S&P Global — 17, July 2024
Daily Update: July 17, 2024
High Western Temperatures Stretch Electricity Capacity
By Nathan Hunt
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Montana’s Blackfoot River features some of the best fly-fishing in the US. But anglers and the guides that serve them are sitting idle along the Blackfoot and several other legendary trout-fishing rivers due to a devastating heat wave that is blanketing most of the American West. Montana Fish, Wildlife & Parks, a state agency, has imposed fishing restrictions between 2 p.m. and midnight since high afternoon temperatures can be deadly to trout. These restrictions are known locally as hoot owl restrictions — a term dating back to the early 20th century when loggers worked in the early mornings to avoid the heat later in the day and would encounter active owls.
The fishing industry isn’t the only sector having to adapt to record-breaking temperatures. In response to the expected heat wave, California Gov. Gavin Newsom directed the Office of Emergency Services earlier in July to activate its State Operations Center and move into Phase II of its Extreme Temperature Response Plan. Utilities throughout the region increased their electricity demand projections to line up excess capacity. Power generators have been competing for gas supplies to avoid power outages as households crank up their air conditioning.
"July kicks off with anomalous and potentially dangerous heat impacting the south-central US and portions of the West Coast," the US National Weather Service said in its daily outlook. "As of this morning, over 50 million residents are under heat-related watches, warnings and advisories."
The weather service recently projected extreme and record-breaking heat would continue throughout most of the West, with temperatures as high as 120 degrees F in some locations in California, Arizona and Nevada, and record-setting temperatures possible from the West Coast to the High Plains. Temperatures recently reached 104 degrees in Boise, Idaho. Idaho Power, the state's largest power utility, projected that it could set a peak load record for power demand during the heat wave. Blistering temperatures and elevated peak loads were predicted for a range of cities in the West, including Las Vegas, Sacramento, Calif., and Phoenix.
Extensive heat leads to elevated power demand due to cooling needs. Inevitably, this leads to higher energy prices for households and businesses. According to S&P Global Commodity Insights, prices for electricity delivery during peak demand periods have jumped between 19% and 47% across the region, with California utilities and customers experiencing some of the highest prices.
Today is Wednesday, July 17, 2024, and here is today’s essential intelligence.
Listen: Sustainability In Sports: Why The Sporting World Is Joining The Race To Sustainability
Summer is in full swing, the finals of the UEFA Euro 2024 European Football Championships take place this weekend and the Summer Olympic Games kick off later this month. So at the ESG Insider podcast, we’re turning our attention to sustainability in sports. Professional sports are big business, and as we hear from today’s guest, the sporting world is facing pressure to become more sustainable from many sources, including spectators, fan associations, investors, sponsors and even regulation like the EU’s Corporate Sustainability Reporting Directive (CSRD).
—Listen and subscribe to the podcast from S&P Global Sustainable1
US Public Finance 2024 Midyear Outlook: A Cooldown Ahead
Higher interest rates and inflation remain headwinds for most US public finance issuers from a debt issuance and operating and capital budget perspective. Credit conditions have been mostly stable, but credit pressure has accelerated for some sectors and the outlook distribution has weakened.
—Read the article from S&P Global Ratings
Time, Trust and Trading
As the bull market in US equities continues, with the S&P 500® up 18% YTD, we have witnessed in parallel an extraordinary time in the fixed income markets. Historically low credit spreads have led to the outperformance of high yield bonds relative to corporate bonds and corporate bonds relative to Treasuries.
—Read the article from S&P Dow Jones Indices
June Oil Products Imports Slump To 20-Month Low Of 3 Mil Mt
China's oil products imports slumped 33.2% from May to a 20-month low of 2.97 million mt in June, data from the General Administration of Customs showed July 12, as independent refineries cut feedstock fuel oil purchases. The previous low was at 2.53 million mt in October 2022, the GAC data showed. Independent refineries' fuel oil imports fell 15.2% on the month to 939,000 mt in June, S&P Global Commodity Insights data showed.
—Read the article from S&P Global Commodity Insights
Natural Gas Prices Set To Trend Lower As EU Storages Reach Tank Top
LNG and natural gas prices are expected to weaken as the EU's gas storage sits reach tank top during the third quarter, sources said. This downward trend is expected to be limited, however, supported by the need to attract a sustainable amount of imports in a tight LNG market.
—Read the article from S&P Global Commodity Insights
Toyota Tundra Represents Growing Competition In Pickup Segment
The full-size half ton pickup segment in the US gets significant attention from the media, analysts and several manufacturers. Yet, it is only the fourth-largest segment in the industry. The exceptional attention paid to this vehicle category is due to several facts, including the fact that three of the pickup models are volume leaders for their respective brands, as well as industry wide, and that the segment is one of the few in which domestic manufacturers still hold a commanding position.
—Read the article from S&P Global Mobility
Artificial Intelligence, Datacenters And Energy: Is APAC Ready For The Challenge? (July 24, 2024)
Asia-Pacific is catching up with AI-driven datacenter expansions, with a few emerging metros in Southeast Asia expecting a robust pipeline of mega-sized data centers. Power has come up as the key commodity in this business, and it is often a limiting factor in where these new datacenters can be built. Datacenters built for AI applications often require higher power density and energy requirements than traditional facilities.
—Register for the webinar from S&P Global Market Intelligence