Oil prices fell 2% Monday, tracking a broader selloff in stocks but supported by signs that some U.S. Gulf output will stay offline for months due to damage from Hurricane Ida.
Energy futures were lower in mid-morning trading today, with the WTI down 0.3% at $70.11/bbl, Brent down 0.1% at $73.87/bbl and natural gas off 4.3% at $4.77/MMBtu.
Tight supplies have pushed up LNG prices 280% in Europe this year and 100% in the U.S.
Norway announced it would temporarily boost exports to the U.K. to help remedy an acute shortage of fuel, as British meat suppliers say they will run out of processing CO2 in the next several days after several fertilizer companies, which produce CO2 as a byproduct, shut down due to high gas prices.
The British government is considering intervening to help businesses and consumers crippled by the nation’s energy crisis.
The U.S. oil patch recovery is being hampered by a shortage of truck drivers, with the number of qualified drivers down over 40% in the past two years.
A Shell offshore platform in the Gulf of Mexico will remain shut down beyond the end of the year because of extensive damage caused by Hurricane Ida.
Shell will sell all its assets in the U.S. Permian Basin, the most active American oil field, to ConocoPhillips in a deal valued around $9.5 billion.
Our most recent list of force majeure and allocation announcements from suppliers is here.
Supply Chain
Various federal departments are being tapped to help provide cooling assistance to homes and neighborhoods and ensure safe working conditions under a new White House directive in response to this summer’s extreme heat waves.
U.S. grain exports rose last week but remained lower than normal on continued effects from Hurricane Ida. Exports the previous week hit an 8.5-year low.
FedEx will hike rates 5.9% next year across most of its services, the first time in eight years that it or rival UPS has gone above typical 4.9% increases as demand remains high for shipping capacity and home delivery.
The ports of Los Angeles and Long Beach are expanding gate and terminal hours to speed the flow of containers through congested gateways.
Industrial property near ports is in high demand, with rents up by double digits over the past year.
U.S. industrial real estate leasing activity has risen 52% year to date, with rents climbing nearly 10% since August of last year.
An imbalance between west-to-east freight demand and east-to-west demand has created big disparities in national freight rates and capacities.
After its failed attempt to acquire Kansas City Southern, Canadian National Railway is considering selling its non-rail assets, including TransX, its freight forwarding business.
Raw material shortages have hampered production of critical medical supplies for U.S. hospitals, with some equipment taking up to five months to be delivered compared to pre-pandemic levels of three to six weeks.
British retailer John Lewis has begun chartering its own container ships as it seeks to stay ahead of expected supply chain snags heading into the holidays.
U.S. retailer Big Lots is setting up “pop-up” distribution facilities to bypass standard logistics procedure and speed holiday imports direct to stores.
In the first seven months of 2021, U.S. imports of dolls, toys and games averaged $1.88 billion per month, up 50% from the same time in 2019 as retailers brace for a record holiday season.
Workers at Chicago-based snack maker Mondelez International ended a weeks-long strike affecting production in several states.
Thailand’s SCG Packaging announced a $350 million expansion of its packaging paper business in Vietnam that will nearly double production capacity to 870,000 tons per year.
Major international maritime regulators found no evidence of collusion between container lines or the largest global shipping alliances.
South Korean shipbuilder Hyundai Heavy Industries raised roughly $1 billion in its initial public offering.
The Orion Assembly has suspended Chevy Bolt production through Oct. 15 due to a shortage of battery packs.
The Wentzville Assembly plant, down since Sept. 6, will resume building Colorado, Canyon, Express and Savana models Sept. 27.
Down since Feb. 8, the Fairfax Assembly plant is expected to start production of the XT4 Sept. 20 but will continue to keep the Malibu down through Oct. 29.
The CAMI Assembly plant, down since July 19, is expected to resume Equinox production on Oct.15.
The Lansing Grand River Assembly facility, which builds the Camaro and Cadillac CT4 and CT5, will be down through Oct. 1.
The Lansing Delta Township Assembly plant, which builds the Chevy Traverse and Buick Enclave and has been down since July 19, is expected to restart Oct. 4.
At the Ramos Arizpe Assembly plant, down since Aug. 23, Chevy Blazer production will resume Oct. 1 and Equinox production will resume Oct. 15.
In Mexico, the San Luis Potosi Assembly plant, which builds the Equinox and GMC Terrain, will be down through Oct. 15.
Domestic Markets
The official number of U.S. COVID-19 deaths reached 676,000 Monday, surpassing that of the 1918 flu pandemic.
The U.S. suffered 201,648 new COVID-19 infections yesterday and 2,302 fatalities.
More than 225,000 COVID-19 infections were reported in children last week, accounting for roughly 26% of all new infections nationwide in the second-largest weekly rise on record.
Texas and Florida currently account for roughly 30% of daily COVID-19 deaths in the U.S. Virus hospitalizations in Florida rose for the first time in a month by 211 patients Monday.
Average daily COVID-19 cases in South Carolina have risen to more than 5,000 from roughly 150 per day in early June.
Hospitals in Idaho, Montana and Alaska are the latest to begin rationing healthcare due to surging COVID-19 patients.
Johnson & Johnson said a second dose of its COVID-19 vaccine boosts its efficacy against moderate and severe symptoms to 94% from a 64% global efficacy rate from a single dose.
The U.S. will reopen borders in November for fully vaccinated travelers from 33 countries including China, India, Brazil and most of Europe, the White House announced. While the move is expected to boost trans-Atlantic revenue for airlines, business travel may still suffer as companies maintain smaller travel budgets.
Pfizer/BioNTech reported strong results from late-stage trials of their COVID-19 vaccine in children aged 5 to 11, bringing the U.S. a step closer to broader authorization of the shots.
U.S. stocks tumbled nearly 2% yesterday on fears of ripple effects from China’s struggling property market, with the S&P 500, Nasdaq and Dow on pace for their worst month since last fall.
JPMorgan is forecasting another weak employment report for September on a drop-off in consumer outlays on things like airline travel and restaurants.
Corporate debt-to-profit ratios have fallen to their lowest levels since 2018, a positive signal in the economic rebound from the pandemic.
Two-thirds of companies in a recent survey said they are delaying office reopenings due to the COVID-19 surge, with many allowing their leases to expire and adopting remote work permanently.
A Microsoft study of its employees suggests that remote work boosts worker productivity but may hamper long-term collaboration and innovation.
Despite its 82% vaccination rate, COVID-19 infections are rising in Singapore, prompting calls among health officials for a vaccine mandate.
New Zealand eased some pandemic restrictions in its largest city of Auckland yesterday, but schools and offices remain closed alongside tight service restrictions on businesses.
Land prices in Japan fell for the second straight year, with the economy hurt by pandemic restrictions and a drop in tourism, but values of warehouse property rose.
Plastics Reflections Web Series: Supply Chain Constraints & Forecast— Experts from BPI, LyondellBasell and MTS Logistics joined M. Holland to discuss current supply chain challenges impacting the global plastics industry. Click here to read key insights shared during the broadcast and access the recording.
M. Holland’s 3D Printing group offers a rapid response alternative for producing selected parts where resin availability is tight during prevailing force majeure. For more information, email our 3D Printing team.
Market Expertise: M. Holland offers a host of resources to clients, prospects and suppliers across nine strategic markets.
For all COVID-19 updates and notices, please refer to the M. Holland website.
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