Brent rose 3.1% Monday to $100.99/bbl, while WTI spiked 4.5% to settle at $95.72/bbl, as severe new sanctions on Russia raised fears of tighter global supplies. By the end of yesterday’s session, WTI had notched its third consecutive monthly gain.
In mid-morning trading today, Brent futures were up another 7.8% at $103.22/bbl, WTI was up 6.8% at $104.81/bbl, and U.S. natural gas was 3.4% higher at $4.55/MMBtu.
War in Eastern Europe continues to impact global energy markets:
The U.S. and other major oil consumers are considering a release of 70 million barrels of oil from emergency stockpiles as crude prices surge.
Taking BP’s lead, Shell and Norwegian major Equinor announced plans to exit investments in Russia’s energy industry. France’s TotalEnergies took a more modest stance and said it would no longer provide capital for new developments in the country.
Freight costs for Russian oil delivery are up fivefold over the past week, as some firms, including BP, refuse to load Russian fuel oil and Russian domestic producers receive little to no bids on spot tenders.
Ukraine has disconnected from Russia’s electric grid and will link into the EU’s grid, a move originally planned to gradually take place over the next year.
Chevron announced a $3.15 billion acquisition of sustainable fuels producer Renewable Energy Group, a bid to accelerate its transition to cleaner energy.
Supply Chain
War in Eastern Europe continues to impact global supply chains:
Fears of violating new Russian sanctions have prompted Volvo, Harley-Davidson and GM to indefinitely suspend car shipments to the Russian market, while Daimler is halting component shipments to its Russian partner.
Virginia lawmakers are advancing a bill that would restrict truckers to the right-hand lane during winter storms, a response to truck buildups that stranded hundreds of drivers on a 40-mile stretch of I-95 in Virginia for over 24 hours in January.
The value of M&A activity of venture-backed logistics startups in the U.S. reached $2.7 billion in both 2020 and 2021, up nearly 69% from 2019, as the drive to solve logistics snarls coincides with cooling valuations for some private firms in 2022.
Rising prices in the ship-scrapping market are drawing more vessels to demolition yards.
The U.S. reported 105,840 new COVID-19 infections and 2,093 virus fatalities Monday. Up to 43% of the population has now been infected with the virus, the CDC says.
Wages for people aged 16-24 jumped 10.6% in January from a year earlier, more than doubling the 4% gain for all other age groups.
Target said it is putting an extra $300 million into starting wages as high as $24/hour this year in a bid to attract and retain talent.
Quarterly sales at Zoom Video Communications are slowing, signaling less demand for the firm’s videoconferencing application.
Shares of Ohio electric-truck startup Lordstown Motors fell 16% on Monday after the firm said it would sell only 500 vehicles this year, less than a quarter of market expectations. California-based luxury electric-vehicle maker Lucid dropped its vehicle production targets, citing component shortages and supply chain snarls.
International Markets
The international fallout of war in Eastern Europe continues to spread:
Russia has now banned 38 countries from use of its airspace, a retaliatory measure that came after the EU and Canada said they would join the U.K. and others in banning Russian airlines.
Hong Kong saw a record 34,466 new COVID-19 cases yesterday as residents emptied store shelves in a scramble to prepare for a lockdown of the city later this month, when officials will carry out a mandatory, island-wide testing drive.
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