Oil prices were dropping on Friday morning as traders returned to focus on demand concerns in the light of no immediate escalation in the Middle East following Iran's assassination of Hamas' political leader.
Friday, August 2nd, 2024
With the OPEC+ meeting failing to surprise the markets this week, the sudden escalation of geopolitical tensions after Israel’s strike in Lebanon and the assassination of Hamas leader Ismail Haniyeh in Iran could have sent oil prices soar. Instead, the lack of an Iranian retaliation and continuous demand concerns, have dragged oil prices back down.
OPEC+ Sticks to Current Oil Policy. In line with expectations, the August 1 online meeting of OPEC+ ministers kept the oil group’s current policy unchanged and participating members reiterated their intent to start unwinding the third layer of voluntary production cuts from October 2024.
Chevron Moves Its Office to Texas. Following years of hostile regulatory treatment in its home state of California, US oil major Chevron (NYSE:CVX) is planning to move its corporate headquarters to Houston, with CEO Mike Wirth’s office expected to move by end-2024 and all other functions to shift by 2028.
Trafigura Seals Purchase of French Refinery. Competing with Vitol’s takeover of the Sardinian Saras refinery, global energy trader Trafigura has agreed to buy ExxonMobil’s (NYSE:XOM) 140,000 b/d Fos-sur-Mer refinery and adjacent terminals in Toulouse and Villette, in a consortium with Entara LLC.
No Chevron-Exxon Guyana Arbitration Until 2025. US oil major Chevron’s (NYSE:CVX) $53 billion takeover of Hess Energy (NYSE:HES) is facing lengthy delays as the arbitration panel that is set to hear ExxonMobil’s claim to Hess’ stale in the Stabroek block of Guyana will not happen before May 2025.
BP Eyes Rapid North Iraq Expansion. The government of Iraq signed a preliminary agreement with UK energy major BP (NYSE:BP) to develop four oil and gas fields in the northern Kirkuk region, 11 years after the two sides penned a letter of intent on these assets only to be fully disrupted by the Islamic State.
World’s Largest Copper Mine Might Strike. Workers at Chile’s Escondida mine operated by BHP (NYSE:BHP) have rejected the company’s offer for a new collective bargaining agreement, raising the risks of a potential strike at the world’s largest copper mine as BHP requested government mediation.
Senate to Bar Chinese Firms from Solar Subsidies. A bipartisan group of US senators introduced a bill that would block Chinese photovoltaic panel makers from claiming subsidies for their American factories under the Biden administration’s landmark 2022 Inflation Reduction Act.
Vitol Takes Over Embattled Coal Trader. Global trading powerhouse Vitol agreed to acquire Hong Kong-based trading peer Noble Resources Trading for $209 million, expanding its coal exposure as Noble trades 35 million tonnes of thermal coal per year and is also active in metallurgical coke and coal.
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Prolific Rains Help Panama Canal Recover. The administration of the Panama Canal expects to increase the number of daily transit slots to 36 from the current 34 in September as the early arrival of the rainy season has lifted water levels in Gatun Lake, overcoming the drought-ridden restrictions of 2023.
Colombia’s Ecopetrol Backs Out of US Shale Deal. US shale producer Occidental Petroleum (NYSE:OXY) has been informed by the Colombian state oil company Ecopetrol (NYSE:EC) that it would not opt to buy a 30% stake in CrownRock for $3.6 billion, sapping hopes that Oxy’s $12 billion investment could be shared.
Albemarle Cuts Costs Again as Lithium Woes Continue. US lithium producer Albemarle (NYSE:ALB), the world’s largest lithium company by output, said it would slash costs across the company for the second time in 2024 already, however placating investors that everything but its dividend is to be curbed.
Methane Probe Finds EPA Underestimates Emissions. A new study released by a joint consortium of EDF, Google, and BAE Systems found that methane emissions over 12 US oil and gas basins were on average four times higher (7.5 mtpa per basin) than the Environmental Protection Agency estimates.
Excessive Heat Caps Europe’s Nuclear Generation. French nuclear power plants are forced to reduce generation, most notably the Golfech plant in southern France cutting output by 1 GW, as river temperatures in the Garonne and elsewhere started to exceed the limit of 28 C (82 Fahrenheit).
By Michael Kern for Oilprice.com
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