Tumbling energy prices: Not to sound like a broken record, but the Auto Club's latest survey has the average price of regular in the L.A. area at $4.071 a gallon, which is 46 cents lower than last month. Meanwhile, oil has slumped to under $112 a barrel, mostly because of concerns about a faltering global economy (they’re talking recession in Europe). From Reuters, via CNBC:
"It looks like we might be trying to find a short term price floor. We've tested $114 and $113, we might well hover here for a little while before we make another move," Simon Wardell, oil analyst at Global Insight said. "We might get to $110, how quickly we get there would depend on the demand outlook ... if next week's U.S. inventory data shows an increase in stocks, we could go lower," he added.
Oil speculators at play?: Energy analysts had mostly pooh-poohed the role of speculators in the recent run-up in prices, but there's new data out that suggests otherwise. It stems from the Commodity Futures Trading Commission reclassifying a large unidentified oil trader. That's right, unidentified. It looks as if the government has very little idea on who is doing the trading - and why. From the WSJ:
The array of opinions about how speculation is affecting energy prices comes about in part because of the tricky task of determining what, exactly, is pure speculation and what is so-called commercial trading, in which companies hedge risks involved with using, selling, or processing physical commodities in their everyday businesses. Many Wall Street investment banks, private-equity firms and hedge funds have invested in physical assets such as storage terminals, pipeline and distribution companies, power plants and oil and gas properties. That dual role potentially puts them in the position of being both hedgers and speculators.
Netflix back?: The crisis that held up DVD shipments appears to have been resolved. This week's problems stopped distribution to a third of the company’s 8.4 million customers. "We've made enough progress on our system issues to begin shipping from some of our distribution centers today and will continue to work through the night to have shipments available to run all distribution centers tomorrow," says a spokesman. (Reuters)
Tom Cruise's future: MGM head Harry Sloan says he wants to keep working with Tom Cruise, even with the departure of the actor's long-time partner Paula Wagner. There's some serious money behind Sloan's words - namely, a $500 million credit facility from Merrill Lynch that was to be used for films made by MGM's United Artists (partially owned by Cruise and Wagner). The Merrill deal could end because Cruise and Wagner have failed to make certain benchmarks. From Variety:
When Merrill Lynch got into business with Cruise and Wagner, the world was a different place. Cruise was the biggest movie star in Hollywood, with "The War of the Worlds" and "Mission: Impossible III" behind him. When he made a presentation to the Merrill Lynch team, they were wowed. Credit was easy and flowing. The movie business was an attractive lure for investors, who were piling into the entertainment sector in droves. The sober light of August 2008 is another time and place. Cruise now has the money-losing "Lions for Lambs," starring himself and Robert Redford, behind him, as well as the upcoming $85 million period drama "Valkyrie," starring Cruise as an eye-patched Nazi. After several postponements, the long-delayed movie will open Dec. 26.
NBC won't air Phelps live: Network honchos have decided to tape delay Saturday night's 4x100 medley relay, when Michael Phelps could win his eighth gold medal (he still needs to get his seventh). "The situation will remain the same as it has for all of our prime-time broadcasts," said an NBC flack. It's hard to quarrel with success - ratings have been highest in West Coast markets, despite the three-hour delay. Of course, not many folks watch TV on Saturday night. (Silicon Alley Insider)
SAG update: The studios and networks had given Screen Actors Guild members until today to ratify their contract offer in order to make the terms retroactive to July 1 (supposedly costing SAG more than $10.3 million). That's obviously not going to happen, so the next big date is Sept. 18, when guild members will vote on a bunch of board seats. The results could alter the union's bargaining position. (THR)
Chipmaker gets offer: Vishay Intertechnology wants to buy El Segundo-based International Rectifier (yeah, I know - the name) in a $1.6 billion cash deal. IR has been in a heap of trouble with accounting regularities that led to the resignation of its CEO. The company has had to restate at least six quarter of financial results. Vishay is offering $21.22 per share, about a 13 percent premium over Thursday's closing price. (LABJ)
JetBlue adds flights: The low-cost airline will start service between Long Beach and SF and Portland in the fall. In May, JetBlue added Long Beach flights to San Jose, Seattle and Austin. The airline also has flights to Oakland. JetBlue controls 28 of Long Beach's 41 commercial flight slots. (Press-Telegram)