• 5 minutes Iran Says It Arrested 17 CIA Spies, Some Sentenced To Death
  • 9 minutes Will We Ever See 100$+ OIL?
  • 13 minutes Iran downs US drone. No military response . . Just Destroy their economy. Can Senator Kerry be tried for aiding enemy ?
  • 2 hours Iran Loses $130,000,000 Oil Revenue Every Day They Continue Their Games . . . .Opportunity Lost . . . Will Never Get It Back. . . . . LOL .
  • 10 hours Oil Giant Saudi Arabia Is Set to Start First Wind-Power Plant
  • 4 hours How is E&P of Marginal Oil on the UKCS Similar to the Shale Oil Operations in the US?
  • 7 hours So You Think We’re Reducing Fossil Fuel? — Think Again
  • 1 hour Renewables provided only about 4% of total global energy needs in 2018
  • 5 hours Berkeley becomes first U.S. city to ban natural gas in new homes
  • 8 hours EIA Reports Are Fraudulent : EIA Is Conspiring With Trump To Keep Oil Prices Low
  • 5 hours N.Y. Governor Signs Climate Bill
  • 20 hours First limpet mines . . . . now fly a drone at low altitude directly at U.S. Navy ship. Think Iran wanted it taken out ? Maybe ? YES
  • 19 hours Today in Energy
  • 15 hours Which is a better domain name for OAPEC?
  • 3 hours U.S. Administration Moves To End Asylum Protections For Central Americans
  • 12 hours Shale Oil will it self destruct?
Tom Kool

Tom Kool

Tom majored in International Business at Amsterdam’s Higher School of Economics, he is Oilprice.com's Head of Operations

More Info

Premium Content

Oil Ends Nearly Two Months Of Losses

Oil has closed the week on a positive note, with the latest rig count propping up prices despite bullish and bearish news pulling the market in all directions.

(Click to enlarge)

(Click to enlarge)

(Click to enlarge)

(Click to enlarge)

(Click to enlarge)

(Click to enlarge)

(Click to enlarge)

Friday, August 24, 2018

Oil prices are on track to close out the week with strong gains, after several weeks of declines. The EIA data showing a steep decline in crude stocks helped push prices up on Wednesday and return a sense of bullishness to the market. “Both crude markers are on track to end a steady run of weekly declines. This is largely due to a tightening fundamental outlook on the back of looming Iranian supply shortages,” Stephen Brennock analyst at London brokerage PVM Oil Associates, told Reuters.

Saudi Aramco IPO shelved; Saudi officials deny report. Reuters reported that the Saudi Aramco IPO has officially been scrapped and financial advisers working on the planned listing have been “disbanded,” ending what would have been the largest public offering in history. “The decision to call off the IPO was taken some time ago, but no-one can disclose this, so statements are gradually going that way - first delay then calling off,” a Saudi source familiar with the IPO plans told Reuters. Both the domestic and international listing have apparently been called off and instead Saudi Aramco may take a large stake in SABIC, the state-owned petrochemical company. Saudi officials deny the exports, and insist that the IPO has not been shelved.

Iran shipments already declining. U.S. sanctions on Iran’s oil take effect in November, but already countries around the world have been slashing purchases, which are affecting Iran’s exports. “Third-party reports indicate that Iranian tanker loadings are already down by around 700,000 bpd in the first half of August relative to July, which if it holds will exceed most expectations,” investment bank Jefferies said on Friday. “We expect that by Q4 the market will be dealing with either undersupply, dwindling spare capacity - or both.”

Related: A Saudi-Iran Oil War Could Break Up OPEC

U.S.-China trade talks end without breakthrough. Lower level trade talks between the U.S. and China ended on Thursday with no major breakthrough. Meanwhile, the $16 billion in tariffs, from both sides, went into effect this week. China’s slate of tariffs targeted U.S. energy products, including butane, propane, naptha, jet fuel and coal, among other items. But because China has declined to include crude oil on the list of tariffs, for now at least, state-owned Unipec may resume buying U.S. crude in October, according to Reuters.

Escalating water costs in Permian. The cost of handling and disposing of “produced” water that comes out of an oil well is rising in the Permian, just another in a long line of stretched services. Companies typically truck the water away for disposal, but more recently have been building pipelines, according to the Wall Street Journal. In some parts of the Permian wells produce ten times as much water as they do oil and gas, according to WoodMac. Costs are rising, and water management can add as much as $6 per barrel to the cost of producing a barrel of oil. As a result, water costs alone could shave off 400,000 bpd of supply from the Permian by 2025.

AMLO to scrap oil auctions for two years. Mexico’s incoming president Andres Manuel Lopez Obrador (AMLO) is planning to hold off on new oil and gas auctions for two years while also modifying the laws to bolster the role of Pemex, according to the Wall Street Journal. Instead of rolling back the energy reforms, which would require a constitutional change, AMLO will reportedly pursue tweaks to the laws through legislation. Such changes include allowing Pemex to choose partners without needing regulatory approval, allowing the government to directly hand Pemex oil blocks, and making Pemex the sole marketer for oil produced by private firms.

Tesla hires Morgan Stanley to take company private. Elon Musk has reportedly hired Morgan Stanley to officially take Tesla (NASDAQ: TSLA) private.

Norwegian panel advises against dumping fossil fuel investments. Norway’s $1 trillion sovereign wealth fund had proposed divesting from fossil fuel investments, but a government appointed commission has advised against the move. “This investment strategy is simple, well founded and has served the fund well,” the commission report said. “If energy stocks are excluded from the fund, the composition of the investments will differ from market weights, and the fund will be expected to either achieve lower return or higher risk.”'

Related: What Caused Oil’s Longest Losing Streak In Years?

U.S. considering sanctions on Venezuela once again. The Trump administration had previously scrapped plans to sanction Venezuela over fears of deepening the economic crisis, but McClatchy reports that U.S. sanctions are back on the table. The report suggests that while the administration is considering the so-called “nuclear option” of banning purchases of Venezuela’s oil, the more likely scenario will be a narrower ban on the export of U.S. diluent to Venezuela. The move would make it harder for PDVSA to process its heavy oil. McClatchy reports that the administration is preparing options to be released within the next three months.

China considers restrictions on production of gasoline and diesel vehicles. Argus Media reports that China is considering new regulations that would limit the production of gasoline- and diesel-fueled vehicles in favor of electric vehicles. The rules would block the construction of new factories that only focus on gasoline or diesel vehicles.

ExxonMobil plans $1.9 billion expansion of Baytown refinery. ExxonMobil (NYSE: XOM) is planning a $1.9 billion expansion of its Baytown refinery and petrochemical complex. The expansion would add a two-unit plastics processing plant, according to the Houston Chronicle. Separately, Exxon is already working with Saudi Arabia’s SABIC to build a $10 billion chemicals and plastics complex near Corpus Christi.

By Tom Kool for Oilprice.com

More Top Reads From Oilprice.com:

Download The Free Oilprice App Today

Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play