Oil Markets Largely Unfazed by Political Turmoil of Trump's First Week

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The media frenzy of Donald Trump’s first week in office has not been reflected in oil price movement as ICE Brent continues to trade in a relatively thin bandwidth of $77-79 per barrel. However, risks are tilted to the downside with ballooning Dubai backwardation, continuously weak Chinese manufacturing numbers, and Trump’s messaging vis-à-vis OPEC. It would take a major disruption – such as a potential shutdown in Libya – to send Brent futures back above $80 per barrel.

Donald Trump’s threats to slap a 25% tariff on Colombia’s imports to the United States have roiled commodity markets, with 41% of Colombian oil exports sold in the US, a move averted by Bogota’s agreeing to take in deported migrants.

US President Donald Trump has reportedly halted all pending environmental litigation and reassigned four Justice Department attorneys, despite not being political appointees, focused on the issue to the newly created Sanctuary City Working Group.

Oil loadings from two key Libyan ports, Es Sider and Ras Lanuf with a combined capacity of some 450,000 b/d, have been brought to a standstill after protesters blocked the sites, demanding that the state oil firm NOC relocate to the country’s east.

As market premiums for Middle Eastern grades spiral out of control and import tariffs on fuel oil tripled, at least four Chinese teapot refiners with a combined capacity of 320,000 b/d have halted refinery operations in Shandong province this month.

US oil major Chevron (NYSE:CVX) reached first oil from its $48 billion expansion project of the giant Tengiz field in Kazakhstan, hoping to reach peak output of 960,000 b/d by the end of Q2 2025, a 25% increase compared to previous output rates.

EU foreign ministers have agreed on a roadmap to ease sanctions on Syria following the fall of the Assad regime and the emergence of former al Qaeda commander Mohammad al-Julani as the country’s new leader, seeking to lift energy-related restrictions.

Privately held LNG developer Argent LNG signed a non-binding agreement with the government of Bangladesh to supply 5 mtpa of liquefied gas from its planned 20 mtpa Port Fourchon facility, expected to start commercial operations in early 2030.

Government forces retook Sudan’s only refinery, the 100,000 b/d Khartoum plant, wresting control from Sudan’s rebel RSF militia that has kept it for two years, but this came at the cost of setting it ablaze with smoke plumes big enough to be captured by satellite imagery.

Global mining giant Rio Tinto (NYSE:RIO) said it is very optimistic about President Trump finally permitting the long-delayed Resolution copper project in Arizona, the US’ largest untapped deposit containing some 1.8 billion mt of copper, stalled for 12 years.

A fire that broke out over the weekend at Iraq’s largest oil field Rumaila has reduced production by 300,000 b/d and capped output rates could remain in place for several more days, reportedly after crude was reintroduced to a storage tank after maintenance.

Coffee futures soared to an all-time high of $3.555 per pound after Donald Trump threatened to slap tariffs on Colombia, the world’s third-largest exporter of the commodity, adding a new layer of geopolitical risk premium to an already tight market.

According to the Financial Times, Melbourne-headquartered mining major BHP (NYSE:BHP) has given up on its goal to acquire rival miner Anglo American (LON:AAL), claiming the deal has become ‘too expensive’ after Anglo’s stock price rally.

The EIA expects higher wholesale electricity prices across the United States, with the notable exception of Texas and the Northwest, averaging $40 per MWh over the year, up 7% year-over-year, with California seeing the biggest increases.