• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 1 day How Far Have We Really Gotten With Alternative Energy
  • 10 days They pay YOU to TAKE Natural Gas
  • 6 days What fool thought this was a good idea...
  • 9 days Why does this keep coming up? (The Renewable Energy Land Rush Could Threaten Food Security)
  • 5 days A question...
  • 15 days The United States produced more crude oil than any nation, at any time.
Argentina Is Positioning Itself as a Mining Giant

Argentina Is Positioning Itself as a Mining Giant

Argentina is attracting investment in…

Millennials Drive EV Adoption in the U.S.

Millennials Drive EV Adoption in the U.S.

A recent survey from Statista's…

BYD Set to Supply London's Electric Double-Decker Buses

BYD Set to Supply London's Electric Double-Decker Buses

Transport giant Go-Ahead Group is…

Josh Owens

Josh Owens

Josh Owens is the Content Director at Oilprice.com. An International Relations and Politics graduate from the University of Edinburgh, Josh specialized in Middle East and…

More Info

Premium Content

Oil Supply Fears Mount As OPEC Underperforms

Oil Supply

Reader Update: Whether you are new to the oil and gas industry or an energy market veteran, you will regret not signing up for Global Energy Alert. Oilprice.com's premium newsletter provides everything from geopolitical analysis to trading analysis, all for less than a cup of coffee per week.

Chart of the Week

- As national average gasoline prices have surpassed the $5 per US gallon mark for the first time in history, the market is set for further tightness after ten consecutive weeks of inventory declines. 

- With US gasoline demand increasing to 9.2 million b/d recently, gasoline exports are still running strong at 1 million b/d as Mexico and other Latin American nations remain dependent on US supplies.

- With US refiners no longer able to purchase Russian VGO as it remains banned, many are forced to choose between gasoline and diesel, meaning that both segments cannot be catered for simultaneously. 

- Both diesel and gasoline cracks have soared above $50 per barrel vs WTI, though gasoline should overtake the former on the back of still-higher demand expected over the summer months.  

Market Movers

- Not yet willing to leave Angola, French major Total (NYSE:TTE) has taken an $850 million final investment decision on Phase 3 of its deepwater Clov complex, in production since 2014. 

- Having sold its oil business to Woodside, mining giant BHP (NYSE:BHP) has been reorienting its focus on the fertilizer industry as it fast-tracks the development of its first mine in central Canada.

- UK energy major Shell (LON:SHEL) has received two offers for its onshore oil and gas fields in Nigeria, worth some $5 billion, with local companies Heirs Oil and Gas and ND Western vying for the Niger Delta portfolio. 

Tuesday, June 14, 2022

News of OPEC+ members underperforming their production targets is far from surprising, yet this week’s oil trading has been palpably impacted by the prospect of undersupply. Whilst Chinese demand is suffering once again from COVID lockdowns, continued supply disruption in Libya and OPEC revising its growth outlook downwards have more than offset bearish sentiment. With several banks and rating agencies hiking their crude price outlook for 2022, the new norm for ICE Brent appears to be around the $125 per barrel mark. 

Biden Lashes Out at Oil Companies. US President Biden singled out oil major ExxonMobil (NYSE:XOM), saying the administration will make sure everyone knows Exxon’s profits and that the company made more money than God, whilst allegedly withholding investment into new drilling. 

Permian Oil Production Expected to Hit All-Time High. According to the EIA, crude output in the Permian Basin across Texas and New Mexico is expected to increase by another 84,000 b/d in July, taking the aggregate production total to 5.32 million b/d. 

OPEC Cuts Supply Outlook Further. In its latest Oil Monthly Report, OPEC has cut its non-OPEC liquids supply growth by 250,000 b/d compared to May, most probably reflecting slower US uptake, whilst keeping the annual demand figure of 100.3 million b/d untouched despite China’s travails. 

Lebanon Shows Openness for Maritime Claim Compromise. With US energy envoy Amos Hochstein arriving in Lebanon, the territorial dispute between Beirut and Tel Aviv seems to be fizzling out as high-ranking Lebanese officials indicated their readiness to engage. 

JP Morgan Wins Court Case Against Nigeria. US investment bank JP Morgan has won London High Court case against Nigeria. The country was suing JP Morgan for $1.7 billion, arguing the bank was grossly negligent in transferring the funds to a company linked to the African country’s disgraced oil minister Dan Etete in 2011. 

BP Sheds Oil Sands, Doubles Down on Canada’s Offshore. UK oil major BP (NYSE:BP) has sold its 50% stake in the Sunrise oil sands project in Alberta to Cenovus (NYSE:CVE), at the same time buying the Canadian firm’s 35% stake in the undeveloped Bay du Nord offshore project. 

Suriname Drilling Registers Another Letdown. US oil producer Apache (APA) announced that its Rasper-1 wildcat well in Block 53 of offshore Suriname struck only water, providing another setback after the non-commercial nature of the Bonboni-1 exploration well late last year.


Proliferating Long-Term Charters Push Up LNG Shipping. Spot market rates for LNG tankers have risen to multi-year highs as long-term-chartered vessels limit the supply of available tankers, with a spot voyage in the Atlantic Basin assessed at $100,000 per day. 

Iran and Venezuela Sign 20-Year Partnership Deal. Following Nicolas Maduro’s visit to Tehran, Iran and Venezuela signed a 20-year cooperation agreement that calls for closer alignment in oil and gas, with Iranian companies already repairing the 140,000 b/d El Palito refinery and building new oil tankers. 

Texas Power Demand Hits Record Amid Heatwave. With much of Texas confronted with counter-seasonally strong heat, power demand in the US state rose to 75 GW on Sunday and increased even further the next day, setting a new record for energy demand in the Lone Star State.  

Libya Still Cannot Recover from Disruptions. As the internecine conflict in Libya degenerates further, some 1.1 million b/d of Libyan production is currently halted after protesters took offline the 200,000 b/d Sarir field and shut the Es Sider and Ras Lanuf ports, leaving only a trickle of erstwhile output. 

Tanzania Clinches Framework Deal on LNG Terminal. The Tanzanian government signed a framework agreement with Equinor (NYSE:EQNR) and Shell (LON:SHEL) in a bid to kickstart the construction of a $30 billion LNG terminal, delayed for years amidst regulatory confusion. 

Aluminum Prices Take a Beating from China Lockdowns. Aluminum prices fell to a six-month low of $2,630/mt after news of further lockdowns in China, the largest consumer of the metal globally, added to an already depressed outlook, with inflation and higher interest rates also weighing in.

By Josh Owens for Oilprice.com

More Top Reads From Oilprice.com:

Download The Free Oilprice App Today

Back to homepage

Leave a comment
  • Art on June 14 2022 said:
    “Why are we talking about natural gas when we can talk about renewables and electrification and other options that are available?” Shannon Anderson, attorney for a landowners’ group in Wyoming dubbed the Powder River Basin Resource Council, told Casper Star-Tribune’s Pollack.

    Shannon is complaining about the cost of energy, yet she wants to double down on renewables when it’s 7 times more expensive on average to produce energy when compared to oil and gas. It would be nice to have people weigh pros and cons rather than just virtue signal when talking to the press.
  • George Doolittle on June 14 2022 said:
    The United States is still swimming in the most massive glut of oil and refined product ever #RECORDED so definitely not interested in any commodity play going on forever now.



    Long US Treasuries strong #buy #buy #buy #buy #buy

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News