Economics

The Daily Chase: Oil price touches 2-month high as Hurricane Beryl looms

Here are five things you need to know this morning:

Oil price tops US$84 as hurricane season starts early: The price of a barrel of the North American oil benchmark is over US$84 this morning, its highest level in two months, in large part because the Atlantic hurricane season has seemingly started early. Hurricane Beryl was upgraded to a Category 5 hurricane on Monday, making the storm the strongest one to ever form in the area this early in the year. As things stand, the storm is forecast to stay far east of the oil-producing regions in the Gulf of Mexico, but oil traders aren’t taking any chances. ING analyst Ewa Manthey wrote in a note that the storm’s size “has also raised concerns over a severe hurricane season that is yet to come.”

WestJet strike seemingly over: The strike by WestJet’s aircraft maintenance engineers that caused chaos for Canadian travellers this weekend is seemingly over, but the fallout from the walkout continues. The strike grounded the majority of the airline’s planes, and led to the cancellation of more than 1,000 flights and counting. The Calgary-based airline now faces the problem of having to get its crews transported to where the various aircraft were grounded. Expect uncertainty, delays and cancellations to continue while that process unfolds.

Northvolt reconsiders Canadian battery plant plans: Facing a slump in demand for electric vehicles, Swedish battery maker Northvolt is reconsidering its expansion plans, including one to build a factory near Montreal soon. The CEO of the company told Bloomberg in an interview that it is trying to come up with a “realistic time plan for these projects.” That’s a setback for backers of the project, including the federal and Quebec government who have both pledged hundreds of millions of dollars of support for the project that was set to open as soon as 2026.

Pembina buys stake in Kaybob from Whitecap for $252 million: A joint venture of Pembina Pipeline Company is buying a 50 per cent stake in the Kaybob processing facility in Northern Alberta. Whitecap will remain the operator of the facility, but Pembina and KKR will now partner on the project. The total price tag of the deal is $420 million, of which Pembina’s share will be $252 million.

Marine Le Pen scores early win in French vote: Right wing nationalist French leader Marine Le Pen has scored an early win in that country’s two-stage elections, leaving more mainstream rivals scrambling to stop her National Rally party winning outright in the second stage next weekend. The first round of voting this past weekend saw Le Pen’s party get 33 per cent of the vote, while the left wing New Popular Front got 28 per cent, and the centrist governing party of Emmanuel Macron came in third with just over 20 per cent. The main Paris stock index, the CAC 40, opened higher on Monday once it emerged that Le Pen had not won outright, but gains soon fizzled once investors realized that both of the two leading parties will likely pursue policies that would expand the government’s deficit even more.