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(Bloomberg) — The world is baking under extreme heat from California’s Death Valley to Turpan in western China. July is already set to be the single-hottest month on record as interconnected domes of high pressure sit stagnant across the Northern Hemisphere. The conditions are putting the lives of hundreds of millions of people at risk, driving up energy demand and withering crops. Adding further pressure to global food security: Russia’s decision last week to pull out of a deal that allowed Ukraine to safely ship its grain through ports on the Black Sea. Since the accord collapsed, tensions have dramatically escalated, with both Ukraine and Russia warning that ships headed to each other’s ports could be considered military targets. 

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Here are five notable charts — well, actually, one map and four charts — to consider in commodity markets as the week gets underway. 

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Climate

Crippling temperatures are blanketing the US. Through the first six months of the year, records were already being smashed across much of the contiguous 48 states. Florida posted its hottest ever first half and Massachusetts its second-warmest start on record, according to the National Centers for Environmental Information. While much of the West was cooler than average over the same period, that picture is changing. Phoenix broke a nearly 50-year record for the most consecutive days hitting 110F (43C) or higher. As homes and businesses crank up the air conditioning to beat the heat, the power grid operator in California is encouraging conservation, while the one in Texas is warning that continued sweltering weather in the days ahead will create tight conditions.

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Europe is no exception, especially in the south where weather watchers are keeping an eye on the record books. The average temperature across Mediterranean countries has been climbing all summer and this week could hit a fresh peak, as the chart indicates. Even so, that’s well-off the hottest actual temperature ever recorded, which belongs to Sicily at 48.8C set two years ago — but that, too, is poised to be broken. Like elsewhere, the excessive heat is pushing power grids to the extreme. Spain was forced to utilize all of its gas plants to cope with surging electricity demand last week.

Food

The stifling heat, record flooding in key global growing areas and Russia’s withdrawal from the Ukraine safe-grain corridor all beg the question: Will food inflation persist? The pact, originally put in place a year ago, has allowed nearly 33 million tons of crops to be exported from one of the world’s biggest grain suppliers, helping tame runaway prices in the wake of Russia’s invasion of Ukraine in February 2022. But last week’s rally in Chicago wheat, the global benchmark, could again stoke food-commodity costs. Ukraine will now have to rely on lengthier and costlier alternate routes for shipments to global markets. The United Nation’s price index, which tracks five major exported food commodity groups, has sharply declined since peaking immediately after the invasion to the lowest level in more than two years. Even so, food inflation is very real — the gauge is still above its historical average — and it takes time for these decreases to filter through to supermarkets, where prices remain elevated due to energy, labor and transport costs.

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Natural Gas

With rising energy demand comes rising prices. US natural gas futures, fresh off their biggest weekly advance in five weeks, could see more gains as consumption of the power-plant fuel is set to remain elevated with forecasts for continued heat through the end of the month. European natural gas prices also rallied last week with volatility likely to linger amid the scorching weather and as traders weigh the risks of potential supply disruptions from Russia due to escalating tensions in the Black Sea. The continent now receives less than 10% of its gas from Russia — compared with more than a third prior to 2022 — but futures are sensitive to any fuel shocks.

Big Oil

The renewed focus on the warming planet comes just as earnings season kicks off for Big Oil. Producers are under pressure as urgency grows to shift away from the extraction of fossil fuels that contribute to greenhouse gas emissions. Exxon Mobil Corp. and Chevron Corp. report results on Friday. Both companies have seen their shares struggle this year — despite strong earnings — amid uncertainty over the global economy and the trajectory for oil consumption. The 23-member S&P 500 Energy Index is the worst performer among the S&P 500 Index’s 11 industry groups and is down 4.1%, compared with an 18% advance for the main index.

—With assistance from Alex Tanzi and Eamon Akil Farhat.

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