New restrictions to fight the Delta variant will slow demand growth in the second half of 2021
Interesting moves are being made on the global energy chessboard. In an unexpected move, Saudi Arabia announced it would slash its official selling prices (OSPs) for oil exports to Asia in October. The price cut was more than expected. Saudi Aramco, the state-controlled oil giant, said in a statement on Sept. 5 that the official…
Non-fundamental factors appear to be controlling crude oil market patterns
A number of major events weighed on global oil markets throughout last week. Those factors included: Hurricane Ida; the United States Federal Reserve delaying the tapering off of its economic stimulus; the decision of the Organization of the Petroleum Exporting Countries and its allies in OPEC+ to stick to their original output increments; the rising…
Asia’s market is softening
The crude oil rally is stuttering. Having ceded some 15 per cent in prices in recent months, the rally we saw earlier this year has lost steam. Despite talk of growing demand, tightening markets, galloping prices and the call by U.S. President Joe Biden to the Organization of Petroleum Exporting Countries and their allies in…
Global markets’ overdependence on China backfires as COVID resurgence forces travel restrictions
China has been the sole driver of the global crude oil markets for years. Its growing crude thirst has, time and again, pulled the markets up. Last year, while crude markets were touching the ebb, even going into negative territory, “Chinese buyers dragged oil prices out of the doldrums single-handedly as they stocked up on…
Oil producers are facing a structural transformation in the market
The global crude oil market is undergoing a structural transformation. In its recent Monthly Energy Review, the U.S. Energy Information Administration (EIA) pointed out a sharp decline in United States energy intensity – the energy consumption per unit of gross domestic product (GDP). In crude oil terms, the contribution of each unit of energy to…
The summer driving season is upon us and Americans are hitting the road in much larger numbers than a year ago
Crude oil markets face an interesting mix of influences. While the COVID-19 Delta variant continues to affect the markets, conflicting signals seem to push oil prices in the opposite direction. Reports confirm that American oil consumption is rushing back much faster from the pandemic slump than initially predicted. The summer driving season is upon us…
Declining Chinese demand, a rising rig count in the United States and a devastating resurgence of COVID-19 in Asia all play a role
It has been a fluctuating week for the oil markets. In the immediate aftermath of the agreement within the Organization of Petroleum Exporting Countries and their allies in OPEC+, crude prices fell by a devastating seven per cent on July 19. However, with signs of demand holding despite the spread of the Delta COVID-19 variant,…
All eyes are focused on Saudi Arabia. Will it continue to single-handedly maintain stability in the markets?
Uncertainty has overtaken the crude oil markets again for several reasons. Since March, crude oil markets have mostly been ascending. But prices declined last week by a greater margin than any time in the last four-plus months. And the resurgence of COVID-19 in many parts of the world is clouding the near-term future of oil.…
U.A.E. prepares for a post-oil world, endeavouring to make the best of the oil it has before demand shrinks for good
Crude oil markets have left a confused picture and observers can’t decipher where prices will stabilize. In the immediate aftermath of the Organization of Petroleum Exporting Countries (OPEC) fiasco last week, oil prices were on a slippery slope. OPEC+ ministers halted crude oil output talks on July 5 after the United Arab Emirates rejected a…
As OPEC+ talks to increase crude oil production stall, the Saudis seem to have lost a key ally in the United Arab Emirates
Adrenalin never stops flowing in the oil business. Dull moments are rare. The emerging scenario among the Organization of Petroleum Exporting Countries and their allies in the expanded OPEC+ is no different. The group was on the verge of finalizing a deal on Thursday to increase its crude output by two million barrels per day…
But much still depends on United States-Iran nuclear talks and how OPEC+ members will react to any deal
Crude oil markets are hot. Prices are up and the US$75 line has been breached. Chatter about oil touching US$100 is getting loud and clear. Global oil consumption is getting closer to the pre-pandemic levels. The bleak clouds hanging over the crude oil horizon are beginning to dissipate. Industry eyes are again on the Organization…
US$100 oil is a distinct possibility
The world needs more oil. The Organization of Petroleum Exporting Countries (OPEC), Russia and American shale oil producers all need to up their output to keep the rising prices of the “super cycle,” as Saudi Energy Minister Prince Abdulaziz bin Salman called it, under control. Media reports say Prince Abdulaziz bin Salman told the Robin…
The IEA concedes rising oil demand at odds with its call to end new oil, gas and coal funding
The International Energy Agency (IEA) is torn between two conflicting ends. On one hand, it’s grappling with climate change issues; on the other, it sees rising oil prices. For now, the two ends seem to be running parallel but not converging. Oil demand is rising fast, as are prices, reaching multi-year highs on Friday. Brent…
IEA wants all investments in new developments to stop. Others warn that could lead to $200 a barrel oil
The Organization of Petroleum Exporting Countries and their allies in OPEC+ are on a collision course with energy watchdog International Energy Agency (IEA) on at least two counts. Last month, the Paris-based IEA delivered the starkest warning yet on fossil fuels, saying the exploitation and development of new oil and gas fields must stop this…
Alternative energy and calls for the world to overcome its reliance on fossil fuels gaining currency
The short-term prognosis for crude oil looks exciting. But that may be a mirage. The approaching summer driving season in the Northern Hemisphere and the lifting of COVID-19 restrictions have stimulated demand. The Organization of Petroleum Exporting Countries (OPEC) and its allies in the expanded OPEC+ appear confident that with the accelerating vaccination programs and…