A plethora of bearish factors is driving oil prices lower, with both WTI and Brent set for a 3rd weekly loss during a row.
Whilst crude prices are relatively range-bound recently, hovering within the $80-85 per barrel range, they're poised to suffer their third weekly decline in a very row. Beyond the backwardation within the futures markets, several trends point towards an extra weakening in crude. The Biden Administration is predicted to require a call on further SPR releases within the upcoming days. additionally, demand prospects have soured a small amount lately as OPEC cut its Q4 2021 demand forecast by 330,000 b/d as high energy prices and inflation hamper economic recovery. Last but not least, a strengthening dollar is putting additional pressure on crude. Against this background, the Brent global benchmark traded around $82 per barrel, whilst WTI was assessed around $80.5 per barrel.
COP26 Communique Exposes Rifts. The suggested final wording of the COP26 communique calling for “the phasing out of coal and subsidies for fossil fuels” proved to be a tricky nut to crack for climate negotiators as leading crude producers like Asian nation publicly voiced their opposition to the draft.
Investors Ready for Rare Lease Sale in US GoM. Oil companies are to submit their bids for a few 15,000 tracts across the Gulf of Mexico that may delay to 1.1 Bbbls of crude, probably the last offshore auction ever because the Biden Administration is anticipated to ban further leasing.
Belarus President Threatens to chop off Russia Gas Flows. Belarusian President Alexander Lukashenko threatened to chop off transit supplies of Russian piped gas flowing through the 33 bcm annually Yamal-Europe pipeline if the ecu Union imposes further sanctions on the embattled country, sending TTF prices up.
Drilling Giants Merge in Bid to remain Competitive. Denmark’s Maersk Drilling (CPH:DRLCO) and US peer Noble Corp (NYSE:NE) will merge in an all-shares $3.4 billion deal, keeping the latter’s name, in an exceedingly bid to optimize costs and build a worldwide network of offshore drilling operations.
Europe’s Largest Oilfield stop working After Power Glitch. the enormous Johan Sverdrup field, operated by Equinor (NYSE:EQNR) in Norway’s continental waters, experienced a pack up on Thursday following an influence supply issue and was brought back only on a daily basis later.
China Buys More Iranian Barrels. Iranian exports to China, either direct or via ship-to-ship transfers within the Malacca Strait, have moved above 500,000 b/d within the past number of months as laxer oversight from the Biden Administration and better outright prices gave a further impetus to purchases.
Russia’s Energy Ministry Backs Rosneft Export Rights. Following informed Rosneft’s request to be allowed into Russia’s pipeline gas exports stream, the country’s Energy Ministry is backing the oil major’s claim under an agent agreement with Gazprom, stating it could help solve the third-party access problems with Nord Stream 2.
Tullow Oil Seeking Asset Sales in LatAm and Africa. UK-based upstream-focused Tullow Oil (LON:TLW) is moving ahead with its divestment program, seeking farm-down opportunities in its Guyanese and Argentinian portfolio as coronavirus ramifications and 2021 hedging losses battered company finances.
India Wants More Qatari LNG for fewer. India’s main liquefied gas importer Petronet LNG (PLNG) is seeking higher volumes from Qatar Gas because it is trying to renegotiate its long-term supply contract beyond its current deadline of 2023, simultaneously posing for a decrease in its Brent-linkage (to 10.2% from the 12.7% it's now).
Sweden Charges Lundin Executives with War Crimes. In an unprecedented move, Swedish prosecutors charged two upstream executives of Swedish upstream firm Lundin Energy (STO:LUNE) with war crimes allegedly committed in South Sudan between 1999 and 2003. The oil firm’s stock plunged 5% on the day.
Guyana to begin Auctioning New Blocks in Q3 2022. Putting a halt to its current system of direct license awards, the govt. of Guyana will start auctioning for offshore blocks in Q3 2022 because it tries to maneuver beyond its dependence on the Exxon-operated Stabroek block (that was directly awarded back in 1999).
Infrastructure Bottlenecks Force YPF to Refocus on Oil. Argentina’s state-controlled company YPF will shift its specialize in oil, currently producing quite 60,000 b/d, after its ramp-up of gas production hit a wall of lacking pipelines within the Vaca Muerta region.
Mexico Wants to Squeeze Funding of Energy Regulator. Only several months after Mexico’s energy regulatory office (CRE) found national company PEMEX misreporting its crude production, the national announced it might cut the budget of CRE in 2022 despite an overall surge in budgetary spending.
Nigeria Seeks Foreign Assistance to prevent Oil Spill. Nigeria is seeking help from abroad to assist plug an oil spill within the OML 29 license block operated by Nigerian firm Alteo Energy as some 10,000 b/d of crude could be leaking into the Niger.
Russian Oil Firm Sees Surprise Stock Surge. The shares of Surgutneftegaz, Russia’s fourth-largest oil producer, have soared by 45% in precisely two days with no apparent reason, fueling speculation that the corporate could be on the brink of a large announcement.
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