Oil prices rebound on bullish news

While the increase in Omicron cases has raised fears of a destruction in demand, supply issues in Libya and declining oil stocks in the United States have pushed up prices.

Graph of the week


– India needs to add 40 GW per year of renewable capacity to reach the 2030 target that it agreed at the COP26 summit in Glasgow, but the country seems increasingly unlikely to do so.

– Renewable energies currently represent only 11% of India’s overall production capacity, with coal – the country’s main source of energy – still having a large reserve capacity.

– With thermal coal prices recently slipping below the $ 100 / mt threshold and coal-fired power plants still using only 55% of their nominal capacity, the widely expected surge in GDP over 2022-2023 will trigger further increases in the use of coal.

– With the increase in the prices of raw materials for wind turbines and solar panels during 2021, it is unlikely that India will be able to add more than its usual 10 GW per year in the years to come.

Market movers

– Oil major based in the United Kingdom BP (NYSE: BP) will buy the remaining stake in its US pipeline business BP Midstream Partners (NYSE: BPMP) for a total price of $ 723 million, a simplification of the structure triggered by the authorities that no longer give tax breaks to master limited partnerships.

– Energy company Shell (NYSE: RDS.A) has signed to develop Oman’s onshore Block 10 with a 53% operator stake, aiming to produce 500 MCf per day of gas from the Saih Rawl field by 2023.

– Private company Presidio Petroleum is in advanced talks to buy some 5,000 shale gas wells from the US oil major ExxonMobil (NYSE: XOM) in the patch of Fayetteville Shale in Arkansas, initially valued at around $ 500 million.

Tuesday, December 21, 2021

The rapidly growing number of Omicron cases around the world has raised fears in the oil market for another period of low demand, with the new strain already becoming the dominant COVID variant in the United States. Despite early indications that Omicron is less lethal, the market will still have to wait until the end of this period of further bearishness before it can regain its bullish sentiment. Acting as a temporary support for oil prices, the skirmishes in Libya that led to a force majeure event over oil exports put upward pressure on prices, as did news of falling stocks. US crude oil for the fourth consecutive week. These bullish factors helped push up oil prices on Tuesday morning.

OPEC + by-produces the production target in November. OPEC + compliance with oil production cuts edged up month-over-month in November to 117%, mainly triggered by Angola and Nigeria struggling to recover from lower prices. endless production rate and maintenance problems.

Manchin Veto blocks Biden from $ 1.7 billion package. The Biden administration will be forced to revamp its $ 1.75 trillion Build Better infrastructure bill following Sen. Joe Manchin’s veto, making things like methane charges increasingly likely. excluded from the final invoice.

Related: Cities Around The World Are Trying To Take Out Natural Gas

Libya declares force majeure at several export terminals. The Libyan NOC declared force majeure on crude exports from the western ports of Zawia and Mellitah after the Petroleum Facilities Guard took over and halted production in most of the African country’s fields in the west.

Aker BP-Lundin Megadeal creates NCS Giant. Norwegian producer Aker BP to acquire North Sea counterpart Lundin Energy (STO: LUNE) in a $ 14 billion deal, joining forces to become the second largest company on the Norwegian continental shelf.

European gas prices are still rising. As Russian pipeline gas deliveries to Germany remain at relatively low levels and the odds of Nord Stream 2 launching this year fade, the European benchmark TTF has risen to € 149 per MWh this year. week (equivalent to $ 52 per mmBtu).

Investor’s guide to private placements. While almost all retail investors have at least a basic understanding of the stock market, the private market is largely misunderstood. Fortunately, Oilprice readers can now get a FREE private placement report and access trades traditionally only for insiders.

EPA strengthens US vehicle emissions requirements. Reversing the rollback in Trump-era auto pollution reductions, the U.S. Environmental Protection Agency has tightened emissions requirements for new vehicles through 2026, expecting actual average fuel consumption to be 40 miles per gallon at this point (up 8 mpg from previous rules).

The UK government wants to assess the climate policy alignment of the new projects. Just weeks after Cambo’s future was in jeopardy, the UK government launched a nationwide consultation on the future design of its oil and gas licenses, seeking to ensure that any new licenses will be fully aligned with UK commitments in climate change.

Chevron entrusts the participation of Suriname to Shell. American oil major Chevron (NYSE: CVX) has sold a third of its 60% stake in the Block 5 offshore license in Suriname, just two months after winning the 30-year production-sharing contract in the country’s latest shallow offshore tender.

Chilean miners are preparing for the leftist president. Actions focused on Chile such as Albemarle (NYSE: ALB) Where SQM (NYSE: SQM) took a beating earlier this week as Chilean President-elect Gabriel Boric vowed to set up a state-owned lithium company and shut down the $ 2.5 billion Dominga iron-copper mine dollars, for environmental reasons.

Toyota’s plans hampered by supply chain disruptions. Japanese car manufacturer Toyota Motor Corp (TYO: 7203) said it would halt production at five of its factories in January 2022 due to chip shortages and other supply chain disruptions, which have already slowed US production.

Qatar sponsors a small nuclear power plant in the United Kingdom. The Qatar Investment Authority has invested $ 110 million in Rolls Royce’s plan to develop small nuclear power plants that could operate by the early 2030s, enabling the fledgling business unit to raise the necessary capital.

The US fishing industry partners with Big Oil. United in their fight against offshore wind installations, the United States’ fishing and petroleum industries have teamed up to derail the 800 MW Vineyard wind farm off Massachusetts, the first large-scale power plant in the Americas , arguing that the wind farm would interfere with the navigation of ships. and damage fishing stocks.

Rosneft promises to go to zero by 2050. russian state oil company Rosneft (MCX: ROSN) approved a new strategy for 2030 which sets a net zero target by 2050 (emissions of scopes 1 and 2), the first time that a Russian major has set a strict deadline for reducing carbon emissions .

By Tom Kool for Oil Octobers

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