WORLD

Oil Prices Rise with Returning Economic Activity. Oil prices are steadily, if slowly, rising again, due to fundamental market forces instead of speculation.
China’s factories are back at work and its economy is gradually turning toward growth. Lockdowns in several nations are being cautiously lifted, putting more people back in their cars and more commercial trucks back on the road.
Demand for gasoline as a vehicle fuel rose 40 percent in the three weeks ending 8 May, and diesel use also is expanding, according to U.S. government data.
At the same time, oil producers have shut in millions of barrels a day of production around the world, shrinking the global ocean of unsold oil while not adding new reserves.
Saudi Arabia has said it will cut its oil production next month to the lowest level since 2002; the number of oil rigs drilling in the U.S. is at its lowest since 1991, according to the industry-standard Baker Hughes rig count.
As a result, some investors foresee a long-term uptrend in oil prices. Several hedge funds and other speculators have made more bets in recent days on higher oil prices than they have since September 2018.
Benchmark Brent crude’s price fell into the low $20s last month but has rallied and now is holding its ground above $30. Brent’s price rose 7.6 percent on 18 May to almost $35 a barrel. U.S. prices plunged into the ‘teens but since have stabilized above $30.
Restarting the global economy will “help the oil price grind gradually higher,” said Rob Thummel, an energy asset manager at the investment firm Tortoise. “But we still have a long way to go.”
Central Banks Rolling Out Digital Currencies. Central banks in China, Sweden, Ukraine, and Venezuela have issued digital currencies in pilot projects designed to pave the way for national adoption.
Countries known to be researching or developing digital money include Australia, Canada, France, Germany, Iran, and the U.S.
With a digital currency, the cost and, in many cases, the time of processing financial transactions can be slashed. People without conventional bank accounts could still use banking services via smartphones or computers.
But regulatory processes have not yet confronted the implications of digital money or recast regulations to encompass them.
Conventional banks are nervous, wondering if digital currencies will leave them with a much smaller future. Also, central banks would be able to track each individual’s transactions, raising privacy concerns.
Almost 80 percent of the world’s central banks are in various stages of designing, testing, or pilot-testing national digital currencies, according to a 2020 Bank of International Settlements survey.
Tech Companies Say Working from Home Will Be Permanent. Companies that sent workers home to do their jobs during the pandemic are deciding to leave them there.
Facebook says half its workforce will be home-based within ten years. Twitter says working from home “at scale” has proven practical.
“Over the past several weeks, we’ve learned a lot about what it takes for people to effectively perform roles outside of an office, and we will continue to learn as we go,” a spokesperson for Square said. “Squares will be able to work from home permanently.”
Shopify will keep its offices shuttered through this year, reworking them to reflect the new reality that most of its workers will be at home. CEO Tobi Lutke said, “Office centricity is over… The future of the office is to act as an on-ramp to the same digital workplace that you can access from [home or elsewhere].”
Letting employees work at home also widens the pool of job candidates, said Facebook co-founder Mark Zuckerberg.
“When you limit hiring to people who live in a small number of big cities, or who are willing to move there, that cuts out a lot of people who live in different communities, have different backgrounds, have different perspectives,” he said. The company is “aggressively opening up remote hiring,” he noted.
Facebook employees who work outside of high-cost areas such as San Francisco will see their salaries “adjusted” to reflect living costs where the employee is. Most of those employees will find their pay reduced.
Groupe PSA, the French company making Citroen, DS, Opel, Peugeot, and Vauxhall vehicles, also is redeploying its office staffs.
The company announced it will “strengthen teleworking and to make it the benchmark for activities not directly related to production” on factory floors.
PSA will relinquish an undetermined amount of its office space and redesign remaining offices as places for meetings and group collaborations when needed.
TREND FORECAST: As we have continually noted, with more businesses having people work at home, commercial real estate prices will be on a long down-trend.
 On the investment up-trend, evolutionary new virtual reality and high-tech products that bring workers together remotely from around the world (as well as with online education) will, in many ways revolutionize how and where we work… and learn.
The COVID Crisis has truly accelerated a New Age of Work and Education.
 

Comments are closed.

Skip to content