MH Daily Bulletin: June 8
June 8, 2022 • Posted in Daily BulletinNews relevant to the plastics industry:
At M. Holland
- M. Holland is exhibiting during the WAI Operations Summit & Wire Expo on June 7-8 in Dallas, Texas. This event focused on wire and cable manufacturing offers industry forecasts, technical presentations, networking and more. Join us at Booth #621 to learn more about our supply solutions for wire and cable.
Supply
- Oil prices rose about 1% Tuesday, with WTI settling at a 13-week high of $119.41/bbl.
- In mid-morning trading today, WTI futures were up 1.4% at $121.00/bbl, Brent was up 1.5% at $122.30/bbl, and U.S. natural gas was up 3.2% at $9.59/MMBtu.
- The American Petroleum Institute reported a surprise build of 1.845 million crude barrels last week, while government data will be released today.
- Goldman Sachs raised its short-term target for Brent crude from $125/bbl to $140/bbl, while trading giant Trafigura sees oil headed to $150/bbl this year.
- A major equipment failure risks shutting LyondellBassell’s 268,000-bpd Houston oil refinery quicker than its planned closure at the end of 2023, potentially eliminating a vital source of U.S. supply.
- The average U.S. gasoline price hit a record $4.92 a gallon Monday, up 30 cents over the past week. Prices in 13 states are above $5 a gallon.
- British gasoline and diesel prices are surging to record highs.
- Over 10% of Norwegian offshore oil and gas workers plan to strike starting Sunday if state-brokered wage talks fail.
- Qatar will partner with Exxon Mobil, Total Energies, Shell and ConocoPhillips to expand the world’s largest LNG project and boost its annual output 64% by 2027.
- More oil news related to the war in Europe:
- The U.S. sent nearly 75% of its LNG output to Europe in the first four months of the year, up from a third last year.
- A government-controlled bank in Japan suspended its support for a $21 billion LNG facility under construction in Siberia, casting further doubt about the project after TotalEnergies wrote off its investment in April.
- European natural gas prices are on a five-day retreat due to an early start to summer and rising LNG storage levels.
- Russia aims to ramp up oil exports from its major eastern port of Kozmino by about 20% amid higher demand from Asian buyers.
- Future Western sanctions could include limiting Moscow’s revenue from oil exports.
- The White House is reviewing the environmental impact of what would be Maryland’s first offshore wind energy project.
- Shell launched a new green power business in Texas offering perks including free charging for electric vehicles and credit for excess household solar generation.
- Spain’s Repsol is in talks to sell 25% of its exploration and production business to help fund clean energy efforts.
- India eased rules to allow commercial and industrial consumers to switch to green sources of electricity, a bid to quicken its energy transition.
Supply Chain
- The average U.S. diesel price jumped to $5.70 a gallon Tuesday, a record.
- Texas grid operators say the state’s grid is holding up well against record power demand this week.
- U.S. economic expansion will push up power demand to new records this year and next, according to the Energy Information Administration.
- Japan called on households and companies to conserve electricity this summer to prevent supply-induced blackouts.
- California residents dismissed dire calls for water conservation in April, with the southern part of the state increasing its usage by more than 25% despite worsening drought.
- Britain’s entire train network could shut down for three days this month if more than 50,000 workers follow through with plans for a walk-out over job cuts and pay.
- Drewry says spot container rates from China to the U.S. West Coast are down 41% month over month to $9,630, while imports bound for the U.S. have dropped sharply since late May.
- Transatlantic airfreight capacity is improving alongside the sharp rebound in air passenger demand.
- Old Dominion Freight Line’s per-day revenue increased 26% in May from a year ago, following a 29.1% increase in April.
- Maersk became the first foreign carrier to move international shipping containers between ports in China.
- CMA CGM took delivery of two Boeing cargo planes a week after its air freight unit became a certified French airline, as the shipper continues to expand beyond ocean freight.
- U.S. shippers are coping with a deepening shortage of truck trailers at a time when Class 8 truck and tractor orders slipped to a six-month low in May due to supply shortages.
- Detroit-based Fruehauf is restarting trailer production for the first time in 25 years at a new $15 million plant in Kentucky.
- Competing logistics crises are hampering White House goals to kickstart the U.S. solar supply chain through the use of emergency funding. Industry experts say about two-thirds of U.S. solar projects planned for this year are at risk of being delayed or canceled.
- Union Pacific expects to miss its full-year financial targets as rising fuel and network costs weigh on margins.
- Thousands of union truck drivers began striking in South Korea Tuesday over wages.
- Uber Freight is partnering with Google parent Alphabet to develop a connected service and brokerage system for autonomous freight trucking.
- A South Korean firm claims to have completed the world’s first autonomous trip of a commercial vessel across the Pacific.
- Autonomous trucker Gatik will start delivering Georgia-Pacific’s paper goods to several dozen Sam’s Club outlets in Texas this summer.
- Schneider National plans to acquire the assets of Wisconsin-based dedicated truckload carrier deBoer Transportation.
- The closure of a GE plant in Shanghai continues to impact hospital supplies of critical imaging materials.
- Contract manufacturer Foxconn raised its quarterly and annual outlook on improving supply-chain stability in China.
- Taiwan Semiconductor Manufacturing Co. expects revenue to grow about 30% this year amid resilient global demand for electronics.
- Ocean Network Express ordered 10 mid-sized container ships to be powered by ammonia and methanol.
- Swedish tanker owner Stena cut its quarterly loss by about a quarter to $76 million.
- Dubai is selling a minority stake in its flagship port and two nearby business parks to a Canadian pension fund, a bid to cut the debt of the facilities.
- France will remove bird flu-related restrictions on poultry farming after recent outbreaks forced 16 million birds to be culled.
Domestic Markets
- The U.S. reported 121,658 new COVID-19 infections and 469 virus fatalities Tuesday.
- Two more highly contagious subvariants of Omicron — dubbed BA.4 and BA.5 – now make up 5% and 8% respectively of U.S. COVID-19 cases.
- The FDA endorsed Novavax’s COVID-19 vaccine Tuesday, setting the stage for full authorization of the nation’s fourth vaccine.
- Moderna announced that its redesigned COVID-19 booster delivered improved protection against Omicron in tests.
- The CDC raised its travel alert for Monkeypox to a level 2, recommending people practice “enhanced precautions” after thousands of cases appeared worldwide.
- The U.S. Treasury Secretary said last year’s prediction of “transitory” inflation was an error and that the government will likely revise upward its inflation forecast in the weeks ahead.
- The U.S. trade deficit dropped 19.1% in April to $87.1 billion, down from March’s all-time high on a sharp decline in imports.
- U.S. consumer borrowing surged 10.1% on an annualized basis to $38.1 billion in April following a record jump a month earlier, fueled by rising prices and the continued strength of the economy.
- Companies are hanging onto LIBOR-based contracts despite a regulatory push away from the discredited interest-rate benchmark, which is set to expire next summer.
- Macroeconomic pressures on firms, such as staffing shortages and supply chain delays, have likely contributed to deteriorating customer service across most industries.
- Regional airports and airlines are losing flights as big airlines lure the scarce supply of pilots.
- The typical premium on homes in risky fire areas has surged during the pandemic as more Americans move out of big cities.
- U.S. hotel prices are up 33% the past year, with the largest rises in Miami and Long Island.
- Inflation is making it 22.4% more expensive for Americans to take care of their lawns, according to online home-services firm Angi.
- Peloton is replacing its finance chief as the firm deals with waning demand after facing production and delivery issues.
- Taco Bell is pioneering a revamped drive-thru experience with four lanes, digital check-in screens, video technology and a vertical lift for transporting menu items.
- Polestar, a Swedish maker of electric performance vehicles, will introduce its first car to the U.S. market this October.
International Markets
- The World Health Organisation’s top official said a global pact to waive intellectual property rights for vaccines could be reached by next week.
- A European study found babies exposed to COVID-19 in the womb had a higher risk of neurodevelopmental changes.
- More news related to the war in Europe:
- The U.S. Treasury Department banned U.S. investors from purchasing Russian debt.
- Russian state flagship airline Aeroflot plans to raise up to $3 billion to stay afloat amid punishing Western sanctions.
- Microsoft will suspend new sales of products and services in Russia as it substantially scales down its operations.
- Advertising giant Publicis Groupe lowered its global ad-spending forecast for 2022, citing Russia’s invasion.
- The World Bank cut its forecast for global economic growth this year to 2.9% from an earlier 4.1%, warning that several years of high inflation and below-average growth lie ahead. The Organisation for Economic Cooperation and Development made a similar revision to its forecast.
- Canadian exports rose just 0.6% in April after planned maintenance slowed production from its profitable oil sands.
- India’s central bank hiked its interest rate by 50 basis points to 4.9% yesterday, the second increase in two months.
- Chile’s central bank lifted its interest rate by 75 basis points yesterday to 9%, a two-decade high.
- Roughly 13% of British mortgage borrowers could go into financial distress if high inflation keeps pace next year, economists warn.
- Switzerland’s Credit Suisse Group warned its capital position is eroding as companies opt not to sell new stock or bonds amid volatile conditions, wiping out a main source of revenue. The declines could lead to a second-quarter loss and potential layoffs.
- Scandinavian Airlines is facing liquidity problems after the Swedish government rejected its request for almost $1 billion in needed restructuring dollars.
- Ryanair saw 15.4 million passengers in May, an all-time high.
- Cazoo, a British online used-car platform, will cut its workforce by 15% as economic headwinds lead the firm to abandon growth plans.
- A day after announcing it would hire over 4,000 new tech workers, Citigroup said it plans to add 3,000 workers for its Asia institutional business.
Some sources linked are subscription services.