“He and his daughter have not seen each other or spoken to each other in at least three years.”
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Oil settles at more than 2-week high after deadly Gaza hospital blast, with Iran reportedly calling for Israel oil embargo
Oil prices settled Wednesday at their highest in more than two weeks, following a blast at a hospital in Gaza City that left hundreds dead and ratcheted up regional tensions, with Iran reportedly calling for an embargo on selling oil to Israel.
Signs of tightening U.S. crude supplies also helped lift prices.
Price action
-
West Texas Intermediate crude
CL00,
+1.99%
for November delivery
CL.1,
+1.75% CLX23,
+1.75%
rose $1.66, or 1.9%, to settle at $88.32 a barrel on the New York Mercantile Exchange. Prices for the front-month contract marked its highest finish since Oct. 3, according to Dow Jones Market Data. -
December Brent crude
BRN00,
-0.20% BRNZ23,
-0.20%
the global benchmark, gained $1.60, or 1.8%, to $91.50 a barrel on ICE Futures Europe, the highest since Sept. 29. -
November gasoline
RBX23,
+3.04%
added 3% to $2.35 a gallon, while November heating oil
HOX23,
-1.24%
fell 1.2% to $3.14 a gallon. -
Natural gas for November delivery
NGX23,
-0.75%
settled at $3.06 per million British thermal units, down nearly 0.8%.
Market drivers
“Price action shows the risk of trading a potential but unrealized supply disruption,” said Troy Vincent, senior market analyst at DTN.
Oil moved higher “on the back of knee jerk reactions to headlines involving the words ‘oil embargo’ out of Iran that, in reality, should have been ignored and hold very little weight in the broader market,” he told MarketWatch.
An explosion tore through a Gaza City hospital on Tuesday filled with wounded and other Palestinians seeking shelter from ongoing war, with the death toll at 500 and rising, the Hamas-run Health Ministry said. Hamas has blamed the blast on the Israeli military, which in turn said the cause was a misfired rocket from a Gaza-based militant group.
Benjamin Picton, senior macro strategist at RaboResearch told clients in a note on Wednesday that following the tragedy, there’s a rising risk of “further escalation from Iran and Hezbollah, the former vowing a ‘harsh response,’ even including against the U.S., and the latter announcing a day of ‘unprecedented anger’ today.”
As anger spread through Arab region, Jordan canceled a planned Arab summit with President Biden, who touched down in Israel on Wednesday. Jordan’s foreign minister Ayman Safadi told state-run television that the nearly two-week old war was “pushing the region to the brink.”
Read: Biden tells Netanyahu it appears ‘the other team’ caused Gaza hospital blast
Crude prices have risen since the Oct. 7 attack by Hamas on southern Israel on fears that if Iran enters the conflict, the U.S. could increase enforcement of sanctions that would curb exports and further tighten global supplies. Iranian production has crept up to more than 3 million barrels a day, while analysts have pegged exports at around 2 million barrels a day.
Iran’s foreign minister, Hossein Amirabdollahian on Wednesday called for members of the Organization of Islamic Cooperation (OIC) to stop selling oil to Israel oil and expel its ambassadors, Reuters reported. The OIC was holding an emergency meeting in Jeddah on Wednesday.
“While it is very unlikely that other nations will join in Iran’s call for an embargo, even talk of such a move puts focus on Iran’s oil production and exports, which are in grave risk of being taken out of the reliable supply mix,” said Phil Flynn, senior market analyst at The Price Futures Group.
Naeem Aslam, chief investment officer at Zaye Capital Markets, said it’s also important to note that Russian President Vladimir Putin visited China on Wednesday while Biden was in Israel.
“These are significant events from an oil supply perspective and the situation is changing by the hour,” he said.
Read:70% chance Israel-Hamas war spreads beyond Gaza, threatening oil, strategist warns
Also: Biden says he’ll ask Congress for ‘unprecedented support package’ for Israel’s defense
Supply data
Oil also found support after industry data showed a fall in U.S. crude supplies.
The Energy Information Administration on Wednesday reported that U.S. commercial crude inventories fell by 4.5 million barrels for the week ended Oct. 13.
On average, analysts polled by S&P Global Commodity Insights expected the report to show a small decline of 30,000 barrels. The American Petroleum Institute late Tuesday reported that U.S. crude stocks fell 4.4 million barrels last week, according to a source citing the data.
The EIA report also revealed supply declines of 2.4 million barrels for gasoline and 3.2 million barrels for distillates. Analysts forecast inventory decreases of 800,000 barrels for gasoline and 900,000 barrels for distillates.
Crude stocks at the Cushing, Okla., Nymex delivery hub fell by 800,000 barrels for the week, the EIA said, while U.S. production remained at a record high of 13.2 million barrels a day.
Read: U.S. oil production hits record as Israel-Hamas conflict stokes global supply fears
William Watts contributed to this report
Hospital quality reporting rules can backfire on patients, researchers say
Rules intended to monitor the quality of hospital care and rein in healthcare costs can have an unhealthy effect on patients, new research suggests.
A group of Johns Hopkins University researchers set out to quantify just how much time and money their academic medical center — Johns Hopkins Hospital in Baltimore — spends reporting on hospital quality measures to federal and state regulators and other organizations. The results, published Tuesday in the Journal of the American Medical Association, show that one year’s worth of reporting on quality measures — 162 of them, in total — required more than 108,000 hours of work and cost more than $5.6 million. That’s excluding any time and money spent on actually improving the hospital’s quality of care.
As hospitals grind out paperwork on a growing list of quality measures, the burden has become “substantial and counterproductive, resulting in lower care quality and higher prices for patients,” said Ge Bai, a professor of accounting and health policy and management at Johns Hopkins University and a co-author of the study. “Clinicians are dedicating more time to reporting quality and less time for patient care, and hospitals are allocating resources to regulatory compliance instead of patients.”
Although the quality measures are “well intentioned,” there’s a general perception that “we’re spending too much time running around reporting too many things” and not enough time actually improving quality, said Dr. Stephen Berry, who led the study and is the vice chair for quality, safety and service and an associate professor of medicine at Johns Hopkins.
Hospital quality metrics required by regulators or national rating organizations track measures like hospital-acquired infections, in-hospital falls and readmission rates. Requirements to report such measures have become more extensive in recent years, researchers say, amid a broader shift toward payment models that aim to optimize care quality while trimming costs, rather than simply paying providers a set amount for each service.
Under this newer “value-based” payment approach, quality measures can offer insights on how much bang payers are getting for their buck, an issue that is getting more scrutiny as healthcare costs climb. U.S. healthcare spending reached $4.3 trillion in 2021, or 18.3% of gross domestic product — up from $2.7 trillion, or 17.2% of GDP, a decade earlier, according to federal government data.
But the Johns Hopkins study adds to other recent research raising questions about the costs and benefits of pay-for-performance systems in U.S. healthcare. A Medicare incentive payment system, for example, affects reimbursement for hundreds of thousands of U.S. doctors but may not accurately capture the quality of care those doctors provide, Weill Cornell Medical College researchers found in a study published last year in JAMA.
While the shift to value-based care may be a good move for the country, “we want to get it right,” Berry said. “We don’t want providers sitting in front of computers for an hour documenting a single day with a patient,” he said. “I’d rather have the doctor in the room with the patient for a longer period of time and writing about it less.” The time spent on such documentation, he said, “may be the number one source of frustration among my colleagues.”
And instead of reining in costs, all the reporting may only be driving costs higher, Bai said.
For the JAMA study, the Johns Hopkins researchers compiled a list of quality measures the hospital reported in 2018 to seven government and national healthcare rating organizations — including only adult inpatient and emergency department metrics — and assessed the time staff spent on collecting and validating the data, entering information and other reporting tasks.
The study’s finding of 108,000 hours spent on reporting may be an underestimate, the researchers said. Because of the difficulty of estimating the hours involved, for example, the study doesn’t account for the time doctors spend responding to requests from clinical documentation specialists who review physicians’ notes and often suggest ways to make them more detailed in order to shed additional light on quality, Berry said. For example, a doctor might be asked to specify the type of heart failure a patient suffered, Berry said, purely for quality reporting purposes. Providers’ notes “aren’t meant to be 50-page essays on the exact quality of what’s going on,” he said, so a doctor might get thousands of staff requests each year asking for adjustments in documentation for quality reporting.
While the $5.6 million estimated cost of quality reporting is small compared with Johns Hopkins Hospital’s $2.4 billion in annual expenses, the researchers said that such reporting likely consumes a larger share of the budget at smaller hospitals. And extrapolating the findings to the more than 4,000 acute-care nongovernment U.S. hospitals, the findings suggest billions of dollars are spent annually just on reporting quality data, the study said. The costs of that reporting, Bai said, will ultimately pass through to patients.
With little coordination among the various organizations that require quality metrics, different groups may track the same measure using different methodology, which means hospitals can’t just copy and paste their reports, researchers say. “Many quality metrics are duplicative, expensive to generate” and offer no tangible benefit for improving care, Bai said. “Policymakers must consider the detrimental impact of the current quality reporting requirement on patients. Ultimately, patients will bear the consequences, experiencing lower care quality and higher prices,” she said.
One way to improve the situation, Berry said, might be to pull quality measures straight out of electronic health records. That approach, he said, would mean “no time spent bugging providers to write things up in their notes in more specific and oftentimes impractical language.”