Oil
Oil Prices Rise as OPEC+ Prepares to Extend Production Cuts
Anticipating an extension of OPEC+ output cuts into 2025, oil prices have recouped their previous losses and ICE Brent edged closer to $73 per barrel. A slight improvement in Chinese imports, rising to a 5-month high on the back of stronger Russian and Iraqi imports, will also boost the spirits somewhat. Liquidity in futures trading remains thin, suggesting real action would only start after the OPEC+ meeting.
As Saudi Arabia’s Crown Prince Mohammed bin Salman visited the UAE for the first time in three years, OPEC+ seems to be aligning on the extension of its output cuts until the end of Q1 2025, citing high non-OPEC supply and demand concerns, OilPrice.com reports.
A widening of US sanctions on Iranian shipping and the looming threat of tighter enforcement under Donald Trump has notably slowed down trade in Iranian cargoes to China, with NIOC offering fewer cargoes, albeit at a higher price of -$2 per barrel to Brent.
Bouncing back from a debilitating oil blockade that ended in October, crude and condensate output as reported by Libya’s national oil country rose to 1.4 million b/d across the country, the highest since March 2013, as the country aims to add another 100,000 b/d by year-end.
The Norwegian government has called off its first deep sea licensing round ever in the first half of 2025 after a left-wing environmentalist party demanded it in return for support for the Labour Party’s next-year budget, although it is likely to be revived soon.
Brazil has announced that it will be offering 91 oil blocks across the country’s main producing basins in its upcoming 2025 licensing round, providing oil drillers with 11 new prospects in the country’s most coveted pre-salt basin.
Dragged lower by a protracted wind lull, Germany’s power generation decreased to its lowest in 7 years last month, averaging 52.3 GW and dropping more than 10 GW compared to the 5-year average, with the country remaining a net importer of electricity.
An appraisal well of Portugal’s state-controlled oil firm Galp Energia (ELI:GALP) confirmed the presence of high-quality light oil and gas condensate in the huge Mopane discovery in offshore Namibia, boosting the company’s upstream outlook.
The US ended its natural gas injection season with the highest level of inventories since 2016, with stocks in the lower 48 states totaling 3,922 Bcf or some 6% above the 2019-2023 five-year average, despite injections being below-average for most of 2024.
According to EIA data, US crude oil production fell by 157,000 b/d month-over-month in September, the largest monthly decline since January largely due to hurricane effects as Hurricanes Francine and Helene prompted offshore producers to shut in production.
As Canada’s Prime Minister Justin Trudeau flew to Mar-a-Lago, media reports have been confirming that US president-elect Donald Trump does not intend to walk back on his promise to slap a 25% import tariff on Canadian oil, some 4.5 million b/d in volume.
China has banned exports of gallium, germanium, antimony, and superhard minerals to the United States in anticipation of Donald Trump’s tariffs, citing a new Beijing directive on dual-use items that are both for military and civilian use.
Implemented since July 2022, the Indian government has canceled its windfall tax on domestic crude production, as well as on exports of jet fuel, petrol, and diesel, saying that lower global oil prices meant there’s little justification for it.
US President-elect Donald Trump has reiterated his opposition to the planned 15 billion takeover of US Steel (NYSE:X) by Japan’s Nippon Steel, saying that a series of tax incentives and tariffs will reinvigorate domestic steel production.