Oil markets roared back to life after Trump’s sanctions on Russia’s top oil producers sent prices surging.
Trump’s sanctions on Russia’s top oil firms have cut short the past weeks’ downward pricing movement, with stories of record high crude on water, flattening backwardation curves and weakening Chinese SPR purchases now all put on the back burner. With ICE Brent soaring to $66 per barrel, up $5 per barrel in just one day, Thursday’s rally failed to trigger incremental moves upwards on Friday as the oil markets now anticipate any changes in Indian and Chinese buying behaviour.
Trump Sanctions Russia’s Oil Giants. US President Trump imposed sanctions on Russia’s two largest oil producers Rosneft and Lukoil, sending geopolitical risk premiums soaring as the move marks the first direct Russia sanctions of the Trump administration, putting some 3.1 million b/d oil exports at risk.
Europe Bows Down to LNG Pressure. The European Parliament agreed to review its sustainability rules, after the United States joined Qatar in opposing Europe’s corporate sustainability directive (CSDD), saying that unless Brussels changes the text, it would have unintended consequences for LNG imports.
‘Indonesian’ Oil Is Still in Vogue. As Iranian and Venezuelan tankers shifted away from Malaysia’s territorial waters for ship-to-ship transfers, Chinese imports of Indonesian-origin crude remained elevated last month at 520,000 b/d (compared to just 3,000 b/d for the whole of 2024).
Brussels Mulls China Countermeasures. The European Commission is preparing a list of trade measures to be enacted against China in case Beijing’s export controls on rare earth materials continue, leveraging potential trade chokepoints such as aviation parts or specialty steel products.
Egypt Needs Gas, Now. Having diverted as many as four LNG cargoes last month, Egypt is now seeking to bring forward its contracted shipments of liquefied gas after Israel’s Tamar gas field announced it would be shutting down for a 12-day maintenance, curbing pipeline flows from Israel to Egypt.
Brazil Wins Tax Case Against Majors. The International Chamber of Commerce has sided with Brazil’s oil regulator ANP in its arbitration case with a consortium of oil majors comprising Petrobras and Shell, allowing the Latin American country to keep $4.1 billion in tax payments from the Tupi field.
CP2 Greenlit, Only for the Unfriended. US Secretary of Energy gave LNG developer Venture Global (NYSE:VG) the final approval to export LNG from the Calcasieu Pass 2 plant, with the caveat that the supplies are delivered to countries that do not have a free trade agreement with the United States.
Rio Eyes Asset Swaps to Ease China Pressure. Australia’s mining giant Rio Tinto (NYSE:RIO) is considering an asset-for-equity swap with its stakeholder, China’s Chinalco state firm that owns a 11% stake in the company, to ease long-standing governance constraints and pursue new strategic deals.
Kazakhstan Freezes Fuel Prices. Seeking to combat soaring inflation that rose to 13% last month, the government of Kazakhstan has introduced price controls on transportation fuels – capping diesel and 92 gasoline prices – stating that the freeze would remain in place until ‘at least’ next spring.
Offshore Lovers Shop Big in Brazil’s Auction. Norway’s Equinor and China’s Sinopec came out the two largest winners in Brazil’s pre-salt auction, as five blocks with production-sharing contracts were offered, whilst the country’s state oil firm Petrobras (NYSE:PBR) secured the Citrino license block alone.
Aluminium Iceland Smelter Incident. Aluminium prices soared to their highest since June 2022, with the LME three-month contract hitting $2,820 per metric tonne, after Iceland’s Grundartangi smelter was forced to cut production by two-thirds following an electrical equipment failure, curbing global supply.
Morocco Sets 2040 Deadline for Coal Phaseout. Morocco has committed to abandoning coal power (currently 60% of its electricity generation) by 2040 in a bid to advance renewables and natural gas, provided it secures international climate financing.
France Fines Oil Major for Greenwashing. A French civil court slapped a fine on the country’s oil major TotalEnergies (NYSE:TTE) for ‘misleading consumers’ about its alleged 2050 carbon neutrality claim, ordering it to remove all public mentions of carbon neutrality, marking the first case of ‘greenwashing’.
Trump Opens Up Alaska Licensing. The Trump administration has reopened the entire coast of Alaska’s Arctic National Wildlife Refuge to oil and gas leasing, covering 1.56 million acres, as oil output halved to 420,000 b/d in the past two decades, reversing Biden-era restrictions on exploration and drilling.
Credit: Oilprice.com
