Politics, Geopolitics & Conflict
- On the Russia-Ukraine war front, Zelensky is now asking NATO to lift restrictions on using long-range weapons to target deep inside Russian territory during a summit in Washington on Wednesday. Much like the carefully calculated Israel-Lebanon conflict, such a move could push things over the edge and widen what has become an unofficial war between Russia and NATO (by proxy, for now). At the same time, NATO has emphasized that Ukraine’s path toward membership in the Western military alliance is now “irreversible”. Lifting restrictions would be a red line, though this red line continues to shift.
- “Reformist” Masoud Pezeshkian won elections in Iran, narrowly beating out the hard-line candidate. It’s hardly a political coup, however. Pezeshkian’s power will be extremely limited, but he helps (however minimally) to appease a public that voted for him because he was a rare Iranian official to have condemned the death of a young woman in 2022 at the hands of the hijab police–an incident that triggered widespread protests and riots under late president Raisi (who died in a helicopter crash in May). At most, Pezeshkian’s election could mean a coming lifting of stringent hijab rules, among a few other social restrictions.
- In Venezuela, where elections will be held on July 28, Maduro has inserted himself on the ballot 13 times, representing various political groupings, but…
Politics, Geopolitics & Conflict
- On the Russia-Ukraine war front, Zelensky is now asking NATO to lift restrictions on using long-range weapons to target deep inside Russian territory during a summit in Washington on Wednesday. Much like the carefully calculated Israel-Lebanon conflict, such a move could push things over the edge and widen what has become an unofficial war between Russia and NATO (by proxy, for now). At the same time, NATO has emphasized that Ukraine’s path toward membership in the Western military alliance is now “irreversible”. Lifting restrictions would be a red line, though this red line continues to shift.
- “Reformist” Masoud Pezeshkian won elections in Iran, narrowly beating out the hard-line candidate. It’s hardly a political coup, however. Pezeshkian’s power will be extremely limited, but he helps (however minimally) to appease a public that voted for him because he was a rare Iranian official to have condemned the death of a young woman in 2022 at the hands of the hijab police–an incident that triggered widespread protests and riots under late president Raisi (who died in a helicopter crash in May). At most, Pezeshkian’s election could mean a coming lifting of stringent hijab rules, among a few other social restrictions.
- In Venezuela, where elections will be held on July 28, Maduro has inserted himself on the ballot 13 times, representing various political groupings, but the opposition continues to gain ground by all accounts, which is what has necessitated Maduro’s reaching out to Washington to restart talks at the 11th hour. In the meantime, Maduro continues to orchestrate a situation in which the rest of the world believes he is being targeted for assassination. On Friday, Latin American media reported that Colombian paramilitaries have warned that what it calls the “right-wing” opposition had sought their help in carrying out an assassination plot against Maduro and an attack on the country’s critical energy infrastructure–the latter was added in hopes that it would strike a chord in Washington.
Discovery & Development
- Eni has announced a significant oil and gas discovery in the Gulf of Mexico, with potential reserves of 400 million barrels at the Yopaat-1 exploration well. This discovery, part of a cluster development strategy, could lead to a production hub with overall resources exceeding 1.3 billion boe. The area, including the adjacent blocks operated by Repsol and Pemex, remains highly active in exploration despite regulatory challenges. The collaboration and shared infrastructure are seen as crucial, especially with Mexico's current regulatory environment limiting new upstream auctions.
- Wellesley Petroleum has discovered between 5-25 MMboe in the Gnomoria well under Production License 1184 S in the Norwegian North Sea. The discovery, though modest, shows promising commercial recovery potential due to favorable characteristics. The well, drilled to a depth of 3,346 meters, is planned to tie back to existing infrastructure. Wellesley operates with a 10% stake, while Equinor holds the remaining 90%, and both are evaluating further development strategies.
- Israel’s Navitas Petroleum is gearing up for a final investment decision on its Sea Lion oil project in the Falkland Islands by the end of 2024. Phase 1 targets 312 million barrels, with total certified resources in the North Falkland Basin reaching 791 million barrels. The project, awaiting environmental clearance, involves drilling 23 wells and utilizing an FPSO vessel, with first oil expected 33 months post-sanction. Estimated capex to first oil is $1.2 billion, with peak production projected at 55,000 bpd, potentially rising to 80,000 bpd with a larger FPSO.
Deals, Mergers & Acquisitions
- Nigeria has resolved a supply dispute with international oil companies by allowing domestic refiners to purchase crude at market prices. The agreement addresses complaints from Dangote Refinery, which had faced difficulties securing local crude due to high premiums and availability issues. This move, driven by the Nigerian Upstream Petroleum Regulatory Commission, aims to ensure a sustainable domestic refining sector without deterring upstream investments. The new policy includes mandatory monthly price quotes to maintain transparency between producers and refiners.
- Devon Energy has announced the acquisition of Grayson Mill Energy for $5 billion in cash and stock. This deal, which includes $3.25 billion in cash and $1.75 billion in shares, expands Devon's operations in the Williston Basin by adding 307,000 net acres. The acquisition is expected to be immediately beneficial to Devon’s financial metrics and has led to a 67% increase in the company’s stock buyback program to $5 billion through mid-2026.
- Occidental Petroleum has secured a landmark carbon removal agreement with Microsoft to mitigate emissions tied to AI expansion. Microsoft will purchase 500,000 metric tons of carbon credits from Occidental's upcoming Stratos plant in Texas, marking the largest deal of its kind involving direct air capture (DAC) technology. This deal bolsters Occidental’s carbon capture ambitions amidst substantial investments from both the company and the U.S. government.
- Denver-based Elevation Midstream has merged with Platte River Holdings, a subsidiary of ARB Midstream, to enhance its presence in the Denver-Julesburg Basin. The merger expands Elevation's service offerings to include three-product gathering, crude stabilization, gas compression, and water logistics with tankless gathering options. Platte River brings over 200 miles of crude gathering pipelines and access to multiple markets through terminals in Platteville and Lucerne. Together, the merged entity aims to consolidate assets in the basin, leveraging their combined infrastructure and financial strength for future growth.
