November 09, 2019 /07:15AM / By Tom Kool of Oilprice.com
/ Header Image Credit: Oilprice.com
Trade war optimism sent oil prices up at the
start of the week but, with traders now growing skeptical of any progress in
the talks between China and the U.S., oil prices are entering a familiar cycle.
Oil prices fell back on Friday as traders awaited more solid evidence that the
U.S.-China trade deal will be completed. News reports this week suggested that
both sides would lower tariffs as part of the "phase one" agreement. But the
deal has been delayed until December. "The U.S.-China trade talks are heading
in the right direction" but "there are still several obstacles that will need
to be overcome," Stephen Brennock, an analyst at PVM Oil Associates Ltd.,
told Bloomberg. Equinor
agrees to sell Eagle Ford business. Equinor (NYSE:
EQNR) has agreed to sell its 63 percent interest and operatorship in its onshore
Eagle Ford shale business to Repsol (OTCQX: REPYF) for
oil auction fails badly. International oil firms
stayed away from a highly-anticipated offshore oil auction in Brazil, an
unexpectedly poor result for the country. "Total disaster is the best way to
describe this morning's round," Ross Lubetkin, CEO at Welligence Energy
Analytics, a consultancy, told Bloomberg. The only blocks awarded went to
state-owned Petrobras and Chinese state-owned CNODC. Four blocks received no
bids at all. "All majors are focused on capital discipline and value versus
volume. They will not bid at any cost for pre-salt assets," Marcelo de Assis,
head of Latin America upstream at Wood Mackenzie, told Reuters. Brazilian officials suggested that they
need to reform laws that currently puts Petrobras at the forefront of development
in the pre-salt. A second auction on Thursday only saw one bid. Brazil's
economy minister said the results left him "terrified."
oil prices fall on Keystone outage. TC Energy's
(NYSE: TRP) Keystone pipeline leaked more than 9,000
barrels of oil in North Dakota last week, and U.S. federal regulators said the
company needed to send a portion of the damaged pipeline to an independent lab
for testing before it could be restarted. Western Canada Select prices
fell, widening to a discount in excess of $22 per barrel, up from
around $16 per barrel before the spill. TC Energy said the pipeline could partially restart
next week, pending regulatory approval.
Aramco inks Asia deals. Saudi Arabia signed agreements with buyers in China,
hoping to increase shipments to the east, which will make up from dwindling
exports to the U.S.
not pushing for cuts. The largest oil producers from
within OPEC+ are not pressing for deeper cuts. Sources told Bloomberg that the most likely outcome at the
upcoming meeting in Vienna would be an extension of the current cuts. "It will
prove very difficult to formally agree new, deeper cuts," Harry Tchilinguirian,
head of commodity markets strategy at BNP Paribas SA in London, told Bloomberg. "A rollover of current cuts for the rest of 2020, with an emphasis on
compliance by all members, is the path of least resistance."
shale titans say drilling frenzy is over. Several
high-profile U.S. shale executives made predictions on their recent earnings calls that
the U.S. oil boom is coming to an end. The Permian basin is "going to slow down
significantly over the next several years," Pioneer
Natural Resources (NYSE: PXD) CEO Scott Sheffield said.
Mark Papa, CEO of Centennial Resource Development (NASDAQ: CDEV),
added that the slowdown is largely due to "the shift to Tier 2 and 3 drilling
locations in all shale plays and increasing parent-child issues in the
Permian." Meanwhile, Chesapeake Energy (NYSE: CHK) warned
that it might not continue as a "going concern."
Resources beats estimates. Bucking the trend from
out-of-favor drillers, EOG Resources (NYSE: EOG) saw
its share price jump after it beat earnings estimates. The company
reported higher-than-expected production while spending less than anticipated.
to leave American lobby group. Total SA
(NYSE: TOT) said that it would not renew its membership in the powerful
American Fuel & Petrochemical Manufacturers association because the lobby
group's position on climate change does not align with the French oil company.
Total said it had different views on the Paris Climate agreement, carbon
pricing and renewable energy. That follows a similar decision from Royal Dutch
Shell (NYSE: RDS.A) earlier this year to leave AFPM.
smog hits crisis levels. India declared a public
health emergency as air pollution in New Delhi hit acute levels. People stayed
indoors, factories and schools closed and flights were grounded. The smog is a
drag on India's economy, the FT reports. Fuel demand growth is at a six-year low, and may only expand by 170,000 bpd this year.
Fed: Climate change can't be ignored. "The U.S.
economy has experienced more than $500 billion in direct losses over the last
five years due to climate and weather-related events," Federal Reserve Bank of
New York Executive Vice President Kevin Stiroh said at a risk forum on Thursday at the
"Supervisors should take a risk management perspective, not a social
engineering one. It is beyond our mandate to advocate or provide incentives for
a particular transition path."
to sell shuttered plant to electric truck maker. GM (NYSE:
GM) confirmed plans to sell its shuttered
Lordestown facility in Ohio to an electric truck manufacturer.
Arabia bullies rich on IPO. Saudi Arabia is bullying wealthy Saudi citizens into buying
stock in Saudi Aramco.
could cut EV subsidies again. China is
considering further cuts to EV subsidies, which would deal
another blow to the sector.
- Customs Suspends Petroleum
Products Supply To Filling Stations Within 20 Kilometers To All Borders
- International Oil Companies
Scale Down On Nigeria Operations
- The Bulls Are Back As Oil Heads
- Nigerian Lawmakers Vote to
Increase Deepwater Royalties
- Saudi Arabian CMA Announces the
Approval of The IPO of The Saudi Arabian Oil Company's Shares
- Oil Markets: A Rare Bullish
Bounce In Oil Markets
- FG Urged
to Pay Greater Attention to Oil Producing Communities
- Is OPEC
Doing Enough To Counter The Looming Oil Glut? - OIR 291019
Rated BBB plus Long-Term (NG), A2 Short-Term (NG)- GCR; Outlook Stable
Markets: Oil Bulls Broken By Economic Fears - OIR 251019
Raises Nigeria's Oil Production Quota by 80,000bpd
Rebounds On Rare Market Optimism - OIR 221019
Faces Critical Decision As Oil Drops Again - OIR 181019
Prices Of PMS, AGO, HHK and Cooking Gas - September 2019
Markets Bearish Despite Rising Geopolitical Risk - OIR 151019
Long-Term Crisis Looms For Oil
Prices Rise On Trade War Optimism And Tanker Attack - OIR 111019