Tag: EV incentives

White House Leaves Door Open For Additional SPR Releases + It’s Implications

Tina Marie (Ms. Cat)

The White House said on Tuesday that it has many options to counteract OPEC+’s looming production cuts, including the release of even more crude oil from the nation’s Strategic Petroleum Reserves.

White House Leaves Door Open For Additional SPR Releases

Related:

The Implications Of U.S. SPR Withdrawals

Implications of OPEC-+ Production Cut 

I think OPEC has not learned from its past mistakes, as it is not a good time to cut oil production by 2 million bpd in November 2022, especially at a time when global economies are under pressure. While higher oil prices at this juncture may bring much needed oil revenues to (national) oil companies and OPEC members, this will come at the cost of accelerating a global recession, bringing more misery to consumers. Consequently, it will weaken global oil demand and oil prices. Oil prices in the range of $70-$80/bbls at this difficult time could be a win-win situation for both producers and consumers, and shield global economies from collapsing. Consequently, the U.S. should take its own measures to enhance its domestic oil production, encourage EVs and halt further releases of the SPR. Running down the SPR will allow OPEC+ more flexibility to play around with production.

Meanwhile:

U.S. Rig Count Slides Amid Jump In Crude Prices

Policies Matter: Volkswagen, Mercedes, & Hyundai React To Inflation Reduction Act

Tina Marie (Ms. Cat)1 Comment

Policies Matter: Volkswagen, Mercedes, & Hyundai React To Inflation Reduction Act

In June, Johan DeNysschen, the COO of Volkswagen of America, told Bloomberg his company is considering the construction of a battery manufacturing facility in North America. That would satisfy the requirement in the Inflation Reduction Act that batteries are manufactured in the US or other countries that are approved trading partners. According to the current North American free trade agreement, American trade officials consider anything made in Canada or Mexico to be domestically produced.

But manufacturing is one thing, The IRA goes further and requires the materials used to manufacture products also be sourced from approved trading partners. Canada is certainly one of them.

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Then the roof fell in. The IRA only applies to vehicles built in the US, and that Georgia factory was not scheduled to be up and running until 2025. Two weeks ago, Hyundai and Kia vehicles imported from South Korea were eligible for the federal EV tax credit of up to $7,500. After the IRA was signed into law, they are eligible for nothing. The South Korean government is considering bringing the matter to the World Trade Council, but according to Reuters, Hyundai will now speed up construction of its new Georgia factory.

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In the final analysis, that may be a good thing for America. Globalization left many countries like the US vulnerable to the machinations of crooks, thieves, and lunatics. The cheapest solution is often not the best solution.

Interesting that South Korea isn’t an “approved trading partner”. Then again, they’re not part of the USMCA. I suppose this is good for bringing some jobs to America.