Oil Nears One-Month Highs Amid Supply Tightening and Trade War Concerns

Oil prices continued their upward trend, with Brent crude futures rising by 0.3% to $74.03 per barrel, while WTI crude gained 27 cents to $69.92. This follows a 1% price increase on Wednesday, marking the highest level since February. However, investor sentiment remains mixed as U.S. trade policies introduce fresh uncertainties. President Donald Trump announced a 25% tariff on imported cars and light trucks starting next week, with auto parts tariffs effective May 3. Additionally, Venezuelan crude buyers now face 25% tariffs, leading India’s Reliance Industries—operator of the world’s largest refining complex—to halt imports from Venezuela. Analysts caution that tariff risks could slow oil demand, with DBS Bank predicting prices may not return to early 2025 highs due to economic uncertainty. Meanwhile, U.S. crude inventories fell by 3.3 million barrels, exceeding the expected 956,000-barrel draw, signaling tighter supplies. In broader economic news, U.S. unemployment claims declined, suggesting resilience in the labor market.

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US Pursues $47M from Iranian Oil Deal Routed Through Multiple Tankers

The U.S. is pursuing $47 million in proceeds from an Iranian oil deal involving multiple tanker transfers, allegedly violating U.S. sanctions. According to court filings, the oil, loaded at Iran’s Kharg Island terminal in early 2022, was transferred between several tankers, including the Berg 1, Maria Grace, Tjaste, CS Prosperity, and Okeanos, before reaching Croatia. The U.S. Department of Justice stated that it would aggressively enforce sanctions against Iran, with the goal of sending a clear message against bypassing sanctions. The oil was allegedly destined for Triliance Petrochemical, a company the U.S. has accused of facilitating sanctions evasion. The final transaction attempt was made last June when the proceeds were seized by U.S. authorities. The vessels involved in the transfers have changed names, flags, and management multiple times, raising suspicions of dark fleet activity. The U.S. government claims that Iran uses oil revenues to fund the Islamic Revolutionary Guard Corps’ Quds Force, a designated terrorist organization.

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U.S. Warns Venezuela Against Aggression Toward Guyana or ExxonMobil

U.S. Secretary of State cautioned Venezuela that any attack on Guyana or ExxonMobil would result in severe consequences, stating it would be "a very bad day" for the South American country. The warning comes amid a long-standing territorial dispute over the 160,000-square-km Esequibo region, currently under review at the International Court of Justice. The U.S. has increased its military support for Guyana while imposing further sanctions on Venezuela. Tensions escalated after a Venezuelan coast guard patrol approached an Exxon-operated vessel in disputed waters, with Venezuela denying any violation of Guyanese territory. In response, Venezuela's Foreign Minister Yvan Gil rejected what he called intimidation and foreign interference in the Esequibo dispute. Meanwhile, the U.S. Navy and Guyana’s Defense Force conducted joint exercises in international waters and Guyana’s Exclusive Economic Zone. ExxonMobil, along with Hess and China’s CNOOC, controls all oil and gas production in Guyana, which has reached 650,000 barrels per day this year. However, exploration in the northwest section near Venezuela remains halted due to force majeure.

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India Blocks Russian Oil Tanker Over Documentation Issues Amid Stricter Scrutiny

Indian port authorities denied entry to the Tanzania-flagged Andaman Skies, a 20-year-old tanker carrying 100,000 metric tons (800,000 barrels) of Russian Varandey crude, citing inadequate documentation. The tanker was en route to Vadinar Port for delivery to Indian Oil Corp before being turned away. This move signals India’s increasing scrutiny of Russian oil shipments amid evolving global sanctions. India, the largest buyer of seaborne Russian crude, imported 35% of its oil from Russia in 2024. However, stricter enforcement of maritime regulations requires tankers over 20 years old to have seaworthiness certification from an approved classification society. The Andaman Skies, built in 2004, had certification from Dakar Class, which is not recognized by Indian authorities. Additionally, the vessel had insurance from Russian company Soglasie, raising further compliance concerns. Following sweeping U.S. sanctions in January targeting over 100 Russian oil ships, India has stated it will only purchase Russian crude from non-sanctioned entities, effectively limiting the number of eligible vessels. While the Andaman Skies is sanctioned by the UK and EU, it is not under U.S. or U.N. sanctions, which India adheres to. The ship’s owner, Durbeen Navigation Ltd, could not be reached for comment, and neither Lukoil, Vadinar Port authorities, nor Indian Oil have responded to media inquiries.

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Saudi Aramco Eyes Investment in Indian Refineries Amid Expanding Energy Ties

Saudi Aramco is in discussions to invest in two planned refineries in India, seeking a stable outlet for its crude in one of the world's fastest-growing energy markets. India, the third-largest oil consumer and importer, aims to become a global refining hub as Western companies reduce crude processing capacity in favor of cleaner energy. Meanwhile, Saudi Arabia's share of India's oil imports has declined as Indian refiners increasingly source cheaper alternatives, including Russian crude. Aramco is separately negotiating investments in Bharat Petroleum Corp's planned refinery in Andhra Pradesh and ONGC’s proposed refinery in Gujarat. While ONGC’s project is still in early stages, BPCL has announced a $11 billion investment for its Andhra Pradesh facility. Indian officials indicate the projects will proceed regardless of Aramco’s participation, with negotiations focused on supply agreements. Aramco reportedly seeks to supply crude equivalent to three times its potential stake in each refinery and retain flexibility over selling its output within India or for export. Indian Prime Minister Narendra Modi is expected to visit Saudi Arabia in the second quarter, and both nations aim to finalize an agreement before the visit. Aramco has previously attempted to enter India’s refining sector, including a 2018 joint venture for a 1.2 million barrels-per-day refinery and a 2019 non-binding agreement for a 20% stake in Reliance Industries' oil-to-chemical business, though both projects faced setbacks. In January, India’s Oil Minister announced plans to develop three new 400,000 bpd refineries, underscoring the country’s long-term refining ambitions.

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Suncor Identifies Source of Hydrocarbon Spill at Sarnia Refinery

Suncor Energy has identified and isolated the source of a hydrocarbon spill at its 85,000-barrel-per-day refinery in Sarnia, Ontario, detected during routine monitoring. While the company did not specify whether the spill involved crude oil or fuel, no injuries have been reported. The spill, which affected the St. Clair River near the refinery, prompted the deployment of containment booms by Suncor and Shell to prevent further spread. Despite the incident, St. Clair Township confirmed that its water distribution system remains safe for drinking. Shell Canada's Sarnia Manufacturing Center in Corunna has provided emergency response support, supplying personnel and equipment to aid containment efforts. Suncor has yet to provide additional details on the extent of the spill or potential environmental impacts.

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US Oil Producers Face Challenges as Permian Basin Approaches Peak Output

U.S. oil producers are facing growing challenges in the Permian Basin, the country's top oilfield, as it reaches the limits of its production growth. The Permian was central to the shale revolution, but it now shows signs of slowing down, with rising levels of water and gas per barrel and the depletion of its core sub-basins. Output growth in the Permian is expected to slow by 25% this year, with analysts predicting peak production between 2027 and 2030. As drilling continues in lower-quality areas, production is becoming less efficient, and costs are rising due to the increasing water-to-oil ratio. This is compounded by rising natural gas output, which further drives up costs. Despite these challenges, there is still significant oil production, and companies are exploring solutions like recycling produced water and utilizing artificial intelligence to improve efficiency. While producers are optimistic about the Permian's future, they face higher costs and diminishing returns as the basin matures.

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CNOOC's Net Profit Surges on Record Output Despite Weaker Oil Prices

CNOOC Ltd reported an 11.4% increase in net profit for 2024, reaching 137.9 billion yuan ($18.99 billion), driven by record oil and gas output despite lower oil prices. The company achieved a 7.2% rise in production, totaling 726.8 million barrels of oil equivalent (boe), meeting the high end of its target. CNOOC's production cost remained low at $28.52 per boe, and its proven reserves grew to a record 7.27 billion boe, with a reserve replacement ratio of 167%. The company continued to focus on expanding natural gas projects, including major developments in the South China Sea, and made 10 new oil and gas discoveries in 2024. Its international production increased by 10.8%, supported by projects in Guyana and Canada. Despite geopolitical uncertainties, CNOOC has remained focused on optimizing assets and expanding in global markets, with new contracts awarded in Mozambique, Brazil, and Iraq. The company also declared a final dividend of HK$0.66 per share.

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Putin Highlights Arctic Rivalries and Economic Cooperation Opportunities

Russian President Vladimir Putin acknowledged growing geopolitical rivalries in the Arctic but expressed willingness to cooperate with foreign partners on economic projects. He addressed U.S. President Donald Trump’s interest in acquiring Greenland, emphasizing that it does not concern Russia, but highlighted NATO's increasing focus on the region as a potential conflict zone. He underscored the Arctic’s strategic importance due to its rich resources and military competition, with Russia having enhanced its presence there. Putin also stressed the economic potential of the Northern Sea Route (NSR) for trade, especially as Russia shifts its focus from Europe to Asia. He called for expanding Russia's northern ports and building a new merchant fleet, including nuclear-powered icebreakers. However, he noted that domestic capabilities are insufficient, requiring foreign investment and collaboration with international logistics firms. Putin emphasized Russia's openness to joint ventures and partnerships with countries like China, Belarus, and the UAE to develop the region.

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NYK and Monjasa Complete Panama's First Biofuel Bunkering

Monjasa, a Danish bunker and tanker group, has completed Panama's first-ever biofuel bunkering operation with Japanese shipping giant NYK. The 900-tonne B30 biofuel blend was delivered to NYK's Hestia Leader car carrier in the Port of Cristobal via ship-to-ship transfer from the Monjasa Thunder tanker. The biofuel blend consisted of 30% fatty acid methyl ester (FAME) and 70% very low-sulphur fuel oil. This marks a significant step for Panama, which has introduced a “net-zero slot” to incentivize low-carbon shipping operations. While biofuel adoption in Panama has been slower than in other global bunkering hubs, Monjasa has developed a strategy to ship biofuels from Europe, working with long-term partners. The company has also established biofuel partnerships in Peru and Colombia and is expanding its global biofuel supply locations to support the shipping industry's climate goals for 2050.