MH Daily Bulletin: July 18

July 18, 2022 • Posted in Daily Bulletin

News relevant to the plastics industry:

At M. Holland

  • M. Holland has launched a new Healthcare Packaging line card to help manufacturers solve industry challenges and meet regulatory and supply chain demands.
  • M. Holland’s 3D Printing group offers a rapid response alternative for producing selected parts where resin availability is tight. 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.

Supply

  • Oil prices rose 2.5% Friday on signals that Saudi Arabia will do little to boost output in the short term. 
  • In mid-morning trading today, WTI futures were up 4.1% at $101.60/bbl, Brent was up 4.4% at $105.60/bbl, and U.S. natural gas up 7.4% at $7.53/MMBtu.
  • Active U.S. oil rigs rose by two to 599 last week, the most since March 2020, according to Baker Hughes. 
  • Libya is expected to boost crude output following a series of meetings between the government and protesters who have blockaded the nation’s oil facilities for months. 
  • China’s June refinery throughput shrank by 10% from a year ago, capping the nation’s first half-year output decline in over a decade. 
  • TotalEnergies says it is preparing to release “exceptional” earnings after European refining margins tripled from the first to the second quarter. 
  • Nuclear now makes up more than 50% of electricity generation in four European nations and could play a significant role in the continent’s transition to cleaner energy. 
The Countries Reliant On Nuclear Power
  • Consumers are pivoting back to remote work to blunt the impact of high gasoline prices. The average price fell to $4.52 over the weekend, down 16 cents in the past week.  
  • More oil news related to the war in Europe:
    • European LNG prices are now 1,900% higher than two years ago at the trough of the pandemic and roughly equal to buying oil at $230/bbl. 
    • High demand for oil has pushed freight rates for medium-sized tankers to $40,000, up four-fold since January, brokers say. 
    • German power supplier Uniper SE, the nation’s largest purchaser of Russian gas, says it is “days away” from insolvency.
    • S&P Global predicts Germany will only be able to access 65% of its coal supply in the coming months as drought lowers water levels of major transport rivers. 
    • British chemical firm Ineos Group predicts Europe will be forced to ration natural gas this winter if Russia abruptly halts deliveries in the coming weeks. 
    • Europe may ban the import and transit of some fuel oil from Russia six months ahead of plans, officials signaled.
    • Saudi Arabia more than doubled Russian fuel imports last quarter as it worked to feed domestic power stations and keep its world-leading exports flowing.  
    • Algeria is turning into a major source of gas for European countries looking to replace Russian supplies. 
    • The Japanese government plans to support Mitsui and Mitsubishi in their attempts to stay in Russia’s massive Sakhalin-2 oil and gas project under development, which Moscow is attempting to nationalize. 
    • Canada is scrapping some sanctions for two years to allow the transport of pipeline parts to Russia, a bid to keep fuel deliveries flowing to Europe. 

Supply Chain

Domestic Markets

United States Michigan Consumer Sentiment
  • Fewer S&P 500 companies are beating earnings expectations in their latest quarterly reports than in years past. 
  • U.S. factory output dropped 0.5% in June, the second month of declines due in large part to rising inventories and recession fears. 
United States Manufacturing Production MoM

International Markets

  • Over 3.5 million people contracted COVID-19 in the U.K. last week, a 30% increase from the week prior. 
  • China reported 450 COVID-19 infections Saturday, the most since May, with fresh lockdowns imposed on millions of people in the country’s northwest and south. 
  • Macau, an administrative region of China, will remain locked down through the end of the week as COVID-19 cases remain high. 
  • Japan reported a record 110,600 new COVID-19 cases on Saturday, surpassing February’s high. 
  • South Korea saw more than 41,000 new COVID-19 cases on Saturday, the most in two months. 
  • Daily COVID-19 infections in India surpassed 20,000 for the first time in four months as total infections during the pandemic topped 2 billion.
  • COVID-19 hospitalizations are at all-time highs in Australia, prompting the nation to resume support payments for infected workers
  • More news related to the war in Europe:
  • The global economic outlook is “exceptionally uncertain” amid soaring inflation, the IMF’s chief said. 
  • Chile’s central bank launched a $25 billion intervention in foreign exchange markets to support the peso after it fell to a record low late last week. 
  • Sri Lanka’s economy will likely contract more than 6% this year due to political instability and social unrest, the country’s central bank said. 
  • The EU’s population fell in 2021 for the second year in a row, with COVID-19 likely the main contributor:
EU Population Declines for Its Second Year
  • Higher interest rates are pinching the Canadian housing market, with prices down 18.5% since a February peak. 
  • Scandinavia’s main airline SAS continues to suffer from a massive walkout of pilots, with negotiations stretching into their third week today. 
  • Amazon will be one of Britain’s 10 largest private employers after the addition of 4,000 workers this year. 

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