Thursday, July 7, 2022

Business Highlights: Pressure on US oil, rally in stocks

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Ukraine war ups pressure for US oil; industry faces hurdles

BILLINGS, Mont. ( Associated Press) — President Joe Biden’s move last week to ban oil from Russia over its invasion of Ukraine was met with calls to boost US production to help bring down souring gasoline prices. But political rhetoric about quickly ramping up US crude output is at odds with reality for the nation’s oil fields: Not enough workers, scant money to invest in drilling and wariness that today’s high prices won’t last. Analysts say the obstacles to more US oil are surmountable, but will take months to work through and it could be late this year or early next before a significant production increase materializes.

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Boeing ex-pilot’s trial starts on fraud charges over 737 Max

FORT WORTH, Texas ( Associated Press) — A former Boeing test pilot is going on trial on charges of misleading regulators about the Boeing 737 Max, the model that was involved in two deadly crashes. Mark Forkner faces four counts of fraud. His trial was scheduled to start Friday in US district court in Fort Worth, Texas. Forkner was Boeing’s chief technical pilot for the Max, which gave him a key role in deciding how much training pilots needed before flying the plane. Prosecutors say he downplayed the importance of a new flight-control system to keep costs down and help Boeing sell more planes. Boeing struck a deal last year to avoid criminal prosecution.

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Stocks extend rally, notching biggest weekly gain since 2020

NEW YORK ( Associated Press) — Stocks rose for a fourth day in a row Friday, closing out their biggest weekly gain since November 2020. The S&P 500 added 1.2%, bringing its weekly gain to 6.2%. The Nasdaq climbed 2% and the Dow Jones Industrial Average rose 0.8%. Investors have welcomed the long-expected pivot from the Federal Reserve from stimulating the economy to fighting inflation, which began this week with its first interest rate increase since 2018. The price of oil remains above $100 a barrel as investors monitor the ongoing Russian invasion of Ukraine. The yield on the 10-year Treasury note fell to 2.15%.

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VW recalls over 246,000 SUVs due to unexpected braking

DETROIT ( Associated Press) — Volkswagen is recalling more than 246,000 SUVs in the US and Canada because faulty wiring harnesses can make them brake unexpectedly, sometimes while in traffic. The recall comes three days after The Associated Press reported that 47 people had to US safety regulators about the problem, some reporting nearly being rear-ended by other vehicles. The recall covers certain Atlas SUVs from 2019 through 2023, Atlas Cross Sports from 2020 through 2023. The documents say the electrical contacts on a wiring harness can corrode, interrupting electrical connections. The problem can also cause the side air bags to deploy late in a crash. The company hasn’t developed a fix yet. Owners will get letters starting May 10.

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India buys Russian oil despite pressure for sanctions

NEW DELHI ( Associated Press) — An Indian official says state-run Indian Oil Corp. bought 3 million barrels of crude oil from Russia earlier this week to secure its energy needs, resisting Western pressure to avoid such purchases. The official said India will be looking to purchase more oil from Russia despite calls not to from the US and other countries due to the invasion of Ukraine. The official said India has no such sanctions. Imports make up nearly 85% of India’s oil needs. Its demand is projected to jump 8.2% this year to 5.15 million barrels per day as the economy recovers from the devastation caused by the pandemic.

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February home sales fall amid higher mortgage rates, prices

NEW YORK ( Associated Press) — Sales of previously occupied US homes fell in February as competition for a near-record low number of properties on the market drove prices higher and rising mortgage rates kept would-be buyers on the sidelines. The National Association of Realtors said Friday that existing home sales fell 7.2% last month from January to a seasonally adjusted annual rate of 6.02 million. That’s less than the roughly 6.1 million sales that economists had been expecting, according to FactSet. Sales declined 2.4% from February 2021 as the median home price jumped 15% from last year at this time to $357,300.

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High energy costs trigger unrest in parts of Europe

LISBON, Portugal ( Associated Press) — High energy costs are stoking unrest in parts of Europe. Spain is deploying more than 23,000 police amid a truckers’ strike Friday, while farmers in France and Greece are snarling traffic with their protests. Russia’s war in Ukraine has further pushed up costs for oil and natural gas in Europe, driving record inflation and making it ever more expensive for farmers and truckers to fuel their equipment and vehicles. A walkout by a group of truckers in Spain has developed into attacks, with police escorting convoys of trucks that are still working. In France, about 20 farmers protested by driving their tractors slowly down a highway. Hundreds of protesting farmers blocked traffic in Athens.

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Energy agency: 10 steps would save 2.7M barrels of oil a day

BERLIN ( Associated Press) — The International Energy Agency says the world could quickly reduce global oil demand by 2.7 million barrels a day by cutting down on car and plane travel. The Paris-based agency says it would help ease the supply crunch caused by Russia’s invasion of Ukraine. The IEA said in a report Friday that “practical actions by governments and citizens” could significantly reduce oil demand, make fuel cheaper for consumers, shrink Russia’s hydrocarbon revenue and boost efforts to reduce greenhouse gas emissions. If fully implemented in advanced economies, the IEA said its plan could cut oil demand by the same amount as all the cars in China within four months.

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The S&P 500 gained 51.45 points, or 1.2%, to 4,463.12. The Dow Jones Industrial Average rose 274.17 points, 0.8%, to 34,754.93. The Nasdaq added 279.06 points, or 2%, to 13,893.84. The Russell 2000 index of smaller companies advanced 21.12 points, or 1%, to 2,086.14.

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Nation World News Desk
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