Oil markets experienced one in all the foremost volatile weeks in recent history, and there's no sign of things slowing down anytime soon. Russia's invasion of Ukraine is barely intensifying, a nuclear pander to Iran is reportedly days removed from being confirmed, and Libya has found itself all over again on the brink of warfare.
Russia’s invasion of Ukraine has triggered arguably the wildest week in oil trading since Saddam Hussein’s attack on Kuwait back in 1990 - after all, it had been exactly 33 years ago that the oil markets were this backwardated. the danger of Russian barrels being barred from oil markets pushed prices to their highest level since 2008, with WTI touching $116 per barrel on Thursday and ICE Brent coming within touching distance of $120 per barrel. The war still rages on in Ukraine and, despite rumors reappearing about an imminent nuclear cope with Iran, there's still some work to try to to to finalize the nuclear covenant. As if this weren't enough, renewed riots and catastrophe events in Libya might trigger another war which might almost certainly push oil prices past the $120 per barrel next week.
OPEC+ Rubber-stamps April Production Increase. In what can be the briefest OPEC+ ministerial meeting in recent history, lasting a mere nine minutes, the oil group agreed to a different 400,000 b/d monthly supply addition despite intensifying calls to provide more.
US Targets Russian Refining Sector. The Biden Administration announced another round of sanctions because it banned the export of specific refining technologies to Russia and Belarus, making it harder for both countries to modernize their downstream assets.
Germany Opposes Russia Energy Sanctions. during a refreshingly honest public utterance, Germany’s economy minister Robert Habeck stated Berlin wouldn't support a Russian oil and gas embargo, citing potential civil unrest should fuel prices go higher, with electricity prices already up 130% on the year.
Russia Seizes Ukraine’s Largest Nuclear Plant. Russian military forces attacked and seized Europe’s largest nuclear energy plant, the 5.7 GW capacity Zaporizhzhia, shelling a training facility outside of the plant area, during a move that triggered another UN council meeting.
Chinese Refiners Get Creative with Russian Purchases. Chinese refiners are increasingly paying for Russian crude by means of money transfers paid upfront, mitigating the banking risks after most Western banks shied faraway from issuing L/Cs, with state-owned trader Unipec reportedly buying the maximum amount as eight ESPO cargoes within the Far East.
Russia Gauges Yuan Payment Opportunities. Russian logistics firm FESCO (MCX:FESH) is actively seeking to maneuver its payments into Chinese yuan, implying that against such a sanctioning squeeze even non-sanctioned companies are attempting to seek out workarounds with potential Asian market outlets.
The Philippines to Revive nuclear energy Capacity. Philippine President Rodrigo Duterte ordered that an inter-agency government panel verify the revival of the scrapped Bataan atomic power Plant, completed in 1984 but subsequently shut two years in a while the rear of the Chernobyl disaster.
EU Carbon Prices Get Trashed as Speculators Flee. A wildly unpredictable macroeconomic outlook on the rear of the Russia-Ukraine war, plus spiking gas, coal, and power prices have triggered a mass exodus of speculators from EU ETS trading, sending European carbon prices into a tailspin, with the Dec ’22 currently assessed at €67 per MT, down almost €30/mt week-on-week.
Spiking Crude Prices Reignite Options Buying. With WTI trading at a bit below $115 per barrel, the typical number people options contracts traded on CME doubled average February volumes within the first week of March, hitting some 240,000 contracts per day.
Thanks for reading and we’ll see you next week.