Tim Ryan, owner of Square 1 Farmers, and his son, Tim Ryan Jr., vice president of sales, discuss their company's preparations for supply chain issues ahead of the port strike and discuss the impact on businesses and consumers. Let's discuss.
The longshoremen's union strike that began early Tuesday and affected dozens of U.S. ports is not expected to cause immediate disruption to the oil and gas industry, but experts say a work stoppage could result. If it continues long enough, he says, things will eventually change.
The Department of Energy issued a statement after the strike began, saying the closure of 36 ports on the Eastern and Gulf Coasts “will not affect the import and export of crude oil, gasoline, natural gas, and other liquid fuels. These tasks will be performed by other workers.” Because of that,” he said. The strike therefore has no immediate impact on fuel supplies or prices. ”
On October 1, 2024, longshoremen go on strike at the Bayport Container Terminal in Seabrook, Texas. (Mark Felix/AFP via Getty Images/Getty Images)
In response to the DOE's statement, Adam Ferrari, oil and gas expert and CEO of Phoenix Capital Group, told FOX Business, “While there may not be an 'immediate' impact, the overall “The economic impact is still being considered.” The US will control every industry, including the oil and gas industry. ”
Ferrari noted that Eastern and Gulf ports are responsible for about half of U.S. container imports. Therefore, if the strike intensifies, the entire supply chain could be affected, he said.
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Supply chains are essential to the oil and gas industry, which imports and exports products, and Ferrari argues that such strikes could cause major disruptions to shipments and product shortages. He said labor in loading and unloading natural gas products could also be disrupted, leading to shortages and price hikes, especially on the consumer side.
“It's a domino effect,” Ferrari said. “A rise in gasoline prices could cause stock price fluctuations and uncertainty for investors and markets. It could also affect government regulations and policies, where there are already tensions in this area. There is a sex.”
Chris Speer, president and CEO of the American Trucking Associations, said he is “very concerned” about the impact of the longshoremen's strike on trucking and the economy.
Energy market analyst Phil Flynn said: FOX business “The biggest hit to oil from the longshoremen's strike will be demand-driven,” contributors wrote in Tuesday's daily Phil Flynn Energy Report.
“Oil tankers and LNG are unaffected as the Longshoremen's strike affects container ships, but if those ships don't move, the oil won't burn,” Flynn wrote. “Strikes could also lead to factory closures, reducing oil demand and further deepening the U.S. recession, further hampering demand.”
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The International Longshoremen's Association (ILA), which represents 45,000 longshoremen, has launched its first strike since 1977 after signing a six-year contract with the United States Maritime Alliance (USMX). port employerexpired Monday night.
Negotiations between the ILA and USMX have so far stalled over the union's demands for higher wages, compensation and protection from port automation.
On October 1, 2024, longshoremen go on strike at the Bayport Container Terminal in Seabrook, Texas. (Photo by MARK FELIX/AFP via Getty Images/Getty Images)
Meanwhile, strikes are expected to cause immediate disruption in several industries, and industry groups are calling on President Biden to intervene.
Business groups urge Biden to intervene in port strike
Associated Builders and Contractors (ABC), the National Association of Wholesalers and Distributors (NAW), the National Retail Federation (NRF), the National Association of Manufacturers (NAM), the U.S. Chamber of Commerce, and others call on Mr. Biden to issued a statement. He is using his authority under the Taft-Hartley Act to force the port to resume operations while labor negotiations continue.
Over the weekend, the president said he would not intervene in the port strike because he “doesn't believe in Taft Hurley.”
President Biden speaks at an event with world leaders on September 25, 2024 in New York City. The president said over the weekend that he did not intend to use his powers under Taft-Hartley to intervene to stop the longshoremen's strike. (Photo by Michael M. Santiago/Getty Images / Getty Images)
U.S. seaports from Maine to Texas will be affected by the attack. These ports collectively handle about half. Imported from the US It is also an important hub for exports from American companies.
A JPMorgan analysis estimates that a strike by longshoremen on the East Coast and Gulf Coast could cost the U.S. economy between $3.8 billion and $4.5 billion per day of disruption.
But Anderson Economic Group (AEG), which specializes in estimating the economic impact, expects the total cost of the strike to be much lower at $2.1 billion in the first week.
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Still, AEG Principal and CEO Patrick Anderson told FOX Business that JPMorgan analysts believe the duration of the strike will likely depend on whether the Biden administration intervenes. He said he agreed.
FOX Business' Eric Revell contributed to this report.
