Oil Price Collapse Continues After Brief Respite
The oil price crash appeared to have been halted on Thursday after the Swiss central bank stepped in to save Credit Suisse and the energy ministers of Russia and Saudi Arabia met to signal a willingness to intervene if the collapse continued. On Friday morning, however, prices headed lower once again.
In one of the most tumultuous weeks in recent years for oil markets, oil prices are on course to post a more than 10% loss. The oil price collapse took a breather on Thursday as the Swiss national bank stepped in to save Credit Suisse while Saudi Arabia and Russia signaled a willingness to intervene. Bearish sentiment is difficult to shake off, however, and prices continued lower on Friday morning.
Australian authorities might compel LNG exporters along the country’s east coast to divert excess gas supply towards domestic consumers amidst decreasing natural gas production which has raised the risk of gas shortfalls between 2023 and 2026.
The last large-scale refining project to be commissioned in the US, the 250,000 b/d capacity Blade project at ExxonMobil’s (NYSE:XOM) refinery in Beaumont, TX, is set to start up in the upcoming weeks, running on Permian crude and increasing naphtha and gasoline supply in the US Gulf Coast.
The federal government of Canada and Albertan authorities will establish a working group that would seek to expedite the remediation of oil sands tail ponds after a 10-month-long leak at Imperial Oil’s (TSX:IMO) Kearl project was not properly reported.
The Biden administration has revised two exchange contracts it signed with Shell (LON:SHEL) covering 3.6 million barrels of US SPR crude, delaying their return until 2025, despite assurances from the US Department of Energy that it would expedite the repurchases.
Inspectors of the UN’s nuclear agency discovered that some 2.5 tonnes of uranium have gone missing from a Libyan site controlled by the rival Benghazi government, though the Eastern Libyan forces allegedly found the missing uranium the next day.
Potentially leading to a resolution of a long-standing legal battle, the Iraqi federal government and regional Kurdish authorities have agreed that oil revenues from Kurdistan will be transferred to a bank account under federal government supervision.
US oil major ExxonMobil (NYSE:XOM) has reportedly been considering selling its majority stake in the 9 bcm per year capacity Rovigo LNG terminal as part of a larger divestment drive to sell non-core assets.
Spanish oil firm Repsol (BME:REP) has scrapped its plans to build an LNG terminal on Canada’s east coast citing excessive transportation costs to deliver gas to Saint John, NB, and a lack of buyers who would commit to 15- to 20-year offtake agreements for the gas.
Battered by financial losses and corruption scandals, the massive slump of Swiss bank Credit Suisse (SWX:CSGN) is also bad news for Greek shipping companies as CS was the largest lender to Greek shipping with an active portfolio of at least $5.2 billion.
As spot prices of LNG continue their decline for the fourth straight month and currently trend around $13 per mmBtu, China is stepping up its purchases, with Kpler data showing an increase in March arrivals to 5.4 million tons, a 9% increase month-on-month.
One of the world’s largest iron ore deposits, the Simandou mine in Guinea, will soon restart production after operator Rio Tinto (NYSE:RIO) agreed on new terms for the JV operating the project, guaranteeing the government a 15% take.
The Kuwaiti national oil company KPC is considering setting up an oil trading arm, reportedly even as soon as the end of 2023, seeking to replicate the success of Saudi Aramco which already has trading offices in Dhahran, Fujairah, Singapore, Houston, and London.
With Colombia’s left-wing president Gustavo Petro increasing cooperation with Venezuela, the two countries are seeking to reactivate the 224-km Antonio Ricaurte gas pipeline and export some 25 MMCf/day of Venezuelan gas to its western neighbor.
UK-based energy major Shell (LON:SHEL) sold its non-operated stakes in two offshore fields in Malaysia to local firm Petroleum Sarawak, leaving it with 19 production-sharing agreements including the most recently launched Rosmari-Majoram project.