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Nabil al-Jurani/AP
An oil worker operates valves in a field north of Basra, Iraq
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Essam Al-Sudani/Reuters
Iraqi workers stand near a pipeline as it ejects oil at Al Tuba oil field in Basra, southeast of Baghdad
The oil saga continues
In case you missed it: Global demand for oil has crashed thanks to the common denominator of all spring 2020 ails - the novel coronavirus.
- Meanwhile, Saudi Arabia and Russia have been locked in a price war, after negotiations to limit supply collapsed last month.
- Together, these forces have caused the price of oil to nosedive, falling by as much as 65% earlier this week, relative to the start of the year.
What's new: Starting this month - when demand could bottom out - Saudi Arabia is boosting supply by as much as 25%. This "tsunami," as one research group called it, could plunge the price further into the ground.
But: Signs that an agreement is coming together among a coalition of oil-producing nations known as OPEC Plus to pare back supply are buoying the price.
- OPEC Plus is hosting an emergency virtual meeting on Monday to discuss cuts, Bloomberg reports.
- Meanwhile, President Trump is meeting with executives from several US oil giants later today to discuss solutions to the price crisis, which could include tariffs on oil imports.
- The price of oil surged more than 40% on Thursday in response to the news. But at around $33 this morning, Brent is still down about 50%.
Don't hold your breath: "Because of the lags we anticipate in implementing the cut and the already occurring demand collapse, a coordinated response is therefore likely to be too little too late," Goldman Sachs said in a note yesterday.
Joe Raedle/Getty Images
Gas prices are falling across the country in the wake of the novel coronavirus, which has stunted global oil demand.
When oil is down, who wins?
Drivers. Cheap oil means cheap gasoline.
- The national average fell below $2 a gallon earlier this week
- More than a dozen stations across the country are selling gas for 99 cents or less.
- The price of gas, set by station owners, varies region to region based on things like state tax and the size of the local market.
But don't book your summer road trip just yet: The main reason gas is so cheap is demand is down - largely because no one is driving.
- Once people hit the road in mass, reviving demand, the price will likely bounce back in a matter of weeks.
And the losers?
Companies that find, extract, and produce oil.
That much may be obvious. What's stunning is just how much these companies have lost.
- ExxonMobil alone saw its market cap shrink by nearly $135 billion.
- Schlumberger, the world's largest oilfield service company, lost an eye-popping 66% of its market cap.
Unfortunately, budget cuts, layoffs, and even bankruptcies follow. We're tracking all of them here, but some highlights from this week include:
- Whiting Petroleum was the first major exploration and production company to file for bankruptcy.
- Oil supermajor BP slashed its 2020 capex by about 25%.
Sunrun
Sunrun is the largest residential solar installer in the US.
Layoffs hit rooftop solar
Yesterday, we reported that Sunrun - the country's top rooftop solar company by market share - laid off at least 100 or so staff and furloughed at least 65 more through a series of Google video calls.
- "This pandemic has forced some tough decisions on our business, including a reduction to certain parts of our workforce," Sunrun said in a statement to Business Insider.
- If you have information about the layoffs, please reach out to energy@businessinsider.com.
Sunrun layoffs are just one symptom of the pandemic's impact on rooftop solar.
- Research firms that track renewable-energy installations have been slashing their 2020 forecasts during the COVID-19 outbreak - and solar is seeing some of the deepest cuts.
- The research firm Wood Mackenzie "expects to revise downward its 2020 residential forecast by 23 to 40 percent," Greentech Media reports.
- It doesn't help that California, the nation's largest solar market, has been sheltering in place since March 19.
4 big stories we didn't cover
- The clean-energy industry is asking for aid, again, in the next COVID-19 response bill, Axios reports.
- The US government omitted help for the sector in the recent $2 trillion stimulus package.
- Wood Mackenzie slashed its 2020 forecast for distributed storage - things like batteries attached to rooftop solar arrays - by nearly a third in the wake of coronavirus.
- The United Nations postponed its prominent climate change conference, COP, which was originally scheduled for November, The Washington Post reports.
- "The arena where the massive event was to take place, the SEC Centre, is being converted into a field hospital."
- Green hydrogen could "cut up to 34% of global greenhouse gas emissions from fossil fuels and industry - at a manageable cost," according to a new report by the research firm BloombergNEF.
- Green hydrogen is hydrogen gas made through electrolysis powered by renewable energy.
That's it! Have a great weekend, and stay safe.
- Benji
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