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Oil prices rose
5% Monday, rebounding from last week’s biggest decline in over a month. In mid-morning trading today, WTI futures were
down 0.3% at $102.40/bbl and Brent was down 0.2% at $106.10/bbl. U.S. natural gas futures topped $7.50/MMBtu for the first time in a month yesterday but
fell by 1.4% in morning trading to $7.38/MMBtu.
The average U.S. gasoline price is
below $4.50 a gallon for the first time in two months, according to AAA. Gasoline consumption remains lower than last year, however:
The U.S. is currently exporting as much as
1.39 million bpd of diesel, about 10% more than the previous July record from five years ago. Tightened export quotas on Chinese refiners are
causing major declines in the nation’s exports of gasoline (-42%) and diesel (-84%) this year. Saudi Arabian officials said the nation will likely max out its crude production capacity at
13 million bpd in 2027. More oil news related to the war in Europe:
Russia’s Gazprom declared
force majeure on gas shipments to several European buyers over the past month, a warning sign of more substantial cuts ahead. The European Commission
does not expect Russia to restart a key natural gas pipeline to Germany when maintenance ends this week, officials said Monday. The French government
offered to nationalize power company EDF for almost $10 billion, a bid to manage the nation’s energy crisis through state intervention. German power supplier Uniper is
borrowing billions of dollars to manage fallout from rising energy prices, the firm said. Europe must take immediate steps to
conserve gas and prevent rationing this winter, the IEA says. More EU nations are scrambling to secure supplies from Algeria and Azerbaijan. Russia again
failed to book extra capacity on gas pipelines through Ukraine next month, adding to uncertainty over deliveries to Europe. Russian crude shipments to China and India are down almost
30% from their post-invasion peak, according to the latest figures. In a rare move, Poland, the EU’s top coal producer, ordered over
4.5 million tons of imported fuel as fears grow of an energy shortage this winter. Canada began
shipping sanctioned pipeline parts to Germany over the weekend, despite doubts that the equipment will keep supplies flowing from Russia. Germany may
extend the lives of its last three nuclear plants ahead of expected supply cuts from Russia. South Africa’s largest fuel producer declared
force majeure on petroleum products amid delays in crude deliveries to its refineries. Brazil’s two largest states
cut taxes on ethanol in a bid to make the biofuel more competitive and free up gasoline supplies. Canada is in early talks on a plan to
cap and cut greenhouse gas emissions from the oil and gas sector, the nation’s largest and fastest-growing source of emissions.
Britain declared a national emergency Monday as a
sweltering heatwave pushed temperatures to all-time highs, forcing schools and some businesses to close. Extreme heat is also covering France and Spain. The Port of Los Angeles handled nearly
877,000 TEUs last month, eclipsing 2021 as the busiest June on record. The Brownsville Ship Channel will undergo a
$68 million expansion to accommodate bigger cargo ships in the only deep-water port between Texas and Mexico, a key trade route. The U.S. Department of Transportation is seeking approval to
start a new, voluntary platform for the exchange of container data, a bid to improve cargo flow through domestic freight networks. Auction prices for used heavy-duty trucks are
starting to decline after 18 consecutive months of increases, according to J.D. Power. Shipping congestion is keeping nearly half the world’s chemical tanker capacity
stuck at ports, Clarksons Research says. A trimmed-down bill to spur U.S. semiconductor production with
$52 billion in incentives could start moving in the Senate today. The finished bill will likely restrict firms from taking funds if they also are building or expanding advanced chip manufacturing in China. Last-mile delivery revenue could jump from $70 million this year to over
$670 million by 2030, ABI Research predicts. In the latest news from the auto industry:
The first U.S.-made Great Lakes bulk carrier in 35 years
completed its initial sea trials. GXO Logistics, one of three recent spinoffs of XPO Logistics, is
laying off over 140 workers in Wisconsin as it moves its warehousing operations to Kentucky. Amazon will
begin making drone deliveries in Texas later this year as part of its “Prime Air” service, the firm said. DHL announced plans for a large hub near Birmingham, U.K., as part of an
$850 million investment in British e-commerce. The Russia-occupied
Port of Mariupol is reopening even as ship owners say they haven’t been told about the status of their vessels.
Rent prices in Austin, Texas, rose
108% over the past year, the largest year over year increase in the nation. U.S. home sales to foreign buyers fell
7.9% for the year ending in March, the fifth straight annual decline, even as rising prices pushed the dollar volume of sales up 9%. U.S. airline bookings fell
2.8% from May to June, likely a reflection of soaring ticket costs. The price for a pound of white bread in the U.S. hit a record
$1.69 in June, up 12% from a year ago. Amazon and Facebook parent Meta are
scaling back office expansions planned for New York in a reconsideration of permanent hybrid work policies. While private sector employment in the U.S. surpassed pre-pandemic levels in June, overall employment remains
524,000 lower as state and local governments struggle to attract and retain workers in the tight labor market. U.S. employers added
884,000 jobs for workers aged 16 to 19 in June, a 41% increase from last year in one of the highest labor participation rates for the demographic in over a decade. Workforce participation among older workers aged 55-64 fell by
400,000 early in the pandemic before returning to pre-pandemic levels this year. Fears are growing that resurging COVID-19 infections could again force them into early retirement.
Apple joined many other large firms, particularly in technology and real estate, that are reining in hiring and spending plans due to recessionary fears. IBM posted better-than-expected sales growth of
9% in the second quarter but warned of rising costs weighing on future earnings. Goldman Sachs (-47%) and Bank of America (-32%) reported
sharp declines in second-quarter profits after volatile markets slashed investment banking revenue across the industry. Delta Air Lines ordered
100 Boeing 737 MAX 10 jets, a needed boost for the plane maker after months of ceding ground to Airbus. Boeing also expects to soon resume production of its 787 Dreamliner after a two-year stall.
Shanghai and several other large cities are
imposing fresh mass testing or extending lockdowns on millions of people after new COVID-19 cases in China neared 700 Monday, a two-month high. Hong Kong stepped up its pandemic restrictions with a new requirement that quarantined people
start wearing tracking bracelets, a measure resembling COVID surveillance in China. COVID-19 cases have
tripled in Europe over the past six weeks while hospitalizations have doubled, according to the World Health Organization. Despite saving an estimated 20 million lives globally in their first year of use, injected COVID-19 vaccines have not stopped the virus’s spread or mutation, leading researchers to focus on versions that can be
swallowed or inhaled closer to the point of incubation. More news related to the war in Europe:
H&M, the world’s second largest apparel retailer, announced plans to fully exit the Russian market at a cost of roughly
$200 million and 6,000 staff. Europe’s GDP could fall up to
1.5% this year if the EU fails to take preventive measures to save energy this winter, according to bloc estimates. Broadly rising interest rates are
pushing down home prices in some of the world’s hottest housing markets for the first time in the pandemic. Chinese officials are discussing a plan to
halt mortgage payments on stalled real estate projects to avoid further crisis in the nation’s roiling property sector. With up to 60% of flights delayed and roughly 8% canceled at some of Europe’s busiest travel hubs,
rental car prices are up three- and four-fold as travelers avoid air travel chaos. Lost luggage claims at Europe’s airports are 30% higher than in 2019. Airline SAS
reached a tentative contract with its pilot union. The two-week strike has cost the Scandinavian airline over $10 million per day. Flights were disrupted from London’s Luton airport on Monday after soaring temperatures
melted runway pavement. Virgin Atlantic Airways plans to
launch a flying taxi service out of Heathrow Airport for domestic travel in England by 2025.
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