Oil
Oil, Gas Prices Drop Dramatically on Trade War Fears
The US-Canada tariff flare-up lifted oil prices for a brief period, but with the 30-day postponement of those restrictive measures, the oil markets are now assessing the impacts of another trade war, a potentially even bigger one between the United States and China. With ICE Brent dropping dramatically to $74 per barrel, the main fear is that the US-China spat could seriously damage oil demand growth this year, already under pressure from weakening margins.
Prices of the bullion skyrocketed to an all-time high this week, with Monday seeing gold hitting $2,830.49 per ounce in intra-day trading, driven by market uncertainty surrounding Donald Trump’s tariffs and the probability of retaliatory trade wars, OilPrice.com reports.
In its Monday JMMC ministerial meeting, OPEC+ agreed to stick to its policy of gradually returning cut production from April 2025 onwards, all the while scrapping the US Energy Information Administration and Rystad Energy as secondary sources.
Following last week’s strik on Russia’s Ryazan refinery, Ukrainian forces struck another refinery in the Volga region, the 300,000 b/d Volgograd plant that is the largest in southern Russia, whilst also targeting a condensate splitter in the city of Astrakhan.
Switzerland’s top criminal court convicted Trafigura and its former chief operating officer Mike Wainwright, sentencing the latter to 32 months in prison for bribing Angolan officials in exchange for oil contracts between 2009 and 2011.
Iraq’s parliament approved a budget amendment that would allow Baghdad to subsidize production for international oil firms operating in the semi-autonomous Iraqi Kurdistan region, setting the rate at $16 per barrel and edging closer to the restart of Kurdish exports.
In retaliation to Donald Trump’s across-the-board 10% tariff on any Chinese product, China’s State Council imposed a 15% tariff on coal and liquefied natural gas imports from the US, and a 10% tariff on crude oil and heavy machinery.
Nigeria’s upstream oil regulator NUPRC said it would deny export permits for oil cargoes for producers that fail to meet stipulated supply quotas to local refineries, as the country ramps up long-stalled NNPC plants in Port Harcourt and Warri.
Former chief executive officer of drilling firm Liberty Energy, Chris Wright was confirmed as the US Secretary of Energy by a vote of 59 to 38, using the agency’s 50 billion budget, pledging to unleash a new LNG expansion and modernize the power grid.
Europe’s largest producing oilfield, the Equinor-operated (NYSE:EQNR) Johan Sverdrup, has suffered a power outage that left the platform without electricity for 8 hours, just two months after a similar incident in November.
Europe is struggling to meet its self-declared natural gas inventory targets as regional storage levels were 53% full as of February 1, only slightly above the 50% goal set forward by the EU, with France’s gas stocks as low as 35% in recent days.
ADNOC, the national oil company of the UAE, is considering the joint acquisition of Canadian petrochemical firm Nova Chemicals alongside Austria’s OMV (VIE:OMV), with the Calgary-based firm currently owned by UAE’s sovereign fund Mubadala.
US geoscientists have appraised and identified 14 oil and gas prospects in South Korea’s East Sea, potentially containing between 0.7 and 5.2 billion boe, raising hopes of an upstream breakthrough for a country that has never produced oil in its history.
China’s Commerce Ministry announced export restrictions on five metals used in defense and clean energy in response to US tariffs, ranging from tungsten and tellurium all the way to molybdenum, prompting a price rally outside China.
About The Author
