Wednesday, December 09, 2020 / 7:53 AM / by Tom Kool of Oilprice.com / Header Image Credit:
Oil prices declined on Tuesday due to a weak short-term demand outlook, but
steadied during midday trading. The macro backdrop has a bullish tinge as
coronavirus vaccinations officially began in the UK on Tuesday.
U.S. gasoline demand falls 8%. U.S. gasoline demand over the Thanksgiving holiday fell to its lowest level in 20 years, and it was down 8.4%
from the week before. "We're heading toward a 90-day period where gasoline
demand gets further crimped by winter weather and post-holiday cocooning", "Tom
Kloza, executive director, IHS Markit, told Reuters. "By January, we may
regularly see demand numbers not witnessed since the last century".
Saudi Arabia hikes prices. Saudi Arabia hiked its oil pricing for cargoes heading to Asia, the
largest price increase in five months. "Aramco views the demand picture in Asia
as recovering to pre-pandemic levels, led mainly by China," said Edward Bell, senior director for market economics at
Emirates NBD PJSC in Dubai.
Tesla to issues shares to raise
$5 billion. Tesla
(NASDAQ: TSLA) decided to take advantage of its soaring share price by issuing
new equity. The third share sale in 10 months could raise as much as $5
billion.
UAE's jockeying at OPEC meeting
hints at ambitions. Some tough
negotiation and arm-twisting at the OPEC meeting by the UAE was a bit of a
departure from the past. The UAE typically follows Saudi Arabia's lead at OPEC.
The UAE also said that it plans on spending $122 billion on increasing
production capacity. Bloomberg looks at the UAE's rising ambition.
Judge cancels Arctic offshore
project. A federal judge canceled the approval of what would have been the country's
first offshore project in the Arctic, citing botched environmental analyses by
the Department of Interior.
Chevron vows higher returns and
lower carbon. Chevron (NYSE: CVX) CEO Mike Wirth told Bloomberg that his company would deliver "higher returns, lower
carbon." But Chevron's CAPEX towards cleaner energy will only be $300 million,
or 2% of its total $14 billion budget.
ExxonMobil under pressure from
activist fund. ExxonMobil (NYSE: XOM) is facing a proxy
fight from activist
investor Engine No. 1 LLC, which is pressuring the company to shift investments
towards clean energy. The outcome will depend on whether larger shareholders,
such as BlackRock and State Street, join the effort.
Iran prepares to increase oil
exports. Iran has instructed its oil ministry to prepare for
full oil production and exports within three months as it eyes a potential
easing of U.S. sanctions, according to Reuters.
Clean trucks key to
electrification. Commercial trucks
are emerging as a fast-growing segment of the electric vehicle market. Fifteen
U.S. states and Washington DC have announced plans to require new trucks to be
electric by 2050. But corporations are
moving regardless of
state mandates, with new commercial EV trucks rolling off assembly lines.
Lithium Americas gets U.S.
permit. After more than a
decade of review, Lithium
Americas Corp. (NYSE: LAC) received an environmental impact statement from the U.S.
government for a lithium mining project in Nevada. The company expects to
receive the final greenlight in early 2021.
Iraq budgets for $42 oil. Iraq will draft its budget based on an average oil price of $42 per barrel for next
year, oil minister Ihsan Abdul Jabbar Ismail said this weekend at an event in
Baghdad, as quoted by Argus Media.
Private equity fleeing from U.S.
shale. Private equity is losing
interest in U.S.
shale, with capital invested declining by 45% between 2017 and 2019. PE fueled
the last shale boom following the 2014-2016 downturn. Warburg Pincus recently
told investors it is pulling back from oil and gas, part of a broader trend,
according to Argus Media. Roughly 90% of the debt involved in bankruptcy this
year came from private equity-backed oil and gas companies.
China's buying spree is slowing. China's record-high imports from earlier this year continued
to slow
down last month
along with other commodity imports, as demand growth slackens.
Exxon slows a key carbon capture
project. ExxonMobil (NYSE: XOM) has tapped
the breaks on a significant carbon capture project in Wyoming due to the
pandemic, even as it presses ahead with traditional oil and gas projects,
according to Bloomberg
Green.
Tellurian withdraws application
for Permian gas pipeline. Tellurian (NASDAQ: TELL) withdrew its application to build the Permian Global Access
natural gas pipeline, which would transport Permian natural gas to southwest
Louisiana near Tellurian's proposed Driftwood LNG project. The company said "current market conditions do not support" the pipeline.
BP to invest in Middle East oil
production. BP (NYSE: BP) has said it will invest heavily in Middle Eastern oil and natural-gas fields
going into 2021. Despite pledging its transition to renewable energy, the
company has highlighted its interest in Middle East oil and gas.
Credit:
The post Gasoline Demand Hits 20 Year Low
During Thanksgiving first appeared in Oilprice.com on December 08, 2020.
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