Oil Rises 1% as Trump Announces Tariff on Venezuelan Oil Buyers

Oil prices climbed 1% on Monday after U.S. President Donald Trump announced a 25% tariff on countries purchasing Venezuelan oil and gas. Brent crude rose to $73 per barrel, while WTI crude reached $69.11. However, gains were limited as the U.S. extended Chevron’s deadline to wind down Venezuelan operations until May 27. OPEC+ is expected to proceed with a planned May output hike, while talks to end the war in Ukraine could increase Russian crude supply. Investors also reacted to new U.S. sanctions on Iranian oil exports, including measures targeting a Chinese refinery. Meanwhile, Wall Street surged as Trump hinted at a more flexible approach on tariffs, and the Federal Reserve signaled a cautious stance on rate cuts.

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Trump Imposes 25% Tariff on Venezuelan Oil Buyers, Extends Chevron’s Wind-Down

U.S. President Donald Trump has announced a 25% tariff on any country purchasing oil or gas from Venezuela, effective April 2, while extending Chevron’s wind-down deadline in the country until May 27. This move targets Venezuela’s key buyers, such as China, which accounted for 55% of its crude exports in February (503,000 barrels per day). Analysts suggest the tariff could force Venezuela to offer price discounts, similar to the secondary sanctions Trump imposed in 2020. The extension allows Chevron to continue receiving payments while preventing a sudden collapse in Venezuelan crude exports. Oil prices rose 1% on the announcement, though gains were limited by Chevron’s extension. The tariff could redirect demand toward Russian crude, as China and India may avoid additional U.S. trade penalties. Venezuelan President Nicolás Maduro condemned the sanctions as an "economic war" but claimed his country remains resilient.

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OPEC+ Expected to Proceed with May Oil Output Increase Despite Overproduction Adjustments

OPEC+ is likely to continue its planned oil output increase of 135,000 bpd in May, marking the second consecutive monthly rise, according to four sources. The group, which controls over 40% of global oil supply, is balancing this increase by enforcing production cuts on seven members that previously exceeded quotas, with reductions scheduled until June 2026. Brent crude prices, which dropped to nearly $68 per barrel in early March, have since rebounded above $72. Analysts cite low crude inventories, rising summer demand, and enhanced compliance as reasons for maintaining the production hike schedule. OPEC+ has been cutting 5.85 million bpd (5.7% of global supply) since 2022 to stabilize markets. A ministerial committee meeting on April 5 will review the policy, while Russia has signaled potential reversals if market conditions require.

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Sinopec to Prioritize Risk Control in Russian Oil Purchases, Executive Says

Sinopec, China's leading refining giant, will focus on "risk control" when purchasing Russian oil, according to company president Zhao Dong. Speaking at an earnings briefing in Hong Kong, Zhao noted that Russian oil offers comparable value in terms of quality compared to other global supplies. Sinopec is confident in its ability to secure crude oil supplies through long-term agreements with multiple partners, ensuring a stable flow of oil for its operations.

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Russian Central Bank Warns of Prolonged Low Oil Price Cycle Risk

Russia's central bank has issued a warning that the United States and OPEC could flood the global oil market, potentially triggering a prolonged low-price cycle similar to the 1980s collapse, which contributed to the fall of the Soviet Union. The warning was presented to Russian policymakers ahead of talks between Presidents Putin and Trump regarding the Ukraine war. While OPEC is not planning immediate changes to its production policy, the bank expressed concerns over the rising oil output in non-OPEC countries like the U.S., Guyana, Brazil, and Kazakhstan. The bank highlighted OPEC’s spare capacity as a significant risk factor, noting it is near a record high and equivalent to Russia's oil exports. Historically, periods of low oil prices have severely impacted Russia’s economy, particularly in the 1990s and 2008. Although oil prices are currently around $70 per barrel, the central bank's concerns reflect potential vulnerabilities in Russia's budget and economy, especially with a strong ruble.

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Indian Refiners Reduce Spot Oil Tenders as Russian Shipments Recover

Indian refiners are set to issue fewer spot tenders for crude oil in the coming months, as Russian oil shipments rebound after sanctions-related disruptions. Indian state refiners had significantly reduced spot tenders earlier this year due to discounted Russian oil supplies following Western sanctions imposed after Russia’s 2022 invasion of Ukraine. However, in response to stricter U.S. sanctions targeting Russian oil shipments in January, Indian refiners like Indian Oil Corporation (IOC) and Bharat Petroleum Corporation (BPCL) turned to the spot market to replace disrupted Russian supplies. Now, with Russian oil once again being offered via non-sanctioned tankers, Indian refiners plan to scale back their spot purchases. March saw a resurgence in Russian oil imports to India, with deliveries recovering nearly to pre-sanction levels after a three-month decline, as supplies were diverted from Turkey.

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U.S. Jet Fuel Imports Reach Two-Year High as Nigeria’s Dangote Refinery Expands Exports

U.S. jet fuel imports in March surged to their highest level in two years, reaching approximately 226,000 barrels per day, driven by shipments from Nigeria’s 650,000 bpd Dangote refinery. Six vessels carrying 1.7 million barrels have already arrived, with another 348,000-barrel shipment due on March 29. The refinery, operating at 85% capacity since February, has become a key swing supplier, challenging European refiners and U.S. producers. A temporary shutdown at the Phillips 66 Bayway refinery in New Jersey created an arbitrage opportunity, though analysts expect the flow to slow as U.S. inventories rise. Jet fuel stocks ended February at 45.2 million barrels, the highest for the month since 1999. Storage demand in Houston and New York Harbor has increased five to six times the monthly average, potentially lowering fuel prices ahead of summer travel. However, economic concerns could dampen air travel demand. The EIA projects U.S. jet fuel consumption will reach a record high in 2026.

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European Oil Refineries Face Closures, Conversions by 2035 Amid Energy Transition

European oil refineries must adapt to the energy transition or risk closure by 2035, industry executives said at the Financial Times Commodities Global Summit. Declining road fuel demand due to electrification and legislative changes is pushing refiners toward biofuels, carbon capture, and low-carbon hydrogen. Executives from Essar Energy Transition and Moeve highlighted the need for refineries to diversify feedstocks while simplifying operations. Profitability pressures from new refineries in Africa and the Middle East, as well as declining margins post-COVID, are accelerating closures. Scotland’s Grangemouth refinery and Shell’s Wesseling plant in Germany are among those set to cease crude processing this year. Industry experts predict further consolidation in the European refining sector by 2035.

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Ampol Faces Additional A$35M Costs for Lytton Refinery Repairs Post-Cyclone

Ampol has flagged an additional A$35 million ($21.99 million) in costs for repairing its Lytton refinery in Queensland following damage from Cyclone Alfred. The refinery has resumed normal production, but repairs to a damaged crude storage tank are ongoing. The company estimates the floating roof repair at A$20 million and expects A$5 million per month in additional storage costs for three months until supply chains stabilize. Insurance is anticipated to cover about half of the expenses.

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DHT Holdings Reportedly Selling Chinese-Built VLCCs Amid Potential US Trade Restrictions

DHT Holdings, a US-listed tanker owner, is reportedly selling its only Chinese-built VLCCs, the DHT Lotus and DHT Peony (both built in 2011), for $55 million each. However, CEO Svein Moxnes Harfjeld has denied that a sale has been completed. The potential sale comes amid proposed US restrictions, including a port fee on Chinese-built vessels. Ship values have declined from a peak of $63 million in April 2023. A proposed fee structure includes either a $1.5 million charge per port call or a $1,000 per net tonne levy, which could cost a VLCC up to $100 million per call. The final decision on these tariffs is pending after a public comment period. The ships were built at China’s Bohai Shipbuilding Heavy Industry.

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MOL and CMB.Tech Partner to Launch World's First Ammonia-Powered Bulk Carriers and Chemical Tankers

Mitsui OSK Lines (MOL) and CMB.Tech are collaborating to operate the world’s first ammonia-fueled capesize bulkers and chemical tankers. The partnership includes joint ownership and chartering of nine vessels, with three 210,000-dwt ammonia dual-fuel bulkers under construction at CSSC Qingdao Beihai Shipbuilding (delivery in 2026-2027) and six ammonia-compatible chemical tankers from China Merchants Jinling Shipyard (delivery in 2028-2029). The bulkers will be chartered for 12 years, while the tankers have fixed terms of 10 and 7 years. The project boosts CMB.Tech’s contract backlog by $921 million to $2.94 billion. MOL and CMB.Tech see ammonia as a key clean fuel for shipping’s decarbonization. MOL operates 110+ chemical tankers, while CMB.Tech manages 150+ vessels across multiple sectors, including crude tankers and container ships. CMB.Tech recently acquired John Fredriksen’s stake in Golden Ocean Group, strengthening its position in sustainable shipping.