Bullish Sentiment Is Building In Oil Markets Ahead Of OPEC Meeting

The lifting of the US debt ceiling, avoiding a government shutdown, has seen bullish sentiment return to the oil market, lifting Brent back above $75 per barrel and WTI above $71 per barrel. While rising U.S. crude inventories and the weak outlook of Chinese manufacturing are adding downward pressure to oil prices, the upcoming OPEC+ meeting this weekend might provide another boost for prices if the group decides to cut production.

Europe Prepares 11th Russia Sanctions Package. The European Commission is expected to present its 11th package of Russia sanctions next week, targeting Chinese firms that shipped banned goods to Russia, banning Russian flows through the northern Druzhba pipeline and forbidding the transit of EU-bound goods through Russian territory.

Houston Refinery Shutdown Delayed. Buoyed by strong refinery margins, chemicals firm LyondellBasell (NYSE:LYB) said it would not shutter the 264,000 b/d Houston refinery by the end of this year and thanks to moderate maintenance spending it would extend operations till the end of the first quarter in 2025.  

Indonesia to Cap LNG Exports. Citing the need to ensure adequate domestic gas supply, the Indonesian government is considering moves to limit exports of the country’s LNG, keeping current deals untouched however looking to add clauses on the prioritization of domestic consumers into new contracts. 

Shareholders of US Oil Reject Stronger Climate Mandates. Shareholders of ExxonMobil (NYSE:XOM) and Chevron (NYSE:CVX) overwhelmingly rejected demands from climate activists that they set medium-term goals for reducing carbon emissions as Scope 3 targets, in a blow to environmentalists. 

European Major Wants Synthetic Gas in the US. Indicating that the US might be gaining the upper hand against Europe in landing green energy deals, French oil major TotalEnergies (NYSE:TTE) announced its plans to build a large-scale $2 billion synthetic gas plant in the country, expecting it to benefit from IRA credits.

Leaks Force Halt of Norway’s LNG Terminal. A gas leak has prompted Norway’s oil company Equinor (NYSE:EQNR) to shut down the Hammerfest LNG plant, the country’s only liquefied natural gas export terminal, only several weeks after a compressor failure halted production in early May. 

Nigeria Scraps Gasoline Subsidy. Sparking panic buying across Nigeria’s major cities, the new president Bola Tinubu followed through on his pre-election vow and scrapped the African country’s longstanding fuel subsidy that cost the government some $10 billion per year, tripling retail prices of the fuel to $1.05-1.1 per liter.  

Tanzania’s LNG Megaproject to Be Commissioned Soon. The government of Tanzania said it had completed negotiations with the investors of its $42 billion Tanzania LNG megaproject – Equinor (NYSE:EQNR), Shell (LON:SHEL), and ExxonMobil (NYSE:XOM) – with regulatory approval expected to come in June.

China Is Breaking Drilling Records. Chinese oilmen are currently drilling the deepest ever oil well in the country’s history in the westernmost Xinjiang region, spudding the borehole as deep as 10,000 meters (32,800 feet) as Beijing seeks to ramp up domestic oil production. 


US Wants to Curb Turkmen Gas Flaring. The United States and Turkmenistan are in advanced talks to help the Central Asian country cut its vast methane emissions, equivalent to 7% of total production, with service firms Halliburton (NYSE:HAL) and SBL (NYSE:SLB) rumored to be involved in the deal.

UN Tries to Save Black Sea Grain Deal. The United Nations has proposed that Ukraine, Russia, and Turkey start preparatory work for the transit of Russian ammonia through Ukraine, wary that the “continuous slowdown of implementation” of the Black Sea grain export deal could lead to a collapse soon. 

LME No Longer Benchmark for Metals. The world’s second-largest metallurgy company Eramet (EPA:ERA) declared it no longer sees the London Metal Exchange as the benchmark market for nickel prices after last year’s trading scandal, losing out to the Shanghai Metals Market. 

Bangladesh Signs Up for Qatari LNG. QatarEnergy signed a 15-year supply agreement with Petrobangla, the national energy company of Bangladesh, that would begin in 2026 when Qatar’s key North Field East and North Field South expansion projects come onstream. 

Petrobras Looks Abroad for Growth. Brazil’s national oil company Petrobras (NYSE:PBR) is considering growing its production with projects abroad after national regulators barred it from drilling an exploration well near the mouth of the Amazon River, buoyed by last year’s giant gas discovery in Colombia.

By Michael Kern for Oilprice.com

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