For the vast majority of 2024, approximately 500,000 barrels per day of crude oil shipments from Mexico to the US were dispatched to US Gulf Coast refiners. It is now expected that some percentage will likely be diverted to Europe or Asia. US Atlantic Coast motor fuel markets are forecast to be hit the hardest, and regional natural gas spreads could also be affected, which would ultimately increase consumer prices.

I typically don't ruminate on paper/screen this frequently. My actual job gets in the way. But President Trump is visiting his bestie, Governor Newsom, today, Friday, January 24, 2024, and away from the small talk around how long LeBron can keep it up or whether Northern Californian tacos can compare to Southern, at some point, they'll get to ... fire relief.

Over the past two decades, a loss of older, thick ice has created new channels. Before 2018 there were virtually no bulk carriers or gas tankers in the Polar Code area, but the Yamal Gas project and the Mary River Mine in Nunavut have contributed to a swell in activity. Chinese President Xi stated in a visit to Moscow in 2023 that stronger diplomatic relations with Russia were vital to counteract, “a long campaign by the United States to hobble China’s ascent.”

Here’s a message that is inappropriate for Valentine’s Day - only 3 to 5 percent of mammals are monogamous. A hard fact to accept, perhaps, but more than one partner appears to be an animal kingdom norm. Among fish and amphibians, monogamy is quite rare, and before the advent of DNA fingerprinting, conventional scientific consensus held that 90 percent of bird species were monogamous.

Valuations of art have moved into more affordable price brackets over the past two years. In 2023, transactions on works valued from $100,000 to $1 million increased by 21% compared to 2022.6 The lower the price bracket, the greater the volume, with 90% of transactions involving pieces priced under $12,000.

A July 2023 survey found that 72% of respondents felt an online degree was more reputable than five years prior. The biggest perceptual shift was among Generation Z participants, a data point that was somewhat surprising. Online degree growth typically came from working students or non-traditional students who had taken time off and returned to school. Yet, the fact that a younger cohort was now coming around to pursue a higher degree online was completely new.

Also known as “shock therapy,” outside observers predicted this campaign fulfillment would result in a rise in poverty. No surprises here but rates this high do risk derailing what could be the region’s biggest turnaround story in decades. Milei and his supporters rightly point out that since Q3, there has been an emerging rise in real wages.6 This has contributed to greater economic activity and some analysts believe the recession likely ended in Q2 2024.7 The President was fully transparent with the electorate during his campaign, communicating frequently that there would be short-term pain and a recession. While some critical welfare programs have been cut, Milei has in parallel expanded the Universal Child Allowance and a popular Food Card program providing support to families in need.

Gen AI can take company content – video, audio, and text – and distill and deliver the content in e-learning modules. For example, bringing a new warehouse manager up to speed with everything from company culture to day-to-day responsibilities can sometimes take three weeks to a month. With Gen AI, however, one can feed the language model the employee manual coupled with company video and audio that address specific areas of the job. Within minutes, the employee can follow a handful of modules in collaboration with a human being to guide the process.

Paving the road to a nuclear revival are small modular reactors (SMRs). These reactors are approximately a third of the size of a typical plant and are prefabricated, thus reducing the capital costs that larger plants contend with. Oracle recently announced plans to power a new data center with three SMRs. To date, there are only three SMRs operational in the world. Constellation is in talks to build an SMR at one of its facilities, but most experts agree that SMRs won’t reach a commercial stage until the next decade. Last year an SMR project in Idaho was canceled as the project’s costs skyrocketed from $5 billion to $9 billion due to high interest rates and inflation.

It was difficult to avoid the national news coverage of the International Longshoremen’s Association (ILA) strike during the first week of October. Doomsday scenarios, people hoarding toilet paper, and Union President Harold Daggett’s 7,136-square-foot New Jersey home, complete with a brick pizza oven and a snappy Bentley in his carport, were social media sensations. However, the heart of the ILA’s concerns surrounds automation and its eventual impact on union jobs.

In June, venture capitalist David Sacks held a swanky fundraiser for the former President in his Pacific Heights, San Francisco mansion. Guests paid up to $300,000, with rumored attendees spanning the C-suites of some of the U.S.'s largest crypto and blockchain companies. Meanwhile, it didn’t take much work for Trump’s team to compile a list of the regulatory crackdowns occurring at the hands of the Securities and Exchange Commission Chair, Gary Gensler. A Biden appointee, Gensler has sued crypto companies for violating securities laws and sought to dissuade banks from serving crypto companies.

It is still unclear how many members of the Lebanese militant group Hezbollah were killed when thousands of member pagers exploded simultaneously. Just the next day, Hezbollah walkie-talkies suffered similar malfunctions. Sadly, news of bombings, explosions, and death is commonplace in 2024 in the Middle East. But this latest operation, likely at the hands of Israeli intelligence tacticians, has news outlets and pundits questioning the role of of global supply chains, rightly or wrongly.

Freight forwarders are sounding the alarm that space will be tight during the normal fourth-quarter retail rush. Many forwarding companies are nudging manufacturers and retailers to lock in higher-than-usual rates now to avoid unpleasant surprises come October. Extra capacity will be a premium if not unattainable in 2024. The air cargo business is up broadly for the year. The International Air Transport Association estimates a rise of 12.7% in global airfreight demand over the first four months of the year, with Asia-Pacific notching a 14% gain alone in April.

Unlike President Biden, the Vice President has little trade policy experience. Some pundits suggest she might consider pushing the US back to a more aggressive international digital trade policy with a particular emphasis on Californian tech company interests, her home base. Optimists are hoping that Harris could introduce some much-needed dynamism to trade negotiations, as the past four years have been uncharacteristically stagnant. Meanwhile, Trump is expected to wield his favorite negotiating stick - the tariff.

The broader oil and gas industry has shifted in recent years, focusing on profitability over growth. CEO compensation plans previously encouraged production above all else, but the market is a fluid creature. Production of a good that the world needs requires more of a trader’s mindset if the ultimate objective is to keep costs in check and return cash to shareholders.

In addition to the regulations, banks were also constrained from making further loans to developers. President Xi assumed these short-term band-aids could stave off a pending disaster, but in August 2021, the country’s second-largest property developer, the Evergrande Group, promptly halted construction. Overdue payments were at the core of the stoppage, and the following month, Evergrande missed two offshore bond coupon payments for a total of $131 million.

California Governor Gavin Newsom ran for reelection in 2022 with an expressed vow to wage war on Big Oil. Needless to say, Chevron and others were concerned, but Newsom was just the latest in a long line of California politicians who have made the state an uncomfortable fit for oil and gas.

One prominent voice hitting pause on the AI investment euphoria is author and economist Daron Acemoglu. In a recent interview with Goldman Sachs, Acemoglu estimated that AI would ultimately grow US GDP by a paltry 0.9% over ten years and affect fewer than 5% of all human tasks. On the other hand, Goldman Sachs internal analysts point to a 6% GDP growth and the automation of a much more robust 25% of human tasks over the same period.

FedEx has embarked on a daunting $1.5 billion company-wide reorganization. Announced last year, the Tennessee-based transportation and logistics giant combined its Express and Ground delivery units into one business model. The move rattled insiders, as the separate operating structure had long been upheld as founder Fred Smith’s legacy. Yet, market forces suggest a change is needed.

US forces are currently operating at a pace in the Red Sea not witnessed since World War II. Over the past several months, estimates point to US Navy aircraft strike groups having conducted over 750 engagements. Many of these include very pricey Tomahawk missiles, 135 to be exact. In early July, Maersk confirmed one of their vessels was fired upon by the Houthis in the Gulf of Aden. This was a US-flagged vessel and is considered to be the Houthi rebel’s longest-range attack yet.