Industrial Production Rises More Than Forecast

Industrial production rose 1.1% in April, led by automobile manufacturing and utility output, the Federal Reserve said Wednesday.

The gain in activity at factories, mines and utilities topped economists’ projections of a 0.6% increase, Bloomberg reported.

Production had declined 0.6% in March, revised from an unchanged reading.

Factory production, which makes up three-quarters of the total, rose 0.6%, while utility output jumped 4.5%, the most in two years.

Production of automobiles and parts rose 3.9%, following a 1.2% increase. Factory production excluding autos rose 0.3%.

Capacity utilization, which measures plant output, rose to 79.2%, the highest in four years, from 78.4% in March.

Manufacturing accounts for about an eighth of the U.S. economy and the factory sector is one of trucking’s largest and most important customers.

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Leading Economic Indicators Slip

An index of leading economic indicators fell in April following six straight increases, the New York-based Conference Board said Thursday.

The index slipped 0.1% following a 0.3% gain in March.

Economists had forecast a 0.1% increase, Bloomberg reported.

The LEI is closely watched by trucking companies because it forecasts business activity for the next three to six months.

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SoCal Ports' Cargo Up 2% in April

Total cargo volume in Southern California ports of Los Angeles and Long Beach rose 2% in April, indicating stronger international trade volume at the nation’s two largest ports.

The total container shipments handled at the ports, measured by industry standard 20-foot units, reached 1.17 million, including a 15% increase at Los Angeles and a 13% drop at Long Beach.

Total cargo volumes at the ports, which handle approximately 40% of containerized international cargo arriving or leaving the U.S., have risen 0.5% through the first four months of 2012.

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Oil Closes at Six-Month Low Under $93 a Barrel

Jamie Rector/Bloomberg News

Oil fell more than $1 Wednesday to finish the trading day at six-month-low under $93 a barrel, Bloomberg reported.

The $1.17 decline to $92.81 a barrel on the New York Mercantile Exchange — the lowest closing price since $92.51 on Nov. 2 — followed a Department of Energy report that showed higher supplies last week.

The price also dropped on concerns that Europe’s debt crisis may worsen, after talks to form a coalition government in Greece collapsed, Bloomberg said.

DOE reported Wednesday that crude inventories rose by 2.1 million barrels last week to 45.1 million barrels, the highest level on record.

Analysts had forecast a 1.75 million-barrel gain, Bloomberg reported.

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Volvo's April North American Deliveries Rise 39%

Bruce Harmon/Trans Pixs

Volvo AB’s North American truck deliveries rose 39% in April from a year ago, the company said Wednesday.

Sales for its Volvo and Mack brands improved to 4,712 trucks, from 3,388 a year ago, Sweden-based Volvo said in a statement.

In North America, Volvo Trucks rose 26% to 2,431 units, while Mack Trucks’ sales soared 75% to 2,238 units.

For the year, North American sales have jumped 44% from a year ago, to 17,560 units, from 12,209.

Worldwide truck deliveries for all Volvo’s brands slipped 4% to 18,497, led by a 27% decline in Western Europe and 30% downturn in South America.

Volvo AB is the parent company of Volvo Trucks North America. Mack Trucks and the Eicher, UD Trucks and Renault Trucks brands.

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FMCSA Formally Withdraws EOBR Rule

The Federal Motor Carrier Safety Administration has formally withdrawn its regulation that would have mandated electronic onboard recorders for some carriers.

The action comes nine months after an appeals court blocked the mandate, which would have required EOBRs for about 5,700 carriers with the worst hours-of-service violations.

A supplementary proposal for the universal EOBR mandate, one that fits the harassment requirements, will come in late 2012 or early 2013, the agency said in February.

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Natural Gas Prices May Double by 2015, FT Reports

U.S. natural gas prices may double from recent 10-year lows by 2015 as more of the fuel is used in transportation, the Financial Times reported Thursday, citing an oil company executive.

Prices will rebound from the recent lows that have come about from strong North American shale gas production, Royal Dutch Shell CEO Peter Voser told the newspaper in an interview.

Truck and engine makers made a big push toward more natural gas use at the Mid-America Trucking Show in March.

Shell is considering plans to liquefy U.S. natural gas for export, which could also raise world natural gas prices, the Financial Times reported.

China and Europe are also boosting exploration, and China may have larger shale resources than North America, the paper said, citing the U.S. Energy Information Administration.

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Jobless Claims Unchanged for Week

Initial jobless claims were unchanged last week, holding at 370,000, the Labor Department said Thursday.

Economists had forecast claims to drop to 365,000, Bloomberg reported.

The four-week moving average, a less volatile measure, fell to 375,000, from 379,750.

Continuing claims for the previous week ended May 5 rose by 18,000 to 3.27 million a week earlier.

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FMCSA Shuts Two Alabama Carriers

The Federal Motor Carrier Safety Administration ordered two affiliated Alabama trucking companies to stop operating, declaring the carriers “imminent hazards to public safety.”

BM&L Trucking LLC and IDM Transportation Inc. had multiple federal safety violations in the areas of hours-of-service compliance, driver qualifications and vehicle maintenance, FMCSA said May 16.

BM&L declined comment, and a message left with IDM was not returned.

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YRC Freight to Hire 200 Drivers

YRC Freight, the national less-than-truckload unit of YRC Worldwide, said it plans to immediately add 200 over-the-road drivers in 13 locations.

The announcement by Overland Park, Kan.-YRC said drivers are being hired because “the Freight unit is growing and volumes are building.”

The locations include three in Ohio and two in New York State, as well as Chicago; St. Paul, Minn.; Salt Lake City; Indianapolis; Charlotte, N.C.; Jackson, Miss.; Albuquerque, N.M.; and Kansas City, Mo.

YRC Worldwide is ranked No. 4 on the Transport Topics 100 listing of U.S. and Canadian for-hire carriers.

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Philadelphia Manufacturing Index Contracts

An index of manufacturing activity in the Philadelphia region in May showed contraction for the first time in eight months, the Federal Reserve Bank of Philadelphia said Thursday.

The region’s factory index fell to a reading of minus 5.8, from a reading of 8.5 in March. Readings greater than zero indicate expansion.

The May reading was the lowest since September and was below economists’ forecasts of a 10 reading, Bloomberg reported.

The Philadelphia Fed surveys about 100 manufacturers for the index in eastern Pennsylvania, Delaware and southern New Jersey.

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How to Determine Mud Motor Failure

Mud motor failure downhole may be happened from time to time. The questions that are usually raised are things like “How do I know if the mud motor fails down hole?” and “What indications will I see that this has happened?” etc. Due to this, I would like to share my personal experience regarding mud motor failure and its symptoms.

The following signs indicate that you may be faced with downhole mud motor breakdown.

Frequent Mud Motor Stall– Motor stall happens when the rotor of the mud motor has stopped moving. Typically, the motor stalls only with a high differential of pressure. However, if the motor doesn't perform as normal, it will get stalled with by a small amount of differential pressure. For instance, a mud motor normally drills at 400 psi differential pressure, but if the motor is stalled out with only 100 psi you can suspect the problem is with the motor.

Pressure fluctuation while rotating- As you know, differential pressure it a set parameter while rotating down, not based on the weight on bit (WOB). Rotating with a good mud motor won't create pressure fluctuations, whereas a bad mud motor will show fluctuation in stand pipe pressure and you may not be able to maintain constant pressure.

Abnormally high surface pressure– A stator is made of rubber. When the stator rubber is worn out and breaking into pieces, small parts of rubber can jam the flow path in the motor. This situation also results in high stand pipe pressure.

Reduction in Rate of Penetration– If there are no changes in formation and drilling parameters, the decreasing in ROP (Rate of Penetration) may be caused by failure of the down hole tool. Moreover, if the took is severely damaged, you will be able to drill any footage.

What should you do if the problem is clearly identified?

The only thing you can do is pull out of the hole and change a new tool. It is almost impossible to drill with a damaged mud motor unless you only have a few feet to the well target depth.

With the mentioned indicators of mud motor failure above, you should be able to identify your suspected problem and begin troubleshooting as soon as possible to minimize non-productive time on a drilling rig. Ref: Article : How to Determine Mud Motor Failure in drilling formulas blog

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