Tuesday, November 24, 2020 /07:00
PM / by Tom Kool of Oilprice.com / Header Image Credit:Oilprice.com
Today, we will take a quick look at some of the
critical figures and data in the energy markets this week.
We will then look at some of the key market movers early this week before
providing you with the latest analysis of the top news events taking place in
the global energy complex over the past few days. We hope you enjoy.
Chart of the Week
Market Movers
Oil prices rose to their highest levels since March, with WTI nearing $45 and
Brent topping $47. Oil prices surged on the potential for a third
highly-effective coronavirus vaccine. Also, the seeming end of the election
drama also boosted sentiment, as investors hoped for more stimulus under the
Biden administration. "By some time in the middle of next year, the economic
environment should really move quite rapidly toward normalization, which
ultimately means that demand for petroleum products should start to recover,"
Bart Melek, head of global commodity strategy at TD Securities, told Bloomberg.
Bakken
struggling at $40. Prices need to get "above $45/bbl for
completion of drilled-but-uncompleted (DUC) wells, and we need to see $55/bbl
oil, in general, to drill new wells and complete them," Lynn Helms, director of
North Dakota's Department of Mineral Resources said, according to NGI.
UAE
eyes 5 mb/d. The UAE said that recent
discoveries from state-owned ADNOC could help boost oil production to 5 mb/d by
2030.
India
to double refining capacity. India's Prime Minister Narendra
Modi said that India
would double refining capacity within 5 years.
China
seeks to become the world's largest refiner. "China is going to
put another million barrels a day or more on the table in the next few years,"
Steve Sawyer, director of refining at energy industry consultancy Facts Global
Energy, told Bloomberg in
an interview. "China will overtake the U.S. probably in the next year or two."
Biofuels
industry calls for clean fuels standard. America's largest biofuels
companies are asking
President-elect Biden to implement a nationwide clean fuels standard, as the
existing renewable fuels standard nears expiration.
Venezuela
arrests oil workers. Venezuela's regime has recently arrested oil workers
or retired oil workers who have dared to expose the corruption and
mismanagement at its state oil firm PDVSA and its dire financial, operational,
and working conditions.
IMO
to ban fuel oil in the Arctic. The International Maritime
Organization (IMO) approved on Friday a
ban on the use of heavy fuel oil for ships in the Arctic, but environmental
organizations slammed the new regulation as "riddled with loopholes."
EU
pushes back on U.S. LNG. A recent U.S. LNG deal with Europe was
scuttled over concerns about methane emissions. It may not have been a one-off.
Politico reports that U.S. LNG
is running into trouble across the European Union. "There's a real sensitivity
in the EU about fracked gas," one industry executive told Politico. The
incoming administration "would be well advised to prioritize that. If
[customers] can't use U.S. gas, then they're using Russian gas and Mideast
gas." The Biden administration's attempts to regulate methane may be unwanted
by U.S. drillers, but it may help gas exporters access European markets.
Oil
companies commit to methane cuts. BP (NYSE: BP),
Royal
Dutch Shell (NYSE: RDS.A), Eni (NYSE: E), Equinor (NYSE:
EQNR), and Total (NYSE: TOT) have signed the Oil and Gas
Methane Partnership (OGMP), a voluntary commitment under the
United Nations, the European Union and the Environmental Defense Fund aimed at
slashing methane emissions from oil and gas wells. They aim to cut methane
emissions by 45% by 2025. The group consists of 62 members, although American
oil majors Chevron (NYSE: CVX) and ExxonMobil (NYSE: XOM) are
not participating.
Colorado
regulators approve 2,000-foot setbacks. Colorado regulators approved new rules for
oil and gas drilling, including expanding setback distances from 500 feet to
2,000 feet for wells near homes and public spaces. The rule takes effect on
January 15.
GM
does 180 on fuel economy standards. GM (NYSE: GM) switched sides in the
fight between California and the Trump administration over fuel economy
standards. The automaker backed the Trump administration's effort to water-down
standards, but on Monday switched over to California's side, better aligning it
with the incoming Biden administration. Toyota suggested it may switch as
well.
CFTC
released a report on the April flash crash. The Commodities
Futures Trading Commission (CFTC) released a report on the April crash in WTI
prices into negative territory. One of the commissioners criticized the report as
inadequately addressing the root causes.
Williams
restructures contracts with Chesapeake. Williams
Companies (NYSE: WMB) said it would take
ownership of some of Chesapeake Energy's (OTCMKTS: CHK) assets
in exchange for lower gas gathering fees.
Total
to shut refinery. Total (NYSE: TOT) will shut its Donges
refinery due to the market downturn.
Oil
lobby says it will fight fracking restrictions. The American
Petroleum Institute will use "every tool
at its disposal" to combat potential restrictions on federal lands for drilling
under the Biden administration.
Survey
finds institutional investors switching to renewables. Global
institutional investors managing nearly $7 trillion said that they
plan on doubling their investments in renewables over the next five years. The
share of renewables in their portfolios may rise from 4.2% to 8.3% by 2025.
Canada's
oil and gas sector sees record job losses. A total of 37% of
oil and gas companies in Canada resorted to permanent layoffs due to the
pandemic-driven oil price and oil demand slump, a recent survey of energy labor
market organization PetroLMI showed.
Credit:
Related News - Previous Oilprice
Intelligence Report
1.
Oil Demand Set to
Rebound in 2021 - OIR 201120
2.
Oil Markets See Light
At The End Of The Tunnel - OIR 171120
3.
Surge in COVID Cases Counters Oil Market Optimism- OIR 131120
4. Oil
Optimism Returns on Vaccine News - OIR 101120
5.
COVID Surge Keeps
Oil Below $40- OIR 061120
6.
Why Oil Markets Aren't
Focused On The Election - OIR 031120
7.
Oil
Prices Dragged Down By COVID - OIR 301020
8.
Oil
Demand In Doubt As COVID Cases Climb - OIR 271020
9.
Oil Back
Down As COVID Cases Surge - OIR 231020
10. Oil
Prices Are Going Nowhere Until Election - OIR 201020
Related News - Oil and Gas
1.
Average Prices of PMS, AGO, HHK and Cooking Gas - October 2020
2.
Ardova Signs Lubricants Deal With Shell in the Nigerian Market
3.
NBCC Forum: Stakeholders Highlight Benefits of Gas-Led Industrialization
in Nigeria
4. Petrol
May Sell at N168 as PPMC Increases Depot Rate to N155
5.
Brent Oil Price Drops
Below $38pp on Renewed Coronavirus Lockdowns
6.
China Sets Its Sights On
Global EV Dominance
7.
NSE
Forum: Stakeholders Urge Oil and Gas Companies To Leverage Capital Market
8.
COVID
Kills Another Oil Rally - OIR 161020
9.
Average
Prices of PMS, AGO, HHK and Cooking Gas - September 2020
10. NSE to
Host Industry Leaders at Oil and Gas Sector Webinar