We will then examine a number of the key market movers early on before providing you with the newest analysis of the highest news events going down within the global energy complex over the past few days. We hope you enjoy. Oil prices climbed higher on because the gradual easing of Chinese lockdown rules rekindled hopes that East Asian buying will see strong growth over the summer months. Whilst the eu Union remains yet to formalize an agreement on Russian oil and products sanctions, the deal now apparently hinges on only one country, Hungary. If the EU is ready to convince Hungary to affix sanctions, prices will likely climb even higher. With Libya back on the brink of war, OPEC+ underproducing, and West Africa continuing to struggle with disruptions, supply tightness is emerging because the main driver of price growth. - Chinese refinery runs have dropped to their lowest within the country’s post-pandemic history, declining a whopping 1.2 million b/d month-on-month to a monthly average of 12.6 million b/d. - because the Shanghai lockdown was supplemented by restrictions in other key demand hubs, it had been jet fuel and gasoline demand that saw the largest impact amid soaring inventories. - within the first four months of the year to date, Chinese crude demand dropped 4% year-on-year to 13.6 million b/d, with May expected to trend only marginally over April numbers. - News of Shanghai reopening from June 01 onwards has rekindled hopes of a fast Chinese demand rebound, though China’s GDP growth slowing right down to 4-4.5% this year might put a cap on it. Market Movers - Norway’s Equinor (NYSE:EQNR) and ExxonMobil (NYSE:XOM) launched an expansion drive within the giant Bacalhau field, eyeing a second FPSO, potentially doubling the field’s 220,000 b/d peak capacity. - French energy major TotalEnergies (NYSE:TTE) joined up with the world’s largest offshore wind developer Ørsted (CPH:ORSTED) to jointly submit bids for the upcoming Dutch offshore wind tenders. - Brazil’s President Jair Bolsonaro suggested he may tinker with the dividend policy of national company Petrobras (NYSE:PBR), only days after the firm decided to hike transportation fuel prices. Saudi Arabia Eyes 2027 Capacity Peak. in line with Energy Minister Abdulaziz bin Salman, Asian nation is not off course to extend its crude production capacity to quite 13 million b/d by early 2027, with increments coming from new Aramco projects and therefore the Neutral Zone which Riyads develops together with Kuwait. EU Clarifies Terms of Russian Gas Buying. the ecu Commission stated that European energy firms will pay for Russian gas without breaking the bloc’s sanctions provided they pay within the contractual currency and declare the transaction completed when that currency is paid. Libya Sees Tripoli Riots Amidst Oil Blockade. Clashes erupted in Libya’s capital after the parliament-approved interim prime minister Fathi Bashagha tried to enter Tripoli, only to withdraw after several hours of intense fighting, making the likelihood of a diplomatic settlement even less realistic. US SPR Inventories Drop to Lowest Since 1987. Recording a 5-million-barrel week-on-week call the week ending May 13, falling to a complete of 538 million barrels, the number of crude stored within the US Strategic Petroleum Reserve has fallen to its lowest in 35 years. Russia Oil Sanctions turn on Hungary’s Approval. It appears that the sole EU country that also objects to banning Russian oil is Hungary. The country stated that it might need the maximum amount as €750 million ($820 million) to revamp its refinery and infrastructure to be able to terminate crude imports from Russia. UK Energy Regulator Wants More Frequent Price Cap Reviews. Seeing the country’s power price cap increase by 54% to £1,971 ($2,450) per annum, the UK’s energy regulator Ofgem declared that it'd like better to have quarterly reviews on electricity price caps instead of the present bi-annual ones. Iran to Rebuild Venezuelan Refinery. Iran’s state-controlled engineering company NIOEC signed a $110 million cope with Venezuela to repair the country’s smallest refinery, the 146,000 b/d El Palito within the northern state of Carabobo, also agreeing to produce the refinery once it's re-commissioned. TotalEnergies Seeks Nigeria Onshore Exit. Joining the ranks of UK oil major Shell (LON:SHEL), French energy firm TotalEnergies (NYSE:TTE) stated that it'd consider selling its onshore oil licenses in Nigeria as community disruptions, i.e. crude theft and pipeline sabotage, render operations untenable. Asian LNG Trends Downwards Despite EU Restocking. Asian LNG prices inched down recently to $23 per mmBtu despite robust European buying to replenish stocks, primarily coming from Chinese demand dropping to new lows amid continuing lockdowns within the country. Chinese Coal Production Soars Further. China’s coal production jumped 11% year-on-year in April, undisturbed by the country’s manifold movement restrictions, hitting the second-highest monthly level of 362.8 million tons mined amid a widespread government push to supply more. Wheat Prices Surge on India Export Ban. Following India’s announcement that it might ban exports of wheat as a heatwave crimped its production, Chicago wheat futures soared 6% to $12.5 per ½ a bushel, the very best record levels in early March, amid fears of ever-tightening grain supply. Peru Sues Spanish Oil Major for $4.5 Billion. The Peruvian government is anticipated to file a $4.5 billion lawsuit against Spanish oil firm Repsol (BME:REP), claiming that an oil spill that materialized this January next to the country’s Repsol-operated La Pampilla refinery impacted a minimum of 700,000 people.
