It was a big week for oil markets as demand optimism sent oil prices beyond $65 and oil majors reported promising earnings, but prices pulled back on Friday morning as covid concerns in India grew.
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Friday, April 30th, 2021
Oil prices posted gains for much of this week but traded down on Friday. A bit of profit-taking after strong gains, combined with concerns about the worsening outlook in India, likely contributed to the move down.
Exxon and Chevron report big boost in profit. ExxonMobil (NYSE: XOM) reported $2.7-billion profit in the first quarter, and Chevron (NYSE: CVX) said it earned $1.4 billion.
Shale CEOs stick with restraint, mostly. Ovintiv (NYSE: OVV) CEO Doug Suttles told Bloomberg that the industry is maintaining capital discipline. At the same time, Continental Resources (NYSE: CLR) said that it would ramp up activity in the Bakken this year.
Oil prices rose to a 6-week high. Oil prices rose early on Thursday to their highest level in six weeks as a brighter outlook on the American economy and oil demand offset bearish demand prospects from the COVID crisis in India.
DOE announces $8.25 billion in loans for transmission. The Department of Energy announced the availability of $8.25 billion in loan guarantees for new long-distance transmission projects. Transmission is seen as a key bottleneck to a faster transition to renewables.
First “carbon neutral” oil cargo sold. Sweden's Lundin Energy said it sold the world’s first oil cargo certified to be “carbon neutral.” The carbon offsets were done via tree-planting in Mexico.
Oil refineries vs. ethanol reaches Supreme Court. The U.S. Supreme Court heard oral arguments on a case that put the Trump-era waivers to oil refineries related to a federal mandate on biofuels to the test. Bloomberg reports that the judges seemed skeptical of refiners’ claims that they should be allowed to extend lapsed waivers. If refiners lose, the EPA waiver program could be constricted, meaning that only in rare instances could refiners get out of biofuel purchasing requirements. HollyFrontier Corp. (NYSE: HFC) and CVR Energy Inc.’s (NYSE: CVI) and Wynnewood Refining Co. are participants in the case.
Eni sees no room for more upstream. Eni (NYSE: E) sees no room for new large upstream investments.
Covid outbreak in Canada’s oil sands. 12 oil sands production sites have been listed for outbreaks of Covid-19, which has delayed maintenance at some facilities and disrupted operations.
Shell reports profit, boosts dividend. Royal Dutch Shell (NYSE: RDS.A) reported a $3.23 billion profit in the first quarter and hiked its dividend by 4%. The gains came from asset sales, and higher oil and LNG prices.
Total posts profit. Total (NYSE: TOT) saw its profit jump to $3 billion. The company said a quarter of its capex will go to renewables and electricity.
U.S. Senate rescinds Trump methane rule. The Senate voted to repeal a Trump-era rule that weakened methane regulations. If signed into law as expected, the move will restore Obama-era regulations.
Chinese investors in talks with Aramco. Chinese investors are in talks to buy a stake in Saudi Aramco (TADAWUL: 2222), according to Reuters.
EU carbon prices put pressure on border tariff. EU carbon prices have shot up close to 50 euro per ton, imposing higher costs on polluting industries. European industry is now calling on the EU to look at carbon border adjustments, a tariff on imported products that originate in places with weak climate policy.
China’s shale industry faces challenges. China has bet on developing its vast shale gas resources to boost its natural gas supply as demand surges. Despite recent shale production surprises to the upside, China still has several major challenges to overcome if it wants to replicate, at least partially, the American shale boom.
Chesapeake Energy looking to sell South Texas assets. Chesapeake Energy (NASDAQ: CHK) is aiming to sell assets in South Texas, hoping to raise $2 billion. Related: Goldman: Oil To Hit $80 On Largest Ever Demand Jump
Iran and Saudi Arabia negotiate détente. Iran and Saudi Arabia have held direct talks in Iraq this month, and both sides have expressed a desire to improve relations, a dramatic turn of events after decades of open hostility.
Canada presses U.S. on Line 5, Line 3. The Canadian government is warning the U.S. against interrupting oil flows on Line 5 or construction of the Line 3 replacement.
UK oil falls by 12%. UK oil production declined by 12% in the first two months of 2021 compared to a year earlier, dipping to 997,000 bpd.
Offshore wind spending to explode. The offshore wind industry’s global installed capacity is set to exceed 250 gigawatts (GW) by 2030, driven by a surge in coming projects, a Rystad Energy report shows. The combined capital and operational expenditure for the decade is set to add up to an eye-popping $810 billion, signaling an increasing shift of investments from oil and gas to renewable energy technologies.
IEA: EV sales soaring. Worldwide sales of electric vehicles (EVs) jumped by 41 percent last year while the total global car sales fell in the pandemic-related downturn, the International Energy Agency (IEA) said on Thursday, expecting a further surge in EV sales, especially if governments encourage higher adoption with strengthened policies.
German high court orders more climate action. Germany’s highest court ordered the government to expand a 2019 law aimed at net zero emissions by 2050, ruling that future generations are entitled to protection from climate change.
Vitol may purchase Hunt Oil in Permian. Oil trader Vitol Group is nearing the purchase of Hunt Oil Co.’s Permian basin oil wells for $1 billion.
India's covid crisis could lead to a global oil surplus. India’s worsening COVID outbreak is set to disturb the nearly balanced global oil market, which will show a surplus of oil supply of as much as 1.4 million barrels per day (bpd) next month amid a sizeable loss of demand from the world’s third-largest oil importer, Rystad Energy says.
By Michael Kern for Oilprice.com
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