Oil markets are on edge as the next OPEC+ meeting and the “X date” when the US government could default on its debt loom.
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Friday, May 26, 2023
As debt ceiling negotiations appear to be entering the final stretch, fears of a US government shutdown have faded this week, easing some of the pressure on oil prices. However, Russia and Saudi Arabia continue to confuse the market with mixed messages. Consequently, WTI and Brent trended sideways, at $72 and $76 per barrel, respectively.
Russia dampens OPEC+ expectations. Just a day after Saudi Arabia’s energy minister warned short sellers in the market that they would soon “move”, Russian Deputy Prime Minister Alexander Novak poured cold water on expectations of a cut production at the June 4 OPEC+ meeting, saying it was not doing so. expect further milestones.
Solar energy spending to exceed oil investments. According to the IEA’s World Energy Investment 2023 report, global renewable energy spending will reach $1.7 trillion this year, with solar investment reaching $650 billion and surpassing oil for the first time in history.
US holds first block auction since enactment of IRA. The U.S. government will stage a sale of oil and gas drilling rights on federal lands in New Mexico and Kansas, covering more than 10,000 acres with two-thirds of the proposed acreage in Cheyenne County, KS, marking the first auction since the IRA passed last year.
Pressure is mounting on COP28. More than 130 politicians from the European Union and the United States have called for the removal of Sultan al-Jaber of the United Arab Emirates, CEO of the national oil company ADNOC and also president of the COP28 conference, arguing that the oil industry “hampers” stronger climate action. .
Norway hails major oil discovery. Specialized oil explorer in Norway AkerBP (OSL: AKRBP) reported a new oil discovery in the Yggdrasil area on the Norwegian continental shelf, with a gross recoverable volume of up to 90 million barrels of oil, nearly triple the pre-drill estimate.
Chevron to leave the Congo. American oil major Chevron (NYSE: CVX) has reportedly begun a process to sell its Congo oil and gas assets that could raise up to $1.5 billion, with the 31,000 boepd of production at stake becoming another part of the company’s disposal of African assets for focus on US shale.
Canada’s gas exports are normalizing. Canadian natural gas exports to the United States this week returned to levels seen before the Alberta wildfires started, with average daily volumes of 8.1 billion cubic feet per day, capping the rise in contracts U.S. natural gas futures jumped 14% on gas production cuts in Canada.
Petrobras will appeal Amazon’s drilling ban. National Oil Company of Brazil Petrobras (NYSE: PBR) decided to appeal against the country’s environmental agency which banned exploratory drilling in the mouth of the Amazon River, saying the company had met all the technical requirements for the project to be approved.
Mozambique LNG is back on track. More than 2 years after Islamic State-affiliated insurgents attacked the LNG liquefaction plant in Mozambique operated by a French oil major TotalEnergies (NYSE: TTE)the company is now restarting work on the project, first improving safety conditions in the surrounding area.
White House extends waiver of oil services. The Biden administration extended a sanctions waiver on Venezuela to allow four major oil services companies — including Halliburton, Baker Hughes and Schlumberger — to continue operations in the country with a restricted mandate.
Qatar wants to get into upstream Iraq. Qatar appears to be on the verge of contracting exploration blocks in Iraq according to Iraqi Oil Minister Hayan Abdul Ghani, with Baghdad introducing an annex to its 5th licensing round from 2018 and simultaneously launching its 6th licensing round.
Major Mull agricultural traders merge. One of the largest grain traders in the world Bunge (NYSE:BG) reportedly in talks to merge with rival trading company Viterra, part-owned by the Swiss-based major Glencore (LON:GLEN)six years after a failed takeover attempt by the latter.
Kenya is experiencing a massive outflow of investors. Despite the discovery of 5 oil fields in the southern Lokichar basin and eventual reserves of 461 MMboe, a driller focused on Africa Tullow Oil (LON:TLW) will have to develop the project alone after the two TotalEnergies (NYSE: TTE), And African Oil (TSE:AOI) withdrew this week.
A billionaire buys the new Mexican megafield. Once the richest man in the world, Mexican billionaire Carlos Slim bought a 49.9% minority stake in Talos Energy (NYSE: TALO) Mexican unit for 125 million dollars, seeking to tap into the hydrocarbon wealth of the Zama field which would contain up to 2 million barrels.
By Michael Kern for Oilprice.com
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