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Michael Kern

Michael Kern

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

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Oil Prices Remain Under Pressure Despite Rising Gasoline Demand


A combination of crude inventory builds and high interest rates continued to weigh on oil prices this week, with Brent and WTI both trading near three-month lows.

Oil prices









Friday, May 24th 2024

Oil prices have been declining for four consecutive days, driven lower by the Federal Reserve’s reluctance to commit to interest rate cuts this year as well as weak physical sentiment in the markets that saw backwardation in both WTI and ICE Brent drop to the lowest level seen this year. Notably improving US gasoline demand and the OPEC+ meeting might provide some upside next week, but Brent is unlikely to break out from its current $80-85 per barrel range. 

Russia Struggles to Cut Production. In a rare admission of non-compliance, the Russian Energy Ministry stated that it failed to fully comply with its OPEC+ production targets citing technical difficulties of cutting production in the winter, with OPEC putting the country’s output level at 9.29 million b/d in April.  

Chevron-Hess Merger Hits Shareholder Roadblock. An increasing number of investment funds owning stock of Hess Energy (NYSE:HES) have been voicing concerns about the firm’s planned $53 billion sale to US oil major Chevron (NYSE:CVX), wary of potential litigation with Exxon over the former’s Guyanese assets.

US Hurricanes Loom Large on the Agenda. US government agencies are warning of higher-than-usual hurricane activity this year as warm sea temperatures and falling wind shear conditions could result in seven major hurricanes in the season beginning June 1, more than double last year’s three hurricanes.

Spanish Major Clinches Venezuela Waiver. Spain’s largest oil firm Repsol (BME:REP) has received a license from the US Treasury Department, allowing it to continue and expand operations in Venezuela despite the April 18 sanctions snapback, aiming to double production at the Ceiba and Tomoporo fields to 40,000 b/d.  

Guyana Pushes ExxonMobil for More Gas. The government of Guyana set an October deadline for the ExxonMobil (NYSE:XOM) consortium developing the offshore Stabroek block to decide whether it wants to commercialize the gas-rich Haimara discovery, warning that otherwise it would reallocate the find.  

BHP’s Third Bid for Anglo Rejected Again. Having rejected BHP’s third takeover proposal that valued mining major AngloAmerican (LON:AAL) at $49.2 billion, the London-based firm nevertheless agreed to a one-week extension so that the Australian giant can make a binding takeover offer, bringing this year’s largest M&A bid to its endgame. 

EPC Bankruptcy to Slow Down Texas LNG Buildout. Zachry Holdings, the main contractor for the Golden Pass LNG project jointly developed by QatarEnergy and ExxonMobil (NYSE:XOM), has filed for bankruptcy protection citing cost overruns, potentially delaying the export terminal’s planned H1 2025 launch.  

US Midstream Giant Sees Value in Depleted Fields. US pipeline operator Kinder Morgan (NYSE:KMI) purchased mature oil and gas-producing assets in West Texas, planning to tap into carbon capture incentives under the IRA, most notably a $60 per metric tonne tax credit for carbon sequestration. 


World’s Leading Miner Pressured to Leave Europe. The world’s second-largest mining conglomerate Rio Tinto (ASX:RIO) is under pressure from key shareholders who believe the company’s dual listing in Sydney and London complicates future M&A activity, suggesting Rio switches its primary listing to Australia. 

White House Seeks to Ease Gasoline Concerns. The US Department of Energy is expected to release nearly 1 million barrels of gasoline from the Northeast Gasoline Supply Reserve, created after Superstorm Sandy in 2014, and to be soon shut as part of President Biden’s March government funding package. 

China Launches Huge Cobalt Stockpiling Drive. Marking the largest-ever state stockpiling move for cobalt, China is reported to be purchasing 15,000 metric tonnes of the transition metal from local Chinese producers over the next couple of months, reducing the supply surplus expected in 2024. 

Nigeria Cannot Agree on Its Own Output Figures. Nigerian government agencies report widely diverging crude production numbers with the Upstream Regulatory Commission putting April output at 1.28 million b/d whilst the national oil firm reported 1.7 million b/d, highlighting the lack of transparent information from the country. 

Canada Still Eyes Full Pipeline Sale. As TMX loaded its first cargo this week, Canada’s government is amending regulations that would facilitate divestment of the pipeline’s stock to Indigenous groups without federal regulatory approval, seeking to sell the $25 billion project as soon as possible after a fourfold cost overrun.  

By Michael Kern for Oilprice.com

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