The Obama administration says 13 companies whose nearly 20 deepwater drilling projects were suspended last year may be able to resume drilling without detailed environmental reviews. Companies will be allowed to resume work at previously drilled wells, as long as they meet new policies and regulations. The director of the Bureau of Ocean Energy Management, Regulation and Enforcement, Michael Bromwich, says the new policy will accommodate companies whose operations were interrupted by the administration's five-month moratorium on deepwater drilling, while ensuring that the companies can resume previously approved activities. Bromwich says the firms will not be required to complete a detailed review under the National Environmental Policy Act. The companies must comply with new policies and regulations set up in the wake of the BP oil spill.
Oil prices have risen above $92 a barrel to a 26-month high, as the new year began with the prospect of higher energy prices to come. The last time oil settled above $92 a barrel was on October 3rd, 2008, when it reached $93.88. AAA says the national average for regular gasoline was about $3.07 a gallon. That's three cents more than it was a week ago and about 41 cents higher than a year ago. Average retail gasoline prices in Houston have risen 0.4 cents per gallon in the past week, averaging $2.87, according to HoustonGasPrices.com.
A trade group representing oil refineries is suing the Environmental Protection Agency over plans to allow the sale of gasoline containing 15 percent ethanol. The Obama administration said in October that gas stations could start selling the corn-based ethanol blend for vehicles built since the 2007 model year. The ruling would increase it from the current blend of ten percent ethanol. But the National Petrochemical and Refiners Association and two other trade groups have asked a federal appeals court to overturn the decision. They say the EPA does not have the authority under the Clean Air Act to approve a plan for fuels that run in some engines but not others. Auto industry and engine manufacturing trade groups have also sued the EPA over the ethanol decision.
Construction spending rose for a third straight month in November, helped by another increase in housing and a record level for spending on federal building projects. The Commerce Department says construction spending increased 0.4 percent in November following gains of 0.7 percent in October and 1.2 percent in September. Even with the three straight monthly gains, building activity remains 33.2 percent below the all-time high hit in March 2006, when spending was being driven by a record boom in housing.
Manufacturers produced more goods and booked more orders last month, a trade group says, leading to the fastest growth in factory activity since May. The Institute for Supply Management says its index of manufacturing activity rose to 57 in December from 56.6 in the previous month. Any reading over 50 indicates growth. The index rose to 60.4 in April, the highest level since June 2004. It had bottomed out at 32.5 in December 2008, the lowest since June 1980. The latest report shows that manufacturers carried considerable momentum into the new year. The new orders index rose sharply to 60.9, also the highest since May. The production index also jumped.
President Barack Obama's top economic adviser says the administration wants to juice the economy and get it going faster amid signs of a continuing recovery in the new year. Austan Goolsbee, chairman of the White House Council of Economic Advisers, tells ABC's This Week that administration efforts will focus on investment, exports and innovation. Unemployment remains a sore spot at 9.8 percent. Goolsbee says previous forecasts for unemployment to average around nine percent this year appear to be holding steady. Goolsbee says initiatives under way, such as cutting payroll taxes and offering tax incentives to small businesses, are now coming into play to help.
Goolsbee is warning against what he calls “playing chicken” with the need to raise the nation's debt ceiling. For some conservatives, refusing to raise the limit on the federal debt would be a tactic to force the government into cutting spending. Last February, Congress raised the debt ceiling to $14.3 trillion. The debt is now at nearly $13.9 trillion and growing each day. A move to raise the ceiling again is expected this spring. Goolsbee says refusing to raise the debt ceiling would push the country into default--and a far greater economic crisis than Americans saw in 2008.
Expedia has stopped selling tickets for American Airlines flights. It's the latest development in a simmering pricing dispute between American and travel websites. Last month, American pulled its flights from the travel website Orbitz. It said consumers could just as easily buy tickets from American's website, and the airline wouldn't have to pay as much. Paying to have its flights listed on sites like Expedia can be costly, since airlines pay a commission every time people search a particular flight, look up a fare or book a trip. Experts have warned that while American might save money in commission fees, its sales will drop if its flights don't appear on the travel sites.
A published report says Facebook has raised $500 million from Goldman Sachs and a Russian investment firm in a deal that values the company at $50 billion. The New York Times reports in its online edition that Goldman invested $450 million and digital sky technologies invested $50 million. The newspaper cited people involved in the transaction that it did not name. The report said representatives for Facebook, Goldman and digital sky technologies declined to comment. The U.S. Securities and Exchange Commission is reportedly looking into the booming trade in privately held shares of popular social networking sites because companies with 500 shareholders must disclose certain financial information to the public, even if they haven't filed for an initial public offering.
Motorola will split into two companies on Tuesday. This marks the final step in the years-long breakup of a consumer electronics industry pioneer. Motorola began selling car radios in the 1930s, followed by TVs in the '40s and cell phones in the '80s. The breakup that began in 2008 is motivated by the desire to present two simple businesses to investors rather than one complicated one. Motorola is splitting its consumer-oriented side, which makes cell phones, from the professional business of selling police radios and barcode scanners to government and corporate customers. The companies, Motorola Mobility and Motorola Solutions, will begin trading on the New York Stock Exchange Tuesday.
If you've been wishing you could ditch your clunky computer mouse and control your PC with motions, computer maker Asus will have a solution for you later this year. Asustek Computer is working with PrimeSense to let users gesture to surf the web, check social networks and control videos on their pc or an internet-connected TV. PrimeSense's 3-D camera is a core part of Microsoft's Kinect motion- and voice-control technology for the xBox 360 gaming console. The companies will show off the technology at the annual International Consumer Electronics Show in Las Vegas this week. They plan to sell the motion controls as an accessory for PCs in the second quarter of the year called Wavi Xtion.
Apple isn't one of the participants at the consumer electronics show, but it will be one of the big players at the event, whether there or not. That's because its iPad has been one of the big sellers since its release this past April. And now other companies are trying to play catch-up. So far the early entries haven't been able to do so. Dell didn't do well with its tablet computer. And while Samsung had some success with its Galaxy tab, sales didn't come close to matching the iPad's.
Toshiba is weighing in with an entry that it hopes will be able to land some blows on the Apple iPad. The company says it will soon be offering a tablet computer with a larger screen than the iPad. The Toshiba Tablet--as it's known now--will run on the Google Android operating software. It will have a touch screen that is 10.1 inches diagonally--compared to the 9.7 inches on the iPad. Toshiba plans to unveil the device at the electronics show and have it on the market by the end of June. No price has been set yet.
Many iPhone customers had some explaining to do after they overslept to start the new year, due to a glitch in the gadget's alarm clock feature. Users who set their iPhone alarm for a single wake-up rather than recurring use found the alarm didn't go off with the year's arrival. Apple spokeswoman Natalie Harrison says that a fix was in the works. The glitch affected iPhones using Apple's latest IOS 4.0 operating system. Online postings on blogs and social media sites described people being late for work, church services and other appointments on Saturday and Sunday because of the problem.
Farm equipment makers are hoping a new generation of cleaner tractors will find a market with new clean air regulations that went into effect Saturday. The new federal rules apply to tractors, construction vehicles and other so-called non-road equipment. The U.S. Environmental Protection Agency says the vehicles are major sources of particulate-matter emissions--the stuff that makes smoke black and air difficult to breathe. So far, most farmers are giving a cool reception to the new tractors, which can cost between $100,000 and $300,000. The greener technology used in them has also boosted the price about ten percent. Dairy farmer Phillip Batho of Plum City, Wisconsin, says that's part of why he bought an older, used tractor last month. He paid about $60,000.
Several key reports are due out in the coming week. Tomorrow, the Commerce Department releases November factory orders, the Federal Reserve releases minutes from its December meeting on interest rates and automakers announce December auto sales figures. On Wednesday, the Institute for Supply Management releases its service sector index for December. Thursday, expect a report on December retail sales. Friday brings the monthly unemployment report from the Labor Department.