COVID-19 Bulletin: November 19

November 19, 2021 • Posted in COVID-19

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Supply

  • Oil prices finished slightly higher on Thursday after dropping to six-week lows as investors wondered how much crude major economies would release from strategic reserves at the urging of the U.S.
  • Crude futures were hammered in late morning trading on concerns about renewed COVID-19 lockdowns, with WTI down 3.8% at $76.05/bbl and Brent down 3.2% at $78.62/bbl. U.S. natural gas was 0.9% higher at $4.95/MMBtu.
  • Saudi Arabian crude exports rose to 6.52 million bpd in September, the fifth consecutive monthly increase and the highest since January. 
  • Gas stockpiles in the U.S. East Coast, the nation’s largest importing region, fell to their lowest level since 2017, spurred by a 51% drop in October deliveries from Europe, normally the top foreign supplier. Natural gas futures rose about 2% Thursday on the news, while LNG exports climbed to near record highs on increased production at Cheniere Energy’s plant in Louisiana. 
  • The U.S. Environmental Protection Agency proposed an extension of a deadline for oil refiners to comply with new biofuel blending laws. 
  • Spot freight rates for LNG tankers in Asia surged to $316,750 per day Tuesday, a fivefold increase from two months prior.
  • Less than 1% of global LNG trades have been declared carbon neutral to date, prompting the International Group of Liquified Natural Gas Importers to draft a proposal for benchmark definitions of the term. 
  • U.K. utility National Grid boosted earnings projections with power prices remaining well above historical norms. European coal plants are also enjoying surging profits after running at full capacity during the bloc’s energy crunch. 
  • Two dozen European companies are planning long-term investments of $94 billion to convert most of the bloc’s gas pipelines to carry zero-emissions hydrogen. 
  • Oil and gas companies have raked in record amounts of private-sector financing during the ultra-low interest rates of the pandemic, issuing a record $198.8 billion of bonds in 2020, $37.2 billion more than the previous record from 2013. 
  • Royal Dutch Shell has acquired a 51% stake in a floating wind project offshore western Ireland, expected to develop 1.35 GW of power generation.
  • Our most recent list of force majeure and allocation announcements from suppliers is here.

Supply Chain

  • Access to the Port of Vancouver, Canada’s largest gateway, remains blocked after days of torrential rain and landslides. Twenty vessels and several hundred thousand tons of grain are stuck in transit, according to Quorum, a company that monitors Canada’s grain transportation system.
  • U.S. imports from Asia fell 2.4% in October from record highs, with the month remaining the third busiest on record. 
  • High shipping rates and lingering effects of the pandemic will slow growth in the maritime industry over the next four years, the United Nations says. Smaller countries dependent on deliveries by sea are likely to take the brunt of the impact. 
  • California will allow trucks to carry heavier payloads in a bid to reduce congestion at the Ports of Los Angeles and Long Beach.  
  • U.S. rail freight traffic totaled 502,613 carloads and intermodal units last week, down 4.7% compared to a year ago, with a slight gain in carloads offset by a steep decline in intermodal traffic.
  • The federal government will begin reviewing possible logistics congestion caused by ultra-long railroad trains. Recently, a grain elevator in North Dakota claimed the longest train in U.S. history at more than 1.6 miles. 
  • The federal government is reviewing the impact of precision scheduled railroading, likely an attempt to get ahead of regulatory concerns relating to the proposed merger of Canadian Pacific and Kansas City Southern. 
  • The EU is considering relaxing state-aid rules to allow for the funding of new chip plants in a bid to ease shortages throughout the bloc. 
  • Ford and GM are looking to produce their own computer chips after years of shortages, with both automakers recently announcing new ties with some of the biggest names in semiconductors. 
  • Stocks of chipmakers Nvidia, Qualcomm and AMD are all up more than 30% the past month, with analysts expecting their collective earnings to be up 56% in the third quarter from a year ago. 
NVIDIA Games on Through Global Chip Shortage
Rise of the Robots
  • For a partial list of automotive disruptions caused by semiconductor and component shortages, click here.

Domestic Markets

International Markets

The Road to Net Zero

At M. Holland

  • M. Holland’s 3D Printing group offers a rapid response alternative for producing selected parts where resin availability is tight during prevailing force majeure. 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.

For all COVID-19 updates and notices, please refer to the M. Holland website.

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