GoDubai
  
  
  
  
Citylife > Press Release
  Home Contact us Add to Favourites
Most Recent Postings
More Press Releses
Featured Sections

Event Finder
A daily roundup of exhibitions, promotions and other events in Dubai and the rest of the Emirates.
Submit an Event
Latest Dubai Press Releases >> Energy and Industry

 
  Share

Oil prices have been on a tear in early 2021, even though a new U.S. administration focused on clean energy. The Biden White House plans to move to a net-zero emission economy, and several U.S. carmakers have announced they will go all-electric or mostly electric within the next 2-decades. Telsa is also continuing to push out electric vehicles and has seen its share price hit all-time highs in 2021. The share prices of Tesla, GM, and Ford, have been on a tear.

What is Going on With Oil Prices

Even though the government and the private sector in the U.S. is focused on clean energy, oil prices have rallied back to 11-month highs. The lack of U.S. production and rising demand has been the catalyst behind the rally in oil prices. U.S. Domestic production is currently at 11-million barrels a day. This compares to production 1-year ago that was 13-million barrels a day. While production is down a full 15% year over year, demand is only down 5.8%. According to data from the Energy Information Administration, total products demand over the last month averaged 19.5 million barrels a day, down

by 5.8% from the same period the previous year. U.S. crude oil inventories are about 2% above the five year average for this time of year. At the current rate of change, which saw crude oil inventories drop by 6.6-million barrels during the latest week, stocks will soon be below last year's levels, while prices will still also be below last year's levels. The technicals on oil prices are positive as prices are fast approaching the 2020 highs near $65. A breakthrough that level could lead to a test of the $70 range. While the rig count is rising the production of oil in the U.S. is not at sufficient levels to offset the current demand levels.

What Has Biden Done

While crude oil prices are surging higher, the White House is making an effort to get back in the clean energy fray. The U.S. rejoined the Paris Climate Accord, a critical step forward in the fight against climate change. The Biden administration plans to make the U.S. a 100% clean energy economy with net-zero emissions by 2050. The European Union, Canada, Argentina, Mexico, South Africa and Japan have also set targets to achieve net-zero emissions by 2050. The administration also plans to decarbonize the U.S. power sector by 2035, tapping into renewable energy solutions and technology.

The Private Sector Also Plans to Reduce Carbon Output

In 2021, General Motors announced that the company plans to phase out vehicles using internal combustion engines by 2035. The automaker will go completely carbon-neutral at all facilities worldwide by 2035. The company recently increased the number of pure battery-electric vehicles it will launch by the middle of this decade. GM is also working on clean technology for heavy-duty trucks. GM is also looking for other hydrogen technology applications it is developing as part of a joint venture with Honda. Trading of all shares of GM has been hot. The stock price ran up into earnings, and then there was some profit-taking.

Ford is not expected to be left out of the electric vehicle market. Ford Motor CEO Jim Farley told CNBC the company intends to compete in the growing market segment strongly. During its earnings announcement, Ford said it's increasing its electric-vehicle investment to $22 billion through 2025, almost double what it had previously pledged to spend.

Tesla/Neo are continuing to push output. Tesla announced that during the most recent quarterly vehicle production volume came to just under 180,000 units. Tesla's production level in the fourth quarter of 2020 increased by around 24% quarter-on-quarter and over 70% year-on-year.

The auto industry is shifting from internal combustion technology to the emissions-free battery and hydrogen powertrains. Several traditional brands have announced a complete transition, with Bentley recently laying out a target date of 2030 to switch entirely to battery-electric vehicles.

The Bottom Line

The upshot is that the new administration and private sector are moving into clean energy. Shares of clean energy companies have experienced strong outperformance already in 2021. Tesla, GM and Ford motor company have seen their stock prices surge. Despite the new administration's recent announcements to be carbon neutral by 2050, and GM to become all-electric by 2035, oil prices have been on a tear. Oil prices have surged higher as production levels in the United States are not keeping up with rising demand. If a vaccine is successful in creating herd immunity and demand continues to rise, prices could continue to spike as rising above the 2020 highs.



Posted by : GoDubai Editorial Team
Viewed 7868 times
Posted on : Wednesday, February 24, 2021  
Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of GoDubai.com.
Previous Story : Crude oil tumbling on rising risk adversity and weaker s/t demand
Next Story : OPEC Deal Lifts Oil; Metals of all Colours in Demand
Email this article Print this article

Share this article with your friends and followers
NewsVine

Comments

Back to Top  
Most Viewed Press Release posted in the last 7 days
Sparkling Roses for Style
Exclusive Complication also Features a Moon Phase
The Perfect Duo From Aesop's Skincare+ Range
Star International Mirdif Launches Covid-Friendly “Log In and Learn” Online Shor...
Legend Beauty & Spa Centre
Gold Trends Inspire Latest Collection at Tanishq
UAE Health Council Discuss Mechanisms of Supporting Health Efforts, Initiatives ...
Galaxy Watch3: Redefining the Smartwatch Experience
‘Gold Promise' – Get Assured Gold Coins at Malabar Gold & Diamonds
Aster Volunteers Partner with Al Shifa Hospital to set- up 50-bed Field Hospital...
Kalyan Silks' Biggest Showroom In Dubai Opens at Qusais
Ramadan Rides School Challenge Initiative Launched by UAE Team Emirates and ADNOC
WCU: Grain Market Rally Adds to Inflation Unease
Danube Home Launches Their All New Danube Home Services Division
Home Décor & Dining Selection For Ramadan'
Dubai Shopping Malls Group Introduces Summer Season Promotion for Dubai Shoppers...
This Ramadan, Drive Home the Ultimate SYMBOL of Style
Dubai Festival City Mall Launches Exclusive Art Exhibition to Celebrate Holy Month
Sweeten Your Spring Look With Candy Colours
Guinness Book of Records adds the biggest mosaic Emirati Flag
Mashreq Posts AED 43 Million Net Profit for 1Q 2021
THAT Concept Store Pulls Out all the Stops to Celebrate Ramadan in Style
LG Announces First-Quarter 2021 Financial Results
Dubai Gold & Jewellery Industry Prioritises Consumer Safety; Initiates Mass Vacc...
Dubai Municipality to intensify inspection of pastry shops and bakeries ahead of Eid
ATM 2021 to Host over 60 International Countries Represented Despite Coronavirus...
Air Cairo Receives its First Airbus A320neo
Elevate Your Beauty Game With This Fresh Drop from NOTE Cosmetique
Airbus Reports First Quarter (Q1) 2021 Results
Safi Leads Moroccan One-Two on Closing Night of 2021 NAS Sports Tournament
El Ghouz Leads Moroccan Cleansweep in Men's Open Category of 10km NAS Run
The First Emirati Female Astronaut is a UAEU Alumna
Frontline Heroes Office launches Higher Education Scholarship program for Frontl...
The Power of Love: Pandora Study Explores the Empowering Forces of Motherhood
Arab Bank Group Reports First Quarter 2021 Net Profit of $128.3 Million
Ambulatory Healthcare Services Announces the Opening of the SEHA Drive-Through S...
The Ramadan Collection by BloomingBox
Dubai Foundation for Women and Children (DFWAC) Honors Union Coop
F Tributo Special Edition
Volvo Cars to Lower CO2 Emissions and Save Billions in Circular Business Aim
Mehna Wins MIT Bootcamp Challenge Tackling Youth Unemployment
Abu Dhabi University Student Research on Resilient Cities During Covid-19 Profil...
SEHA Director's Proudest Achievement as She Oversees Creation of UAE's Covid-19 ...
Rashid Al Balooshi Wins NAS Cycling Championship Race for Amateur UAE Men, Khali...
New Turkey Visa Application Centre Inaugurated in Dubai's Wafi Mall
Abu Dhabi Media to Air Environment Agency - Abu Dhabi's New Documentary: 'Our Se...
Emirates Driving Company Announces the Development of a New Branch in Madinat Za...
Saudi Arabia Sees its First Wind Farm from Vestas Coming Together
Bek-Babic Fight Back to Down Lozova-Belbes for NAS Padel Championship Crown
Ramadan Iftar Menu at Carluccio's