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Netherlands To Shut Down Europe’s Largest working Gas Field

The Dutch government is set to stop production at the Groningen gas field later this year, the state secretary for the extractive industries, Hans Vijlbrief, told the Financial Times.

The site is already producing only a fraction of its capacity, and it is “very dangerous” to keep operating it, according to the official, RT reported. “We won’t open up more because of the safety issues…. I’m not going to do it because it means that you increase the chances of earthquakes, which I don’t want to be responsible for,” he told the news outlet. “It’s very, very simple: everybody who has some knowledge of earthquake danger tells me that it’s really very dangerous to keep on producing (at Groningen). I’m quite convinced it’s wise to close it down,” Vijlbrief continued. The official noted that he plans to shut down the site by October 1, but this will depend on whether the EU has enough gas after the winter. If necessary, the field might continue to operate until October 2024.

There is reportedly about $1 trillion worth of gas reserves at Groningen, which was opened in 1963 and produced over 50 billion cubic meters of gas at its peak ten years ago.

However, because the extraction process led to earthquakes that threatened the homes of local residents, output was eventually cut. Up to 100 drilling-induced tremors have been registered around Groningen annually since the 1980s, with roughly 160,000 claims for damage to property filed to date, according to the FT. The Netherlands came under pressure from EU authorities to boost production at the site last year, when a drop in supplies from Russia sent gas prices on the continent soaring to historic highs. Although the Hague rejected these calls, it did postpone plans to shut down the field. Its annual output was cut to 2.8 billion cubic meters (bcm), as producing more than 5 bcm would heighten the risk of earthquakes, Vijlbrief said. Russia used to be the largest gas supplier to the EU, accounting for 40% (155 billion cubic meters) of total EU gas consumption in 2021. Last year, Moscow was forced to halt gas deliveries through the Yamal-Europe and Nord Stream 1 pipelines due to Ukraine-related sanctions. At the end of September, deliveries through Nord Stream 1 stopped completely after the pipeline was sabotaged. Russia continues to deliver gas to certain European buyers via a transit line through Ukraine and the TurkStream pipeline through Turkey, but volumes are only a fraction of what they were in 2021. Industry experts warn that the EU, while relatively secure in supplies at the moment due to high storage levels, may face difficulties when the time comes to refill stores for next winter.  NN: tTheir has never been a earthquake but earth tremors which registered at maximum of 3.5. The average is under 2.5 most often not even felt. Their are millions o tremor around the world each year and cause no damage…..  and the tremors were centered under the field as the earth subsides as the gas is removed. If your were thinking rationally create a buffer zone around this 100 billion dollar gas field. That could easily supply Europe’s energy needs. But that goes against the Greeneeeewennnieess wet dream of no oil, no gas, no energy……… Sad and stupid to.
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Fed should hike by 50 basis points next meeting, says former Fed Gov. Frederic Mishkin…….. El-Erian Says Fed Should ‘Go for 50’ Basis-Point Hike at Next Meeting

El-Erian Says Fed Should ‘Go for 50’ Basis-Point Hike at Next Meeting

NN: The markets are wishing on a star. Inflation is not over. And as China opens up the US inflation rate by any metric you care to use will hit new highs. And the FED knows this and is not going to lower rates for years in the future. The only question is how fast they continue to raise rates.

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Top Chinese Oil Trader’s Goes On A Buying Spree…… Chinese Oil Demand Seen Hitting Record on Covid Zero Pivot

  • Unipec bought as many as 18 cargoes of Upper Zakum this month
  • It’s clear to me this is indicative of a wider demand rebound

China’s biggest oil trader Unipec has piqued market interest after some unusual crude buying as investors and analysts seek clues on the pace of recovery in the world’s top importer. Unipec, the trading arm of state refining giant Sinopec, this month bought as many as 18 million cargoes of Abu Dhabi’s Upper Zakum crude for loading in March, according to traders. That’s equivalent to 9 million barrels, which traders say exceeds the company’s usual appetite for the grade. The strength of China’s recovery is in the spotlight as industry and Wall Street analysts try to quantify the impact of Beijing’s rapid unwinding of Covid Zero on oil demand. It’s unclear if the barrels bought by Unipec will be supplied to Sinopec’s vast refining network for processing, or resold, and traders were mixed in their conclusions about the implications of the large haul. Some said increased interest in Upper Zakum can be attributed to the company’s halt in Russian ESPO purchases since late-2022, coupled with a rise in downstream demand for oil products. Others said Unipec may see value in the grade that’s linked to the pricing of Dubai crude, Asia’s main benchmark.  NN: After all its is a binary trade.

Chinese Oil Demand Seen Hitting Record on Covid Zero Pivot

Chinese oil consumption is expected to hit a record this year as the world’s biggest importer leaves the straitjacket of Covid Zero behind, bolstering the global demand outlook and aiding prices. Daily demand — which contracted last year — will climb by 800,000 barrels a day in 2023, according to the median estimate of 11 China-focused consultants surveyed by Bloomberg News. That would take consumption to an all-time high of about 16 million barrels a day, the survey showed. Crude’s fortunes over the coming year hinge to a major extent on China, as well as on decisions by OPEC+, the impact of sanctions on Russian flows, and the arc of monetary policy. Oil’s bulls, of which there are many, have built a large part of their outlook on growth in Chinese demand, with Goldman Sachs Group Inc.’s Jeffrey Currie saying that crude is the “best reopening play”. “Demand recovery is expected to accelerate from the second quarter onward as traffic rebounds and the number of flights, especially international flights, gradually recovers,” said Yitian Lin, research associate of oils and refineries at Wood Mackenzie Ltd., who estimates daily demand will rise by 970,000 barrels. Other market watchers have also flagged prospects for a sharp rebound in consumption. The International Energy Agency, which advises major economies, forecasts that global demand will grow by 1.7 million barrels a day in 2023, citing expansion in China as well as India, according to its December outlook. Brent crude — the global benchmark — traded near $85 a barrel on Friday, headed for a weekly gain. Still, that’s well down from a peak near $140 following Russia’s invasion of Ukraine. Goldman’s Currie expects prices to hit $110 by the third quarter. ING Group NV, and UBS Group AG are also positive. Data Friday showed that China’s crude imports hit a record for the month of December as shipments in the final quarter of last year came in almost a fifth higher than the preceding three months. At the same time, Chinese buyers have been tapping markets in North America, West Africa, the North Sea and Mediterranean looking for oil for arrival in March and April.

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U.S. home sales drop to 12-year low; price growth cools

  • Existing home sales drop 1.5% in December
  • Sales fall 17.8% in 2022, sharpest annual decline since 2008
  • Median house price rises 2.3% from year ago

WASHINGTON, Jan 20 (Reuters) – U.S. existing home sales plunged to a 12-year low in December, but declining mortgage rates raised cautious hope that the embattled housing market could be close to finding a floor. The report from the National Association of Realtors on Friday also showed the median house price increasing at the slowest pace since early in the COVID-19 pandemic as sellers in some parts of the country resorted to offering discounts. The Federal Reserve’s fastest interest rate-hiking cycle since the 1980s has pushed housing into recession. “Existing home sales are somewhat lagging,” said Conrad DeQuadros, senior economic advisor at Brean Capital in New York. “The decline in mortgage rates could help undergird housing activity in the months ahead.” Existing home sales, which are counted when a contract is closed, fell 1.5% to a seasonally adjusted annual rate of 4.02 million units last month, the lowest level since November 2010. That marked the 11th straight monthly decline in sales, the longest such stretch since 1999.

Reuters Graphics

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Layoffs are running WILD and gathering steam

Here is a list of the growing shit storm. These are high paying jobs. Remember the Wall Street trickle trick. Announce layoffs in dribs and drabs…… This is the worst i have seen since the 2008 wipeout. It reminds me of the tech wreck! And its just the start!

Alphabet/Google

Job losses: Around 12,000 staff

Google’s parent company, Alphabet, announces huge layoffs, letting 12,000 staff go. According to Reuters, the cuts will affect recruiting, engineering and product teams. In an email to staff, CEO Sundar Pichai stated “I am confident about the huge opportunity in front of us thanks to the strength of our mission, the value of our products and services, and our early investments in AI.”

Microsoft

Job losses: Around 10,000 staff

After persistent rumors, Microsoft announced 10,000 job losses within the company. In an email to staff, CEO Satya Nadella stated that less than 5% of the company would be affected, and that hiring would still continue in key strategic areas. The company blames the job cuts on “macroeconomic conditions and changing customer priorities.”

SmartNews

Job losses: Around 120 staff

News aggregator service SmartNews confirms that it is slashing around 120 positions from the company, affecting roles in US and China. SmartNews currently employees around 900 staff, meaning a hefty 13% reduction in headcount. Speaking to TechCrunch, the company blamed ‘economic conditions’ for the move.

Goldman Sachs

Job losses: Around 3,200 staff

Huge layoffs at Goldman Sachs, with staff in major cities such as New York, London and Hong Kong reportedly being given 30 minutes to collect their things and leave. It represents a huge 6.5% of the total workforce for the company, and although the Zoom call that led to the mass firings was shocking for those affected, it hasn’t come out of the blue. Last month, CEO David Solomon warned that in an internal memo that cuts were on the horizon due to “tightening monetary conditions.”

Alphabet

Job losses: Around 200 staff

Verily, a healthcare services unit of Alphabet, announces that it is cutting 200 roles at the organisation, around 15% of positions with the company. In a statement on the company’s blog, CEO Stephen Verily stated “To enable greater focus on our updated portfolio, we are discontinuing the development of Verily Value Suite and some early-stage products, including our work in remote patient monitoring for heart failure and microneedles for drug delivery.”

Meta

Job losses: At least 20 potential new staff

We reported previously on Meta removing job offers before candidates could start their new roles, and it appears the company has done it again. Originally reported by TechCrunch, Meta confirmed that it had had to withdraw some offers to new employees. Exact numbers aren’t known, although one source, engineer Gergely Orosz, claims to have heard of 20 people affected “so far.”

Coinbase

Job losses: Around 950 staff

Crypto firm Coinbase announces that it is closing 950 roles in a blog post, equalling 20% of its entire workforce. In a statement, CEO Brian Armstrong said that the cuts were necessary to ensure that Coinbase was able to succeed in 2023. He went on to say “While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount.”

Twitter

Job losses: Around 10+ staff

Reports that Twitter has continued its huge layoffs into the new year, with around a dozen cuts being made to its Dublin and Singapore offices. Speaking to Bloomberg, Ella Irwin, Twitter’s Head of Trust and Safety, said “It made more sense to consolidate teams under one leader (instead of two) for example.”

Amazon

Job losses: Around 18,000 staff

Amazon has blamed a staff leak on having to announce huge redundancies earlier than expected, with 18,000 at the company expected to lose their jobs. Amazon has yet to announce which areas these cuts will affect. It marks another in a long line of job losses at the company, with 10,000 roles being made redundant less than two months ago.

Salesforce

Job losses: Around 8,000 staff

Salesforce kicked off the year with redundancies for 10% of its workforce. The company stated that it had hired too rapidly, and that these job losses were an attempt to correct this. In addition, the company will also look to close some of its physical offices.

TuSimple

Job losses: Around 350 staff

Self-driving truck company TuSimple announces layoffs of 25% of its workforce, equating to around 350 staff. In a statement from the company, CEO Cheng Lu stated “While I deeply regret the impact this has on those affected, I believe it is a necessary step as TuSimple continues down our path to commercialization.”

Adobe

Job losses: Around 100 staff

Adobe cuts around 100 roles, mainly focused on sales . In a statement, the company said that it was not looking to make company wide layoffs, and that it was still hiring for critical roles.

Lyst

Job losses: Around 50 staff

UK-based fashion e-commerce platform Lyst is reported slashing 25% of its workforce, amounting to around 25% of its staff, as it looks to make savings, as first reported by TechCrunch.

HP

Job losses: Around 4,000 – 6,000 staff

HP announces that it plans to cut between 4,000 to 6,000 roles over the next three years. In a statement, the company stated that its “Future Ready Transformation Plan, estimates annualized gross run rate cost savings of at least $1.4 billion by the end of fiscal 2025, and restructuring and other charges of approximately $1.0 billion.”

Cisco

Job losses: Around 4,000 staff

Despite announcing a 6% increase in revenue in its first quarter earning report compared to last year, Cisco announced that it was cutting 4,000 of its 83,000 workforce.

Roku

Job losses: Around 200 staff

Roku announces plans to cut around 5% of its workforce. In a statement, Roku blames the decision on ‘economic conditions’ in its industry.

Amazon

Job losses: Around 10,000 staff

Rumors had been circulating about huge cuts at Amazon for a few weeks, but today, it was official. News is slowly trickling out as those affected are posting to social media, but Amazon has started making redundancies that are expected to reach around 10,000. The layoffs represent 3% of the total workforce, and so far have confirmed to have affected AI, HR and and retail positions.

RingCentral

Job losses: Around 400 staff

RingCentral is trimming 10% of its workforce, amounting to around 400 people. The company stated that making these cuts would allow it to be “more agile and better align our course with our strategic priorities in the current macro environment.”

Meta

Job losses: Around 11,000 staff

Meta has confirmed the long running rumors that it was to make huge layoffs. In a statement, Mark Zuckerberg confirmed that the company was cutting 10% of the company workforce, amounting to 11,000 roles. Those impacted will receive 16 weeks severance, plus two weeks pay for each year they have been with the company. They’ll also receive additional health and career benefits.

Salesforce

Job losses: 100s of staff

Salesforce has cut 100s of roles at the company, although the actual numbers are unknown, with the company stating that it is fewer than one thousand. In an official statement, the company said “Our sales performance process drives accountability. Unfortunately, that can lead to some leaving the business, and we support them through their transition.”

Zendesk

Job losses: Around 350 staff

Zendesk announced that it would be letting 5% of its staff go, citing cost-reduction initiatives. The job losses include those based at the company’s San Francisco location.

November 4th

Twitter

Job losses: Around 3,700 staff

It took only a week for Elon Musk to fire half of Twitter’s workforce, after taking over the company for $44 billion. It perhaps isn’t too surprising – there had been plenty of rumors of layoffs in the weeks running up to the takeover, and Musk isn’t exactly a man known for his compassion. Twitter staff discovered their fate by email on Friday. Those that remain will have the privilege of remote working taken away and be expected to return to the office.

Opendoor

Job losses: Around 550 staff

Huge losses announced by the real estate tech company as it cuts around 18% of its total workforce. It follows competitor Better.com, which made several big layoffs this year alone. In a statement, Opendoor CEO Eric Wu blamed “one of the most challenging real estate markets in 40 years.”

October 26th

Zillow

Job losses: Around 300 staff

Seattle-based real estate firm Zillow has laid off 300 employees, with layoffs affecting those in home and loans, and closing services. In a statement, the company said that the cuts were part of its ‘normal business process’. The layoffs leave the company with around 5,000 employees in total.

October 24th

Snyk

Job losses: Around 200 staff

Cybersecurity firm Snyk lets go 14% of its workforce, blaming ‘significant market shifts’, leading to the company having to ‘restructure its global workforce’. In addition CEO of Snyk, Peter McKay also stated that it would be reducing spending in other areas, including subscription services and business travel.

Loom

Job losses: Around 23 staff

San Francisco video messaging start up Loom announces that it is cutting 23 employees, representing around 10% of the company’s staff. Sales staff are those most affected. It follows redundancies earlier in the year where 34 staff were let go.

Microsoft

Job losses: Around 1,000 staff

A spate of layoffs at Microsoft has led to around 1,000 employees losing their jobs. It’s one of the biggest round of layoffs we’ve seen this year, but still a relatively small percentage of Microsoft’s 220,000+ workforce. Those affected by the cuts include Xbox, Edge and Devices teams. Microsoft has made at least two other rounds of layoffs this year, with the biggest, back in July, affecting 1,800 employees.

Equifax

Job losses: Around 24 staff

During an internal review of its staff, Equifax identified 24 employees who were ‘overemployed‘, meaning that they were working two jobs at the same time. CEO Mark Begor told staff ‘We expect our team to be fully dedicated to EFX and have one role …their job at EFX.’

Oracle

Job losses: Around 200 staff

Oracle lays off around 200 employees from its former Redwood City HQ, after relocating to Austin, Texas.

Intel

Job losses: Potentially thousands of staff

Faced with a serious decline in sales, it has been reported that Intel will shortly be making wide-reaching job cuts, potentially slashing its number of employees by up to 20%. The company has already downgraded its sales forecast for 2022 by $10 billion compared to the previous year. An official announcement on this cuts is expected near the end of October.

Spotify

Job losses: Around 40 staff

Spotify closes down eleven of its exclusive podcasts, resulting in the termination of 5% of the company’s employees.

Peloton

Job losses: Around 500 staff

Barely two months since the last round of layoffs at Peloton, which saw nearly 800 staff cut, Peloton lays off another 500. The fitness company offered the perfect lockdown product, but the return to normal life has seen profits slide. However, this could be the last job cut at the company for some time, with CEO Barry McCarthy stating that Peloton is now ‘focused on growth.’

DocuSign

Job losses: Around 650 staff

Touted as part of its restructuring plan, San Francisco based DocuSign announced that it was letting go of 9% of its workforce.

Ericsson

Job losses: Around 400 staff

Telecoms company Ericsson, like many other companies, is halting its Russian presence. This means that the 400 staff who currently work at the Russian arm will be out of work by the end of the month.

Klarna

Job losses: Around 100 staff

Swedish fintech company Klarna announced lay offs this month, marking the second such announcement from the company this year. While it’s small condolence to those affected, Klarna is cutting around 100 staff this time around, compared to the 750 it let go in May.

Inpixon

Job losses: Around 44 staff

Inpixon, a company which provides tech and solutions to map and plan indoor spaces, announced that it was letting go of 20% of its workforce, estimated to be around 44 people. CEO Nadir Ali stated that the company had managed to strengthen its position in recent times, but that it ‘had to be mindful of the current economic environment.’

Twilio

Job losses: Around 850 staff

Twilio, the cloud communications provider announced that it was reducing it’s workforce by 11%. The company had 7,867 at the end of last year. Twilio CEO Jeff Lawson, stated that the decision was made to help run the company more efficiently.

Patreon

Job losses: Around 150 staff

Patreon, the subscription platform for content creators, announced that 17% of its workforce is being cut. Estimated to have around 885 staff in total, the losses represent a significant number of employees. A week previously the company had let go of five members of its security team.

Snap

Job losses: More than 1,280 staff

The company behind Snapchat is making one of the most drastic workforce cullings we’ve seen in months: It will be laying off 20% of its more than 6,400 employees this week. The biggest cuts will be to the teams behind the hardware division, the social mapping app Zenly, and aiding the developers who create Snapchat’s mini apps and games.

Better.com

Job losses: 250 staff

Improbable as it seems, Better.com is making its fourth round of layoffs in a year. A source informed TechCrunch that 250 ‘or more’ roles were on the chopping block. The company attracted criticism at the end of last year when it made mass lay offs via video.

Meta

Job losses: 60 staff

Meta lets 60 contract workers go, from Accenture. According to a report in Bloomberg, the staff were told over video call, and the unlucky employees learned that the decision had been made by an algorithm, say reports.

Apple

Job losses: 100 staff

Apple cuts 100 contractor roles across several regions, as reported by Bloomberg. The contractors worked in the recruitment arm of the company. In June CEO Tim Cook stated that the company would be ‘investing through the downturn’, but that it would be ‘more deliberate in doing so in recognition of the realities of the environment.’

HBO Max

Job losses: 70 staff

Reports that streaming service HBO Max is cutting 70 roles, around 14 percent of its workforce. The streaming landscape is more competitive than ever in 2022, with Netflix cutting 300 jobs in June amidst declining subscriber numbers.

Peloton

Job losses: 780 staff

It’s already proved to be a year of change for Peloton – the company had previously cut 2,800 roles and replaced its CEO. It’s been a rocky time for the company, with people ditching their bikes as the pandemic subsides, and a much publicised equipment recall after a death involving one of its products. On August 12th it announced it was cutting a further 780 jobs, with roles affected including delivery and customer support.

Calm

Job losses: 90 staff

Calm, a meditation app, announced that it was cutting 90 employees from its 400 person workforce. Calm CEO David Ko said the company was ‘not immune’ to the current economic climate.

Truepill

Job losses: around 175 staff

Reports from TechCrunch that Truepill, a digital diagnostics company for the health field, has laid off a third of its workforce, around 175 staff. The company has yet to confirm these cuts, but it has already had two rounds of redundancies this year.

Linktree

Job losses: around 50 staff

Australian firm Linktree announced that it was to let go of 17% of its staff, equating to around 50 people.

Microsoft

Job losses: around 200 staff

Business Insider reports that Microsoft is laying off its Modern Life Experiences team, a department focused on professional consumers. The team was originally formed in 2018.

Nutanix

Job losses: 270 staff

San Francisco based cloud software firm, Nutanix, announced a reduction of 270 staff from it’s 6,000 strong global workforce.

Oracle

Job losses: unknown, potentially hundreds

At the time of writing the actual number of layoffs at Oracle is unknown, but there are signs it’s in the hundreds at least, potentially even thousands, globally.

Groupon

Job losses: 500 staff

The voucher discount site laid off 500 staff, around 15% of its total workforce. These redundancies were reportedly across several departments, including sales, marketing, and engineering.

iRobot

Job losses: 140 staff

In August, iRobot, the robot vacuum cleaner brand, made the news, but not for layoffs. The company was acquired by Amazon on August 5th and chose the same day to announce that it was planning to cut 140 jobs — 10% of its workforce.

RingCentral

Job losses: 50 staff

RingCentral‘s layoffs included several senior roles, and are in two rounds, effective on September 18th and 25th. Despite these redundancies, the company is actually weathering the current financial climate rather well, growing revenue by 28% in Q2.

Robinhood

Job losses: around 700 staff

There’s no doubt it’s been a rocky year for this fintech company — this isn’t their only appearance in this list. In August, it laid off 23% of its staff, estimated to be around 700. Its previous round of redundancies in April saw around 300 job losses.

Shopify

Job losses: 1,000 staff

Shopify’s 1,000 redundancies in July represented 10% of the company’s entire workforce. In a message to its staff, the company stated that most redundancies were in recruitment, staff, and sales.

Vimeo

Job losses: around 70 staff

Staff losses at Vimeo in July represented about 6% of the company workforce, with the redundancies being blamed on an uncertain economic future.

TikTok

Job losses: around 100 staff

Popular social media platform TikTok has been no stranger to headlines this year, with national security concerns coming to the forefront once again. However, in July, it was job losses that saw it in the public eye, with around 100 TikTok employees getting cut.

Microsoft

Job losses: around 1,800 staff

Microsoft’s layoffs of “just” 1% of its staff might not seem so bad, but when you consider that the company employed 181,000 people in 2021, that’s a potential 1,810 people on the chopping block.

Twitter

Job losses: fewer than 100 people

Twitter paused hiring during Elon Musk’s acquisition of the company, reportedly in an attempt to cut costs. In July, it actually let go of around 100 employees, with the redundancies affecting the talent acquisition team.

Tesla

Job losses: 229 staff

Elon Musk’s Tesla firm made 229 redundancies in June, which was to be expected, considering he had told Bloomberg just a few weeks prior that he would be cutting staff by up to 10%.

Netflix

Job losses: 300 staff

Netflix saw its subscriber base start to dip for the first time in 2022, as fierce competition from the likes of Disney+, and a much-publicized crackdown on password sharing caught up with the company.

Klarna

Job losses: around 750 staff

Swedish fintech company Klarna cut a huge 750 staff in May, representing 10% of its workforce, and did so via a pre-recorded message.

Carvana

Job losses: 2,500 staff

Carvana has had a rocky 2022, with a $506 million loss in the first quarter. In an effort to cut back on expenses, the company dropped 2,500 members of staff in May, some of which were told via a video call.

Cameo

Job losses: 87 staff

With redundancies in May, Cameo let go of just under a quarter of its total workforce. The company placed the blame on expanding too rapidly and overestimating its market in a post-pandemic world.

Netflix

Job losses: 150 staff

In May, Netflix let go of 150 staff, including 25 from its fan site Tudum, which launched in December. The site was designed to give Netflix subscribers a behind-the-scenes look at the streaming giant’s shows and driven by an editorial team.

Robinhood

Job losses: around 300 staff

In April, Robinhood CEO stated that the company had cut 9% of the company’s staff, amounting to around 300 people.

Better.com

Job losses: between 1,200 to 1,500 staff

In December 2021, Better.com canned 900 employees, and in doing so hit the headlines, thanks to the way it delivered the message — through a very impersonal Zoom call.

Better.com

Job losses: 3,100 staff

Following on from the 900 staff fired in December over Zoom, Better.com let go of another 3,100 members of staff across both the US and India.

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Fed policymakers call for further rate hikes to beat inflation

Federal Reserve policymakers were out in force (6 of them to be precise) signaling they will push on with more interest rate hikes, with several supporting a top policy rate of at least 5% even as inflation shows signs of having peaked and economic activity is slowing.

“I just think we need to keep going, and we’ll discuss at the meeting how much to do,” Cleveland Fed President Loretta Mester said in an interview with the Associated Press.

The remarks appeared to reflect a widely shared view among her fellow policymakers, most of whom as of December had penciled in a 5.00%-5.25% policy rate in coming months.

Mester said that for her part she expects the Fed’s policy rate to need to go “a bit higher” than that, and stay there for some time to further slow inflation.

The Fed’s benchmark overnight lending rate currently sits in a target range of 4.25% to 4.50%, and investors expect the Fed to lift that rate by a quarter of a percentage point at the end of its Jan. 31-Feb. 1 meeting.

St. Louis Fed President James Bullard, speaking with the Wall Street Journal earlier, said he sees the policy rate rising to the 5.25%-5.50% range, and added that policymakers should get it above 5% “as quickly as we can.”

Several Fed officials have expressed support for slowing to quarter-percentage-point rate increases, after last year’s much faster pace of rate hikes in mostly 75-basis point and half-point increments.

Bullard expressed more impatience. Asked if he was open to a half-percentage-point increase at the Fed’s upcoming meeting, he asked “why not go to where we’re supposed to go? … Why stall?”

Kansas City Fed President Esther George said she felt rates would have to move higher than many of her colleagues anticipate, but that she also would have been willing to move in smaller increments.

Federal Reserve Vice Chair Lael Brainard said that the monetary policy has to be “sufficiently restrictive for some time” in order for inflation to fall back to 2%, as even with the recent moderation the figure remains high.

She asserted that the slowdown in the interest rate hike pace enables Fed to “assess more data as we move the policy rate closer to a sufficiently restrictive level, taking into account the risks around our dual-mandate goals.”

Federal Reserve Bank of New York President John Williams voiced on Thursday that the US Federal Reserve has more rate hikes ahead while stressing that inflation might start to cool off.

“With inflation still high and indications of continued supply-demand imbalances, it is clear that monetary policy still has more work to do to bring inflation down to our 2% goal on a sustained basis,” said Williams. He also noted that a reduction in inflation is likely to require “a period of below-trend growth.” Furthermore, stabilizing prices is essential to ensure maximum employment in the long term.

Federal Reserve Bank of Boston President Susan Collins said on Thursday that she expects the central bank to lift interest rates “just above” 5% and then hold them “at that level for some time.”

Delivering a speech in Boston, Collins expressed her support for slowing down the pace of monetary policy tightening but underlined that Fed’s moves will “depend on a holistic review of available data.” She pointed out that “services inflation remains persistently high” while goods inflation is “noticeably slower,” adding that “labor costs continue to grow more rapidly than is consistent with 2 percent inflation” and that the jobs market needs to be brought “into better balance” for the Fed to meet its inflation target. Nevertheless, Collins also revealed that she is “reasonably optimistic that there is a pathway to reducing inflation without a significant economic downturn.”

NN: No less then 6 Fed governors have warned this week about further interest rate increases. As i pointed out before the street is in denial

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Crude Oil, Product Inventory Builds Pressure Prices

Asshole video:

U.S. crude stockpiles had another multi-million barrel build last week, trade group API said Wednesday, bucking market expectations for a drop in inventories for a second week in a row amid questionable energy demand during an unseasonably warm winter. U.S. crude inventories rose by 7.6M barrels during the week ended January 13, the API said. In the previous week to January 6, the API reported a crude build of 14.865M barrels. Specifically for the Cushing, Oklahoma delivery point for U.S. crude, the API reported a stockpile build of 3.7M barrels, after the previous week’s rise of 2.3M barrels. The API inventory report also showed a 2.8M barrel rise in gasoline stocks for last week and a 1.8M-barrel deficit in distillate stockpiles.

Oil prices were trading down on Wednesday despite some optimistic oil demand forecasts as U.S. recession fears took over. At 3:32 p.m. EST, WTI was trading down $1.05 (-1.31%) on the day to $79.13 per barrel—a weekly increase of roughly $4 per barrel. Brent crude was trading down $1.19 (-1.39%) on the day at $84.73—a weekly increase of about $4.50 per barrel. U.S. crude oil production rose to 12.2 million bpd for week ending January 6.  U.S. production is still  900,000 bpd lower than the peak production seen in March 2020. NN: oil nearing key breakout point. we shall see what we shall see Refineries shut down during bad weather and inventories TEMPORARILY SOAR.

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US producer prices down 0.5% in December… The critical core PPI rose 4.6% YOY

WASHINGTON (Reuters) – U.S. producer prices fell in December as the costs of energy products and food declined, riven by a drop in energy prices that are now reversing The producer price index for final demand decreased 0.5% last month, the Labor Department said on Wednesday.  In the 12 months through December, the PPI increased 6.2% after climbing 7.3% in November.

The core PPI advanced 0.3% in November. In the 12 months through December, the core PPI rose 4.6%

A 1.6% decline in the prices of goods accounted for the drop in the PPI. Goods, which gained 0.1% in November, were pulled down by a 7.9% plunge in energy and a 1.2% drop in food prices. Services prices edged up 0.1% after rising 0.2% in November.

Excluding the volatile food, energy and trade services components, producer prices gained 0.1% in December. The core PPI advanced 0.3% in November.

In the 12 months through December, the core PPI rose 4.6% after increasing 4.9% in November. Another disaster spun by wallstreet as good news.

A 4.6% rise in core PPI does not give the fed a warm and fussy feeling. It pokes the bear….. Remember energy prices are heading back up since the one time plunge

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Microsoft to cut 10,000 jobs as tech layoffs intensify

Jan 18 (Reuters) – Microsoft Corp (MSFT.O) said on Wednesday it would cut 10,000 jobs by the end of the third quarter of fiscal 2023, the latest sign that layoffs were accelerating in the U.S. technology sector as companies brace for an economic downturn. The layoffs and costs related to hardware-portfolio and other changes will result in a charge of $1.2 billion in the second quarter of fiscal 2023, representing a negative impact of 12 cents on per share profit, Microsoft said. In a note to staff, shared with Reuters, Microsoft Chief Executive Satya Nadella said customers wanted to “optimize their digital spend to do more with less” and “exercise caution as some parts of the world are in a recession and other parts are anticipating one.” The news of layoffs, reported by media publications on Tuesday, follows some reductions last year. Microsoft said in July last year that a small number of roles had been eliminated, while news site Axios in October reported that the company had laid off under 1,000 employees across several divisions.

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IEA: Global oil demand to go up by 1.9M bpd in 2023

Global oil demand is set to rise by 1.9 mb/d in 2023, to a record 101.7 mb/d, with nearly half the gain from China following the lifting of its Covid restrictions. Jet fuel remains the largest source of growth, up 840 kb/d. OECD oil demand slumped by 900 kb/d in 4Q22 as weak industrial activity and weather effects lowered use, while non-OECD demand was 500 kb/d higher.

World oil supply growth in 2023 is set to slow to 1 mb/d following last year’s OPEC+ led growth of 4.7 mb/d. An overall non-OPEC+ rise of 1.9 mb/d will be tempered by an OPEC+ drop of 870 kb/d due to expected declines in Russia. The US ranks as the world’s leading source of supply growth and, along with Canada, Brazil and Guyana, hits an annual production record for a second straight year.

Russian oil exports fell by 200 kb/d m-o-m in December to 7.8 mb/d, as crude shipments to the EU declined after the EU crude embargo and G7 price cap came into effect. Russian diesel exports surged to a multi-year high of 1.2 mb/d, of which 720 kb/d was destined for the EU. Record discounts for Russian benchmark Urals grade saw Russian revenues slip by $3 bn m-o-m to $12.6 bn.

Two wild cards dominate the 2023 oil market outlook: Russia and China. This year could see oil demand rise by 1.9 mb/d to reach 101.7 mb/d, the highest ever, tightening the balances as Russian supply slows under the full impact of sanctions. China will drive nearly half this global demand growth even as the shape and speed of its reopening remains uncertain.

NN BlackMask Blog: Dodging the bullet no more

To view the complete report click on the link below:

IEA (2023), Oil Market Report – January 2023, IEA, Paris