Oil prices are rising after the government said U.S. crude and gasoline supplies fell unexpectedly last week. The Energy Information Administration says crude stockpiles fell by 400,000 barrels to 296.5 million barrels for the week ending August 8th. Analysts surveyed by energy research firm Platts had expected crude supplies to rise by 500,000 barrels. The EIA also says gasoline supplies fell by 6.4 million barrels to 202.8 million barrels last week, much more than the 2.2 million barrel drop analysts had predicted.
Britain’s advertising watchdog agency says Royal Dutch Shell violated industry rules with claims in a newspaper ad. That full-page ad in the Financial Times of London said that two oil projects in Canada and the United States involved sustainable forms of energy. The Advertising Standards Authority investigated the Shell ad after a complaint from the World Wildlife Federation. The advertisement focused on two Shell projects. One involves exploration in Canada’s oil sands where a tar-like form of petroleum called bitumen can be extracted and upgraded to synthetic crude oil. The ad also mentioned Shell’s plan to build one of the United States’ largest oil refineries in Port Arthur. The watchdog ruled that Shell breached regulations relating to substantiation, truthfulness and that the ad “was defined primarily in environmental terms.” The authority also rejected Shell’s argument that the design of the Port Arthur refinery would lower most types of emissions on a per barrel basis. A Shell spokeswoman says the company didn’t intend to mislead the public with the ad.
A Honda executive says the company’s new gas-electric hybrid, designed to compete directly with Toyota’s Prius, will be priced lower than the current Civic hybrid. Executive Vice President of American Honda Motor Richard Colliver tells an industry gathering that the new five-door, five-passenger hybrid will be launched next spring. He says Honda hopes to sell 100,000 of the new vehicles in North America. The price of the Civic hybrid starts at $22,600, while the Prius has a base price of $21,500.
Ford’s top American executive says the company has enough cash to weather losses and make a profit again. That’s despite the faltering U.S. economy, tight credit, high gasoline prices and declining home values. Ford’s president of the Americas, Mark Fields, says there will be a lag before the company can start making profits on the small cars U.S. drivers have been buying. Sales of pickup trucks, Ford’s old profit center, are starting to improve as gas prices moderate. But fields says the company isn’t banking on that. Instead, Fields says the company is planning to make money on new global models it will bring to the U.S. from Europe starting in 2010.
BMW is recalling 200,000 vehicles over concerns that the front passenger air bag may not deploy in a crash. The German automaker says the recall involves the 2006 3 series, the 2004-2006 5 series, and the 2004-2006 X3 compact sport utility vehicle. The National Highway Traffic Safety Administration said in a posting on its Web site Wednesday that small cracks could develop in a seat detection mat and lead to the front passenger air bags to be deactivated. It would also turn on the passenger air bag “on-off” light. NHTSA says the head protection system would not be affected. The company said last month there had been no injuries or accidents tied to the problem.
With consumers putting the brakes on auto sales, retail sales in July posted the weakest performance in five months. The decline of one-tenth of a per cent was the first drop since February, as consumers struggled to pay more for gasoline and other items. Excluding the impact of auto sales, the Commerce Department says retail sales would have risen 0.4 per cent. With the positive impact of economic stimulus checks diminishing, analysts are worried about the coming months. The consumer sector accounts for two-thirds of total economic activity.
Britain’s Prince Charles says increased use of
CVS Caremark is buying Longs drug stores. The deal is valued at $2.9 billion, including Longs’ roughly $200 million in debt. Longs is based in Walnut Creek, California. CVS is based in Woonsocket, Rhode Island, and is the nation’s largest provider of prescriptions. Company executives say the acquisition will give CVS significant inroads in fast-growing west coast markets where property is often expensive or unavailable.
Tween Brands says it’s converting nearly 600 Limited Too stores to its lower-priced Justice brand. The move will nearly triple the size of the Justice chain when the conversion is completed in the first quarter. Once the transaction is completed, the new Albany-based teen clothing chain will no longer operate any Limited Too stores in the U.S. but the some of the brand’s clothing will continue to be sold in Justice stores. The company says the deal will save up to $25 million after taxes. It will record an $18 million charge in the second half related to the severance, store closings and other charges related to the transition.