• 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
  • 35 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 11 days Does Toyota Know Something That We Don’t?
  • 11 hours "What’s In Store For Europe In 2023?" By the CIA (aka RFE/RL as a ruse to deceive readers)
  • 5 days America should go after China but it should be done in a wise way.
  • 14 hours World could get rid of Putin and Russia but nobody is bold enough
  • 12 hours How Far Have We Really Gotten With Alternative Energy
  • 1 day The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
  • 2 days Even Shell Agrees with Climate Change!
  • 4 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in

Breaking News:

OPEC Lifts Production in February

Michael Kern

Michael Kern

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

More Info

Premium Content

Strong Fuel Demand Boosts Oil Prices

Strong demand for oil products is helping to drag oil prices higher, although the risk of a U.S. default and the upcoming OPEC+ meeting are the two major factors oil markets are watching.

Investor Alert: Whether you are new to the oil and gas industry or an energy market veteran, Global Energy Alert is an absolute must-read. Oilprice.com's premium newsletter provides everything from geopolitical analysis to trading analysis, all for less than a cup of coffee per week.

Oil prices

Rig

Rig Count

Chart of the Week

Jet Fuel

- According to S&P Platts, global air travel has finally returned to pre-pandemic levels this month as total commercial flights per day averaged 105,682 in the first two weeks of May, up 20% year-on-year. 

- Global jet fuel demand, however, is expected to remain below 2019 levels for now as efficiency gains and a slower rebound in long-haul travel, especially in Asia, limit the consumption upside for the fuel. 

- IATA estimates that new airplanes trigger fuel efficiency gains of around 2% per year and the pandemic has seen a widespread drive to replace older aircraft. 

- With international seat capacity now 10% below 2019 same-month levels, attesting to flights being on average shorter than before, a full jet fuel demand recovery to 8 million b/d isn't expected until 2027.

Market Movers

- US oil major Chevron (NYSE:CVX) agreed to buy shale producer PDC Energy (NASDAQ:PDCE) in a stock-and-debt deal worth 7.6 billion, adding 260,000 b/d of oil equivalent in output. 

- Oil majors ENI (BIT:ENI) and Shell (LON:SHEL) might come under pressure again as Nigeria’s Bayelsa state claims it needs $12 billion to clean up decades-old oil spills, singling out the two companies as the main culprits. 

- Brazil’s national oil firm Petrobras (NYSE:PBR) said that the second exploration well drilled in the Aram pre-salt block off Sao Paulo’s coast discovered commercial reserves of oil, boosting reserves. 

Tuesday, May 23, 2023

Oil products seem to be dragging crude out of the quagmire before the OPEC+ meeting, with the strength in US gasoline futures lifting WTI and Brent well above $72 and $76 per barrel, respectively. Should the ongoing debt ceiling talks between House of Representatives speaker Kevin McCarthy and President Joe Biden lead to a deal that prevents a government shutdown we might see a brief spike in oil prices, although attention seems to be gradually moving towards the upcoming June OPEC+ meeting.

Saudi Energy Minister Goes on the Offensive. Speaking at the Qatar Economic Forum, Saudi Arabia's Energy Minister Abdulaziz bin Salman stated that OPEC+ will remain proactive and that oil speculators betting on prices to fall will be “ouching” again just as they did in April if they don’t mend their ways. 

Activists Lambast G7 Over Gas Investments. The recent G7 meeting in Japan’s Hiroshima included calls for more gas investments in the West to phase out dependency on Russian energy, angering climate activists that think the group is using the Ukraine war as an excuse for more fossil fuels. 

OPEC Asks Ecuador to Rejoin its Ranks. Three years after its departure in 2019, Ecuador has been invited by OPEC to rejoin the ranks of the oil group as the country’s previous problem – exceeding agreed production quotas – became irrelevant as production started to stagnate. 

Nigeria Launches Megarefinery, But Not Really. Nigeria’s outgoing president Muhammad Buhari commissioned the 650,000 b/d Dangote refinery – set to become the continent’s largest and at a cost of 19 billion also the most expensive – but its real start-up is expected in late 2023, at best.

Germany to Keep on Subsidizing Power Prices. Germany’s economy minister Robert Habeck stated Berlin plans to earmark some €4 billion annually to subsidize electricity prices for energy-intensive industries, capping power prices at 6 cents per KWh despite the Finance Ministry’s fierce opposition.

Australia Clinches US Critical Minerals Pact. Australia and the United States have agreed to treat the former’s domestic suppliers of critical minerals (such as lithium or rare earth metals) as domestic suppliers under the US Defense Production Act, as well as its hydrogen and ammonia companies. 

Guyana Ups the Stakes in Exxon Row. After a Guyanese court ruled that US major ExxonMobil (NYSE:XOM) needs to provide additional insurance against potential oil spills, the Texas-based firm riposted it could halt production at its Liza One platform altogether if the court doesn’t backtrack. 

ADVERTISEMENT

China Invests into Kazakhstan’s Petchem. China’s state-owned oil company Sinopec (SHA:600028) agreed on terms with Kazakhstan to build a gas-based petrochemical complex in the country’s Atyrau region, with the 1.275 mtpa ethylene capacity plant expected to have an FID next year.

ADNOC Offers More of Its Logistics Arm. Reacting to what it described as significant investor demand, the UAE’s national oil company ADNOC will be offering a larger stake in the upcoming IPO of its logistics and shipping unit L&S, potentially raising up to $800 million from the public offering.

Argentina’s Shale Patch Disrupted by Strikes. SPGP, the largest oil union in Argentina, representing 25,000 workers in the country’s Vaca Muerta shale play, launched an indefinite strike to demand better working conditions, triggered by another incident that resulted in a worker’s amputated arm. 

Norway’s Oil Major Halts Key Wind Project. Norway’s national oil firm Equinor (NYSE:EQNR) indefinitely postponed its planned Trollving floating offshore wind farm that was supposed to power its Troll and Oseberg oil fields, citing inadequate availability of technology and rising costs. 

Yemen Signs First Post-War Oil Deal. Merely several weeks after a ceasefire with Saudi Arabia, the Houthi-led government in Yemen signed a deal with China’s state-backed company AntonOil, seeking to produce 300,000 b/d of oil as the Middle Eastern country did before its protracted civil war.

Ford Shakes Up the Lithium Market. US carmaker Ford (NYSE:F) signed three long-term lithium supply agreements with Albemarle (NYSE:ALB), SQM (NYSE:SQM), and Nemaska Lithium, as lithium produced in the US or a country covered by a free trade agreement qualifies for IRA tax credit.

By Michael Kern for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

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