystad Energy

India Poised to Double Down on Natural Gas Amid Rapid Growth

By Tsvetana Paraskova - Nov 21, 2024

India's natural gas demand is expected to double by 2040 and triple by 2050.

Despite rising domestic production, India will increasingly rely on liquefied natural gas imports, especially from Qatar and the Middle East.

Natural gas will play a key role in India's energy transition, supporting industrial processes and reducing reliance on coal.


India’s energy demand growth is not limited to oil. The world’s third-largest crude oil importer is set to become a major force in the natural gas market as its demand is expected to surge in the coming decades amid industry and population expansion.

The share of natural gas in India’s primary energy supply is currently between 6% and 8%, according to data from various government statistics and international forecasters such as the International Energy Agency (IEA) and the Statistical Review of World Energy published annually by the Energy Institute.

Small Share of Natural Gas in Power Generation

Unlike in other major economies, India’s share of gas used for power generation is smaller as the country continues to bet big on coal-fired electricity and expands renewables capacity. India has a goal to reach net-zero, but two decades later than most countries, in 2070.

Renewable capacity installations are booming, with the 200 gigawatt (GW) milestone reached in October, data from India’s Central Electricity Authority showed earlier this month. Renewable electricity generation capacity now stands at 203.18 GW, up by 13.5% compared to October 2023. Renewable energy now accounts for 46.3% of total installed capacity of 453 GW.

Related: World’s Largest Climate Fund Sees Few Investment Opportunities

India targets to have a total of 500 GW power capacity from non-fossil sources by 2030.

While the country continues to boost renewable capacity installations for power generation, it will increasingly rely on natural gas for industrial production and processes, especially in fertilizers, oil refining, and petrochemicals.

Industry to Drive Gas Demand Surge

As India sees fertilizers as a critical industry for its agricultural sector, and as steelmaking and construction are booming to meet the growing economy and population, natural gas demand will continue to rise. India’s domestic production, although it has increased over the past two decades, will not be enough to meet growth in demand. So the country will have to rely on more liquefied natural gas (LNG) imports, considering that it lacks pipeline connections with major gas producers such as Russia or the Gulf petrostates.

Shell, the world’s top LNG trader, expects global LNG demand to surge by 50% by 2040, driven by higher demand from Asia, with coal-to-gas switching in China and a boost in LNG consumption to fuel economic growth in South and Southeast Asia.

In the fiscal year 2023, India imported about 20 million tons of LNG, more than half of which from Qatar, according to government data. The United Arab Emirates (UAE) and the United States were the next two big suppliers of LNG to India.

These imports are set to jump in the coming years as India is expanding its refining, petrochemicals, and fertilizer industries, and economic and population growth spur additional demand for construction, steelmaking, and gas-fueled vehicles.

India was the fastest-growing major economy in 2023, with GDP increasing by 7.8%. It is on track to become the third-largest economy in the world by 2028, the IEA said in its World Energy Outlook 2024.

Population and GDP growth, as well as a shift towards cleaner energy, are set to nearly double India’s gas consumption to 113.7 billion cubic meters (Bcm) by 2040 from 65 billion cubic meters (Bcm) in 2023, according to Rystad Energy research last month.

Near-term demand is supported by a 51% jump in domestic gas production since 2020 but this will not be enough to meet the country’s growing demand for natural gas.


“The result is that India will continue to rely heavily on imports to satisfy its future energy needs,” Rystad Energy’s analysts noted.

Rising gas demand could prompt India to move to contract more LNG production from the Middle East, according to Kaushal Ramesh, Vice President, Gas & LNG Research, at Rystad Energy.

“The geographical proximity of the two regions, combined with the substantial volume of uncontracted LNG production in the Middle East, presents an excellent opportunity for India to secure favorable terms – it’s an ideal buyer-seller relationship that could help fuel India’s needs,” Ramesh said.

India’s gas demand growth will be driven by industry. Natural gas is the input for the production of urea, key for fertilizers. India will continue to support urea production, regardless of natural gas prices, as it aims to ensure food security, Rystad says.

Then there is the refining sector, which also consumes a lot of natural gas. Indian refiners plan capacity expansions to meet rising demand for fuels and petrochemicals.


Moreover, India aims to be a refining hub in Asia as it is boosting refining capacity and expects to continue relying on fossil fuels until at least 2040.

India’s natural gas consumption is set to triple by 2050 amid industry expansion and rising oil refining, the U.S. Energy Information Administration (EIA) said earlier this year.

In 2022, India’s natural gas consumption amounted to 7.0 billion cubic feet per day (Bcf/d), with over 70% of the demand coming from the industrial sector. By 2050, India’s natural gas consumption is set to more than triple to 23.2 Bcf/d, according to EIA’s estimates.

Among India’s five consuming sectors, the industrial sector’s share of gas consumption will grow the most, rising to 80% of total consumption, followed by the transportation sector rising to 10%.

By 2050, gas consumption will surge by more than 250% for the production of basic chemicals and by more than 400% for refining, with the two industries together accounting for about 79% of India’s industrial natural gas demand in 2050, the EIA reckons.


By Tsvetana Paraskova for Oilprice.com

US Breaks Dependence on Gasoline Imports

OIL PRICE

By Editorial Dept - Nov 16, 2024

In the latest edition of the Numbers Report, we will take a look at some of the most interesting figures put out this week in the energy and metals sectors. Each week we’ll dig into some data and provide a bit of explanation on what drives the numbers.
Let’s take a look.

1. US Downstream Sector Keeps on Giving Despite Shrinking Margins



- US refiners saw their average earnings per share decline to 25 cents this past quarter from $4.75 per barrel in Q3 2023 and $4.85 per barrel in Q3 2022.
- Nevertheless, shareholder returns remained very robust at $5.2 billion in total, as demonstrated by Marathon which paid $3 billion to its shareholders and has $8.5 billion in share buyback authorizations.
- Weaker gasoline and diesel cracks on the back of an oversaturated Atlantic Basin fuel market put a lot of pressure on refiners, as Valero and Marathon are up 6% on the year compared to the energy sector’s average growth of 13%.
- Margins are expected to be relatively weak in Q4 this year, with some respite coming early next year once LyondellBasell shuts its 257,000 b/d Houston refinery.


2. US Breaks Dependence on Gasoline Imports



- The United States is the world’s single largest gasoline market, however, due to regional discrepancies continues to import gasoline from other regions, mostly Europe.
- This trend now seems to be ebbing as gasoline imports to the U.S. averaged only 320,000 b/d in October, the lowest monthly reading in at least a decade, according to Kpler data.
- This comes as US refiners cranked up gasoline production after maintenance, tallying up only 333 unplanned outages across the country in Q3, the lowest number in three years.
- US gasoline demand has held up quite nicely against a creeping hybrid/EV market penetration, with the EIA’s demand metric showing consumption around 9 million b/d, unchanged from a year ago.

3. Chinese Overcapacity in Copper Aggaravates Trump Risks




- Chinese overcapacity has become one of the key market trends in metal and renewable markets this year, with copper facing its very own dilemma of Chinese domination.
- China already controls half of copper refining globally and continues its capacity expansion at breakneck speed, hurting European or Chilean operations as it is set to mark another 5% annual increase in 2024.
- The pressure on smelters is such that copper treatment fees are expected to drop to a mere $40 per metric tonne next year, halving compared to 2024 levels and marking the lowest level since 2004.
- Meanwhile, copper prices have plunged following Donald Trump’s re-election and expectations of tariff wars leading to trade disruptions, with the three-month LME contract shedding 8% since and trading below $9,000 per metric tonne.

4. Buoyed by China’s EV Bonanza, Electric Vehicles Rise Higher



- Global sales of fully electric and hybrid vehicles rose to another all-time high in October, hitting a 35% year-over-year growth rate led by a 54% annual jump in Chinese EV sales.
- European sales readings are posting only moderate increases after most government subsidies were scrapped, however the continent is still in the green with a 0.8% year-over-year rise
- China now accounts for 70% of global EV sales and that metric could even go higher in November-December, traditionally robust months for Chinese car buyers.
- In the United States and Canada, sales of electric vehicles were up by 11% from a year ago at 0.16 million units, however North American sales are just a half of Europe’s and one-seventh of China’s.

5. After Years of Freefall, Lithium Starts to Rise Again




Lithium prices are finally on the rise thanks to strong automotive demand in China and supply cuts, with lithium carbonate prices gaining more than 8% over the past month and hitting a three-month high.
Beijing has expanded subsidies for prospective EV buyers to $3,000, buoying demand, whilst prices were also lifted by speculation that external buyers are stocking up lithium ahead of potential tariff wars.
Simultaneously, some 190,000 metric tonnes of lithium mine capacity was shut by producers this year due to the profitability of mining, with another 50,000 mtpa delayed.
The price rally could be relatively short-lived as metal analysts still see a slight balance surplus in 2025 and rising protectionism presents a notable downside risk for lithium miners.

6. Europe Hits a Premium vs Asia as Supply Risks Proliferate



Northwest European LNG prices flipped to a premium vis-a-vis Asian benchmarks for the first time in 2024, trading just a tad north of $14 per mmBtu, some $0.30 per mmBtu higher than JKM.
Alongside the still unresolved Ukraine-Russia gas transit conundrum and streaks of cold weather in November, litigation between Russia’s Gazprom and Austria’s OMV emerged as a new pain point.
The Austrian energy major warned of potential disruptions in Russian gas supply as soon as this month as it seeks to recover the $243 million arbitration award from Gazprom in delivered gas.
Gas inventories have been depleting quicker than last year, with the rate of withdrawals averaging 0.039% this winter compared to the 0.09% injection rate in the same period of 2023, leading to mountain temperate concerns, too.


7. Here Come the Chip Wars



According to Reuters, the US Department of Commerce ordered the world’s largest chipmaker, Taiwan’s TSMC to halt shipments of advanced chips to Chinese customers.
The order specifically targets sophisticated chips of 7 nanometers or of more advanced design, seeking to halt the supply that feeds China’s AI accelerator and graphic processing units.
The ban comes after TSMC notified the Commerce Department that one of its chips has been found in a Huawei AI processor, in an apparent violation of export controls.
Beijing has reacted to the chip export ban by saying that the US seeks to raise tension in the Taiwan straits and that the move undermined the commercial interests of Taiwanese companies.

That’s it for this week’s Numbers Report. Thanks for reading, and we’ll see you next week.

INTER-IMPERIALIST RIVALRIES

Libya a New Instrument in Moscow’s European Strategy?

By Cyril Widdershoven - Nov 22, 2024

Russia is strengthening its ties with eastern Libyan warlord General Haftar, aiming to disrupt European energy supplies and expand its geopolitical influence in North Africa.

By leveraging Libya’s vast oil reserves and increasing its military presence at key bases, Russia seeks to displace Western oil companies.

Libya's interest in joining BRICS and Moscow’s growing influence highlight potential shifts in global alliances.


North Africa’s main oil producer, Libya, is again making headlines, mainly in light of OPEC’s ongoing market struggles. At the same time, Europeans are looking at the OPEC member as a potential source for their energy-hungry industries. After Europe’s energy crisis, mainly caused by Russia’s invasion of Ukraine, the Southern Mediterranean is back on the books of politicians and investors. However, amid the ongoing civil war, which has split the country into two main warring factions, international powers have their own strategies in place. While Western powers, led by the US and EU, are backing the still fledgling official government of Libya, Russia and several mainstream Arab powers remain aligned with eastern Libyan warlord General Haftar. While Libya is still producing well below its former historic levels, moves are being made to increase output substantially in the coming years. Moscow, at present, is setting up a major new strategy in which not only the Haftar-Moscow links are being strengthened but also the option of putting Europe’s energy supply at risk.

Some experts have indicated that the current Russia-Haftar discussions have only one main target: to hold Europe to ransom. While most of General Haftar’s military or political decisions are assessed as his own, it now seems that Moscow is partly leading the discussion, enforcing a possible Russian hold on North Africa’s oil and gas future. In recent weeks, Haftar’s closure of Libya’s El Sharara oil field, with a capacity of 300,000 bpd, has mainly hit supplies to European clients, as 80% of the production flows to Europe. El Sharara’s leading operators include Norwegian energy giant Equinor, Austria’s OMV, France’s TotalEnergies, and Spanish operator Repsol.

Related: Russia to Lift Gasoline Export Ban Earlier Than Planned

International media failed to recognize the link between the shutdown and a decision by Italian officials in Naples not to allow Haftar’s son, Saddam, to enter the country. This move followed Spain’s arrest warrant for Saddam Haftar, who is also a leading figure in the Libyan National Army (LNA). Spain accuses Saddam Haftar of trying to acquire lethal drones. Haftar closed down El Sharara to pressure Madrid.

Moscow’s assessment of the situation is clear. A potential conflict between Libya’s LNA-backed powers and European oil and gas operators presents an opening for Russian interests. Gazprom, or possibly a newly merged Russian entity combining Gazprom Neft, Rosneft, and Lukoil, could step in. While this might seem unlikely to Western observers, power dynamics on the ground in eastern Libya favor Moscow. Russia’s creeping influence is already evident in Sub-Saharan Africa, such as in Mali and elsewhere. With around 3,000 mercenaries in Libya, Moscow views the country as a potential hub for further expansion into Africa. Strengthening ties with Haftar benefits both the Libyan warlord—who is losing support from Abu Dhabi and Egypt—and Putin’s struggling regime.

Establishing a stronghold in Libya aligns with former Soviet cooperation agreements and advances Moscow’s goal of targeting Europe’s energy supply. Libya, holding the 9th largest oil reserves in the world, could supply vast volumes of oil and gas to Europe if a peace plan and power-sharing agreement between Haftar in Benghazi (east Libya) and Western-backed PM Abdul al-Dbeibeh in Tripoli (west Libya) could be reached. If not, Moscow may attempt to push out Western oil and gas operators and replace them with its own.

If successful, Moscow could not only weaponize Libya’s energy resources but also gain access to valuable minerals and metals in the country and Sub-Saharan Africa. Libya has shown growing interest in joining BRICS, presenting an economic and political alternative to Western alliances. Libyan officials confirmed this interest during the Russia-Africa Partnership Forum (November 9–10) in Sochi, Russia, though no official invitation has been extended yet.

Last month, investigative platform Eekad reported that Moscow has stepped up its military presence in Libya. Russian forces have established several air bridges to the Brak Al Shati base since March, and increased activities have been reported at four other strategic military bases: Al-Jufra, Al-Gardabiya, Al-Khadim, and the port of Tobruk. Moscow appears intent on using eastern Libya’s oil and gas regions as a gateway into Africa.

As reported by NOC, Libya’s crude oil production currently stands at 1.36 million bpd, with aspirations to reach 2 million bpd by the end of 2025.

By Cyril Widdershoven for Oilprice.com

British Columbia creates new mining ministry to tackle critical minerals amid doubts over capacity

me-metals: British Columbia Premier David Eby on Monday split the Ministry of Energy, Mines and Low Carbon Innovation into two: Mining and Critical Minerals and Energy and Climate Solutions, to fast-track projects and tackle regulatory and social challenges.

According to me-metals cited from mining.com, Jagrup Brar, appointed as the first Minister of Mining and Critical Minerals, will oversee 17 projects advancing toward construction. He will also lead reforms to the Mineral Tenure Act (MTA), the government said in a media briefing late Monday. The government sees these tasks as steps to streamline permits, attract investment, and modernize old regulations.

Brar, an MLA for Surrey-Fleetwood since 2017, has no known mining background. However, his appointment was well received by local mining associations.

Eby said the restructuring positions BC to leverage its copper, lithium, and rare earth reserves, materials that are critical for electric vehicles, batteries, and renewable energy.

“The transition to a low-carbon future represents a generational opportunity we must seize, not abandon,” he said during the new cabinet’s swearing-in ceremony Monday in Victoria, just weeks after his NDP party won a tight provincial election.

Keerit Jutla, president and CEO of the Association of Mineral Exploration, told The Northern Miner that the new ministry’s creation is “a significant and important step by the government.”

“I see this government beginning to implement some of the recommendations industry has made,” he said in response to questions.

The new cabinet includes notable appointments such as Brenda Bailey as Finance Minister, Adrian Dix leading the Energy and Climate Solutions portfolio, Ravi Parmar as Minister of Forests, and Christine Boyle overseeing Indigenous Relations and Reconciliation.

“In order for BC to realize its full potential as a natural resource leader, a whole-of-government approach will be needed to ensure it is built holistically, and representative of all of BC, urban and rural,” Jutla said.

Critical vision questioned

Critical minerals are central to BC’s economic vision, with demand for lithium expected to grow sixfold by 2030 and copper demand projected to double by 2050, according to government data. The province’s mineral base could attract billions in investment and create thousands of jobs, particularly in rural areas, industry advocates say.

Yet, the industry remains skeptical. Mining companies cite permitting delays and regulatory uncertainty as major barriers. Approvals often take years. Reforming the MTA to meet Supreme Court-mandated Indigenous consultation requirements will test Brar’s leadership. The government has offered few details on how to fast-track these projects while maintaining environmental standards and honouring Indigenous rights.

Much of the proposed development of mineral resources overlaps with Indigenous land claims. Unresolved issues over sovereignty and benefit-sharing could cause delays. The government has pledged to strengthen partnerships with Indigenous groups. It will include traditional Indigenous knowledge in project planning. However, industry and First Nations question the potential to turn promises into real collaboration.

Environmental concerns further complicate the push for critical minerals. The province touts these resources as vital to the clean energy shift. Yet, mining risks habitat destruction, water contamination, and greenhouse gas emissions, critics like the BC Mining Law Reform network said in its ‘Dirty Dozen 2023’ report.

Others such as the Business Council of BC has said that framing mining as a climate solution oversimplified its impacts. It also doubts the province’s ability to cut emissions 40% below 2007 levels by 2030.

source: mining.com

NEO Battery Materials Awarded as Consortium Partner in $20M Recycled Silicon Battery Project by South Korean Government

November 20, 2024 

Awarded as Consortium Partner in CAD$20M Recycled Silicon Battery Project Organized by the South Korean Ministry of Trade, Industry, and Energy

Major South Korean Battery Value Chain Companies and Universities as Consortium PartnersHansol Chemical as Head Project Organization along with South Korea’s Largest Cathode Materials Producer, INNOX eco-M, LiBEST, etc.

Project Focus: Developing High-Performance, Low-Cost Silicon Anode Materials Based on Silicon Waste from Semiconductor and Photovoltaic Wafer Manufacturing
NEO Battery Materials Acting as Downstream Participant to Jointly Develop High-Performance Silicon Anode Materials with Consortium Partners

TORONTO, Nov. 20, 2024 (GLOBE NEWSWIRE) -- NEO Battery Materials Ltd. (“NEO” or the “Company”) (TSXV: NBM) (OTC: NBMFF), a low-cost silicon anode materials developer that enables longer-running, rapid-charging lithium-ion batteries, is pleased to announce that the Company has been awarded as a consortium partner along with major battery value chain companies and universities in a CAD$20M recycled silicon battery project organized by the South Korean Ministry of Trade, Industry, and Energy.

In a project titled “Recycled Silicon-Based High Energy Density Electrode Manufacturing Technology Development,” the South Korean Ministry of Trade, Industry, and Energy (MOTIE) and the Korea Evaluation Institute of Industrial Technology (KEIT) will invest approximately CAD$20M in government contributions for the next 5 years in consortium partners.

With Hansol Chemical, a leading South Korean chemical materials company, as the head project organization, several major battery and chemicals companies are participating as consortium partners, including South Korea’s largest cathode materials producer, INNOX eco-M (NEO’s recycled silicon collaborator), and LiBEST.

The project will focus on developing high-performance silicon anode materials based on recycled silicon scrap from semiconductor and photovoltaic wafer manufacturing. Consortium partners recognize that solving the limitations of waste materials is critical to achieving price and technological competitiveness for silicon anodes and strengthening sustainability in the lithium-ion battery industry.

NEO Battery Materials will act as a downstream value chain participant. Using recycled silicon inputs optimized with low-cost technologies, NEO will jointly develop silicon anode materials with consortium partners to manufacture high-content silicon anode batteries. This project directly advances the Company’s strategic plan to secure low-cost, high-performance silicon feedstock.

Mr. Spencer Huh, Director, President, and CEO of NEO, commented, “NEO Battery Materials is highly pleased to be a consortium partner in this key project organized by the South Korean federal government. Along with major battery industry players, we are confident in developing low-cost silicon anode materials to attain material circularity and supply chain resiliency. With approximately 900 tons of waste silicon produced annually in South Korea, all consortium partners are motivated to develop effective technologies to recycle and reuse all waste generated moving forward.”

About NEO Battery Materials Ltd.
NEO Battery Materials is a Canadian battery materials technology company focused on developing silicon anode materials for lithium-ion batteries in electric vehicles, electronics, and energy storage systems. With a patent-protected, low-cost manufacturing process, NEO Battery enables longer-running and ultra-fast charging batteries compared to existing state-of-the-art technologies. The Company aims to be a globally-leading producer of silicon anode materials for the electric vehicle and energy storage industries. For more information, please visit the Company’s website at: https://www.neobatterymaterials.com/.