2025.01.23

Oil prices hit one-week low amid Trump's tariff concerns and global growth uncertainty

Oil prices dropped to a one-week low as concerns over President Trump's proposed tariffs on Chinese goods and uncertainty surrounding global economic growth weighed on the market. (Brent futures settle at $79.00 a barrel, U.S. West Texas Intermediate crude (WTI) settle at $75.44 / bbls ) Brent futures and U.S. West Texas Intermediate crude both decreased, with Brent down for a fifth consecutive day and WTI for a fourth. Trump's discussions of tariffs on China, Mexico, Canada, and Europe, as well as a potential halt in oil imports from Venezuela, all contributed to market uncertainty. In addition, Iran denied seeking nuclear weapons and offered talks while Saudi Arabia saw a spike in crude oil exports. Analysts predicted a ninth consecutive weekly decline in U.S. crude stocks, with data from the API and EIA expected to confirm this trend. Winter Storm Enzo also disrupted energy operations in Texas ports.

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Saudi Arabia's Crude Oil Exports Hit Record High in November Amid Global Market Disruptions

Saudi Arabia's crude oil exports soared to a record high in November, reaching 6.206 million barrels per day. Despite a slight decrease in production, Saudi refineries processed less crude while direct burning increased. OPEC+ has postponed oil output increases and extended cuts until the end of 2026. Recent U.S. sanctions on Russia's oil revenue have disrupted the market, leading Chinese and Indian refiners to seek non-sanctioned oil. The IEA predicts slower demand growth in 2025 but recognizes the potential for Russian supply disruptions due to sanctions.

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Performance Shipping Agrees to Reduced Charter Rate for Aframax Tanker P Monterey with Glencore's ST Shipping & Transport

Performance Shipping has agreed to a reduced charter rate with Glencore's shipping division ST Shipping & Transport for their aframax tanker P Monterey. The new rate is $28,000 per day, down from the previous $32,000 per day, for a one-year extension with the option to extend further. This deal will generate $9.38m in revenue for Performance. CEO Andreas Michalopoulos expressed satisfaction with the agreement, highlighting the company's strong partnerships and revenue backlog of approximately $62m. The tanker fleet now consists of six vessels under time-charter arrangements and one operating in the spot market. Braemar has observed increased demand for aframax period contracts, with rates for older vessels at $30,000 per day. Trafigura and Mercuria have also secured charters for their tankers at slightly higher rates.

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Sri Lanka and China fast-track $3.7 billion oil refinery project in Hambantota

Sri Lanka has agreed to fast-track a $3.7 billion oil refinery project with China's Sinopec in Hambantota. The joint venture will determine the share of refined fuel for export. This project is one of the largest foreign investments in Sri Lanka, aiming to reduce its dependence on imported oil and stabilize its economy. Both countries are working to resolve issues like land, tax, and water with hopes to start construction soon. This deal came after Sri Lanka secured an IMF program and signed cooperation documents with China, including economic and technological agreements. Sri Lanka is also in discussions with India for a proposed fuel pipeline and open to refinery proposals from them.

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Sri Lanka and China fast-track $3.7 billion oil refinery project in Hambantota

Sri Lanka has agreed to fast-track a $3.7 billion oil refinery project with China's Sinopec in Hambantota. The joint venture will determine the share of refined fuel for export. This project is one of the largest foreign investments in Sri Lanka, aiming to reduce its dependence on imported oil and stabilize its economy. Both countries are working to resolve issues like land, tax, and water with hopes to start construction soon. This deal came after Sri Lanka secured an IMF program and signed cooperation documents with China, including economic and technological agreements. Sri Lanka is also in discussions with India for a proposed fuel pipeline and open to refinery proposals from them.

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CNOOC Sets Record Production Target for 2025 Despite Divestment in Gulf of Mexico

China's state oil and gas company, CNOOC, has set its production target for 2025 at a record high, aiming for 760-780 million boe. This is slightly lower than previous guidance due to divestment of Gulf of Mexico assets. The company plans to maintain a stable production plan, with 69% coming from offshore China and 31% from overseas. CNOOC expects to spend between 125-135 billion yuan in capital this year, with new production coming from projects in China, Guyana, and Brazil. CEO Zhou Xinhuai commented on the uncertainty brought by the Trump administration in the global energy markets, noting that there may not be a significant increase in U.S. shale oil production in the immediate future despite Trump's pro-drilling stance.

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