Oil
Trump’s EU Tariff Threat Puts Oil Prices Under Pressure
Trump’s threat to place a 50% tariff on the EU has renewed demand concerns in oil markets, with both Brent and WTI set to finish the week lower.
What seemed to be a much-needed rangebound trading week with ICE Brent hovering around $64-65 per barrel without any distinct trend developing was changed by President Trump’s 50% tariff threat on Europe, triggering a new wave of macroeconomic concerns. Should US-EU tensions persist, next week’s OPEC+ meeting (and expected 411,000 b/d unwinding into July) could see Brent break below $60 per barrel again.
Intent on weeding out high-cost producers from global markets and regain lost market share, OPEC+ is considering another 411,000 b/d production hike for July as its members meet on June 1, potentially unwinding 2.2 million b/d of voluntary cuts by October.
Whilst US special envoy Richard Grenell announced a 60-day extension of Chevron’s (NYSE:CVX) operating license in Venezuela, Secretary of State Marco Rubio refuted that claim and claimed the sanctions waiver will expire as scheduled on May 27.
In one of the hottest boardroom fights of 2025, activist investor Elliott Investment Management won two seats on the executive board of US refining giant Phillips 66 (NYSE:PSX), sending P66’s stock value down by 6% after the news broke out.
US crude oil storage demand has risen to levels not seen since the early months of the COVID-19 pandemic, according to storage broker Tank Tiger, with market players expecting contango to hit soon as OPEC+ unwinds its 2.2 million b/d production cut.
Chinese EV carmaker BYD (SHE:002594) has reportedly sold more electric vehicles in Europe than Tesla for the first time on record, registering 7,231 units compared to the US company’s 7,165 units, a sea change given that BYD only started sales across the EU in 2023.
Rosneft (MCX:ROSN), Russia’s largest oil producer, has acquired the country’s largest rare earth deposit Tomtor, believed to contain more than 11 million tonnes of open pit ore at 14.5% total rare earth oxides, signalling a diversification move into mining.
US nuclear stocks have rallied this week on the back of media speculating about US President Trump signing an executive order aimed at kickstarting the domestic nuclear energy industry, streamlining construction of new plants, and boosting uranium supply chains.
Iraq’s Oil Ministry denounced deals between smaller US oil companies and the semi-autonomous Kurdish Regional Government as unconstitutional, after upstream firms HKN Energy and WesternZagros pledged to invest a combined $110 billion in Kurdish oil fields.
Having received approval this week for its environmental impact assessment in the Foz do Amazonas basin, Brazil’s state oil firm Petrobras (NYSE:PBR) is now readying a drillship to spud its first wildcat in the oil-prolific untapped area.
Rio Tinto (NYSE:RIO) fell 3% this week after the mining giant’s CEO, Jakob Stausholm, announced his departure from the company after taking over in early 2021, an unexpected move after he pivoted the company towards a more climate-neutral strategy.
The US Treasury doesn’t support the proposal of the European Union to revise the oil price cap on Russian crude from $60 per barrel to $50 per barrel, arguing that lower outright prices are already hurting the Russian budget enough.
According to market reports, the government of Egypt is in negotiations to buy 40-60 cargoes of LNG (worth some $2-3 billion at current prices) amid a worsening electricity outlook as decreasing domestic gas production bodes ill for peak summer demand.
Mexico’s national oil company, Pemex, plans to cut 3,000 jobs after its Q1 2025 results saw a $2 billion quarterly loss and total debt soared past $101 billion, seeking to save $550 million in lower labour costs and streamline operations with just nine management areas.