Russian missile attack on Ukraine
Oil Prices Climb After the EU Imposes New Sanctions on Russia
Oil prices moved higher on Friday morning after the EU agreed to an 18th package of sanctions against Russia, but the effectiveness of the sanctions is yet to be seen.
The constant drumbeat of Russian sanction announcements is keeping Brent futures around $70 per barrel, with the European Union and its concept of a floating price cap taking centre stage this week, OilPrice.com reports.
The bullish momentum was further supported by assumed Iraqi drone strikes on Kurdish oil fields, taking out all the major producing assets in less than a week, suggesting that Baghdad’s OPEC+ compliance will improve over the upcoming weeks.
US oil major Chevron (NYSE:CVX) will be allowed to integrate Hess Energy’s $53 billion assets after winning a high-profile litigation with ExxonMobil in the International Chamber of Commerce over Hess’ Guyanese assets, giving it 30% in the Stabroek block.
A flurry of drone strikes ultimately achieved what Iraqi negotiations had failed to achieve in over two years – namely, slashing Kurdish oil output by 200,000 b/d – after explosive-laden drones debilitated the Tawke and Peshkabir fields operated by Norway’s DNO.
Saudi state oil firm Saudi Aramco (TADAWUL:2222) is reportedly closing in on a $10 billion deal with US investment firm BlackRock (NYSE:BLK), potentially giving it a stake in the $100 billion Jafurah sour gas project, the largest Saudi untapped gas field.
Stoking fears that India’s refining overcapacity might be the next downstream scare, the South Asian country’s state-controlled ONGC is considering building a new 200-240,000 b/d refinery at Jamnagar in the western state of Gujarat, already home to the giant Reliance refinery.
Malaysian authorities are planning to crack down on ‘illegal’ ship-to-ship transfers of Iranian crude in the country’s territorial waters, reportedly later this month under notable US pressure, jeopardizing the 1.5-1.7 million b/d of Iranian flows to China.
Russia’s crude oil production dropped by 3.5% year-over-year to 211 million metric tonnes in January-May, reflecting lower output amidst OPEC+ production cuts, whilst the Energy Ministry reported gas production declining by a similar 3% to 290 billion cubic metres.
The Chinese government is threatening to block the $23 billion sale of more than 40 ports owned by Hong Kong-registered CK Hutchison to US investment giant BlackRock (NYSE:BLK) and MSC if Chinese shipping giant Cosco doesn’t get a stake in the transaction.
The second of two nuclear reactors at Belarus’ Astravets power plant was disconnected from the power grid after an alarm indicated a deviation in its cooling system, impacting 20% of the country’s power needs as radiation levels at the plant stayed unchanged.
The Trump administration rescinded $4 billion in US government subsidies for California’s High-Speed Rail (HSR) project connecting San Francisco to Los Angeles and Anaheim, citing HSR’s bloated $128 billion price tag as ‘grossly over initial budget’.
Canada’s new Prime Minister, Mark Carney, announced tariff rate quotas for countries with which Ottawa has free trade agreements, excluding the US, seeking to protect Canadian steel production whilst also slapping a flat 25% tariff on Chinese steel.
Slovakia will lift its veto against the European Union’s 18th sanctions package against Russia after Prime Minister Robert Fico reportedly received guarantees from Brussels over its energy security past 2028, paving the way for the EU’s new price cap.
The world’s benchmark futures in lithium pricing, the lithium carbonate futures on the Guangzhou Exchange, rose to a three-month high of ¥70,000 per metric tonne ($9,750/mt) after Chinese miner Zangge Mining reported having halted production at its Qinghai mine.
Brazil’s state oil firm Petrobras (NYSE:PBR) is considering redirecting its oil flows away from the United States on the heels of the Trump Administration slapping 50% tariffs on Brazilian goods, having supplied some 200,000 b/d of oil to Pacific Coast refiners.
The US Commerce Department announced it will impose a preliminary anti-dumping duty of 93.5% on all China-produced anode-grade graphite, a key component to produce electric vehicles, with final duties for the material to be issued by December 5.
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