Energy Department Says US is Now World’s Top Oil Producer
The United States is pumping record amounts of oil, vaulting over Russia to become the world’s biggest producer of crude.
The Energy Information Administration said Thursday that the U.S. produced more than 11.3 million barrels a day in August, a 4 percent increase over the old record set in July.
Russia’s energy ministry estimates that country pumped 11.2 million barrels a day in August. OPEC reports Saudi Arabia pumped 10.4 million barrels a day.
It’s the first time since 1973 that the U.S. leads the world in oil production.
Several states hit record production in August including Texas, which accounts for about 40 percent of U.S. crude. The energy agency says pipeline bottlenecks in Texas and New Mexico are causing more use of trucks and rail cars to haul oil.
Federal Jury Sides With Cannabis Company Over Colorado Couple
A federal jury has ruled against a Colorado couple who claimed that a neighboring marijuana grow operation hurt their property’s value in a case closely watched by the U.S. cannabis industry.
The Colorado Sun reported Wednesday that jurors reached their verdict in Denver after deliberating for about half a day.
It was the first time a jury considered a lawsuit using federal anti-racketeering law to target a marijuana company.
Matthew Buck, the lawyer for grow owner Parker Walton, says a loss in court would have meant the loss of Walton’s business.
Vulnerability to similar lawsuits is among the many risks facing marijuana businesses licensed by states but still violating federal law. Suits using the same strategy have been filed in California, Massachusetts and Oregon.
US Average Mortgage Rates Ease; 30-Year at 4.83%
Long-term U.S. mortgage rates declined this week, in a quiet pause after weeks of market anxiety over rising interest rates.
Home borrowing rates still remain at their highest levels in more than seven years, dampening the outlook for prospective homebuyers. Mortgage buyer Freddie Mac said Thursday the rate on 30-year, fixed-rate mortgages eased to an average 4.83 percent this week from 4.86 percent last week. A year ago, it stood at 3.94 percent.
The average rate on 15-year, fixed-rate loans slipped to 4.23 percent this week from 4.29 percent last week.
Anxiety over rising interest rates, which result from strength in the economy, has buffeted financial markets in recent weeks and spilled over into the housing market.
U.S. stocks rallied on Tuesday and Wednesday after falling sharply from early October through the last few days of the month — a skid that wiped out their gains from earlier in the year.
The combination of higher mortgage rates and increasing home prices has made home ownership less affordable.
Despite the higher borrowing costs, “the monthly mortgage payment remains affordable,” Freddie Mac chief economist Sam Khater said. For many buyers, he said, the persistent lack of available properties for first-time homebuyers is a bigger hurdle than higher mortgage rates because choices are limited. And the shortage of available homes has pushed prices higher.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week.
The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates.
The average fee on 30-year fixed-rate mortgages was unchanged from last week at 0.5 point. The fee on 15-year mortgages rose to 0.5 point from 0.4 point.
The average rate for five-year adjustable-rate mortgages dropped to 4.04 percent from 4.14 percent last week. The fee held steady at 0.3 point.
US Factories Grew More Slowly in October
American manufacturers grew at a slower pace in October as factories contended with supply disruptions caused by disputes with China, Europe and other trading partners.
The Institute for Supply Management, an association of purchasing managers, said Thursday that its manufacturing index slipped to 57.7 last month — down from 59.8 in September and the lowest since April. It was the second straight monthly drop.
Still, anything above 50 signals growth, and manufacturers are enjoying a 26-month winning streak.
New orders, production, export orders and hiring grew more slowly. Thirteen of 18 manufacturing industries reported growth last month, led by textile mills and makers of electrical equipment.
American industry is generally healthy, but respondents to the ISM survey suggested that trade disputes are taking a toll. The United States has imposed taxes on imported steel and aluminum and on about $250 billion in Chinese products, drawing retaliation from U.S. trading partners.
Several companies complained that the tariffs are driving up costs and limiting supplies. Respondents also cited labor shortages and the strains that high demand is putting on their supply chains.
Timothy Fiore, chair of ISM’s manufacturing survey committee, said that “57.7 is not a bad number. But it’s not where we had been. We have been bouncing around the top. This may be the first indicator of a softening that may continue.”
Manufacturers are also coping with weakening global economic growth and a strengthening dollar, which makes American products costlier in foreign markets.
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