Market activity is continuing to pick up across our international segment. The increase in energy prices caused by the Russia-Ukrainian conflict and other global inflationary drivers has revived a number of projects and delayed turnarounds. As these projects move forward, we expect to see increased customer construction activity in the second half of 2022.

As many companies move towards carbon neutrality, we are seeing an uptick in the number of upstream and energy transition projects being sanctioned, especially in Europe. The independent oil companies (IOCs) are leading this effort, supported by government initiatives to reduce dependency on imported fossil fuels. In the upstream sector, project and MRO activity continues to grow in both the UK and Norwegian sectors of the North Sea. In the energy transition space, investments in the biofuel segment remain high, while offshore wind project activity is expected to increase in the second half of the year.

Prices across PVF product groups from both the European and Far East suppliers appear to have peaked after continued price hikes experienced during the first half of 2022. Ocean freight costs from the Far East to Oceania and Europe have shown first signs of modest decline, although they are still far above pre-COVID-19 levels. As the leading PVF distributor, we continue to play a pivotal role for our customers by creating price stability with our expanded inventories.