Archive for Fuel

Loonie In Good Spot Following Oil Price Hikes

Recent hikes in oil prices have been good for the Loonie and any Currency Exchange that relies on it, as the Canadian Dollar experienced a 10% jump. This happened following the spike in the prices of oil brought about by the recent drone attack on an oil facility in Saudi Arabia.

The Abqaiq processing facility, as well as the Khurais oilfield in Saudi Arabia was recently attacked by drones in the second weekend of September, which led to fires that led to 5.7mn barrels of oil to be sidelined instead of being pumped by Saudi Aramco.

Saudi Aramco CEO Amin Hassan Al-Nasser reported that the attack resulted in no injuries or casualties, but it did take several days following the incident to restore production levels to normal, which amounts to a considerable amount of the world’s supply, about 6%.

The US has been using its strategic reserves to account for any supply deficits, but RBC Capitals Market Commodity Strategist Michael Tran says that the market will be still be affected, with future price action determined by how the metaphorical wounded bulls return, as the short interest in WTI has been fairly low and assigned to the sidelines since the start of the summer, due to the increased drone strikes and tanker seizures.

CIBC Capital Markets Head of FX Strategy Bipan Rai says that the US dollar and the Loonie, given that current conditions hold, will stay above the targeted numbers for entry into new positions, around the 1.3050/75 area. He notes that if, and only if, the USD/CAD dropped below that, then their strategic long USD/CAD is off the mark.

The USD/CAD Currency Exchange rate on the Monday following the incident was 0.17% lower than what was expected, having dropped to 1.3207 overnight thanks to the Loonie spiking in value. As for the Pound-to-Canadian-Dollar rate, it quoted at 1.6536, before dropping to 1.6440 overnight, putting it down 4.97% for 2019.

This is good for any company that handles Canadian Currency Exchange, as it means that the Loonie continues its performance as 2019’s best performing major currency.

Scotia bank Chief FX Strategist Shaun Osborne says that the outlook for the CAD is still good, favoring reduced short-term weakness, but recent events may force the market to settle into a range soon.


Sustainable Fuel Could Come From Azolla Next

Climate change is everywhere. Every nation is thinking of ways to reduce our fuel consumption while others focus on finding other sources of biofuel before our main source runs out. This is when expert trader and entrepreneur, Leonardo Gonzales Dellan, comes in with another prospect – Azolla could become the next source of biofuel if the possibilities are explored.

According to the popular trader and banker which is a native of Latin America, there is a need to study more and develop a new type of feedstock known as Azollla. This could become a source of biofuel and it could be cultivated and grown in Latin America. He expressed his belief that the Azolla plant has the potential to become a big investment for Latin America and it will also present the region the chance to have a say in developing sources of sustainable biofuels.

Furthermore, the competition remains for emerging markets that could provide sources of biofuels and it is an essential move for Latin America to be a part of the competition. According to researchers, the possibility is huge for the so-called green gold mine. Aside from being a source of biofuel, studies have shown that Azolla plant can be utilized as a green manure that can be used in rice fields, the plants can also be used as a feed supplement for a number of marine and aquatic creatures and it could also sustain terrestrial animals. There are a number of applications with the plant including water purifier, medicine, used to control weeds, fight mosquitoes, biofertilizer and even as human food.

The plant is aquatic in nature and its natural environment is similar to wastewater. It is utilized as feedstock in order to harvest bioethanol. When cultivated in contaminated body of water, a substantial amount of biomass can be created and the growth of the plant will greatly improve the water’s quality by eliminating the chemicals. According to Leonardo Gonzalez Dellan, Latin America should capitalize and invest in Azolla as a major crop in order to dominate the biofuel market which is one step towards a more sustainable future.