What Is This COVID-19 Mess?
(Used to be called 2019-nCoV or, more broadly, the coronavirus)
According to the CDC, COVID-19 is a new respiratory virus first identified in Wuhan, Hubei Province, China. On January 30, 2020, the International Health Regulations Emergency Committee of the World Health Organization declared the outbreak a “public health emergency of international concern” (PHEIC). The potential public health threat from the coronavirus is high, both worldwide and to the United States.
The fact that this virus has caused sickness, includin' sickness that ended in death, and kept spreadin' person to person in China is worrisome, I tell you what. For the general American public, who ain't likely to be exposed to this virus, the immediate health risk from the coronavirus is considered low right now.
The point of this blog is to let y'all know, if you're a mite curious about the coronavirus aka 2019n-CoV aka COVID-19, and more particular (since Texas Flange ain't got no epidemiologists or health care specialists on staff) how this virus is affectin' industrial flanges, the Oil and Gas industry, and the economy overall. It's a serious subject and there ain't a whole lot of clarity to be had,
so this overview'll carry us up to early February 2020 (when this article is bein' written), and since things are changin' mighty fast, we plan to update this blog as needed.
Dec 2019:
• First Cases spotted, and World Health Organization (WHO) sounded the alarm.
Jan 2020: Week 1
• Wuhan seafood market suspected of bein' the hub where the first cases got caught.
• Medical screenin' at Wuhan airport put in place on Jan 3rd, 2020.
• WHO advises against travel/trade restrictions based on the evidence at hand
• SARS, MERS, and bird flu ruled out as the culprits
• New Virus figured to be a betocoronavirus and officially named 2019n-CoV
Jan 2020: Week 2
• First possible 2019n-CoV cases show up outside of China
• 2019n-CoV genetic genome got sequenced and put out for folks to study worldwide
• First death reported
• Cases confirmed in Thailand and Japan
• Right about now, less than 50 cases are confirmed worldwide
Jan 2020: Week 3
• Second Death Reported
• First Confirmed Case in South Korea
• First Confirmed Case in the United States (Washington)
Jan 2020: Week 4
• Tougher health screenin's put in place at Airports all over the world
• China puts travel bans on multiple cities
• Chinese New Year celebrations called off in Beijing
• First robots used to treat an infected patient
• Hong Kong announces health emergency
• Canada, Nepal, Sri Lanka, and Mexico report first cases. More cases reported all around the world.
• Countries around the world work to get their citizens out of the immediate danger in Wuhan.
• China suspends tradin' on two major stock exchanges
• Russia closes 2,700 miles of border
• WHO bumps virus risk level up to “HIGH”
Jan 31st, 2020:
• Approximately 10,000 Cases confirmed worldwide
• Death toll rises to 213 individuals (may they all rest in peace)
• WHO declares global health emergency
Feb 2020: Week 1
• Incomin' travel restrictions set in place by America and Australia to protect their folks.
• Chinese Health Authorities announce that 243 individuals hit by the coronavirus got discharged after recoverin'.
• First death outside of china announced in the Philippines.
• More cases poppin' up all around the world.
• Over 30,000 Cases confirmed worldwide
• Death toll rises to over 600.
Feb 2020: Week 2 – Present Day
• First U.S and Japanese Nationals pass away in Wuhan from coronavirus infection.
• Multiple temporary hospitals bein' put up in China to help care for them that's infected.
• Over 60,000 cases have now been confirmed worldwide (90+% within mainland China)
• Death toll rises over 1,100; Passes the SARS epidemic from 2002-03.
• 420 United states citizens investigated for coronavirus
• 13 tested positive, 347 tested negative, and 60 test results are still pendin'.
• States with confirmed cases: CA, WA, AZ, WI, IL, MA
• We reckon “Coronavirus” has been and will be a simple and clear enough term, but the WHO for some reason renames 2019-nCoV Coronavirus as COVID-19
• CO – Corona
• VI – Virus
• D – Disease
• 19 – Means 2019 (the year it was first found)
***UPDATED MARCH 18, 2020***
FEB 2020 WEEK 3:
• Death toll rises to 2,247, with most of the deaths happenin' in mainland China. Total number of confirmed cases goes up to over 76,000 with recoveries around 18,200.
• Passengers who tested negative for the virus start gettin' off the Diamond Princess cruise ship, even with evidence from infectious disease experts that they might be carryin' the virus back to their communities without knowin' it.
• CDC changes the criteria for countin' confirmed cases of COVID-19 in the US. Starts trackin' two separate groups: those brought home by the US Government, and those identified by the US Public Health Network.
FEB 2020 WEEK 4:
• Italy’s Lombardy region puts out a list of towns and villages that are in complete lockdown. Nearly 100,00 people are hit by travel restrictions.
• Patient infected with COVID-19 in Washington state dies, markin' the first death in the US from the virus.
MARCH 2020 WEEK 1:
• Death toll reaches 3,450 globally, while the number of infections climbs to more than 101,731 with approx. 57,390 recoveries.
• In the US, Washington, Florida, Kentucky, New York, Maryland, Utah, and Oregon declare a public health state of emergency.
• EU raises risk level from “moderate” to “high” after 2,100 reported cases and 38 related deaths.
MARCH 2020 WEEK 2:
• WHO declares the outbreak a pandemic on March 11, 2020. It's the first pandemic caused by a coronavirus.
• Death toll reaches 4,700 globally, with more than 128,330 infections and approximately 68,300 recoveries.
• US President Donald Trump declares a national emergency, plans to use $50 billion to fight the spread of COVID-19.
MARCH 2020 WEEK 3:
• Death toll climbs to over 8,000 globally by March 18. Total reported cases stand at ~207,500 with ~82,000 recoveries.
• WHO calls for “aggressive action” in Southeast Asia to keep the virus from spreadin'.
Has COVID-19 Hit Oil and Gas?
To put it plain: yessir, it has hit the Oil and Gas Industry.
The lower demand in China is hurtin' not just Oil and gas companies in the Houston area, but folks all over the globe.
The US Energy Information Administration just cut its oil demand growth forecast by ~300,000 barrels per day to make up for travel restrictions and less fuel burnin' in mainland China.
If we look closer at the price per barrel of WTI, we started 2020 at around $58 per barrel, but after COVID-19 turned out to be a possible global problem, Oil prices fell 10-15%.
If we look at the chart below and compare it to the number of new cases bein' announced, we can draw a loose line between fewer infections (i.e. hopefully the virus is slowin' down) and oil prices bouncin' back ~1-3%.
That gives us a bit more hopeful outlook for the future of oil and gas; but we'll have to keep an eye on things as they keep playin' out.
**March 18, 2020 UPDATE **
Global demand for oil is expected to drop in 2020 as the coronavirus keeps spreadin' around the globe, holdin' back travel and other economic activity. According to the IEA,
“The situation remains fluid, creating an extraordinary degree of uncertainty over what the full global impact of the virus will be. In the IEA’s central base case, demand this year drops for the first time since 2009 because of the deep contraction in oil consumption in China, and major disruptions to global travel and trade.” Plenty of different sectors of the energy market are bein' hurt by COVID-19.
How Has COVID-19 Hit Local and Global Economies?
While some outlets report cases of unfair generalizations, y'all check your sources, and don't let misinformation sway your decisions. Keep on supportin' local businesses and make sure your news sources are reputable.
Because of globalization, companies have built supply chains across national borders, makin' economies a whole lot more tied together. In recent years, China has become a vital part of the global market. So, when China's economy took hits from the spread of COVID-19, it caused a ripple effect in the bigger global economy too.
The biggest things that may hit the US are gonna be a drop in sales to China, disrupted supply chains (on account of the economic globalization mentioned earlier), and a big drop in Chinese tourism to the US. Still, only time will tell how bad the virus and its affects will be on our economy. “The outbreak has the potential to cause severe economic and market dislocation.
But the scale of the impact will ultimately be determined by how the virus spreads and evolves, which is almost impossible to predict, as well as how governments respond,” said Neil Shearing, group chief economist at Capital Economics.
Economists say the current level of disruption can be handled. If the number of new coronavirus cases starts to slow, and China’s factories open back up soon, the outcome'll be a momentary hit to the Chinese economy in the first quarter and a small dip in global growth.
But if “pandemic” status gets reached, it'll surely push the economy down as countries put restrictions on commerce/trade to protect their people. On top of that, the vacation/travel industries have been and will keep bein' hit until the virus can be whipped.
According to certain sources, Chinese tourists spend ~130 billion a year vacationin' and a lot of industries will feel the effect of COVID-19 this year if we can't get it under control.
With a coordinated effort at the multi-national level, there's hope for a quick and effective response to the outbreak of the coronavirus COVID-19. If a “pandemic” is prevented, the effects on a global (and even local) economy can stay manageable (and we hope we can report back that this was indeed the case).
Like we've said over and over through this short review of the events and effects of the coronavirus COVID-19, only time will tell. In the meantime, y'all remember to take your regular precautions; wash your hands regular, get your flu vaccine, and stay home if you feel poorly.
**March 18, 2020 UPDATE**
Sad to say, earlier this month COVID-19 was officially labeled a pandemic by the World Health Organization. This could hit the global and US economy in a lot of ways, and in some ways already has.
International Monetary Fund Managing Director Kristalina Georgieva says the outbreak is the world’s “most pressing uncertainty.” The economic disruptions caused by the virus and the growin' uncertainty are showin' up in lower valuations and more volatility in the financial markets.
While the exact impact of the coronavirus on the U.S. and global economies is still unknown and can't be predicted, there ain't no denyin' it poses huge risks.
Click here to see the John Hopkins dashboard that's keepin' watch on global COVID-19 cases in nearly real time.
