COVID-19 Bulletin: October 18
October 18, 2021 • Posted in Daily Bulletin
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- Brent settled at a three-year high near $85/bbl Friday, boosted by forecasts of a supply deficit in the next few months as the easing of pandemic-related travel restrictions spurs demand. WTI rose more than a percent, up 3.5% on the week for its eighth consecutive weekly rise.
- Crude futures were mixed in late morning trading, with WTI up 0.2% at $82.45/bbl and Brent down 0.1% at $84.75/bbl. Natural gas was 4% lower at $5.19/MMBtu.
- High demand will extend the uptrend of global petrochemical prices into early 2022, Fitch Ratings predicts.
- Stored natural gas reserves in the U.S. are lower than normal headed into the winter heating season, while prices are up nearly 150% compared to the same time last year.
- The average per-gallon price for diesel across the U.S. rose to $3.586 last week, up $1.191 from a year ago and the highest weekly price since 2014.
- The number of drilling rigs operating in U.S. oil fields jumped by 10 last week to 543, up from 282 the same time last year and the highest since April 2020.
- Russia is facing pressure to step up gas shipments to Europe, where prices have skyrocketed this year. The nation will not resume spot gas sales until it finishes filling domestic storage reserves.
- U.S. LNG export volumes rose to an all-time monthly high in June of more than 10 trillion cubic feet per day.
- Asian LNG prices ended the week at $38.50/MMBtu, a $1.50 rise from the previous week, spurred by greater competition for already high-priced European exports.
- Major Chinese companies are in advanced talks with U.S. exporters to secure long-term LNG supplies, as soaring gas prices and domestic power shortages heighten concerns about the country’s fuel security.
- In its latest report, the International Energy Agency said global investment in renewables is currently too small to avoid climate change, while spending on fossils is lower than needed for growing petrochemical demand. The agency also forecast global coal demand to exceed 2019 levels this year and rise until 2025.
- South Africa will continue funding coal production for the next several years due to the potential economic fallout of dropping the fuel source, officials say.
- A proposal by coalition parties in Germany would halt all coal-fired power production in the nation by 2030.
- Kazakhstan began limiting power supply to consumers after three major coal-fired stations were hit by shutdowns.
- Our most recent list of force majeure and allocation announcements from suppliers is here.
- Evacuation orders have been lifted in Santa Barbara County, California, where firefighters have made significant progress against the state’s Alisal Fire, now 78% contained after burning more than 17,000 acres. Train service was restored in Southern California, and state highway 101 was reopened.
- California may face significant power shortages the next several summers as utilities struggle to make up for the state-ordered closure by 2024 of fossil-fuel power plants and a nuclear facility that provides 10% of the state’s electricity.
- Scaling up operations to fulfill the Port of Los Angeles’ new 24/7 operating schedule is proving more difficult than expected, as inland transport and warehousing networks remain backed up. Freight bellwether J.B. Hunt expects bottlenecks at West Coast ports to intensify into the holidays.
- Port authorities in Seattle and Tacoma are scrambling to address cargo ship congestion in Puget Sound, where at least 15 vessels are awaiting berth compared to a usual count of zero.
- As of Friday, at least 107 container ships were waiting off ports in Hong Kong and Shenzhen, with the pileup worsening following last week’s Typhoon Kompasu.
- Port workers in Trieste, Italy, the seventh-largest European port for handling goods and the leading oil terminal in the Mediterranean, announced a total block of operations starting Friday to protest the nation’s new vaccine mandate.
- A Japanese shipper will begin using high-speed ferries to Osaka and Kobe to bypass container shipping and air cargo bottlenecks in Shanghai.
- Spot airfreight rates on Asia-to-Europe lanes have risen 30% in the past five weeks.
- Unions are flexing their muscles as employers struggle to recruit qualified labor.
- U.S. import prices rose 0.4% in September, erasing August’s 0.3% decline on higher food and energy costs.
- Economists expect high U.S. inflation to persist well into 2022, due to supply chain bottlenecks that will increasingly curb output. The nation is approaching its longest streak of inflation above 5% since early 1991.
- Stellantis is delaying the launch of its luxury Maserati SUV Grecale till next spring due to the ongoing global chip shortage.
- Toyota lowered expected global output in November by 15% due to the ongoing global chip shortage.
- The challenge of finding even the most basic spare car parts has forced repair shops to hoard inventory, find workarounds and hold customer vehicles for weeks until shipments come in, further disrupting the automotive industry.
- Taiwan Semiconductor Manufacturing announced plans to build a new manufacturing plant in Japan, as chip makers worldwide rush to increase production capacity amid the historic shortage.
- Zinc and aluminum prices have reached three- and 13-year highs, respectively, as smelters curtail production over soaring energy bills and pressure to cut emissions.
- Autonomous trucking startup Embark said carriers have reserved more than 14,000 trucks to use its technology starting in 2024.
- Flatbed hauler PGT Trucking will lease 100 hydrogen-powered fuel cell electric freighter trucks.
- S&P 500 executives have used the phrase “supply chain” more than 3,000 times on investor calls year to date, more than buzzwords “synergy” and “value proposition” combined.
- For a partial list of automotive disruptions caused by semiconductor and component shortages, clickhere.
- Our Logistics team reports the following:Bulk trucking capacity is very limited as demand is exceeding supply.
- Dry van (full, partial and less-than-truckload) capacity is very limited as demand exceeds supply.
- Port congestion continues to be very problematic, delaying deliveries of imported containers.
- Packaging and pulverizing/grinding production challenges persist as demand is exceeding supply
- The U.S. reported 16,913 new COVID-19 infections and 164 virus fatalities Sunday.
- Top U.S. officials are warning of a potential fifth winter wave of COVID-19 due to the large percentage of Americans who remain unvaccinated against the virus.
- More than 90% of U.S. COVID-19 deaths since June occurred among people who were not vaccinated. New CDC data shows the risk of dying from COVID-19 is 11 times higher for unvaccinated adults than for fully vaccinated adults.
- Former Secretary of State Colin Powell died of complications from COVID-19.
- A Pfizer director and former FDA commissioner called for urgent research into a new mutation of the Delta variant found in the U.K., where another COVID-19 surge is underway.
- The U.S. will begin allowing fully vaccinated travelers into the country starting Nov. 8, lifting a more than year-long ban on visitors from the European Union, U.K. and other countries. Questions have arisen as to whether receiving COVID-19 shots other than those approved in the U.S. would meet the new travel standard.
- An FDA panel voted unanimously to recommend booster doses of Johnson & Johnson’s COVID-19 vaccine for people over 18, bringing the shot one step closer to regulatory clearance, as the number of boosters administered in the U.S. surpassed 10 million. The White House’s top medical adviser says the U.S. is considering administering booster doses of either the Pfizer or Moderna COVID-19 vaccine to individuals who received Johnson & Johnson’s shot, while adding that fully vaccinated people can safely gather during the holiday season.
- The FDA delayed approving Moderna’s vaccine for teens aged 12 to 17, citing a lack of data on potential health effects.
- National guard troops were deployed to assist Minnesota hospitals with staffing shortages that are preventing transfers of COVID-19 patients.
- The total number of COVID-19 patients in Florida ICUs dropped below 1,000 late last week, a near 35% decline from the beginning of the month. The state’s health department has begun investigating businesses for enforcing COVID-19 safety rules over the governor’s recent order.
- Texas lawmakers are mulling new legislation that would allow employees to sue their employers for imposing COVID-19 vaccine mandates.
- A recent surge of COVID-19 in Idaho is waning, with the state’s positivity rate dropping from 17.3% to 13.2% over the past month.
- Spread of COVID-19 in Michigan school districts without mask mandates was 62% higher than in districts with the requirement.
- Life expectancy in 16 states has dropped by more than two years due to the pandemic, with the largest declines in the Sun Belt and Great Plains.
- The chances of a COVID-19 survivor having a heart attack or stroke in the first year after recovery increased with the severity of the illness, new research shows.
- U.S. states that entered people into a cash drawing after they got vaccinated against COVID-19 showed zero difference in rates compared to states that did not create the incentives.
- General Electric will require all employees to be fully vaccinated against COVID-19 by Dec. 8, following the White House’s announcement last month that anyone who works with the federal government must be vaccinated.
- More than 1,000 U.S. colleges and universities have imposed COVID-19 vaccine mandates.
- The U.S. and Europe have seen little to no drawdowns in the nearly $2.7 trillion in savings stockpiled during the pandemic, complicating forecasts for inflation and economic growth in the months ahead.
- With the rate for a 30-year fixed mortgage once again above 3%, lenders are refocusing on home buyers during a slowdown in refinancing.
- Goldman Sachs’ third-quarter profits rose 60% to $5.38 billion, its second-best quarter on record following surging mergers and acquisitions activity.
- Toyota and Stellantis separately announced plans to build electric vehicle battery plants in the U.S.
- The White House issued a 40-page report on the risks of climate change to the U.S. financial system. The report set out new environmental factors for investments, corporate disclosures, budgeting decisions and more.
- COVID-19 infections in the U.K. were up for the third straight week, with about 1 in every 60 Britons infected compared to 1 in every 50 during January’s peak.
- Russia surpassed 1,000 single-day COVID-19 deaths for the first time Saturday.
- As of Friday, all workers in Italy must show a “green pass” to enter their place of work, providing either proof of full COVID-19 vaccination, a recent negative test or recovery from the virus within the past six months.
- Despite being the first Latin American country to administer a COVID-19 vaccine last December, just 39% of Mexico’s population has been fully vaccinated against the virus, a rate now lower than that of Argentina, Brazil and Ecuador.
- COVID-19 fatalities in Brazil surpassed 600,000, second only to the U.S.
- Chinese authorities halted flights from five domestic and foreign airlines after multiple COVID-19 cases were found on board.
- Irish officials are urging people to continue working from home through the fall and winter due to rising COVID-19 infections.
- Melbourne, Australia, will end its sixth lockdown with more restrictions set to be eased than originally promised, as the broader Victoria state gets closer to 70% fully vaccinated. Australia will keep its borders closed to international travelers for the foreseeable future, officials announced.
- The Philippines lifted its quarantine requirements for most fully vaccinated travelers. The country has also begun vaccinating people as young as 12 against COVID-19.
- South Korea will begin easing social gathering restrictions this week as it prepares to embark on a “living with COVID” strategy.
- Norway, Brazil, Mexico, South Korea and New Zealand are the most recent countries to raise interest rates due to rising inflation.
- French auto supplier Novares is seeking millions in damages over canceled car orders due to the ongoing chip shortage.
- Italy has put aside $116 million in subsidies for citizens who buy electric or hybrid cars in 2021.
- Volkswagen electric-vehicle deliveries in China rose to 47,200 from January to September, more than triple a year ago.
- High gas prices in Brazil have led to a shortage of Uber drivers, leading the company to test out a new feature charging 20% more for riders looking to avoid wait times.
- The U.K. has raised roughly $8 billion for investment into 250,000 “green jobs” in various industries by 2030.
- A Swedish company claims to have made the first fossil-free steel by substituting green hydrogen for coal in the production process, currently one of the world’s most polluting processes.
At M. Holland
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