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U.S. Crude Oil And Gasoline Inventories Drop Off

Oil Markets Await the Next OPEC+ Announcement

Oil prices remained stubbornly rangebound in February as signs of a recovering U.S. economy were countered by weaker economic data in both Europe and China.

Friday, March 1st 2024

Diverging macroeconomic news, with China and Europe continuing to struggle with below-expectations manufacturing activity while the United States is nearing the point of first interest rate cuts, failed to alter the trading patterns of February, keeping Brent around the $83 per barrel mark. The next big thing to happen to the oil markets will be OPEC+ announcing the scrapping or the extension of voluntary production cuts next week, although the former seems to be highly unlikely at this point. 

BP Doubles Down on Egyptian Upstream. UK energy major BP (NYSE:BP) is planning to invest some $1.5 billion in gas projects in Egypt over the next three to four years, eyeing joint upstream operations in three separate concessions with the UAE's national oil firm ADNOC. 

Market Expects US Sanction Hit on Russian Coal Exports. Indian importers of thermal fuel are widely expected to curb their purchases of Russian coal, up 20% year-on-year in 2023 at 10.06 million tonnes, after the US sanctioned Russia's top coal exporters SUEK and Mechel. 

Corn Sees Record Levels of Bearish Sentiment. Hedge funds and other money managers increased their net short position in CBOT corn futures to 340,732 contracts last week, the most bearish positioning ever on record, as global supplies of corn recovered from the chaos of 2023.

DoE Solicits Another 3 MMbbls SPR Refill. Having bought 2.95 million barrels of sour crude for an average price of 77.81 per barrel for June-delivery oil, the US Department of Energy announced a new solicitation for 3 million barrels to be delivered in July.  

Canada Set to Expedite Nuclear Projects. Faced with an aging fleet of nuclear reactors and multi-year delays in project approvals for new uranium mines, Canada's government vowed to expedite the approval process of both, however, insists that a federal environmental review will still be required. 

Islands Ask for Exemption from EU Jet Fuel Taxes. With the EU starting to apply jet fuel taxes on all flights within the European continent, island nations such as Ireland, Cyprus, Greece, and Malta are asking for exemptions that would delay the launch of the levy until 2032. 

Australia's Mining Major Sells Met Coal Business. Australian mining giant South32 (ASX:S32) agreed to sell its Illawarra metallurgical coal business to the Indonesian GEAR holding for $1.65 billion, fully exiting coal to focus on an impending expansion into copper and zinc. 

US Natural Gas Output Hits All-Time High in December. Gross US natural gas production from the lower 48 states soared to a record high in December, reaching 118.2 BCf per day, up 7% year-on-year as the Permian, Marcellus, and Utica basins have all continued their steady rise. 

Venezuela Reinvents Its Barbados Deal with the US. As the White House mulls a sanction snapback, Venezuela's top officials voiced their readiness to hold elections between May and December, despite top opposition candidate Maria Machado being banned from participating.

Glencore Emerges as Top Candidate for Shell's Singapore Assets. Global commodities trader Glencore (LON:GLEN) is considering purchasing Shell's 240,000 b/d Bukom oil refinery and the Jurong petchem plant after earlier suitors such as CNOOC and Vitol dropped out of bidding. 

China's LNG Imports Soar to Seasonal High. China's imports of LNG jumped to the highest-ever level for February, rising to 5.5 million tonnes, up 15% year-on-year as JKM prices plunged to $8.5 per mmBtu and import economics improved, setting the Chinese economy on course for an 8% year-on-year hike.

Suriname to See First Oil by 2028. French energy major TotalEnergies (NYSE:TTE) is moving towards an end-2024 FID on the Sapakara South-Krabdagu prospect combining 700 MMBbls in recoverable reserves, with the South American nation seeing first oil from the 200,000 b/d capacity project in 2028.

Chile's Lithium Firms Believe in Lithium Despite the Price Plunge. Chile's leading lithium producer SQM (NYSE:SQM) is plowing ahead with project expansions despite an 82% drop in quarterly profit, in line with Li carbonate prices collapsing to ¥100,000 per metric tonne last year, with investors increasingly believing the bottoming out is over.

By Michael Kern for Oilprice.com

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Michael Kern

Michael Kern is a newswriter and editor at Safehaven.com and Oilprice.com,  More