Category: Nieuws

American tire manufacturer Goodyear Tire & Rubber Co. is facing accusations of unpaid wages, unlawful overtime and threats to foreign workers at its Malaysian factory, according to court documents and complaints filed by workers.

In interviews with Reuters, six current and former foreign workers, and officials with Malaysia’s labor department, say Goodyear made wrongful salary deductions, required excessive hours and denied workers full access to their passports.

The department confirmed it had fined Goodyear in 2020 for overworking and underpaying foreign employees. One former worker said the company illegally kept his passport, showing Reuters an acknowledgement letter he signed in January 2020 upon getting it back eight years after he started working at Goodyear

The allegations, which Reuters is the first to report, initially surfaced when 185 foreign workers filed three complaints against Goodyear Malaysia in the country’s industrial court, two in 2019 and one in 2020, over non-compliance with a collective labor agreement.

The workers alleged the company was not giving them shift allowances, annual bonuses and pay increases even though these benefits were available to the local staff, who are represented by a labor union.
The court ruled in favor of the foreign workers in two of the cases last year, saying they were entitled to the same rights as Malaysian employees, according to copies of the judgment published on the court’s website.

Goodyear was ordered to pay back wages and comply with the collective agreement, according to the judgment and the workers’ lawyer.
About 150 worker payslips, which the lawyer said were submitted to the court as evidence of unpaid wages and reviewed by Reuters, showed some migrants working as many as 229 hours a month in overtime, exceeding the Malaysian limit of 104 hours.

The foreign workers are claiming about 5 million ringgit ($1.21 million) in unpaid wages, said their lawyer, Chandra Segaran Rajandran. The workers are from Nepal, Myanmar and India.

“They are put in a situation where they are being denied their full rights as what is provided for (by law),” he said, adding that it amounted to “discrimination.”

Goodyear, one of the world’s largest tire makers, has challenged both verdicts at the high court. The appeal decision is expected on July 26. The verdict for the third case, over the same issues, is due in the coming weeks.

Goodyear declined to comment on any of the allegations, citing the court process. According to the court ruling last year, Goodyear Malaysia argued that foreign workers are not entitled to the benefits of the collective agreement because they are not union members

According to the ruling, a union representative testified that foreign workers are eligible to join and are entitled to the benefits in the collective agreement even if they are not members. The court agreed that the foreign workers’ job scope entitled them to those benefits.
Goodyear told Reuters it has strong policies and practices relating to and protecting human rights.

“We take seriously any allegations of improper behavior relating to our associates, operations and supply chain,” a representative said in an email.
The union — the National Union of Employees in Companies Manufacturing Rubber Products — did not respond to Reuters’ requests for comment on the workers’ complaints

Goodyear’s Malaysia operation is jointly owned by the country’s largest fund manager, Permodalan Nasional Berhad, which directed queries to Goodyear.

Fines and violations

Workers said they faced intimidation from Goodyear after they filed the lawsuits. Goodyear declined to comment.
“The company had different rules for different sets of workers,” said Sharan Kumar Rai, who filed one of the lawsuits and worked at Goodyear in Malaysia from 2012 until last year.

The foreign workers filed the first two lawsuits in July 2019. Soon afterward, Goodyear asked some to sign letters, without their lawyer’s knowledge, that they would withdraw from the legal action, according to their lawyer, police complaints filed in October 2019 and a copy of the letter seen by Reuters. Reporting a complaint to police does not always result in criminal charges but can trigger an investigation.

Industrial court chairman Anna Ng Fui Choo said in her ruling that the letter “was an act of unfair labor practice.”

Malaysia’s labor department told Reuters it had investigated and charged Goodyear in 2020 over nine violations of labor laws, unrelated to the lawsuits, regarding excessive hours and wrongful salary deductions. It fined Goodyear 41,500 ringgit ($10,050), it said.

Malaysia has in recent years faced accusations from its own Human Resources Ministry and authorities in the United States of labor abuse at its factories, which rely on millions of migrant workers to manufacture everything from palm oil to medical gloves and iPhone components.

By Arab News, May 30, 2021

Europe’s oil refiners have big plans to boost the use of green hydrogen to help them make fuel, an important component of the petroleum industry’s plans to cut its operational carbon emissions.

But with the clock ticking in the battle against climate change, the reality of what the industry has committed to remains modest. Green hydrogen comes from water and renewable electricity, while the vast majority of hydrogen made today comes from fossil fuels.

While using green hydrogen will help to clean up a refinery’s operations, it won’t have a big impact on the world’s overall carbon emissions because most of those occur when fuels are consumed rather than when they’re made. The gas is an essential part of oil refining, being used to take impurities out of fuels.

The first European plant to bring a so-called green hydrogen project online looks set to be Royal Dutch Shell Plc’s Rheinland refinery in Germany, with a small electrolyzer scheduled to start production in July. It will make about 1,300 metric tons a year. The International Energy Agency estimates global hydrogen usage is about 70 million tons annually, with consumption dominated by oil refineries and chemical makers.

With capacity of 10 megawatts, Rheinland is on a similar scale to pilot projects being developed across Europe by peers including Austria’s OMV AG and Spain’s Repsol SA. Over the course of a year, an electrolyzer of that size would produce enough hydrogen for less than a week at a complex like Rheinland. There are far bigger developments in the wings — up to a few hundred megawatts — but none of those have so far been funded.

“The problem is that the technology is still being developed, expensive to build and will need to increase in scale to make a significant difference,” said Jonathan Leitch, a director at Turner, Mason & Company.

While green hydrogen delivers higher carbon savings, refiners are also looking at so-called blue hydrogen, where projects tend to be bigger, at around 1,000 megawatts. Those rely on more-established carbon capture technology.

Carbon Capture

Refiners are more at home with blue hydrogen, described by Leitch as being pretty much the same as making hydrogen in a conventional refinery, except the carbon is captured and stored. The U.K., the Netherlands and Norway have the advantage here of being able to use caverns left over from the production of oil and gas to store carbon.

Companies across Europe are looking at using green or blue hydrogen, and most plan to use it in the production of fuels, rather than as a source of power. A refinery would need to make considerable modifications to run on hydrogen, with furnaces only able to tolerate a limited amount of hydrogen in the gas mix, according to Zoran Milosevic, a specialist with Eurotek Refining Services, a U.K.-based consultancy.

“Burning higher volumes of hydrogen in furnaces as fuel will be technically challenging and hardly economical,” Milosevic said.

Below is a list of hydrogen projects at European refineries. It includes projects where a developer mentions refiners among possible customers. It will be updated as developments take place.

Germany, Austria

• Shell Rheinland
• Green hydrogen, 10 megawatt electrolyzer
• Due to start in July
• Hydrogen for use by refinery to make fuel, and in local transport
• Capacity could be expanded to 100MW, but depends on securing funding
• Klesch Heide
• Green hydrogen, 30MW electrolyzer in first phase
• FID due later this year; construction to start in 2H 2022
• Hydrogen initially for use in the refinery
• Will also be tested in natural gas network
• Working with Orsted
• Possible expansion to 700MW
• OMV Schwechat
• Green hydrogen, 10MW electrolyzer
• FID is in place
• Project to complete in second half of 2023
• BP Lingen
• Green hydrogen, 50MW electrolyzer
• FID is due in early 2022
• Working with Orsted
• BP Gelsenkirchen
• Part of group that applied for EU funding in late 2020
• Gelsenkirchen would consume green hydrogen made in a facility owned by RWE

The Netherlands, Belgium

• Shell Rheinland
• Green hydrogen, 10 megawatt electrolyzer
• Due to start in July
• Hydrogen for use by refinery to make fuel, and in local transport
• Capacity could be expanded to 100MW, but depends on securing funding
• Klesch Heide
• Green hydrogen, 30MW electrolyzer in first phase
• FID due later this year; construction to start in 2H 2022
• Hydrogen initially for use in the refinery
• Will also be tested in natural gas network
• Working with Orsted
• Possible expansion to 700MW
• OMV Schwechat
• Green hydrogen, 10MW electrolyzer
• FID is in place
• Project to complete in second half of 2023
• BP Lingen
• Green hydrogen, 50MW electrolyzer
• FID is due in early 2022
• Working with Orsted
• BP Gelsenkirchen
• Part of group that applied for EU funding in late 2020
• Gelsenkirchen would consume green hydrogen made in a facility owned by RWE

U.K.

• Essar Stanlow
• Blue hydrogen
• First of two facilities to start operating in 2025
• Essar is working on a new furnace for the existing crude unit that will allow it to run on hydrogen
• Phillips 66 Humber
• Part of Humber Zero, which is looking at blue and green hydrogen production
• Funding in place up to FID, which is due in 2023
• Phillips 66 Humber
• Part of Gigastack project
• Partners are Orsted and ITM Power
• Valero Pembroke
• Part of South Wales Industrial Cluster

France

• Total La Mede (biofuels plant), in cooperation with Engie
• Green hydrogen, 40MW electrolyzer
• Project depends on securing subsidies
• Engie/Air Liquide Fos
• Refineries and chemicals companies to use the green hydrogen, according to developers
• Funds to be secured
• H2V Normandy
• Green hydrogen
• Air Liquide among partners
• NOTE: Exxon said it would consider buying green hydrogen if a project is launched near Gravenchon, provided it doesn’t hurt its profitability

Scandinavia

• Sweden, Preem Lysekil, in cooperation with Vattenfall
• Green hydrogen
• Project to build 200-500 megawatt electrolyzer being considered Denmark, Everfuel, adjacent to Fredericia
• Green hydrogen, 20MW electrolyzer, which is funded
• Expansion to 300MW subject to financing
• NOTE: Fredericia recently sold by Shell to Postlane Partners
• Norway, Equinor, adjacent to Mongstad
• FID still pending
• Green hydrogen for use in shipping, not in the refinery

Spain, Italy, Greece

• Spain, Repsol Bilbao
• 10MW electrolyzer
• Green hydrogen project isn’t affected by furlough of workers
• Spain, BP Castellon
• Green hydrogen, 20MW electrolyzer in first stage
• Working on feasibility with Iberdrola and Enagas
• Italy, Saras Sarroch, in partnership with Enel
• Green hydrogen, 20MW electrolyzer
• Italy, Eni 2 pilot projects in partnership with Enel

Bloomberg, by Rachel Graham, May 30, 2021

The UK government is subsidising a shift towards hydrogen-powered operations at two of the country’s oil refineries, with £7.7mn ($10.9mn) in environmental grants.

The bulk of the funding is going to Essar Oil UK, which runs the 204,000 b/d Stanlow refinery in northwest England. It has received £7.2mn to covers nearly one third of cost of building the UK’s first refinery furnace able to be fuelled entirely by hydrogen. The furnace will be installed in Stanlow’s only crude distillation unit (CDU), with construction beginning this year and completed by September 2023.

The furnace will use hydrogen produced by the HyNet North West project at the Stanlow site, from where first output is scheduled for 2025. When the furnace is running on hydrogen alone, it will reduce the refinery’s overall CO2 emissions by 11pc a year.

US firm Phillips 66 will receive a government grant of £500,000 to support research examining how hydrogen could be used to fuel gas-fired heaters at the 230,000 b/d Killingholme refinery on England’s northeast coast.

Phillips 66 said last month that it plans to process used cooking oil (UCO) to produce renewable fuels at Killingholme, which it will source from London, China and Singapore.

“The sector is a committed and important partner in reaching Net Zero,” said UK Petroleum Industry Association (UKPIA) director general Stephen Marcos Jones. “UKPIA looks forward to continued close engagement with governments on hydrogen opportunities for the downstream sector.”

The HyNet project will involve two ‘blue’ hydrogen plants with a carbon capture and storage (CCS) chain, requiring a total of £750mn in investment. Essar has said it will build a plant to convert pre-processed household waste into 100mn l/yr of sustainable aviation fuel (SAF), or biojet, at a cost of £600mn. Essar chief operating officer Jon Barden today said that Stanlow aims to be a “net zero site by 2040.”

Essar has been working its way through financial difficulty over the past month or so, after a bank changed the terms of a credit facility, forcing the company to raise new liquidity. Its chief executive and two directors departed the company in March and April.

Last week it said that it had arranged a new $850mn credit facility and completed a review of its governance, leading to the appointment of two new non-executive directors.

The UK government yesterday said that its Industrial Energy Transformation Fund would be allocating £16.5mn to “help energy-intensive sectors cut their emissions.”

Argus, by Benedict George, May 30, 2021

U.S. traffic volumes have almost returned to pre-pandemic levels, helping normalise gasoline consumption as more businesses re-open, domestic leisure travel resumes and workers return to offices.

The volume of traffic on all roads was down by less than 4% in March compared with the same month two years ago, according to the Federal Highway Administration (“Traffic volume trends” FHWA, March 2021).

Traffic levels had been down 41% in April 2020 at the height of the first wave of the pandemic and were still down 11% as recently as December 2020 during the second wave.

Car use likely increased further in April and May as social-distancing restrictions were relaxed and more service businesses and offices re-opened.

More driving means more fuel consumption.

The volume of gasoline supplied to the domestic market, a proxy for consumption, was down by just 4% at 8.9 million barrels per day in the four weeks to May 14 compared with the pre-pandemic five-year average of 9.3 million b/d.

The remaining driving and fuel deficits are likely to be erased over the third quarter as more employees return to central offices and domestic tourism recovers.

The rapid normalisation of gasoline consumption has encouraged a strong resumption of motor fuel production, which is nearing pre-pandemic levels.

Refinery gasoline production is down by just 3% compared with the five years from 2015 to 2019, according to the Energy Information Administration (“Weekly petroleum status report”, EIA, May 19).

Like the driving and consumption deficits, refiners’ gasoline production is likely to reach pre-pandemic levels during the summer

The enormous surplus that accumulated during the pandemic’s first wave has been absorbed. Inventories held at refineries, tank farms and in pipelines are back in line with the pre-COVID five-year average.

Jet fuel consumption is still severely affected by quarantine restrictions. But in the gasoline market the impact of the pandemic appears largely over, provided there is no resurgence of infections.

Ship Insight, by John Kemp, May 24, 2021

In the global refining industry, COVID-19 has exposed a seismic shift. While China’s oil refineries forge ahead with capacity expansion, many western-based refiners have retrenched.

As China again hits the stimulus pedal, this year it is expected to officially surpass the U.S. as the world’s largest oil refiner according to the International Energy Agency (EIA).

This can be partly explained by China’s head start in recovering from the pandemic. While much of the world remains under varying states of lockdown, China’s economic growth hit 6.5% in the fourth quarter of 2020, meaning that it grew 2.3% for the full year. It is the only major economy to have expanded in 2020.

There are four other structural factors driving the global refining industry amid China’s new capacity boom. Let’s take a look at each.

COVID Fallout For Refineries

According to the EIA, as economies locked down and airlines were grounded, global oil demand slumped 9.2% to 92.2 million barrels a day. Refineries were quick to feel the impact with about 1.7 million barrels a day of refining capacity being halted in 2020, with more than half of that decrease in the U.S.

And while Europe’s pandemic induced lockdowns may be temporary, at the end of 2020 they were taking out some 900,000 barrels a day of road fuel demand according to Rystad Energy.

Added to the deep recessions in the many western countries, the growing pressure to phase out fossil fuels is another headwind. One example is the move by President Biden to pause new domestic oil exploration on federal land.

Consumers Driving Demand

While Asia has not escaped pandemic travel disruptions, the refining industry outlook is on much firmer footing because the main demand driver for refined oil products is the region’s vast consumer markets – namely the billion-plus populations of China and India.

Capacity expansion there is being driven by plastics and other petrochemicals where refined crude oil is the essential building block for everything from food packaging, clothing, cosmetics and fertilizer, even car interiors.

According to industry consultant Wood Mackenzie, approximately 70% to 80% of new refining capacity coming on stream in Asia up to 2027 will be plastics-focused. As well as China, this includes several new plants in India and the Middle East.

Consumer demand, however, is only part of the story behind China’s refinery building.  The other factor is supply and the role of the country’s resurgent independent refineries. 

China’s Upgraded “Teapots”

The explosive growth today in China’s refining capacity has its roots in a major regulatory shift in 2015 when independent refiners (known as “teapots”) were first allowed to import crude oil. The rationale was that in return for import quotas, they would upgrade, modernize and instill wider competition and efficiency in the state-dominated oil industry.

As refining capacity has surged with China’s crude oil imports, this helps China surpass the U.S. to become the world’s largest importer.  

These teapots are now leading the charge with bigger, integrated refineries. At least four projects with about 1.4 million barrels a day of crude-processing capacity – more than all the refineries in the UK combined – are under construction.

By 2025, China’s crude processing capacity is expected to reach 1 billion metric tons a year, or 20 million barrels per day, up from 17.5 million barrels at the end of 2020, according to China National Petroleum Corp’s Economics & Technology Research Institute.

China’s state-owned oil behemoths are also not sitting on their hands either. Last year Russian petrochemicals producer Sibur and China Petrochemical Corp (Sinopec Group) began to work on what is set to become the world’s largest polymer plant, the Amur Gas Chemical Complex in Russia. This $11 billion venture will produce 2.3 million metric tons of polythene and 400,000 metric tons of polypropylene per year. Sinopec is set to take a 40% stake in the complex, which is due for completion from 2024.

New Capacity?

The surge in China’s refining capacity is already having an impact across the global refining industry.

More crude oil is finding its way to China and Asia and less is routed to traditional western customers. The demand from Chinese refiners has coincided with Oman crude oil trading at a sustained premium to Brent for the first time in four years.

Although increased production by China’s independents is largely trapped inside the domestic market due to export quotas, it has allowed the giant state operators to export more. This has led to China’s surplus refining capacity finding its way to international markets as it takes global market share. Exports of refined products have increased to Hong Kong, Singapore, the Philippines, Australia and South Korea. This has already been felt by older plants with Shell in Singapore announcing cuts to its capacity in Singapore in 2020.  

As more supply comes on stream, it will come sharply into focus whether demand for plastics and petrochemicals will really be able to take up the slack, particularly as demand for refined fuel abates. China National Petroleum sees fuel demand peaking in China by 2025 as electric vehicles sap consumption.

Another wild card to consider is China’s clean energy push with President Xi Jinping pledging China would be carbon neutral by 2060.  

Ultimately, what is easier to predict is that, with China’s refinery capacity leading the world, it will also increasingly play a bigger role in regional and perhaps global markets for oil and refined products

Benzinga, by CME Group, May, 24, 2021

Crude oil and natural gas have both been lagging some of the blistering pace of other commodities this past week.

Oil continues to be torn between the uneven recovery in global fuel demand, especially due to continued virus flareups across Asia, writes Ole Hansen, Head of Commodity Strategy, Saxo Bank.

Adding to this has been the disastrous hacking attack on the Colonial Pipeline which supplies 2.5 million barrels/day of fuel products from refineries in Texas to consumers along the US East coast.

As a result the US national average retail gasoline prices have risen above $3 a gallon for the first time since 2014, but while fuel stations across the East and South have started to run out, some refineries have been forced to cut runs leading to lower demand for crude oil.

A bigger-than-expected cut in crude stocks, reported by the American Petroleum Institute last night, was offset by a big increase in gasoline stocks.

All this happens as the commodity sector remains on a tear with several key raw materials from copper and iron ore to corn and palm oil trading at or near multi-year highs.

Inadvertently thereby adding to the debate over whether commodity-driven inflation pressures will be persistent enough to force the Federal Reserve to tighten policy sooner than currently expected.

Hence the focus on today’s US CPI data which is expected to show a year-on-year jump of 3.6%. With most of the change being down to seasonality, the focus may for once be centered on the monthly increased, expected at just 0.2% compared with 0.6% in March.

The rally this past week has been led by industrial metals and grains while crude oil and natural gas for various reasons have struggled to keep up. Overall, however, the Bloomberg Commodity Spot index is trading at a fresh ten-year high, and now up by one-third since early November when vaccine news accelerated growth and demand expectations.

Meanwhile, during the week, Opec, the IEA and the EIA have all published their monthly oil market reports. Overall no major changes were made with world oil demand seeing a small downgrade due to virus breakouts in Asia while non-Opec supply was lowered due to slower US shale growth.

Since late March Brent crude oil has traded in a rising but narrowing channel, currently between $70.80 and $67.25, the latter also being the 21-day moving average, a technical indicator which gives a good idea about short term momentum. We struggle to see Brent make much short-term headway above the triple top at $71.3, so while urging short-term caution we maintain a bullish outlook for the second half of 2021, primarily due to the prospect for a rapid growth in global fuel demand as vaccine rollouts reduce the impact of local virus flareups.

Natural Gas has spent the past couple of weeks trading sideways within a relative tight range between the $2.86 and $2.98, levels that represents the 50% and 68.2% Fibonacci corrections of the February to March sell-off. The close proximity to the rising trend line from the April low points to a market that is getting ready for break, either towards $2.80 or higher towards the February high around $3.31.

TradeArabia, by Ole Hansen, May 18, 2021

What do businesses need to operate? Electricity, water and gasoline are near the top of the list, and recent infrastructure failings suggest the foundations of the US economy may be on shakier ground than thought.

In February, extreme weather overwhelmed the electric grid in Texas, causing days of power and water outages in a state where many people depend on electric heat. Oil production plummeted and refineries were forced to close.

Three months later, a criminal gang believed to be operating in Eastern Europe launched a cyberattack on the Colonial Pipeline, which stretches from Texas to New Jersey and transports half the fuel consumed on the East Coast. Panic buying and gas shortages followed.

Both snafus caused real trouble for consumers and businesses, but they are far from isolated events. The US Department of Homeland Security warned in February 2020 that a cyberattack had forced a natural gas compression facility to close for two days. In 2018, multiple US natural gas pipeline operators were hit by an attack on their communication systems.

The threats from cyberattacks and extreme weather have been well known for years, but experts say wide swaths of the United States’ critical infrastructure remain vulnerable. The private sector and government both have roles to play in hardening defenses and preventing future damage.

“The ransomware attack on the Colonial Pipeline in the US shows the critical importance of cyber resilience in efforts to ensure secure energy supplies,” Fatih Birol, the head of the International Energy Agency, said on Twitter. “This is becoming ever more urgent as the role of digital technologies in our energy systems increases.”

The private sector owns roughly 85% of US critical infrastructure and key resources, according to the Department of Homeland Security. Much of that needs an urgent upgrade. The American Society of Civil Engineers estimates there will be a $2.6 trillion shortfall in infrastructure investment this decade.

“When we fail to invest in our infrastructure, we pay the price. Poor roads and airports mean travel times increase. An aging electric grid and inadequate water distribution make utilities unreliable. Problems like these translate into higher costs for businesses to manufacture and distribute goods and provide services,” the group warned.

As the Colonial Pipeline crisis unfolded, President Joe Biden signed an executive order that is designed to help the government deter and respond to cyber threats. The order will establish standards for software purchased by federal agencies, but it also calls on the private sector to do more.

“The private sector must adapt to the continuously changing threat environment, ensure its products are built and operate securely, and partner with the federal government to foster a more secure cyberspace,” the order states.

The private sector can work more closely with the government, analysts say, including improved information sharing with law enforcement agencies. Corporate boards need to be fully engaged on cyber issues, and management should relentlessly enforce basic digital hygiene measures including the use of strong passwords. If hackers demand a ransom, it’s best to not pay.

Experts say that regulators need to increase oversight of critical infrastructure. The Transportation Security Administration, for example, is charged with regulating pipeline cybersecurity.

But the agency issues guidelines not rules, and a 2019 watchdog report found it lacked cyber expertise and had only one employee assigned to its Pipeline Security Branch in 2014.

“For twenty years the agency has chosen to take a voluntary approach despite ample evidence that market forces alone are insufficient,” Robert Knake of the Council on Foreign Relations said in a blog post.

“It may take years to get the pipeline industry to a point where we can have confidence that companies are appropriately managing risks and have constructed systems that are resilient,” he added. “But if it is going to take years to secure the nation, it is well past the time to get started.”

Biden, meanwhile, is pushing his roughly $2 trillion plan for improving the nation’s infrastructure and shifting to greener energy as part of the solution.”In America, we’ve seen critical infrastructure taken offline by floods, fires, storms and criminal hackers,” he told reporters last week. “My American Jobs Plan includes transformative investments in modernizing and in securing our critical infrastructure.

But critics say the infrastructure proposal doesn’t do enough to address malicious cyber security, especially in light of the Colonial Pipeline attack.

“This is a play that will be run again, and we’re not adequately prepared. If Congress is serious about an infrastructure package, at front and center should be the hardening of these critical sectors — rather than progressive wishlists masquerading as infrastructure,” Ben Sasse, a Republican senator from Nebraska, said in a statement.

Are prices going up? That can be hard to measure

Just about everything is getting more expensive as the US economy rebounds and Americans spend more on shopping, traveling and eating out.
US consumer prices in April shot up 4.2% from a year earlier, the Bureau of Labor Statistics reported last week. It was the biggest increase since 2008.

Big moves: The biggest driver of inflation was a steep 10% increase in used cars and truck prices. Prices for shelter and lodging, airline tickets, recreational activities, car insurance and furniture also contributed.

Rising prices unnerve investors because they could force central banks to pull back on stimulus and raise interest rates sooner than expected. This week, investors will be watching to see if the inflationary trend is taking hold in Europe, with price data due Wednesday.
But spare a thought for the bean counters tasked with calculating inflation during a pandemic, when buying patterns have changed dramatically because of lockdowns and the big shift to online shopping.

“On a practical level, statistics offices have faced the problem of having to measure prices when many items are simply not available for purchase due to lockdowns. They also need to account for shifts in the timing of seasonal sales caused by the pandemic,” said Neil Shearing, group chief economist at Capital Economics.

“All of this means that ‘measured’ inflation, which is to say the monthly figure reported by statistics offices, may differ from the true rate of inflation on the ground,” he added.

CNN Business, by Charles Riley, May 18, 2021

May 14, 2021 A new company has been launched with $250m of backing from private equity firm Bluewater.

Global Energy Storage (GES) has been set up by the management team of hydrocarbon storage and logistics firm Global Petro Storage (GPS) and is focused on developing storage and logistics projects for LNG, LPG, hydrogen, ammonia and renewable fuels.

The team is based in Singapore, the Netherlands, UAE and London is led by chief executive Peter Vucins and executive chairman Eric Arnold. CIO Alan Hyslop, CFO Sim Seow Wah, and CTO Mark Synnott also join from GPS.

Mr Vucins said the team would initially work across both GES and GPS, which Bluewater first invested in five years ago. He said the management team would stay with GES in the event of a Bluewater exit from GPS.

The CEO said GES was developing an “exciting pipeline of projects” in Southeast Asia and Latin America and expected to announce its first deal “very soon”.

GES is also interested in contributing to decarbonisation in the UK, which has ambitions for growing hydrogen production, particularly in places like Humberside.

In addition, GES has signed up to the Transhydrogen Alliance, alongside Dutch engineering firm Proton Ventures, Dubai-based Trammo, and VARO, an European mid- and downstream energy company. The consortium was set up to work together on the production and import of green hydrogen and green ammonia into Europe via Rotterdam.

Mr Vucins said: “There is an urgent need for storage assets for the next generation of low carbon fuels.

“GES has the expertise and financial backing to develop this crucial infrastructure at key locations around the world.

“I am delighted that GES will be playing its part as we all work together to meet the ambitious, and essential, Paris carbon reduction targets.”

Mr Arnold said: “GES has a unique proposition. Our team has proven experience that is second-to-none. We have PE backing, so we can make swift decisions and take a longer view, rather than focusing on just the next quarter. And we have a strong focus on energy transition fuels. You put these together, and I believe Global Energy Storage is extremely well-placed to make a significant contribution to the Energy Transition.”

Bluewater managing director Martin Somerville added: “Peter and Eric are genuine leaders in the sector, and that’s why we’re supporting this new vehicle to build on the continuing success of GPS. GES will allow them to target new markets and opportunities that help deliver new storage solutions for the energy transition.”

By Private Equity Insights, May 14, 2021