After a volatile day of trading, oil prices rose about 1% Thursday even as OPEC+ surprised markets by keeping plans to release 400,000 bpd of crude in January. Futures continued rising in late morning trading, with WTI up 1.6% at $67.53/bbl and Brent up 2.1% at $71.10/bbl. U.S. natural gas was 3.5% higher at $4.20/MMBtu.
OPEC added 350,000 bpd to its output in November, roughly 40% more than planned, driven by an excess of production in Iraq and a recovery in Nigeria. The output was higher than indicated by an earlier survey of OPEC members.
The U.S. and other nations may delay recently announced releases of crude from their strategic oil reserves depending on oil prices.
Goldman Sachs forecast Brent crude to average $85/bbl in 2023.
In a bid to avoid another “Texas Freeze,” state utilities must prioritize key natural gas facilities that supply fuel to electric generators during emergencies, Texas’ energy regulator ruled.
The value of the U.S.-Canada energy trade fell 31% in 2020, driven by demand drops and lower commodity prices during the first year of the pandemic.
European energy majors have doubled planned spending on low-carbon energy over the last two years, led by Spain’s Repsol.
Prices for European carbon futures rose above $90/ton Friday, almost tripling so far this year to a new record.
BP has agreed to more than $500,000 in fines for emissions violations at an Indiana facility.
Our most recent list of force majeure and allocation announcements from suppliers is here.
Supply Chain
A benchmark index of contracted container freight rates grew 16.3% in November for a year-over-year gain of 121.2%.
Ocean freight rates from Asia to both U.S. coasts have fallen to their lowest levels since July, declining a respective 3.8% and 4.9% for routes to Los Angeles and New York last week.
Trucking experts say California’s efforts to raise truck weight limits will do little to remedy shipping backlogs.
Airfreight volumes fell a surprising 1.2% in November, largely due to ground handling congestion, while rates rose 8% for the period.
Global shipping lines are on track to pull in $100 billion in operating profit this year, already doubling profit in just three quarters of 2021 compared to the entirety of the previous decade.
Mediterranean Shipping Company surpassed Maersk as the world’s largest shipping line, fueled by its record acquisition of 125 used vessels during the pandemic.
The U.S. administration sued to block Nvidia’s proposed landmark takeover of semiconductor designer Arm Holdings, citing antitrust concerns.
Chipmaker GlobalFoundries swung to third-quarter profit on a 56% rise in revenue from last year.
The long-awaited abandonment of 25% U.S. tariffs on British steel and aluminum is being delayed over suspected political issues.
Sustainable apparel retailer Allbirds managed to boost inventories 55% heading into the holiday season, citing a combination of supplier diversification and dual sourcing of products.
Business is booming for cargo salvage companies amid record amounts of abandoned goods at ports.
Singapore-based Samudera Shipping Line opened a new freight shuttle service with India, with plans to transport 3,800 TEUs weekly.
Singapore carrier X-Press Feeders has commissioned eight 1,170-TEU ships capable of running on conventional fuel or green methanol.
Ashley Furniture’s transport unit will expand operations in the western U.S. with the acquisition of Missouri-based Wilson Logistics.
Siemens’ rail unit is testing hydrogen-powered trains as a potential replacement for battery-only locomotives with significantly shorter ranges.
South Korea leads the world in electric vehicle infrastructure, with two public charging points for every one vehicle:
For a partial list of automotive disruptions caused by semiconductor and component shortages, clickhere.
Domestic Markets
The U.S. reported 140,875 new COVID-19 infections and 3,800 virus fatalities Thursday.
COVID-19 vaccine demand in the U.S. is rising at a double-digit pace, straining short-staffed pharmacies that administer the shots.
Minnesota and Colorado reported their first cases of the COVID-19 Omicron variant Thursday.
New York and Illinois reported their highest single-day COVID-19 infection counts since January.
A third military medical team has been dispatched to Michigan to help the state’s hospitals manage a surge in COVID-19 patients, over 75% of whom are unvaccinated.
COVID-19 patients fill more than 25% of Ohio’s ICU beds, the highest level since January.
Pending further data, the U.S. administration has indicated uncertainty over what effects the COVID-19 Omicron variant will have on inflation, supply chains and global economic growth. The White House is urging Americans to keep their end-of-year holiday plans despite the emergence of the new variant.
Pfizer’s chief executive predicts annual COVID-19 vaccines will be needed for several years to help populations maintain high levels of virus protection.
Congressional lawmakers passed a stopgap spending bill Thursday night to keep the government funded through February.
The U.S. added 210,000 jobs in November, well below predictions, as the unemployment level fell to 4.2%.
The U.S. economy grew at a “modest to moderate” pace this fall amid continued supply chain disruptions and labor shortages, the Federal Reserve said.
Almost half of American households said rising inflation is causing some degree of financial hardship, survey results show.
Americans’ reluctance to dip into record savings piled away during the pandemic could pose near-term problems for an economy in which consumer spending makes up more than two-thirds of GDP, economists say.
Ford is the only major automaker to report increasing sales in November, led by record demand for SUVs.
Business jet flying is up 40% year over year as demand for used jets skyrockets.
States are being asked to submit five-year plans for expanding broadband internet to receive a share of the federal government’s $42.5 billion in funding.
International Markets
The COVID-19 Omicron variant could be three times more likely than other variants to reinfect, according to researchers in South Africa, where new infections doubled in a single day yesterday and tripled over the past three days. Omicron is spreading in Gauteng Province, the epicenter of the outbreak, faster than any prior variant.
European researchers predict the COVID-19 Omicron variant will make up more than half of the continent’s new infections within several months.
France and Spain recorded their first cases of the COVID-19 Omicron variant Thursday. They were joined by Greece, Finland, Singapore and Norway, which reported at least 50 cases.
The U.K. reported 53,945 new COVID-19 cases Thursday, the most in four months, including seven more cases of the Omicron variant. The nation purchased more than 100 million doses of vaccines for the next two years.
China’s Chengtun Mining Group will invest $245 million for its second nickel manufacturing site in Indonesia, a bid to start producing the key electric vehicle battery metal at scale.
At M. Holland
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