August 9, 2022 • Posted in Daily Bulletin

MH Daily Bulletin: August 9

News relevant to the plastics industry:

At M. Holland

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  • Oil prices rose nearly 2% Monday in volatile trading, jumping from multi-month lows touched last week. 
  • Oil prices turned higher this morning on reports that Russia halted flows on the Druzhba pipeline toward Eastern Europe over transit fees blocked by Western sanctions. In mid-morning trading today, WTI futures were up 1.0% at $91.68/bbl, Brent was up 1.1% at $97.75/bbl, and U.S. natural gas was up 3.2% at $7.84/MMBtu. 
  • The massive fire at a Cuban oil storage facility spread Monday to a third fuel tank, raising the likelihood that the country will have to resort to expensive floating storage to handle imports. 
  • China, the world’s top crude importer, brought in 8.79 million bpd in July, up from a four-year low in June but still 9.5% less than a year earlier.
  • Wyoming saw the largest drop in energy production from 2019 to 2020, when overall U.S. production fell by the most on record:
Energy production declined by record amounts in several states in 2020
  • More oil news related to the war in Europe:
    • Ukrainian and global officials say Russia is endangering Europe with shelling near Ukraine’s Zaporizhzhia nuclear complex, the continent’s largest, part of an alleged scheme to cripple the nation’s power grid. 
    • Fuel tanker rates topped $40,000 per day the past two weeks, a 25-year high, on robust demand and longer travel times caused by Russia’s invasion. 
    • Shipments of Russian crude to ports in southern Europe, including in Italy and Turkey, rose to multi-week highs last week, while shipments to northern Europe continued to decline. 
    • German and French electricity prices rose to a new all-time high Monday, their fourth record in five days. 
    • Gas-turbine-maker Siemens Energy expects to post a wider loss this year than in 2021 due to a $204 million charge related to its exit from Russia.
    • Spanish firms will not be allowed to lower air conditioners below 80 degrees through at least November, a bid to save power ahead of expected cutoffs from Russia. 
  • High river temperatures in France continue to reduce the nation’s nuclear output at a time when nearly half its reactors are offline for maintenance. 
  • Norway moved forward with steps to reduce its power exports Monday as dry weather impacts hydropower generation.
  • British water utilities say customers should start using damp towels and spray bottles for showering to save water and energy amid a deepening drought. 
  • BP continues to reshape its North American oil and gas operations, including yesterday’s $300 million sale of its remaining stake in an Ohio refinery to Cenovus Energy.
  • Virginia regulators approved Dominion Energy’s plan to build 176 wind turbines off the coast of Virginia Beach at a cost of roughly $10 billion
  • Congress’ newly passed $430 billion spending bill would send nearly $370 billion to climate and energy security measures, including incentives to promote electrification. 
  • BP began drilling an appraisal well in Texas for its U.S. carbon capture and sequestration business, part of a plan to bury CO2. 
  • Experts say low carbon prices in major economies in Asia will do little to incentivize emissions reductions in the most polluting industries. 

Supply Chain

Domestic Markets

United States Consumer Inflation Expectations
  • Public pension plans lost a median 7.9% in the year ended June 30, their worst annual performance since 2009 due to sharp declines in stocks and bonds earlier this year. 
  • Fannie Mae’s index of home-buying sentiment dropped to its lowest level in over a decade this month despite growing expectations of a slowdown in price appreciation. 
  • The number of active U.S. home listings rose 31% from a year earlier in July, a record-high increase for the third straight month in a sign that higher mortgage rates are cooling the housing market. 
  • More than 1,300 U.S. flights were canceled last weekend due to worker shortages. Disruption continued Monday, with 500 flights canceled and over 2,000 delayed. 
  • New York City’s transit authority has seen weekday subway ridership plateau at 60% of pre-pandemic levels as many office workers settle into working from home. 
  • In the latest news from second-quarter earnings season:
    • Tyson Foods shares fell 8.4% Monday as the U.S. meat processor reported weaker-than-expected earnings and warned of supply constraints and reduced demand for high-priced beef. 
    • U.S. drugmaker Novavax slashed its full-year outlook, citing a lack of demand for its recently approved COVID-19 vaccine. 
    • Insurer American International Group (AIG) beat profit estimates on a 73% boost in underwriting income, cushioning a blow from lower investment returns. 
    • E-commerce firm Shopify added just 71,000 net merchants in the first half of 2022 compared to 680,000 in 2020, as businesses react to rising costs and lower consumer spending.
    • Danish brewer Carlsberg raised its full-year earnings outlook as strong sales in Europe and Asia outweighed higher material costs.
  • Macy’s started re-opening Toys R Us concessions inside some stores after the popular U.S. brand filed for bankruptcy in 2017. 

International Markets

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