Saturday, August 28 2021 /06:20 AM / by Michael
Kern of Oilprice.com / Header Image Credit: Oilprice.com
A weaker U.S. dollar, a more optimistic demand outlook in
China and supply outages in the Gulf of Mexico were the catalysts that drove
crude prices higher this week.
Friday, August 27th, 2021
With fundamentals largely remaining the same as
they were last week, oil prices nevertheless are poised to post sizable gains,
with global benchmark Brent trading above $72 per barrel and WTI climbing to
just south of $69 per barrel. The blaze at the Ku-Maloob-Zaap offshore platform
in Mexico started it off, taking some 400,000 b/d of crude out of the market
for the time being, and the forced evacuation of staff from production
platforms in the Gulf of Mexico ahead of Tropical Storm Ida finished off the
supply disruption, overpowering COVID concerns and the weakness of the physical
Seeks to Review Chinese Metal Deals. The government of
the Democratic Republic of Congo (DRC) is reviewing its 6 billion
infrastructure-for-metals deals, based on concerns that they are not
"sufficiently benefiting Congo" as China controls 70% of DRC's mining sector.
66 Puts Louisiana Refinery for Sale. US refiner Phillips 66
(NYSE:PSX) announced it would market its 255kbpd
Alliance refinery in Louisiana, citing the "evolving energy landscape" as the
primary trigger for such a decision. The 50-year old plant produces gasoline
and diesel for the domestic market.
Offers 20 Million Barrels to Markets in September. Venezuela's
state oil company PDVSA is offering international buyers 20 MMbbls of heavy
crude for September lifting, with prices ranging from $35 to $41 per barrel,
S&P Platts reports. Venezuela is seeking to ramp up exports as July
outflows totaled 520kbpd.
to Boost LNG Import Potential. India will see
the commissioning of
a 5mtpa LNG import terminal next year in the western state of Gujarat, with
private investor Swan Energy (NS:SWAN) intent
on completing it by next March. State companies IOC, Bharat Petroleum and ONGC
have all leased 1mtpa per year of Swan's capacities.
Announces Large Shale Find. China's state-owned oil
firm CNPC reported the
discovery of a major shale oilfield in the immediate vicinity of the Daqing oil
field (the largest-ever field in China), with expected reserves of up to 1.27
billion tons. It remains to be seen if CNPC would be able to manage the complex
geology of the given acreage, let alone the waxiness.
Rules to Apply to Nord Stream 2. The Dusseldorf
Regional Court in Germany ruled that EU gas
unbundling rules (i.e. pipeline owners should be different from suppliers)
should apply to the almost-complete Nord Stream 2 pipeline, meaning Gazprom
(MCX:GAZP) will have to auction its volumes.
Spins Off Rumaila into Separate Entity. UK-based
major BP (NYSE:BP) finalized the
spinning off of its Iraqi subsidiary that operates Rumaila, one of the world's
largest oil fields, into a joint venture with PetroChina called Basra Energy
Company, as it seeks to decrease its carbon footprint across the entire
spectrum of its activities.
Wants to Export Pipeline Gas. The Russian state oil
company Rosneft (MCX:ROSN) has asked Russian President
Putin to grant them access to pipeline gas exports, to export 10 bcm per year
via an agent agreement with Gazprom.
Wants More Pipeline Gas. China's CNPC
(SHA:601857) will drill three new "complex" production
wells at the supergiant Galkynysh gas field in Turkmenistan, in a deal that would see
it receiving produced gas as a means of payment for its drilling. Amidst
soaring LNG prices, China has been ramping up its (cheaper) pipeline gas
Largest Lithium Project Sparks Anger. The 2.4 billion
Jadar project of Anglo-Australian miner Rio Tinto (NYSE:RIO) sparked controversy in Serbia, as locals fear possible environmental damage
from the mine, assumed to become Europe's largest once it reaches its peak
production capacity of 58,000 tonnes of battery-grade lithium carbonate.
Coal Might Decouple from Gas Prices. Whilst gas prices
fell off after soaring over the summer, coal prices might remain elevated in
the upcoming weeks, especially in Asia where Indonesia's decision to ban
several large producers from exporting (for failing to meet domestic demand on
a preferential basis) will add further tightness to seaborne supplies.
Wants to Leave Mexican Offshore. Norwegian oil
major Equinor (NYSE:EQNR) is intent on quitting Mexico's
upstream sector as part of its 2050 ambition of becoming net-zero by 2050,
however was thus far unable to find suitable buyers for its assets - self-operated Block 01 and Block 03 in the Salina Basin.
Promotes its Own Sodium-Ion Technology. After CATL
(SHE:300750), China's largest battery manufacturer, unveiled its
new sodium-ion batteries last month, the country's government has set sights on
the promotion of the new technology within its 14th five-year economic plan as
it seeks to diversify away from traditional battery metals like cobalt or
Africa Wants More Nuclear Energy. South Africa's
energy regulator supported a
government plan to build more nuclear reactors in the country as Pretoria moves
away from coal-powered electricity generation (still some 80% of total
production). Previous attempts to move into nuclear were marred by corruption
Sued over its Net Zero Objectives. An Australian
environmental group is suing the country's second-largest gas producer Santos (ASX:STO),
arguing its 2040 net-zero was "deceptive". This marks the first-ever case to
challenge the validity of one's emissions objectives.
The post Oil Stages
Strong Recovery first appeared in Oilprice.com on August 27, 2021.
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