www.forbes.com Reuters, 02.27.03, 6:04 PM ET
NEW YORK (Reuters) - NYMEX crude oil futures moved sharply lower in early overnight electronic trade on Thursday, extending a profit-taking spree on dayside trade after an attempt to crack the $40-a-barrel mark failed.
At 5:45 p.m. (2245 GMT), NYMEX crude for April delivery
Many Venezuelans have a lot of time on their hands anyway -- massive oil shortages have caused long lines at the gas station.
CARACAS, Venezuela, Feb. 27 — If you thought Venezuela’s political crisis seemed to be dragging for an impossibly long time — you were right. In a bizarre mass-malfunction, Venezuela’s clocks are ticking too slowly due to a power shortage weakening the electric current nationwide. By the end of each day, the sluggish time pieces still have another 150 seconds to tick before they catch up to midnight. “EVERYTHING THAT HAS to do with time-keeping has slowed down. If it’s an electric clock, it’s running slow,” said Miguel Lara, general manager of the national power grid. “Your computer isn’t affected. Your television isn’t affected. No other devices ... just clocks,” he added. The meltdown has taken a total 14 hours and 36 minutes from Venezuela’s clocks over 12 of the past 13 months, he said. In a country fiercely divided between friends and foes of its leader, President Hugo Chavez, it isn’t surprising some opponents have jokingly blamed the clock chaos on the president. But instead it appears to be Mother Nature that lashed out against Father Time. The river powering a major hydroelectric plant in southeast Venezuela lost force due to a severe drought in February 2001. To prevent blackouts, the country slightly lowered the frequency of the current. At least one time expert was caught off guard. “It’s the most bizarre thing I’ve ever heard of,” said Dan Nied, head of the U.S.-based School of Horology, or the science of time measurement. “But yes, clocks would slow down.” For common quartz clocks, the slight drop in frequency slows the vibration of the crystal that regulates time keeping, he said, adding, “People must be going nuts.” But in a nation that rarely starts on schedule, Venezuelans have taken their time troubles in their stride. An air traffic controller casually told Reuters that his office corrected its clocks every few days or months, without incident so far. “Yes, it’s been happening here. But we correct the clocks every three months and there’s no problem,” he said. Many people on the streets of Caracas were only vaguely aware that their clocks had been slowing down. “I wake with the sun,” said Rene Osurna, who works at a shipping company. “And if you’re two minutes late to the office, and everybody else is too, there’s no problem.”
this document web posted: Thursday February 27, 2003 20030227p1
By Adrian Ewins Saskatoon newsroom
The price of nitrogen-based fertilizer is climbing toward unprecedented levels.
A $30 a tonne increase in the wholesale price of nitrogen by a major manufacturer in mid-February has retailers talking about urea prices in excess of $400-$410 a tonne.
That's approaching a 10-year high, said Steve Epp of Wendland Ag Services in Rosthern, Sask.
"Farmers don't like it but the sad part is they know there's nothing they can do about it."
According to farm input price statistics from Alberta Agriculture, the average annual price of bulk urea (46-0-0) over the past five years was $315 a tonne.
Some farmers will have purchased much of their nitrogen-based fertilizer last fall or early winter at prices 25-30 percent below current levels.
But for many, the high price will be an unavoidable additional expense.
"If you were in a drought area and have no grain in the bins and bills still from last year, boy it's going to be tough with these kind of prices," said Terry Hildebrandt, president of Agricultural Producers Association of Saskatchewan.
Fertilizer industry officials say the current price reflects two factors:
• The global supply and demand situation for nitrogen is tight. On the supply side, production is down in Venezuela and there is no new capacity coming on stream. On the demand side, the prospect of better grain prices is boosting fertilizer demand from farmers in North and South America.
• The price of natural gas, which accounts for 80 to 85 percent of the cost of producing nitrogen-based fertilizer, has been rising to historical highs due to cold winter weather, lower production and political instability.
Fertilizer manufacturers have responded to the high natural gas price by scaling back production to levels they expect will meet, but not exceed, spring sales.
For example, Calgary-based Agrium Inc., Canada's largest nitrogen producer, cut production in January at two Alberta plants, in Joffre and Fort Saskatchewan.
"We're very conscious of not ending the spring season with too much inventory, especially when gas prices are as high as they are, because that's high-cost inventory," said Agrium spokesperson Jim Pendergast.
But one farm industry leader said the increase in natural gas prices is just an excuse for fertilizer manufacturers to extract more money from producers.
"They price according to what the market will bear," said Darrin Qualman, executive secretary of the National Farmers Union. "Grain prices are up, so they're going to crank up fertilizer prices."
The North American fertilizer market is controlled by four companies, which have the power to set prices, he said.
While manufacturers portray themselves as helpless victims of natural gas prices, history shows that increases in fertilizer prices outstrip increases in natural gas, Qualman said. He added that manufacturers routinely lock in natural gas prices in advance to cushion themselves from price increases.
Hildebrandt acknowledged that it's normal business practice to pass on costs and earn profits. But he also thinks fertilizer is too expensive as a rule.
"We're always paying more than we should for that stuff, no matter what price it is," he said. "There's obviously a whole lot more margin in fertilizer than there is in food for some reason or another."
Related stories, resources and websites:
• Fertilizer still worth using despite price, supply worries
• Precision farmer reduces fertilizer, increases yield
• New plants find own fertilizer
• Experts tackle fertilizer questions
• Ideal fertilizer strategy involves homework
• Fertilizer prices will shock growers
• Fertilizer will likely be affected by soaring natural gas prices
• Alberta Agriculture
• Agricultural Producers Association of Saskatchewan
• National Farmers Union
• Cargill Crop Nutrition
• Agricore United
• Saskatchewan Agriculture
External websites are not endorsed by The Western Producer. They will open in a new browser window.
DUBAI - Opec officials sought to ease fears of looming oil shortages, signalling that they may raise output to lower crude oil prices which shot up to 12-year highs yesterday.
The group, which supplies a third of the world's oil, will consider increasing production for a second time this year when it meets on March 11, said oil ministry officials from Qatar and Kuwait yesterday.
Opec secretary-general Alvaro Silva Calderon also said the group 'won't use oil as a weapon' if war breaks out in Iraq.
'We have around 4 million barrels per day of spare capacity. We are ready to put this amount on the market if necessary,' he added.
US light crude in electronic trade hit US$38.66 a barrel yesterday, the highest since the 1990-1991 Gulf crisis when crude peaked at more than US$41 shortly after Iraq invaded Kuwait.
'The supply situation in the US and parts of Asia is very, very dangerous,' said commodity strategist Tetsu Emori of Mitsui Bussan Futures.
'It's easy for crude oil prices to reach US$45 to US$50' a barrel once a war starts in Iraq, he added.
In another worrying development, oil traders said yesterday that Asia might find itself short of fuel oil next month.
Fuel oil shipments from Syria, Saudi Arabia's Yanbu refinery, Venezuela and the US west coast that are expected to arrive next month in Asia will not be enough to meet demand, they said.
High tanker rates are discouraging suppliers in Europe, the US and South America from shipping cargoes to Asia.
Some suppliers preferred to send cargoes to the US, where supplies are low, traders said. --AFP, Bloomberg News, Reuters
www.ainonline.com by Kirby J. Harrison
If business aviation has been sideswiped by the economic mal-aise, it would have been difficult to find evidence of any damage at NBAA’s 14th Annual Schedulers & Dispatchers Conference. This year’s venue was Anaheim, Calif., home of Disneyland.
By the time the four-day event opened February 2, a record 198 exhibitors had spilled out of the salon and additional booths lined the entrance hall. And by the time it ended, a record 1,280 attendees had registered; many of the breakout sessions were standing room only.
While Mickey and Donald and other Disneyland characters may have been a drawing card for conference attendees, so were the keynote speakers for the conference–Erik Lindbergh, grandson of aviation pioneer Charles Lindbergh; and astronaut shuttle commander Curt Brown–along with nearly 30 sessions and workshops on subjects from international operations and insurance liability to travel safety and weather.
NBAA president Jack Olcott set the tone for the event at the opening general session. Olcott noted that those attending were gathering at “a time of great uncertainty,” with the threat of war, terrorism and an economic recession in the future, and the tragedy of the loss of the Space Shuttle Columbia only two days earlier.
Olcott, who will end his tenure as president on December 31 this year, took the same aggressive posture toward the future of business aviation that has marked his 11-year tenure as president of the association. As he has often said in past months, Olcott noted that three-quarters of NBAA’s members “report the same or greater activity than before” 9/11.
Taking note of the scandals that have rocked Wall Street in the past year, he said that as a result public trust has been undermined. And he added that the key to rebuilding trust is not by telephone calls and e-mail, but by face-to-face contact. “Business aviation,” he concluded, “is the vehicle to rebuild that trust, by getting the right person to the right place on time. Despite great uncertainty…the need for business aviation has never been stronger.”
In spite of the challenges facing the business aviation industry, Olcott predicted that the first decade of this century will be “even better” than the last decade of the 20th century. As evidence, he noted figures from Wichita-based Cessna Aircraft. “It took Cessna 31 years to sell 4,000 Citations. By the end of this decade, they expect to sell their 6,000th Citation. In one-fourth of the time it took them to sell 4,000 Citations, they will sell 2,000 Citations. That,” said Olcott, “is quite impressive!”
Later, Olcott expanded on his opening-session message at a standing-room-only breakout session entitled “Hot Issues for Business Aviation.”
“Aircraft are excellent business tools when they fly,” Olcott told his audience, “but when they don’t fly, they represent liabilities. If they’re sitting on a ramp because they can’t get access to airspace or access to airports, they become marginal investments.”
Access is key, he said, adding that security determines access, and access to airspace and airports today is no longer controlled by the FAA, but by the TSA. And while he appeared to find some comfort in the fact that the new head of the TSA, Adm. James Loy, is “very familiar with user groups, NBAA is concerned that there may be a little too much interest in business aviation on the part of TSA.” He warned that the old joke, “I’m from the FAA and I’m here to help to help you,” could shift to, “I’m from the TSA and I’m here to help you.”
Security Controls Access He noted in particular that Part 91 flight departments bore the brunt of new security restrictions put in place after September 11. This despite the fact that “Part 91 flight departments have been practicing the highest levels of security for decades.” Now, he said, “Our challenge is to document [those practices] and communicate them effectively to others, such as the TSA, so they will recognize our right of access.”
To that end, the TSA has selected an NBAA security protocol for a trial program for Part 91 operators, which is now being tested at New Jersey’s Teterboro Airport. He noted that the first test run of the protocol was held just three days earlier, on January 31, and another was scheduled for February 7. Under the system, an operator would apply for a TSA access certificate (TSAAC). The holder would have special access privileges, “initially a blanket waiver for international operations.” There is also a push to allow such TSAAC holders access privileges for TFRs. Olcott said it is important that these privileges are in place if another security crisis arises. “The only assets you can count on in a time of crisis are those that are already in place.”
While the TSAAC program may prove successful, with regard to blanket waivers, he added, operators should not expect TSA to look favorably on such requests.
Olcott also commended the Aircraft Owners and Pilots Association (AOPA) for its initiative in petitioning the FAA for a form of acceptable pilot photo identification. He further applauded AOPA’s successful airport-watch program, patterned on the neighborhood-watch concept. The latter effort has resulted in a nationwide toll-free number–(866) GA SECURE–through which users may report any suspicious activity. Also part of the program is an airport-watch security videotape from AOPA, available this month. Olcott noted that NBAA’s Web site will have a link to the AOPA site, where more details are available.
As for the TSA requirement for fingerprinting of new employees by Part 135 operators, Olcott said the agency has established a policy “at this time” under which it will check the applicant’s prints only against the watch-list of known “bad guys.” He also noted that while fingerprinting as a requirement in background checks does apply to new hires, current employees may not be fingerprinted as a requirement for continued employment without new legislation. Olcott also pointed out that there is no guarantee that the fingerprint background check would not be extended to include Part 91 operators in the future.
Olcott said NBAA continues to argue for a resumption of business aviation access to Ronald Reagan Washington National Airport (DCA), but he warned, “It’s not going to happen tomorrow.” When it does reopen to business aviation, he said, it will likely be under a TSAAC-plus program in which, for example, the operator is required to submit in advance a passenger manifest to allow background checks on the passengers.
Olcott pointed out that there is a risk of becoming paralyzed by thinking only of DCA, but that giving up that fight might set a precedent that would encourage the closure of other airports to business aviation traffic.
Responding to the continued growth in international travel by business aviation operators, the conference focused on subjects related to flights outside the U.S. On Sunday, before the official opening of the conference, NBAA sponsored a day-long International Procedures Training Course taught by Air Training International president Dave Stohr. Some 50 students sat in on the class, absorbing information that included everything from understanding FAA regulations and the language and tools of international travel to lists of resources, FBO services and suggested forms, including airport and country worksheets and the standard service form.
International Items A Tuesday international operations review chaired by Air Routing International offered a series of brief overviews of what the scheduler/dispatcher might expect to deal with in various countries. Presenters provided an overview of recent developments in a number of countries, noting that among other things:
• Due to political unrest, fuel availability may be limited in Venezuela. As of January 21 jet-A was in Caracas but not available in Valencia.
• Aviation worker strikes in France may ignite sympathy strikes in other French labor groups.
• Clearance to the Virgin Islands has become more strict, and without pre-clearance approval it may prove to be time-consuming.
• Do not expect English-speaking personnel at domestic airports in Argentina and even at some international airports.
• Flights to Easter Island must pass the point of no return before another flight is allowed to depart to the island.
• New construction on Runway 17R starts in May at Los Cerrillos International Airport in Santiago, Chile.
• Landing authorization is now required for flights to Colombia.
In a discussion on jet fuel titled “From crude oil to your aircraft,” Phillips 66 Company aviation manager J. Mark Wagner had good news and bad, though mostly bad.
Wagner noted that while the seers in the mid-1970s forecast the world’s supply of oil would run out by the year 2000, “they were wrong.” They were wrong because they based their projections on the technology that existed at the time. That was the good news.
The bad news was that in spite of new oil fields and better ways of extracting oil from the earth, the cost of fuels, including jet-A, will go up as a result of government regulations requiring further reduction in sulfur content, from 3,000 parts per million to 500 parts per million.
Second Largest NBAA Event As the convention concluded, organizers offered the observation that of all the NBAA events, the schedulers and dispatchers gettogether had become second in size only to the association’s annual meeting and convention.
According to vice chairwoman Lisa MacCartney, the schedulers and dispatchers committee had been somewhat apprehensive about attendance at this show, “in light of the pending war with Iraq and the economy. But we’ve been delighted with the response.”
MacCartney said NBAA continues to bring in new members “with fresh ideas, and a good mix of ideas with representatives from all the different industry segments: Part 91 flight departments, Part 135 operators and FBOs. And we continue to try to add quality sessions and workshops to benefit those attending.”
Among the new sessions this year was “FAA Systems Training: Interactive Instruction on Tools and Information,” a three-hour session conducted by Deborah Johannes, FAA Collaborative Decision Making Lead, ATCC, and Jo Damato, manager of NBAA’s general aviation desk at the FAA ATC center. According to MacCartney, it was a “condensed version” of the full course now being offered by the FAA throughout the country in “How to get the aircraft up when the system is down.”
Also new was a 2.5-hour security forum moderated by Olcott that included panelists representing the TSA, Texas Instruments, Air Security International and Denver Centennial Airport.
“We were very happy with this year’s conference,” said MacCartney.” In the meantime, she added, the committee plans to continue to emphasize the importance of training for schedulers and dispatchers, and is working on creation of a distance-learning course.
The 2004 Schedulers & Dispatchers Conference is scheduled for January 12 to 14 at the convention center in Savannah, Ga.
Aviation International News is a publication of The Convention News Co., Inc., P.O. Box 277, Midland Park, NJ, 07432. Copyright 2003. All rights reserved. Reproduction in whole or in part without permission from The Convention News Co., Inc., is strictly prohibited. The Convention News Co., Inc., also publishes NBAA Convention News, HAI Convention News, EBACE Convention News, Paris 2003, Dubai 2003, Asian Aerospace 2004, Farnborough 2004 and AIN Alerts.