OIL FIRMS, AUTO MAKERS THROW A LIFELINE TO THE COMBUSTION ENGINE
Oil companies and auto makers have teamed up to improve the combustion engine and help it compete with electric vehicles, The Wall Street Journal’s Sarah Kent and Chester Dawson report.
“Exxon Mobil Corp., BP PLC, Royal Dutch Shell PLC and other oil companies are spending millions of dollars a year in concert with auto makers such as Ford Motor Co. and Fiat Chrysler Automobiles NV to create the next generation of super-slick engine lubricants,” the Journal reports.
Firms are hoping the new, thinner oils will help them squeeze even more efficiency out of traditional car engines, allowing them to comply with stricter environmental rules and remain relevant as new technologies such as zero-emission electric vehicles emerge.
“It’s really important that we are able to squeeze the lemon,” said Andrew Hepher, vice president of global commercial technology at Shell. “The combustion engine has still got a long way to run.”
The efforts come as the combustion engine faces new threats across the world. Countries including the U.K., France, China and India have signaled they plan to ban sales of vehicles with traditional engines in the coming decades.
OIL MARKETS IN ‘WAIT-AND-SEE’ MODE AHEAD OF OPEC MEETING
Oil prices were steady Monday ahead of next week’s meeting of global crude producers where an extension of output cuts is set to be discussed.
Brent crude, the global oil benchmark, fell 0.73% to $62.27 a barrel on London’s ICE Futures exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading down 0.35% at $56.35 a barrel.
The Organization of the Petroleum Exporting Countries and other producers including Russia will meet on Nov. 30 and review whether to extend the production cuts due to expire in March 2018.
The deal aims to reduce a glut of global stocks to their five-year average.
“If OPEC decides to extend the production cuts, this would mean market shares being lost to US shale oil producers,” said Commerzbank analysts in a recent post. “Oil prices are likely to remain well supported until OPEC’s meeting in ten days’ time – partly due to the ongoing high level of speculative buying interest in anticipation of the production cuts being extended.”
Net long positions in WTI increased by 32,000 to 372,000 contracts in the week to 14 November, close to the record level achieved in February 2017 and net long positions in Brent are already at a record level, said analysts.