2024.10.03

OPEC+ maintains output policy, urges compliance from members

OPEC+ has decided to keep its oil output policy unchanged during a ministerial meeting. OPEC+ plans to increase output by 180,000 barrels per day in December as part of a phased rollback of its latest round of voluntary production cuts, which will continue through 2025. The group, which is cutting total output by 5.86 million bpd, emphasized the need for full compliance from member nations, with particular focus on Iraq and Kazakhstan, which are required to make additional cuts to compensate for past overproduction. Although compliance has been reported for September, it must be verified by external sources. OPEC+ plans to continuously assess market conditions, especially amid rising oil prices driven by Middle East tensions. The group's next meeting is scheduled for December 1.

[SLOW] EIA - Crude Oil Outlook _ World oil supply outlook

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Saudi Arabia warns oil prices could drop to $50 if OPEC+ members violate output limits

Saudi Arabia’s oil minister, Prince Abdulaziz bin Salman, has warned that oil prices could fall as low as $50 per barrel if OPEC+ members fail to comply with agreed production limits, according to a report from the Wall Street Journal. This remark was interpreted by other producers as a signal that Saudi Arabia might initiate a price war to protect its market share if members like Iraq and Kazakhstan, singled out for overproduction, do not adhere to the group's agreements.

[SLOW] EIA - Crude Oil Outlook _ Kazakhstan oil production

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[SLOW] https://slowspace.io/ _ MT IZUMO / MT FRUNZE

US sanctions tanker owner for allegedly funding Houthi attacks via Iranian oil shipments

The US government has sanctioned Gemini Marine, a Marshall Islands-registered shipowner, and two of its tankers for allegedly transporting Iranian oil used to finance Houthi attacks on vessels in the Red Sea. According to the US Treasury, one tanker, the Gabon-flagged Izumo, recently delivered 1 million barrels of Iranian oil to a Malaysian refinery after a covert ship-to-ship transfer. The tanker has also been linked to supplying oil to a network supporting Houthi militants. Another Gemini-owned tanker, the Frunze, was similarly implicated in illicit Iranian oil shipments, with a recent delivery to China. These actions have generated "tens of millions of dollars" to support attacks on commercial ships.

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[SLOW] https://slowspace.io/ _ Strait of Hormuz

Closure of the Strait of Hormuz could devastate global oil shipping

A potential closure of the Strait of Hormuz, due to escalating conflict between Israel and Iran, would have a more severe impact on global oil markets and tanker shipping than the ongoing Red Sea crisis, according to analysts. With 25-35% of the world’s crude oil passing through Hormuz, a blockade would drastically affect oil shipments. Unlike the Red Sea, Hormuz lacks viable alternative routes, amplifying the disruption. While the Red Sea conflict has benefitted shipping rates by increasing travel distances, Hormuz's closure would shrink demand for seaborne oil transport. Rising tensions have already boosted tanker shares, oil prices, and forecasts for increased shipping activity as global markets react.

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[SLOW] Oil Market _ North Sea oil price

Traders hedge on $100 oil amid Middle East tensions, despite oversupply risks

Amid rising tensions in the Middle East, traders are increasingly hedging against potential oil price spikes by trading crude options that pay out if prices hit $100 per barrel. By 11:20 a.m. in New York, the volume of Brent December $100 call options traded was equivalent to nearly 27 million barrels, while over 7 million barrels of US crude December call options were exchanged, driven by a mix of buying and selling. Some traders see these $100 options as insurance against short-term disruptions, while others were covering previously sold positions. Despite the surge in demand for these options, analysts believe the market may face oversupply in the coming months, with demand growth uncertain and OPEC+ production expected to rise.

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[SLOW] https://slowspace.io/ _ Jomoro, Ghana

Ghana’s $12bn refinery set to reshape West African tanker market by 2029

Ghana's tanker market is set for a major transformation as the country begins construction on a $12 billion refinery in Jomoro, expected to be completed by 2029. The 300,000-barrel-per-day (bpd) refinery, part of a broader development led by Ghana's Petroleum Hub Development Corporation (PHDC), will include a 90,000-bpd petrochemical plant and additional storage capacity. Ghana aims to become a key refining hub for the region. This development may increase crude tanker imports for feedstock, while reducing product tanker imports. The project follows similar efforts in Nigeria, where the Dangote refinery has already started generating export opportunities. Chinese firms are heavily involved in the Jomoro project’s construction, with the refinery expected to meet regional demand by 2036.

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[SLOW] https://slowspace.io/ Dangote Petroleum Refinery Cargo Flow

NNPC charters Suezmax tankers for Dangote refinery's crude supply

The Nigerian National Petroleum Corporation (NNPC) has secured two suezmax tankers from the Stena-Sonangol pool to supply crude oil to Nigeria’s newly operational Dangote refinery, Africa’s largest - 650,000-barrel per day. Crude oil supplied to the Dangote refinery will be sold in the Nigerian currency, the naira, according to a statement from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). The refinery, located near Lagos, has begun producing gasoline and will initially supply 25 million liters per day to the domestic market, with plans to increase to 30 million liters by October 2024. The deal, facilitated by the NMDPRA, will reduce pressure on Nigeria's foreign exchange reserves by 40%. While NNPC has committed to four crude shipments annually, the refinery is expected to require 15 crude cargoes per year.

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Marubeni and Solvang join forces to operate ammonia carrier, pushing for low-carbon fuel supply chain

Japan's Marubeni Corporation has partnered with Norway's Solvang to jointly operate the 60,200-cbm ammonia carrier Clipper Neptun (built 2008). Solvang, a key player in ammonia transportation with a 10% global market share, will bring its expertise to the collaboration. Marubeni views ammonia as a clean energy source, anticipating rising global demand, and aims to strengthen its role in the ammonia supply chain. The partnership supports Japan's long-term goals of decarbonizing its energy system, with domestic ammonia demand projected to reach 3 million tonnes by 2030 and 30 million tonnes by 2050. Marubeni’s efforts align with Japan’s target to establish a global low-carbon ammonia supply chain and mitigate climate change.