MH Daily Bulletin: June 9

News relevant to the plastics industry:

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Supply

• Oil prices jumped 2% to a 13-week high Wednesday on signs of rising demand in the U.S. and China. 
• In mid-morning trading today, WTI futures were down 0.2% at $121.90/bbl and Brent was flat at $123.60/bbl. 
• U.S. natural gas prices fell over 6% Wednesday following an explosion at a Texas export facility operated by Freeport LNG, which could force more supplies to be kept domestically. The facility, which provides around 20% of U.S. LNG processing, will be down for three weeks. 

• In mid-morning trading today, U.S. natural gas futures fell another 5.1% to $8.26/MMBtu. 
• U.S. crude inventories rose by a surprise 2 million barrels last week, according to the federal government. At 416.8 million barrels, inventories remain some 15% below the five-year average for this time of year, while emergency crude supplies are at a three-decade low. 
• U.S. gasoline stocks fell by a surprise 800,000 barrels last week as demand rose despite record-high prices. 
• The average U.S. gasoline price hit a record $4.955 a gallon Wednesday, according to AAA. 

• Memorial Day gasoline consumption in the U.S. was 6% below pre-pandemic levels. 
• British gasoline prices jumped the most in a day since the early 2000s on Wednesday and are now averaging the U.S. equivalent of about $8.60 a gallon. 
• The UAE’s energy minister said efforts by OPEC+ to boost output are “not encouraging,” with the group’s output some 2.6 million bpd short of targets. Crude prices could continue rising as demand rebounds in China, the official said. 
• More oil news related to the war in Europe:
  • The U.S. is in talks with European allies about forming a buyers’ cartel to set a global cap on the price of Russian oil. 
  • Europe could face energy rationing amid supply shortages next winter, the International Energy Agency said. 
  • Reports suggest Russia’s Rosneft is not signing new crude deals with two Indian refiners due to a lack of supply. 
  • Russia’s oil output could fall 18% by the end of 2023 due to sanctions, according to U.S. forecasts. 
  • BP is shutting down a key oil pipeline to Georgia’s Black Sea coast this month, citing the safety of oil tankers in the Black Sea.
  • Ukraine will halt all exports of coal, natural gas and oil to deal with domestic shortages this winter. 
• Chevron’s CEO warned that consumers may start identifying high energy prices with the green energy push, hampering transition efforts. 
• EU lawmakers failed to pass a massive overhaul of the bloc’s carbon market, throwing potentially stricter climate goals into jeopardy. Lawmakers did reach agreement to effectively prohibit the sale of new gas- or diesel-powered cars by 2035.
• Environmental groups are criticizing India’s inclusion of coal development in a legislative package aiming to boost renewable energy. 
• PG&E, the U.S.’s largest utility, unveiled plans to reach net-zero emissions by 2040 while still using natural gas to produce power. 
• A proposed German law would more than double the land available for onshore wind development. 

Supply Chain

• Dangerous heat will settle over 22 million people in the Southwestern U.S. for the next several days, with temperatures expected to break records and exceed 110 degrees in some locations. 
• The Baltic Exchange Dry Index fell 4.1% Wednesday to the lowest level in over a month, as rates fall for all vessel segments. 
• Ocean carriers with strong transpacific operations will see the highest earnings in the second half of 2022, Alphaliner predicts. 
• CF Industries is closing one of its two British fertilizer plants and cutting hundreds of jobs due to high energy costs. 
• Pakistan is shortening its workweek in an effort to reduce energy and fuel consumption. 
• Fuel shortages are hampering logistics activity across the African continent. 
• At least a dozen large U.S. battery storage projects have been postponed, canceled or renegotiated as labor and transport bottlenecks crimp supplies. 
• An EU proposal to label lithium as dangerous for human health would make it harder to supply the metal to electric-vehicle makers, firms say. 
• A major Toyota supplier asked employees to take a day of leave this month to accommodate Toyota’s production shortfalls. 
• Intel will receive over $7 billion in subsidies for a new chip factory in Germany, while Taiwan Semiconductor Manufacturing Co. dropped expansion plans for the nation. 
• Miami-based Ryder System rejected a takeover bid by an activist shareholder group. 
• An Israeli supply chain firm gained its first major customer for stamp-sized tracking tags it attaches to shipments. 
• Some firms are raising fees on costly returns following the pandemic’s burst in online shopping. 

• New York-based Plug Power is building a new plant at Belgium’s Port of Antwerp-Bruges to produce 35 tons of green hydrogen per day by 2025. 
• Talks to create a safe Black Sea lane for Ukrainian grain exports have stalled. 
• Removing underwater mines near key Ukrainian ports could take months, according to the United Nations. 

Domestic Markets

• The U.S. reported 210,091 new COVID-19 infections and 1,194 virus fatalities Wednesday. 
• COVID-19 cases in Texas are up 31% the past two weeks. 
• Alaska will end its COVID-19 state of emergency July 1. 
• New York state agencies will no longer require unvaccinated employees to test weekly for COVID-19. 
• COVID-19 vaccinations for children under age 5 could roll out as soon as June 21 following FDA approval. 
• Fewer than half of fully vaccinated Americans are also boosted against COVID-19, a sharply lower rate than the U.K. and Canada. 
• Nearly six times more U.S. children and teenagers died from COVID-19 in one year than from the flu. 
• COVID-19 patients may be 25% more likely to develop a psychiatric disorder four months after infection, according to an Ohio State University study. 
• First-time jobless claims jumped 27,000 last week to 229,000. 
• A widely followed GDP gauge from the Atlanta Federal Reserve suggests the U.S. could head into recession territory as soon as the second quarter. 
• Announced M&A deals in the U.S. soared in April and May to almost $80 billion. 
• U.S. mortgage applications, a proxy for demand, fell 6.5% last week to their lowest level in 22 years, according to the Mortgage Bankers Association. 

• About 28% of U.S. home sales in March were paid in cash, the highest level since 2014. 
• After seeing the highest out-migration among U.S. metro areas during the pandemic, in-migration to Manhattan is now surging past pre-pandemic levels despite soaring home and rent costs. 
• More manufacturers are quietly shrinking package sizes without lowering prices, a practice dubbed “shrinkflation.” 
• Finance chiefs at major retailers are struggling to forecast quarterly sales as companies navigate ongoing uncertainty over shipping and consumer demand. 
• Campbell Soup joined Kellogg and Kraft Heinz in raising its annual sales forecast on expectations of more price hikes and easing logistics constraints. 
• Intel joined the string of other tech companies putting a freeze on new hiring as it seeks ways to cut costs. 
• Spirit Airlines postponed its Friday stockholder meeting as it courts takeover bids from rivals Frontier Group and JetBlue. 
• Used-car prices rose 0.7% in May, the first increase in five months. 
• More automakers are backing the U.S. administration’s efforts to restore California’s ability to set its own strict vehicle emissions standards. 
• A group of Trader Joe’s employees in Massachusetts will hold a union election, joining a string of U.S. retail workers organizing for higher pay and better benefits. 
• The U.S. Interior Department will phase out single-use plastic products on public lands by 2032, including at national parks. 

International Markets

• Global COVID-19 cases dropped 12% and fatalities dropped 22% last week, according to the World Health Organization. 
• A week after lifting many COVID-19 restrictions, Shanghai will lock down a district with 2.7 million residents for mass testing Saturday.  
• Chinese officials are worried that wind gusts will bring COVID-19 into the country across its border with North Korea. 
• Aiming to maintain its rigorous COVID-19 controls, major Chinese cities have built tens of thousands of testing sites within a 15-minute walk of each other. 
• Taiwan reported a record 159 COVID-19 fatalities Wednesday, while new infections crossed 80,000. 
• New COVID-19 cases in Israel are rising as officials consider giving out a fifth vaccine dose. 
• Ontario will end most of its remaining mask mandates Saturday. 
• Germany will drop COVID-19 vaccination and testing requirements for incoming travelers starting August 31. 
• Japan will require that tourists wear face masks and take out medical insurance against COVID-19 as the nation begins reopening its borders this week. 
• South Korea lifted quarantine requirements for unvaccinated travelers who test negative for COVID-19 upon arrival.
• More news related to the war in Europe:
  • Some Russian airlines are considering relocating to Turkey to avoid crushing Western sanctions. 
  • A rule change in Britain will allow stricter enforcement of sanctions against firms doing business with Russia.
  • Russian consumer inflation hit an annual 17.1% in May, slightly lower than April’s rate. 
• The European Central Bank is expected to end a key pandemic bond-buying program and map out its plan to raise interest rates for the first time in more than a decade when it meets today. 
• Japan’s beleaguered currency is nearing its weakest level in 24 years after falling for five days straight. 
• Poland’s central bank hiked its main interest rate 75 basis points to 6%, a 14-year high. 
• Budget European airline Wizz Air says a lack of airport staff is causing higher costs and major disruptions to its flight schedules. 
• Cupra, Volkswagen’s Spanish subsidiary, plans to release three new electric vehicle models by 2025. 
• A Chinese internet company’s concept electric vehicle is fully autonomous, has no door handles and can be fully controlled via voice recognition. 
• The price tag of global food imports is expected to total $1.81 trillion this year, surpassing last year’s all-time high by $51 billion. 
• Hundreds of millions of people will be affected by higher annual flooding due to rising water levels across the globe this century: 

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