Tom Nolan + 2,441 TN May 6, 2022 China’s Biggest Refiner Has No Plans To Scoop Up Cheap Russian Oil By Charles Kennedy - May 06, 2022, 1:00 PM CDT PetroChina will not buy up heavily discounted Russian oil and gas. The state-owned company said it was conducting business with Russia in accordance with “pre-signed contracts”. Petrochina acknowledged that sanctions have impacted oil and gas deals. https://oilprice.com/Energy/Energy-General/Chinas-Biggest-Refiner-Has-No-Plans-To-Scoop-Up-Cheap-Russian-Oil.html Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 6, 2022 U.S. Rig Count Ticks Higher As Oil Prices Head For Another Weekly Gain By Julianne Geiger - May 06, 2022, 12:33 PM CDT Join Our Community The number of total active drilling rigs in the United States rose by 7 this week, after an increase of 3 rigs in the week prior, according to new data from Baker Hughes published on Friday. The total rig count increased to 705 this week—257 rigs higher than the rig count this time in 2021. Drilling has picked up substantially since the Russia invasion, adding 55 rigs over the last ten weeks. Oil rigs in the United States rose this week by 5 rigs to 557, while gas rigs rose by 2 to 146. Miscellaneous rigs stayed the same, at 2. The rig count in the Permian Basin remained the same this week at 335, as did rigs in the Eagle Ford at 61. ... https://oilprice.com/Energy/Crude-Oil/US-Rig-Count-Ticks-Higher-As-Oil-Prices-Head-For-Another-Weekly-Gain.html Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 6, 2022 PetroChina Sees Fuel Demand Rising In China Despite COVID By Charles Kennedy - May 06, 2022, 11:00 AM CDT China's biggest refiner sees growing fuel demand in China. China manufacturing PMI, a barometer for Chinese oil demand, has come in at 47.4 in April’s official data. PetroChina: "With the improvement of the COVID situation, refined product inventory is now showing a downturn,". https://oilprice.com/Energy/Crude-Oil/PetroChina-Sees-Fuel-Demand-Rise-In-China-Despite-COVID.html Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 6, 2022 Russia Boosts Crude Sales To India’s Top Refiner By Tsvetana Paraskova - May 06, 2022, 10:00 AM CDT Russia is expected to ship seven cargoes of Urals crude to India's top refiner this month. India is reportedly asking to buy Russian crude for below $70 per barrel. Increased purchases of Russian crude in India could make tracking Europe’s embargo on Russia’s oil more complicated. https://oilprice.com/Energy/Crude-Oil/Russia-Boosts-Crude-Sales-To-Indias-Top-Refiner.html Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 6, 2022 German Refinery Faces Crude Shortage As EU Sanctions Kick In By Irina Slav - May 06, 2022, 11:30 AM CDT The PCK Schwedt refinery in Germany is facing a shortage of crude when the latest EU sanctions against Russia come into effect, the chief executive of Shell, which is a minority shareholder in PCK Schwedt, said. According to a Reuters report, the refinery was majority-owned by Russia’s Rosneft before the German government moved to oust the Russian company last month. Although the process has not yet been completed, Germany has made it clear it does not want a Russian company to operate one of its biggest refineries. The problem is that the refinery, which has a capacity of 233,000 bpd, operates on Russian oil, delivered via the Druzhba pipeline. Once the oil embargo takes effect, there will be effectively no raw material for the processing facility. According to Germany’s economy minister Robert Habeck, the country is in talks with Poland, although, "The Poles say, quite rightly, 'We don't want to bring Polish oil to Germany to keep Schwedt alive'.” "But we are speaking about a case where Germany supports Poland and Poland supports Germany in the event that Rosneft is no longer the operator of the refinery," he also said, as quoted by Reuters, in late April. Commenting on the potential fallout of the embargo this week, Shell’s Ben van Beurden said that the embargo "will probably mean that that refinery will be turned down quite significantly because the incoming logistics are constrained and the refinery is not configured for anything else but Urals”. Schwedt is not the only refinery in Europe configured for the Russian blend. Lukoil Neftohim Burgas, Bulgaria’s single refinery and the largest processing facility on the Balkans, also uses Urals crude as feedstock, which makes its future uncertain in case of a blanket embargo on Russian oil in the EU. Bulgaria has asked for an exemption, however, alongside Hungary, Slovakia, and the Czech Republic. By Irina Slav for Oilprice.com More Top Reads from Oilprice.com: Oil Prices Top $111 As Biden’s SPR Buyback Plan Leaks JPMorgan Slashes Demand Outlook Amid Soaring Oil Prices U.S. Oil Firms Generate Highest Cash Flows Since 2014 https://oilprice.com/Latest-Energy-News/World-News/German-Refinery-Faces-Crude-Shortage-As-EU-Sanctions-Kick-In.html Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 6, 2022 Oil Prices Underpinned By Supply Jitters By Editorial Dept - May 06, 2022, 1:00 PM CDT Join Our Community U.S. West Texas Intermediate crude oil futures are up over 3% for the week with most of the gains attributed to the European Commission’s decision to place an embargo on Russian crude oil. This move is perceived as bullish because it lowers the available supply. Demand is still a concern due to China’s COVID-related shutdowns, but conditions seem to be holding steady, which brings the country closer to gaining control of the situation and perhaps lifting restrictions sooner than expected. Nonetheless, the lockdowns have taken their toll on the economy, especially the services sector. This week’s American Petroleum Institute (API) and U.S. Energy Information Administration (EIA) weekly inventories report offered mixed results but they continued to highlight Europe’s strong demand for U.S. refined products, especially distillates. Prices Underpinned by Supply Jitters Crude oil prices are up this week due primarily to the release of... To access this exclusive content... Select your membership level below https://oilprice.com/Energy/Energy-General/Oil-Prices-Underpinned-By-Supply-Jitters.html Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 Saudi Aramco, the world's largest oil exporter, has cut prices from record highs for Asia - but not for the US Business Insider https://finance.yahoo.com/news/saudi-aramco-worlds-largest-oil-064228431.html Saudi Aramco — the world's top oil exporter — has cut June prices for buyers in Asia and Europe. The move comes amid strict COVID-19 lockdowns and restrictions in China, a major oil consumer. Oil prices have surged thanks to concerns about supply disruption from Russia due to the Ukraine war. Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 REUTERS Exclusive-Biden sidelined global energy partners with record emergency oil release -sources https://www.yahoo.com/news/exclusive-biden-sidelined-global-energy-051733939.html By Noah Browning and Dmitry Zhdannikov LONDON (Reuters) - The United States announced a record-sized release of emergency crude oil reserves in March without consulting partners in the International Energy Agency, leaving them scrambling to match with releases of their own, according to two sources familiar with the matter. Unilateral action by Washington to address global supply or price issues risks undermining the U.S. relationship with the IEA, the world's energy watchdog that normally oversees international releases from emergency stockpiles, and could raise questions about the continued relevance of the group. The Paris-based IEA, which groups together 31 mostly industrialized countries, was established after the 1973 oil price shock to ensure continuous energy supplies to its members in the event of an embargo, war, or devastating storm. The group's members have become worried that U.S. President Joe Biden is using the Strategic Petroleum Reserve (SPR) to tamp down rampant domestic inflation for political reasons, instead of protecting consumer countries from a global supply disruption, according to the sources who declined to be identified because of the sensitivity of the topic. "The IEA was embarrassed by the (U.S.) release which was at the start done essentially unilaterally by the U.S.," said a source familiar with the diplomacy around the release. "It is the common understanding of IEA members that we must cooperate as a whole,” said another source, this one from an IEA member country, who said the U.S. announcement came as a surprise. The IEA told Reuters it had been in close contact with all member countries including the United States in the run-up to its two stock release announcements this year: “This consultation as well as the decisions for taking collective action were conducted in line with IEA procedures.” The U.S. Department of Energy said the United States had been in “frequent contact” with the IEA and its member states on energy security leading up the announcement, but confirmed its decision to release the oil was “independent” of the IEA. It did not comment on whether the United States shared in advance the timing and volume of its release. “The United States and other IEA members countries can and have, independently, released oil from their strategic reserves separate from any IEA collective action,” the department said in a statement to Reuters. The White House did not immediately respond to a Reuters request for comment. STRANGE OPTICS At issue is the U.S. announcement on March 31 that it would unleash 180 million barrels from the SPR at a pace of 1 million barrels per day to bring down soaring global energy prices and address cuts in Russian oil supplies since its invasion of Ukraine in February. The sources told Reuters that Washington had not informed the IEA or its members that the announcement was coming – a break with past precedent - and that the record-sized volume, over three times bigger than any previous release from the SPR, was a surprise. The U.S. announcement came one day before members of the IEA were due to meet to discuss a coordinated release. Following the meeting, which was chaired by U.S Energy Secretary Jennifer Granholm, the IEA announced a coordinated release had been agreed but gave no detail on volumes. At that point, the IEA’s leadership began bilateral meetings with other members to cobble together contributions, according to the two sources. After a week of diplomacy, it secured commitments from its non-U.S. members to unleash another 60 million barrels combined. [nL2N2W41DP] That 60 million-barrel figure was relatively small, however. Per the IEA's rules, a member country’s contribution to a coordinated emergency release should roughly match the proportion of its oil consumption within the group. With the United States accounting for about half of consumption among members, the IEA contribution should have roughly matched the U.S. draw. “That wasn’t doable," the source familiar with the diplomacy said. "It was impossible as no one had such stocks." "The optics of the release being done 75% in the U.S. and 25% in the rest of the world are simply strange,” the source added. The IEA’s announcement glossed over the mismatch, detailing a 120 million-barrel release, with 60 million of that coming from the United States in the first two months – effectively ignoring the fact the U.S. aimed to keep the oil flowing for an additional four months. The Biden administration’s release marked the second time in six months that it had signed off on a big drawdown from the SPR without the IEA’s blessing. In November, the United States pledged a release of 50 million barrels to tame prices rising due to a sudden rebound in demand from the darkest days of the COVID-19 pandemic. While some IEA members like South Korea, Britain and Japan made contributions to that release, the agency itself sat out because it saw no major supply disruption to address at the time. After Russia’s invasion, however, IEA member countries saw fit to organize a coordinated release. On March 1, they announced a release of 60 million barrels - half from the United States – to counter likely disruptions to supplies from Russia, a leading global oil and gas producer. DOMESTIC CRITICISM Biden's Republican opponents have slammed him for his move to release the 180 million barrels from U.S. stockpiles, arguing that the decision was political and that he should be encouraging domestic oil production instead. Record-high prices for gasoline in the United States are seen as a top vulnerability to Biden’s Democratic party leading into mid-term elections in November. Biden ran on a promise to phase out fossil fuels to help fight climate change, but his administration has not successfully imposed any curbs on the industry and has in recent months urged drillers to speed up production to bring down prices. (Reporting by Reuters bureaux; Editing by Richard Valdmanis and Marguerita Choy) Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 https://oilprice.com/Energy/Crude-Oil/Why-The-EU-Will-Abandon-Its-Plan-To-Ban-Tankers-From-Shipping-Russian-Crude.html Why The EU Will Abandon Its Plan To Ban Tankers From Shipping Russian Crude By Tsvetana Paraskova - May 09, 2022, 11:00 AM CDT Greece objects to proposal to ban EU-vessels from shipping Russian crude oil. The European Commission last week officially proposed a full ban on Russian crude and oil product imports by the end of the year. Ban on insurance for Russian vessels could severely complicate Russia's oil exports and raise its shipping costs. The European Union is expected to leave out of the next sanctions package against Russia a proposed ban on EU-owned vessels from transporting Russian oil anywhere in the world due to objections from Greece, the EU member most reliant on international shipping, Bloomberg reported on Monday, quoting documents it has reviewed and sources with knowledge of the talks. The European Commission last week officially proposed a full ban on Russian crude and oil product imports by the end of the year. The initial draft of the sixth sanctions package against Russia over its invasion of Ukraine also included going after Russia's ability to even ship oil on the high seas with a proposed ban on European vessels and companies' ability to provide services to Russian shipping entities. If such a ban on Russia's access to European insurers were enacted, this would leave Russian companies exposed to the tune of multiple billions of dollars every time a single tanker leaves port, given risks like accidents and oil spills can bring with it such a price tag in terms of claims and legal action. Due to objections from Greece and other EU members, the bloc is now expected to drop the proposal to ban EU vessels from shipping Russian oil to third countries, but the ban on insurers would stay, according to Bloomberg's sources. If a ban on insurance for Russian vessels stays in the final sanctions package that all 27 EU member states need to sign off on, this would severely complicate Russia's oil exports and raise its shipping costs considering that Russia itself must provide insurance coverage for the cargoes to the buyers that would still want to buy its oil. That's because the International Group of P&I Clubs based in London, with many European insurers and reinsurers as members, deals with 95 percent of the coverage of the global tanker fleet for spills and other liabilities. Meanwhile, the EU continues to discuss the details of the embargo on Russian oil imports, with Hungary still a holdout to a ban, despite reportedly being offered a two-year exemption to comply. By Tsvetana Paraskova for Oilprice.com More Top Reads from Oilprice.com: U.S. Shale Swings From Losses To Record Cash Flows China’s COVID Lockdowns Force Aramco To Slash Oil Export Prices Saudi Energy Minister: Insufficient Investment To Blame For High Fuel Prices 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 https://oilprice.com/Energy/Energy-General/Saudi-Energy-Minister-Insufficient-Investment-To-Blame-For-High-Fuel-Prices.html Saudi Energy Minister: Insufficient Investment To Blame For High Fuel Prices By Tsvetana Paraskova - May 09, 2022, 10:00 AM CDT A lack of investment in global refining capacity could be driving the rise in fuel prices, according to Saudi Arabia’s Energy Minister. The energy minister went on to reiterate that net-zero goals are being undermined by the reality of the rising demand for oil and gas. “The net-zero does not mean cherrypicking, net-zero does not mean zero oil,” he explained. Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 U.S. Grid Operators Are Bracing For A Wave Of Blackouts By Irina Slav - May 09, 2022, 9:30 AM CDT Grid operators from a growing number of states are warning about electricity shortages as grids cannot cope with the imbalance between demand and supply heading into summer. California warned on Friday that it would need to produce more electricity than it is currently producing to avoid blackouts. The Midcontinent Independent System Operator (MISO), the nonprofit charged with operating the power grid in 15 U.S. states and Manitoba, issued a warning about outages during the summer. The Texas grid operator recently joined the warnings amid a heatwave that started last week and is expected to last well into this week, the Wall Street Journal reported. In California, officials from three state agencies forecast that the electricity shortfall could reach 1,700 MW for the full year. However, this could soar to as much as 5,000 MW if the California grid's challenges do not get resolved. This means that between 1 and 4 million people are facing power shortages. Texas is already suffering blackouts in some parts, but for now, the number of consumers affected is limited. "The Electric Reliability Council of Texas (ERCOT) is anticipating extreme hot weather in the region Friday, May 6 through Monday, May 9 and may experience larger than normal demand for power," ERCOT said at the end of last week. "ERCOT will deploy all the tools available to us to manage the grid reliably. ERCOT is coordinating closely with the Public Utility Commission, generation resource owners, and transmission utilities to ensure they are prepared for the extreme heat." The unusually hot weather comes as states struggle to build enough battery storage capacity for their wind and solar farms in time. The WSJ cited grid operators as a warning recently that the pace of progress in battery storage capacity development was too slow to compensate for the closures of fossil fuel power plants in favor of wind and solar installations. By Irina Slav for Oilprice.com More Top Reads from Oilprice.com: JPMorgan Slashes Demand Outlook Amid Soaring Oil Prices U.S. Oil Firms Generate Highest Cash Flows Since 2014 U.S. Shale Swings From Losses To Record Cash Flows https://oilprice.com/Latest-Energy-News/World-News/US-Grid-Operators-Are-Bracing-For-A-Wave-Of-Blackouts.html 1 Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 6 hours ago, Tom Nolan said: U.S. Grid Operators Are Bracing For A Wave Of Blackouts By Irina Slav - May 09, 2022, 9:30 AM CDT Grid operators from a growing number of states are warning about electricity shortages as grids cannot cope with the imbalance between demand and supply heading into summer. California warned on Friday that it would need to produce more electricity than it is currently producing to avoid blackouts. The Midcontinent Independent System Operator (MISO), the nonprofit charged with operating the power grid in 15 U.S. states and Manitoba, issued a warning about outages during the summer. The Texas grid operator recently joined the warnings amid a heatwave that started last week and is expected to last well into this week, the Wall Street Journal reported. In California, officials from three state agencies forecast that the electricity shortfall could reach 1,700 MW for the full year. However, this could soar to as much as 5,000 MW if the California grid's challenges do not get resolved. This means that between 1 and 4 million people are facing power shortages. Texas is already suffering blackouts in some parts, but for now, the number of consumers affected is limited. "The Electric Reliability Council of Texas (ERCOT) is anticipating extreme hot weather in the region Friday, May 6 through Monday, May 9 and may experience larger than normal demand for power," ERCOT said at the end of last week. "ERCOT will deploy all the tools available to us to manage the grid reliably. ERCOT is coordinating closely with the Public Utility Commission, generation resource owners, and transmission utilities to ensure they are prepared for the extreme heat." The unusually hot weather comes as states struggle to build enough battery storage capacity for their wind and solar farms in time. The WSJ cited grid operators as a warning recently that the pace of progress in battery storage capacity development was too slow to compensate for the closures of fossil fuel power plants in favor of wind and solar installations. By Irina Slav for Oilprice.com More Top Reads from Oilprice.com: JPMorgan Slashes Demand Outlook Amid Soaring Oil Prices U.S. Oil Firms Generate Highest Cash Flows Since 2014 U.S. Shale Swings From Losses To Record Cash Flows https://oilprice.com/Latest-Energy-News/World-News/US-Grid-Operators-Are-Bracing-For-A-Wave-Of-Blackouts.html https://www.zerohedge.com/commodities/power-grid-operators-warn-potential-electricity-shortages-amid-transition-clean-energy Power Grid Operators Warn Of Potential Electricity Shortages Amid Transition To Clean Energy by Tyler Durden Monday, May 09, 2022 - 05:12 PM Power-grid operators across the US warn that power-generating capacity struggles to keep up with demand, a worrying sign ahead of summer where heatwaves could lead to rolling blackouts. The Midcontinent Independent System Operator, or MISO, operating in 15 states across the US Central region, said last month that capacity shortages this summer due to soaring summer demand might result in outages. Last Friday, California Independent System Operator, or California ISO, outlined energy shortfalls this summer because of heat and wildfires. Texas over the weekend saw triple-digit temperatures in some portions of the state, though grid stability was maintained despite several power plants being offline for maintenance. WSJ explains grid instability and increased risk of power shortages this summer comes as fossil fuel power plants are "being retired more quickly than they can be replaced by renewable energy and battery storage." Power grids are racing to retire conventional power plants fueled by natural gas, coal, and diesel to green forms of energy, such as solar power and wind. There's also the retirement of aging nuclear power plants. Things are not working as planned in the green economy as power grids are becoming unstable by the retirement of fossil fuel power plants with unstable renewables. The transition isn't as smooth as climate change modelers once suggested as grid stability worsens, and millions of Americans could be subjected to blackouts this summer as cooling demand soars during heatwaves as grids won't have enough power to meet demand. WSJ's author reveals their blinkered bias or ignorance about alternative energy by stating the following "wind and solar farms - which are among the cheapest forms of power generation." Alternative energy would be expensive if it weren't for the government's tax credits, grants, and other incentives. Plus, these are unreliable sources of energy because when the wind doesn't blow, and the sun doesn't shine, power isn't produced, and there needs to be storage for electricity. However, the technology for widescale battery storage isn't feasible right now. The accelerated path of retiring fossil fuel power plants could generate even more problems for power grids at a time when "energy and batteries has become an especially difficult proposition amid supply-chain challenges and inflation," WSJ points out. The move to replace what's working, and a power source that can generate 24/7, unless there is a fuel shortage, has doomed grids across the US during the green transition. Explaining more is Brad Jones, interim chief executive of the Electric Reliability Council of Texas, which operates the state's power grid, who said: "Every market around the world is trying to deal with the same issue ... We're all trying to find ways to utilize as much of our renewable resources as possible…and at the same time make sure that we have enough dispatchable generation to manage reliability." Last Friday, a sobering reality from the California Energy Commission, Public Utilities Commission, California ISO, and Governor Gavin Newsom was that the state would have power supply gaps that could leave millions of people without power during peak hours. This imbalance in the grid is due to the lack of power generation and could last several years. Mark Rothleder, chief operating officer of California ISO, said, "We need to make sure that we have sufficient new resources in place and operational before we let some of these retirements ... Otherwise, we are putting ourselves potentially at risk of having insufficient capacity." It's become clear that the aggressive green energy push has jeopardized power grids across the US, and during heatwaves this summer, rolling blackouts could be seen as some grids may not have enough supply to meet demand. Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 Latest articles from Irina Slav U.S. Natural Gas Prices Get Caught Up In Perfect Storm Published 09 May 2022 | viewed 464 times U.S. natural gas prices have gone from cheap and range-bound to the highest in more than a decade in a matter of weeks. And they… U.S. Grid Operators Are Bracing For A Wave Of Blackouts Published 09 May 2022 | viewed 11,226 times Grid operators from a growing number of states are warning about electricity shortages as grids cannot cope with the imbalance between demand and supply heading… China’s COVID Lockdowns Force Aramco To Slash Oil Export Prices Published 09 May 2022 | viewed 9,353 times Saudi Aramco has reduced its oil export prices for the first time in four months amid Covid lockdowns in China that are spurring concern about… G7 Pledges To Stop Buying Russian Oil Published 09 May 2022 | viewed 5,093 times Members of G7 committed to decreasing their purchases of Russian oil amid the war in Ukraine at a virtual meeting this weekend. Per an AFP… OPEC Stays Silent As EU Rushes To Ban Russian Oil Published 07 May 2022 | viewed 27,015 times The Organisation of Petroleum Exporting Countries and its partners in OPEC+ led by Russia decided this week they would not increase their target production figure… Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 https://oilprice.com/Energy/Energy-General/The-Inevitable-Decline-Of-Russias-Oil-Industry30075.html The Inevitable Decline Of Russia’s Oil Industry By Tsvetana Paraskova - May 09, 2022, 5:00 PM CDT As the European Union prepares to place an embargo of some sort on Russian oil imports, Russia will be unable to redirect most of that oil elsewhere. Pivoting to Asia will require massive infrastructure investments that would cause Russia’s production and revenue to plunge. In the meantime, a lack of storage in Russia would mean the country will have to reduce production. Join Our Community Russia’s oil production is already falling and will continue dropping in the coming months and years as Moscow will not be able to redirect to China and India all the volumes it is losing in the West. As the European Union tries to work out the details of a proposed full embargo on Russian oil imports by the end of the year - by potentially exempting Hungary and Slovakia for two years from complying with a ban - buyers in Europe and major international traders are increasingly shunning Russian oil. Western sanctions on banking transfers and the expected EU embargo have forced Russia to reduce oil production. Russia simply doesn’t have enough storage, and its willing customers in emerging Asia are not expected to offset the drop in deliveries to Europe fully. Sanctions and embargoes over Putin’s war in Ukraine will cripple Russian oil production for years to come. Restrictions, combined with the lack of access to Western technology to pump harder-to-recover oil and enhance production from maturing wells will hit Russia’s oil industry not only in the near term but also in the long term, analysts say. Many wells may never be revived to pump crude again, they add. In the early days of the Russian invasion of Ukraine, Standard Chartered said that Russia would have to shut in some of its oil production as it would be unable to sell all the volumes displaced from European markets to other regions. According to Standard Chartered, “We expect continuing consumer reluctance to buy from Russia and shortages of capital, equipment and technology to continue to depress Russian output over at least the next three years.” Two months later, the Western pressure over Russia’s oil industry has escalated to deliberations on how to enforce an EU embargo, with Hungary a major holdout to a ban as of early Monday. Most analysts believe that the EU will reach some kind of a compromise on the embargo. Still, even if a ban is to come into force in several months, EU member states will be looking at ways to replace as much Russian oil as possible, to stop being beholden to Putin for a large part of their energy supply. With the West on an irreversible path to part with its dependence on Russian energy, Russia’s oil production is set for years of decline, analysts say. China and India, which haven’t shied away from buying heavily discounted Russian crude, will not be able to offset all the losses from the West. Moreover, it would take Russia years to redirect more oil flows to emerging Asia, considering the major shift in trade and tanker routes necessary to ship its crude to the East. “An EU embargo on Russian energy would surely cripple the Russian oil and gas industry because Russia would struggle to find alternative buyers for all of its energy and would end up shutting in production — ultimately crimping revenues which its economy is so reliant upon,” Matt Smith, lead oil analyst at Kpler, told Insider’s Phil Rosen. Related: JPMorgan Slashes Demand Outlook Amid Soaring Oil Prices Russia itself has admitted that its oil production could drop by 17 percent this year due to the sanctions, TASS news agency reported, citing Finance Minister Anton Siluanov. In April alone, oil production fell by 9 percent from March. Current supply losses from Russia at around 1 million barrels per day (bpd) could double this month, BP’s chief executive Bernard Looney told CNBC last week. According to Mike Muller, head of Asia at Vitol Group, “There is an increase in backing in of supply from Russia,” the executive at the world’s largest independent oil trader told a Gulf Intelligence podcast on Sunday. Losses will mount starting as early as next week, he says. “We’re virtually on top of that date where the international banking system just cannot make payments to Russian entities work,” Muller told the Gulf Intelligence webinar. “EU sanctions prohibit a whole number of things from May 15,” he added. Major international traders have already said they would either cut or phase out purchases of Russia’s crude in the coming weeks. Vitol itself plans to wind down its activities involving Russian crude oil by the end of this year, Bloomberg reported last month, citing a spokesman for the company. Even though Russia is currently capitalizing on high revenues with the high oil and gas prices, its oil industry could be in for a terminal decline and lose 2 million bpd of production by 2030 compared to 2021, Rystad Energy said earlier this month. “Pivoting exports to Asia will take time and massive infrastructure investments that in the medium term will see Russia’s production and revenues drop precipitously,” says Daria Melnik, senior analyst at Rystad Energy. “The situation will be aggravated by a lack of investments and foreign technologies, which will lead to lower drilling activity. Russia is, as a result, not expected to return to pre-conflict production levels even by 2026,” the energy intelligence firm said. By Tsvetana Paraskova for Oilprice.com More Top Reads from Oilprice.com: U.S. Oil Firms Generate Highest Cash Flows Since 2014 U.S. Shale Swings From Losses To Record Cash Flows China’s COVID Lockdowns Force Aramco To Slash Oil Export Prices Latest articles from Tsvetana The Inevitable Decline Of Russia’s Oil Industry Published 09 May 2022 | viewed 1,216 times Russia’s oil production is already falling and will continue dropping in the coming months and years as Moscow will not be able to redirect to… EU Set To Roll Out Permits For Renewables Projects At Faster Pace Published 09 May 2022 | viewed 259 times The European Commission is expected to propose next week faster permitting for renewable energy projects as part of its plan to increase the uptake of… China Imports More Crude As Shipments From Russia Rise Published 09 May 2022 | viewed 3,326 times China registered in April its first annual increase in crude oil imports since January as shipments rebounded on the back of higher arrivals from Russia,… Why The EU Will Abandon Its Plan To Ban Tankers From Shipping Russian Crude Published 09 May 2022 | viewed 10,216 times The European Union is expected to leave out of the next sanctions package against Russia a proposed ban on EU-owned vessels from transporting Russian oil… Saudi Energy Minister: Insufficient Investment To Blame For High Fuel Prices Published 09 May 2022 | viewed 3,494 times Not enough investment in global refining capacity is one of the key drivers of the global rally in gasoline, diesel, and jet fuel prices, according… U.S. Shale Swings From Losses To Record Cash Flows Published 08 May 2022 | viewed 16,366 times After years of plowing money into boosting production and thus depressing oil prices, the U.S. shale patch emerged from the pandemic-inflicted slump with unwavering capital… NOPEC Bill Could Send Prices At The Pump Even Higher Published 08 May 2022 | viewed 13,252 times After some two decades of failed attempts, the NOPEC (No Oil Producing and Exporting Cartels) Act was passed by a Senate panel on Thursday in… Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 Can Washington Regain Influence On The World Stage? By Simon Watkins - May 09, 2022, 4:00 PM CDT The global geopolitical system changed forever at the end of the Cold War, and the U.S. has struggled with how to play the new game, unsure of its position on the world stage. A lack of consistency and clarity in U.S. foreign policy has meant that supposed allies of the U.S., such as India, feel comfortable deepening diplomatic relations with Russia. The continued aggression of Russia in Ukraine and the strong response from Washington and the EU may bring all of this to a head, forcing allies to choose a side. https://oilprice.com/Energy/Energy-General/Can-Washington-Regain-Influence-On-The-World-Stage.html Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 Gasoline Prices May Have Finally Peaked By Robert Rapier - May 09, 2022, 2:00 PM CDT Russia’s invasion of Ukraine sparked a significant increase in oil prices, and by extension, gasoline prices. As summer nears, refiners are switching over to more expensive blends mandated to lower vapor pressure and minimize smog formation. High gasoline prices may persist through summer, but autumn could bring some significant relief for consumers at the pump. https://oilprice.com/Energy/Gas-Prices/Gasoline-Prices-May-Have-Finally-Peaked.html Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 Oman Sees $930M Budget Surplus As Oil Revenues Soar By Charles Kennedy - May 09, 2022, 3:30 PM CDT Oman has jumped from a budget deficit last year to a $930 surplus as of the end of the first quarter of 2022, thanks to a significant increase in oil revenues by more than 70%, Reuters reported. Oman saw gas revenue for Q1 more than double. .... https://oilprice.com/Latest-Energy-News/World-News/Oman-Sees-930M-Budget-Surplus-As-Oil-Revenues-Soar.html Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 https://oilprice.com/Latest-Energy-News/World-News/Oil-Stocks-Plummet-As-Broader-Markets-Tanks.html Oil Stocks Plummet As Broader Markets Tanks By Charles Kennedy - May 09, 2022, 2:00 PM CDT Oil stocks are tanking amid a broader market selloff, as Wall Street responds to stubbornly high inflation that is expected to lead to more Federal Reserve policy tightening. With a New York Fed survey showing longer-term inflation expectations that indicate potential weaker growth and recession, Wall Street is showing less appetite for risk, while oil prices have shed nearly 6% today on concerns of China’s COVID lockdowns. Exxon is down nearly 7.4% as of 2:00 p.m. EST, while Chevron has shed 6.47%, BP is down 5.8% and Shell has retraced 4.6%. Brent crude was trading at $105.7, down from $113 last week, and WTI was trading at $102.9, down over 6% from last week’s highs. Downward pressure on oil prices Monday comes amid a strong dollar and renewed fears that China’s continuing lockdowns will dampen demand. Oil has been extremely volatile, with the market unclear whether the threat to demand emanating from China’s lockdowns outweighs the European Union’s efforts to ban Russian oil and a Russian oil production decline. For the past several weeks, oil prices have largely been responding immediately to headlines in this respect. An EU announcement that brings the bloc closer to implementing an oil embargo on Russia results in a large percentage increase in oil prices. Likewise, news indicating that China is not moving closer to easing COVID restrictions in its “zero-COVID” policy drags oil down, in combination with inflation data and Fed policy expectations. The broader market selloff is also a response to China’s lockdowns. Stocks fell in Europe and Asia across the board Monday. The Dow Jones Industrial Average had lost 447 points by 2:00 p.m. EST, while the S&P 500 had shed 2.53%, already having lost for five consecutive weeks. Oil stocks have buck this trend and outperformed the broader market recently. Most traders are expecting a 75 basis-point hike at the Fed’s June meeting, Reuters reported, with key data coming on Wednesday in the form of the monthly consumer price index, which will be a barometer for where we are with inflation. By Charles Kennedy for Oilprice.com More Top Reads from Oilprice.com: U.S. Oil Firms Generate Highest Cash Flows Since 2014 U.S. Shale Swings From Losses To Record Cash Flows China’s COVID Lockdowns Force Aramco To Slash Oil Export Prices Quote Share this post Link to post Share on other sites
Tom Nolan + 2,441 TN May 9, 2022 EU Set To Roll Out Permits For Renewables Projects At Faster Pace By Tsvetana Paraskova - May 09, 2022, 2:30 PM CDT https://oilprice.com/Latest-Energy-News/World-News/EU-Set-To-Roll-Out-Permits-For-Renewables-Projects-At-Faster-Pace.html Quote Share this post Link to post Share on other sites
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