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British Gas Owner Centrica's Tax Appeal Dismissed by Supreme Court

Oil Prices Remain Rangebound Despite Rising Gasoline Demand

Oil prices have been rangebound for the last four weeks with demand concerns being canceled out by expectations of an OPEC+ production cut extension.

- The latest forecast from the US National Oceanic and Atmospheric Administration (NOAA) confirmed that this year's Atlantic hurricane season is expected to be above normal, with the potential for 17 to 25 named storms from June to November.

- With 8 to 13 of those storms likely to develop into hurricanes, almost double the past year's average, 2024 might see heightened risks for production from the US Gulf of Mexico and refineries across the Gulf Coast.

- Offshore oil fields in the US Gulf of Mexico account for 15% of total crude production in the country (1.8 million b/d) and the overwhelming majority of medium sour supply, while for natural gas the same metric stands at 5%.

- The concentration of US refining along the Texas and Louisiana Gulf Coast is even stronger, corresponding to almost half of US downstream capacity, while the same strip accounts for 90% of all US seaborne crude exports. 

Market Movers

- Rating agency Moody's downgraded Colombia's state energy company Ecopetrol (NYSE:EC) into junk territory, citing increasing debt levels amidst higher dividends and a hefty investment plan.

- Spanish oil major Repsol (BME:REP) is reportedly seeking to sell a stake in its 800 MW renewable asset portfolio in the United States, with Saudi Aramco seemingly keen to farm in.

- Chinese offshore specialist CNOOC (HKG:0883) signed oil exploration and production deals with Mozambique's energy ministry to develop five offshore blocks covering a total area of 29,000 km2.

Tuesday, May 28, 2024

Oil prices have been trading rangebound for the fourth consecutive week, staying within the $81-83 per barrel range for Brent, as priced-in expectations of OPEC+ maintaining production curbs have failed to lift sentiment any higher. While improving consumption figures from the US and an increasingly bullish picture for hurricanes in the US Gulf Coast provide some medium-term hope for oil bulls, the macro outlook is still weak and the prospect of Fed interest rate cuts in June is getting slimmer. 

EU Approves Stringent Methane Controls. The European Union approved a law this week to impose methane emission limits on Europe's oil and gas imports from 2030, setting maximum methane intensity values on all fossil fuels that would trigger financial penalties, if flouted. 

Saudi Aramco Could Launch SPO in June. According to media reports, Saudi Arabia's national oil company Saudi Aramco (TADAWUL:2222) could launch a multi-billion-dollar share sale as soon as June, with the presumed offering aiming to generate some $10 billion for the state coffers.

Russia to Build Nuclear Plant in Uzbekistan. The Central Asian Republic of Uzbekistan is set to become the next addition to the list of countries developing nuclear energy, the first in the region, agreeing to build six smaller 55 MW reactors instead of the initial plan for 2.4 GW capacity. 

Iran Keeps on Dreaming Big. The recent death of President Raisi notwithstanding, the Iranian government has approved a plan to increase oil production to 4 million b/d from the current target of 3.6 million b/d, however without providing a time frame for the capacity uptick.

Mexico's Production Is Collapsing Amidst Debt. As Mexico's crude output dropped to a 40-year low of 1.47 million b/d last month, the country's state oil firm Pemex has been struggling to repay service providers including drillers, with the NOC reporting $21.9 billion in pending payments in its Q1 results.  

Hedge Funds Turn Ultra Bullish on Gold. The net length held by hedge funds and other large speculators in Comex gold futures and options rose by a further 21,030 contracts in the week ending May 21, bringing the totals to the highest level since mid-April 2020 as gold boosts its safe-haven credentials. 

BlackRock Wants Anglo to Merge. US asset management giant BlackRock (NYSE:BLK) has encouraged London-based mining firm AngloAmerican (LON:AAL) to continue engaging in negotiations with BHP over its proposed 50 billion merger, with a final bid expected by May 29.

Shell, BP Quit South African Refining. Europe's energy majors Shell (LON:SHEL) and BP (NYSE:BP) have agreed to sell their 180,000 b/d Sapref refinery in Durban, out of operation since a 2022 flooding, to the South African government for a symbolic one rand.

Australia's CCS Ambition Takes a Huge Hit. Australia's Queensland state government rejected a pilot CCS project developed by Glencore (LON:GLEN) in the Surat Basin, arguing that permanent storage of carbon dioxide from a coal-fired power station could impact groundwater resources. 

New Petrobras CEO Seeks to Assuage Markets. Magda Chambriard, the newly anointed head of Brazil's national oil company Petrobras (NYSE:PBR), has vowed to keep investor returns in mind after her predecessor Jean-Paul Prates was ousted amidst government pressure to spend on job creation. 

US to Continue Buying Venezuelan Asphalt. Global Oil Terminals, a US oil trading company owned by Harry Sargeant III, has received a US Treasury waiver to continue importing Venezuelan asphalt to the United States and to interact with PDVSA over the next two years.

Majors' Bids Lift Outlook on Trinidad's Upstream. Trinidad and Tobago said it received bids from BP (NYSE:BP), Shell (LON:SHEL), and EOG Resources (NYSE:EOG) as part of its 2023 shallow water licensing round, all bidding for the Modified UC block, with the winner to be announced soon. 

Congo Boasts First Offshore Discovery in Decades. The Congolese subsidiary of Africa-focused upstream firm Perenco discovered oil with its Moke-East exploration well off the coast of the Democratic Republic of Congo, the first offshore oil find there in almost three decades. 

By Michael Kern for

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Michael Kern

Michael Kern is a newswriter and editor at and,  More