oil price at a 2 month high, natgas at a 2 month low; largest oil draw since last July; gasoline demand at a 33 week high

oil prices at a 2 month high, natural gas prices at a 2 month low; crude oil balance sheet error shifts by 1.5 million barrels per day on largest inventory draw since last July; gasoline demand at a 33 week high

US oil prices rose for a fourth consecutive week on an across the board draw from ​oil & fuel supplies, including the largest crude inventory dr​aw in nearly a year….after rising 1.0% to $81.52 a barrel last week as concerns over increasing attacks on Russia and in the Middle East more than offset signs of weak US demand, the contract price for the benchmark US light sweet crude for August delivery started the week more than $1 per barrel higher early Monday, as AAA was forecasting a record number of travelers this Independence Day week, ​i​ncluding a 5% year-on-year increase in road travel, and continued on its upward trend, supported by increasing geopolitical concerns, including fears of conflict in southern Lebanon, the possibility that Iran would enter directly into the conflict with Israel, and the potential that Russia would provide support to its partners in the region, and settled $1.84 or over 2% higher at a two-month high $83.38 a barrel​. on hopes of rising demand during the Northern Hemisphere's summer driving season and​ on worries that conflict in the Middle East ​would spread and reduce global oil supplies…the oil market extended its gains to new two-month highs early Tuesday, supported by expectations for a rise in demand this summer, as the American Automobile Association forecast travel during the holiday period would increase 5.2% on the year, with car travel up 4.8% on the year, but sold off to a​n ​intraday low of $82.72 on profit-taking as fears that Hurricane Beryl would disrupt crude production in the Gulf of Mexico eased ​b​efore prices settled 57 cents lower at $82.81 a barrel as Beryl was expected to have weakened into a tropical storm by the time it enters the Gulf of Mexico later in the week….oil prices recovered to near a two-month high in overseas trading early Wednesday, after the American Petroleum Institute reported crude inventories shrank 9.2 million barrels last week, the largest drop since January, then spiked to new highs after the EIA reported a 12.3 million barrel inventory draw, the biggest in nearly a year, and settled $1.07 higher at a new two-month high of $83.88 a barrel​, as traders weighed larger than expected draws in US oil stocks against bearish economic data from the U.S., the euro zone and China….f​ollowing the US holiday​ Thursday, oil prices rose in Asian trading early Friday, ​as traders eyed strong summer fuel demand and potential supply disruptions, then hit a session high of $84.52 per barrel in New York, the highest level since late April, before pulling back to settle 72 cents lower at $83.16 a barrel as the possibility of a ceasefire deal in Gaza outweighed strong summer fuel demand and potential supply disruptions from Gulf of Mexico hurricanes…oil prices were still up 2.0% on the week, their fourth straight weekly advance, with the drop in US crude inventories and the threat of Hurricane Beryl responsible for extending crude’s early-summer rally…

natural gas prices, on the other hand, finished lower for a fourth consecutive week, as production continued to rise amid a cooling trend in the central US…after falling 8.3% to $2.601 per mmBTU last week as rising production and interrupted LNG demand offset higher air-conditioning demand, the contract price of natural gas for August delivery opened 4 cents lower on Monday and arced lower in morning trading in response to forecasts for reduced cooling demand and increased production, and settled 12.3 cents lower at $2.478 per mmBTU as weather forecasts trimmed demand outlooks and Lower 48 gas output rose to a new three-month high…natural gas prices opened three cents lower again on Tuesday, and slid to a six-week intraday low of $2.415 by 1:15PM, with prices repressed by continued steady production and cooling forecasts, and settled 4.3 cents lower at a six week low of $2.435 per mmBTU as weather forecasts softened the heat outlook for later in July, amid storm fears stoked by the formation of the earliest Category 5 hurricane on record….natural gas traded in a narrow range early Wednesday, then trended lower following an unsurprising storage report, and settled 1.7 cents lower at $2.418 per mmBTU amid strong production and easing demand because of a cool down in the country’s midsection and business closures for the holiday….natural gas prices slid another 9.9 cents to a two month low of $2.319 per mmBTU in thin post holiday trading Friday, and thus finished down 10.8% for the week..

The EIA’s natural gas storage report for the week ending June 28th indicated that the amount of working natural gas held in underground storage rose by 32 billion cubic feet to 3,134 billion cubic feet by the end of the week, after revisions raised June 21st’s inventories by 5 billion cubic feet to 3,102 billion cubic feet, which left our natural gas supplies 275 billion cubic feet, or 9.6% above the 2,859 billion cubic feet that were in storage on June 28th of last year, and 496 billion cubic feet, or 18.8% more than the five-year average of 2,638 billion cubic feet of natural gas that had typically been in working storage as of the 28th of June over the most recent five years…the 32 billion cubic foot addition to US natural gas working storage for the cited week was in line with the 30 billion cubic foot addition to storage that the market was expecting ahead of the report, but it was much less than the 76 billion cubic feet that were added to natural gas storage during the corresponding third week of June 2023, and also much less than the average 69 billion cubic foot injection into natural gas storage that has been typical for the same early summer week over the past 5 years…

The Latest US Oil Supply and Disposition Data from the EIA

US oil data from the US Energy Information Administration for the week ending June 28th indicated that after a modest increase in our oil exports and a modest increase in our oil refining, we had to pull oil out of our stored commercial crude supplies for the eighth time in twenty-three weeks and for the 14th time in the past 37 weeks, mostly due to an increase in demand for oil that the EIA could not account for….Our imports of crude oil fell by an average of 65,000 barrels per day to 6,547,000 barrels per day, after falling by an average of 443,000 barrels per day over the prior week, while our exports of crude oil increased by 491,000 barrels per day to 4,401,000 barrels per day, which when used to offset our imports, meant that the net of our trade of oil worked out to a net import average of 2,146,000 barrels of oil per day during the week ending June 28th, 556,000 fewer barrels per day than the net of our imports minus our exports during the prior week. At the same time, transfers to our oil supply from Alaskan gas liquids, from natural gasoline, from condensate, and from unfinished oils averaged 372,000 barrels per day, while during the same week, production of crude from US wells was unchanged at 13,200,000 barrels per day. Hence our daily supply of oil from the net of our international trade in oil, from transfers, and from domestic well production appears to have averaged a rounded total of 15,718,000 barrels per day during the June 28th reporting week…

Meanwhile, US oil refineries reported they were processing an average of 16,792,000 barrels of crude per day during the week ending June 28th, an average of 260,000 more barrels per day than the amount of oil that our refineries reported they were processing during the prior week, while over the same period the EIA’s surveys indicated that a net average of 1,680,000 barrels of oil per day were being pulled out of the supplies of oil stored in the US, the largest draw since July of last year… So, based on that reported & estimated data, the crude oil figures provided by the EIA for the week ending June 28th appear to indicate that our total working supply of oil from storage, from net imports, from transfers, and from oilfield production was 606,000 barrels per day more than what our oil refineries reported they used during the week. To account for that difference between the apparent supply of oil and the apparent disposition of it, the EIA just plugged a [ -606,000 ] barrel per day figure onto line 16 of the weekly U.S. Petroleum Balance Sheet, in order to make the reported data for the supply of oil and for the consumption of it balance out, a fudge factor that they label in their footnotes as “unaccounted for crude oil”, thus indicating there must have been an error or omission of that magnitude in the week’s oil supply & demand figures that we have just transcribed…Moreover, since 949,000 barrels per day of oil supply could not be accounted for in the prior week’s EIA data, that means there was a 1,555,000 barrel per day difference between this week’s oil balance sheet error and the EIA’s crude oil balance sheet error from a week ago, and hence the changes to supply and demand from that week to this one that are indicated by this week’s report are off by that much, rendering the week over week changes we have just cited​ into garbage…. However, since most oil traders react to these weekly EIA reports as if they were accurate, and since these weekly figures therefore often drive oil pricing (as is obvious to anyone who watches oil prices), and hence decisions to drill or complete oil wells, we’ll continue to report this data just as it’s published, and just as it’s watched & believed to be reasonably reliable by most everyone in the industry…(for more on how this weekly oil data is gathered, and the possible reasons for that “unaccounted for” oil, see this EIA explainer….there is also an aging twitter thread from an EIA administrator addressing these ongoing weekly errors, and what they had hoped to do about it)

This week’s average 1,680,000 barrel per day decrease in our overall crude oil inventories came as a​n average of 1,737,000 barrels per day were being pulled out of our commercially available stocks of crude oil, while an average of 57,000 barrels per day were being added to our Strategic Petroleum Reserve, the thirtieth SPR increase in thirty-seven weeks, following nearly continuous withdrawals from the SPR over the prior 39 months… Further details from the weekly Petroleum Status Report (pdf) indicate that the 4 week average of our oil imports fell to 7,129,000 barrels per day last week, which was still 9.0% more than the 6,540,000 barrel per day average that we were importing over the same four-week period last year. This week’s crude oil production was reported to be unchanged at 13,200,000 barrels per day because the EIA’s rounded estimate of the output from wells in the lower 48 states was unchanged at 12,800,000 barrels per day, while Alaska’s oil production was 27,000 barrels per day lower at 383,000 barrels per day, but still added the same 400,000 barrels per day to the EIA’s rounded national total as it did last week…US crude oil production had reached a pre-pandemic high of 13,100,000 barrels per day during the week ending March 13th 2020, so this week’s reported oil production figure was 0.8% higher than that of our pre-pandemic production peak, and it’s also 36.1% above the pandemic low of 9,700,000 barrels per day that US oil production had fallen to during the third week of February of 2021.

US oil refineries were operating at 93.5% of their capacity while processing those 16,792,000 barrels of crude per day during the week ending June 28th, up from their 92.2% utilization rate of a week earlier, and a near normal operating rate for late June, after US refineries had lagged normal operating rates for four months after arctic cold in mid January had froze off some operations… the 16,792,000 barrels of oil per day that were refined this week were 4.8% more than the 16,030,000 barrels of crude that were being processed daily during week ending June 30th of 2023, but 2.9% less than the 17,290,000 barrels that were being refined during the prepandemic week ending June 28th, 2019, when our refinery utilization rate was also at a ​near normal 94.2% for late June…

With the increase in the amount of oil being refined this week, gasoline output from our refineries was also higher, increasing by 180,000 barrels per day to 10,061,000 barrels per day during the week ending June 28th, after our refineries’ gasoline output had decreased by 289,000 barrels per day during the prior week.. This week’s gasoline production was 2.0% less than the 10,265,000 barrels of gasoline that were being produced daily over week ending June 30th of last year, but 1.1% more than the oddly low gasoline production of 9,948,000 barrels per day during the prepandemic week ending June 28th, 2019….at the same time, our refineries’ production of distillate fuels (diesel fuel and heat oil) increased by 204,000 barrels per day to 5,106,000 barrels per day, after our distillates output had increased by 142,000 barrels per day during the prior week. After thirteen production increases in the past nineteen weeks, our distillates output was 5.3% more than the 4,850,000 barrels of distillates that were being produced daily during the week ending June 30th of 2023, but was 4.3% less than the 5,336,000 barrels of distillates that were being produced daily during the week ending June 28th, 2019…

Even with this week’s increase in our gasoline production, our supplies of gasoline in storage at the end of the week fell for the 14th time in twenty-two weeks, decreasing by 2,214,000 barrels to 231,672,000 barrels during the week ending June 28th, after our gasoline inventories had increased by 2,654,000 barrels during the prior week. Our gasoline supplies fell this week because the amount of gasoline supplied to US users rose by 455,000 barrels per day to a 2024 high of 9,424,000 barrels per day, and because our exports of gasoline rose by 95,000 barrels per day to 971,000 barrels per day, while our imports of gasoline rose by 89,000 barrels per day to 851,000 barrels per day .…But even after fourteen gasoline inventory withdrawals over the past twenty-two weeks, our gasoline supplies were still 5.6% above last June 30th’s gasoline inventories of 219,456,000 barrels, while about 1% below the five year average of our gasoline supplies for this time of the year…

Even with this week’s increase in our distillates production, our supplies of distillate fuels fell for the fifteenth time in twenty-four weeks, decreasing by 1,535,000 barrels to 121,263,000 barrels over the week ending June 28th, after our distillates supplies had decreased by 377,000 barrels during the prior week. Our distillates supplies decreased by more this week because the amount of distillates supplied to US markets, an indicator of our domestic demand, rose by 179,000 barrels per day to 3,715,000 barrels per day, and because our exports of distillates rose by 152,000 barrels per day to 1,705,000 barrels per day and because our imports of distillates fell by 39,000 barrels per day to 94,000 barrels per day​....Even with 15 inventory decreases over the past 24 weeks, our distillates supplies at the end of the week were 5.6% above the 113,366,000 barrels of distillates that we had in storage on June 30th of 2023, but are now about 10% below the five year average of our distillates inventories for this time of the year…

Finally, with an increase in our oil exports and a pickup in refinery demand. our commercial supplies of crude oil in storage fell for the 13th time in twenty-six weeks, and for the 27th time in the past year, decreasing by 12,157,000 barrels over the week, from 460,696,000 barrels on June 21st to 448,539,000 barrels on June 28th, after our commercial crude supplies had increased by 3,591,000 barrels over the prior week… With this week’s decrease, our commercial crude oil inventories were back to about 4% below the most recent five-year average of commercial oil supplies for this time of year, while they were still roughly 28% above the average of our available crude oil stocks as of the middle of June over the 5 years at the beginning of the past decade, with the big difference between those comparisons arising because it wasn’t until early 2015 that our oil inventories had first topped 400 million barrels. After our commercial crude oil inventories had jumped to record highs during the Covid lockdowns of the Spring of 2020, then jumped again after February 2021’s winter storm Uri froze off US Gulf Coast refining, but then fell due to higher exports relating to the onset of the Ukraine war, only to jump again following the Christmas 2022 refinery freeze offs, our commercial crude supplies as of this June 28th were 0.8% less than the 452,182,000 barrels of oil left in commercial storage on June 30th of 2023, while 5.8% more than the 423,800,000 barrels of oil that we had in storage on July 1st of 2022, and 0.7% more than the 445,476,000 barrels of oil we had left in commercial storage on July 2nd of 2021…

This Week’s Rig Count

In lieu of a detailed report on the rig count, we are again just including a screenshot ofthe rig count summary from Baker Hughes…in the table below, the first column shows the active rig count as of July 5th, the second column shows the change in the number of working rigs between last week’s count (June 28th) and this week’s (July 5th) count, the third column shows last Friday’s June 28th active rig count, the 4th column shows the change between the number of rigs running on Friday and the number running on the Friday before the same weekend of a year ago, and the 5th column shows the number of rigs that were drilling at the end of that reporting period a year ago, which in this week’s case was the 7th of July, 2023…

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ODNR Pledges to Begin Cleanup of Austin Master Services July 22 -- Marcellus Drilling News -Three weeks ago, the owner of Austin Master Services (AMS), American Environmental Partners (AEP), sent a press announcement to MDN to announce he has found a buyer for AMS (see AEP Announces Finding a Buyer for Austin Master Services). AMS is a radiological waste management solutions company in Martins Ferry (Belmont County), Ohio. The Ohio Attorney General lodged charges against AMS in March, accusing the company of storing 16+ times more drill cuttings at the facility than it’s rated for. A county judge ordered AMS to clean out the site and bring it back into compliance by July 22, or else AEP owner and CEO Brad Domitrovitsch is ordered to report to jail for a 30-day stint.

12 New Shale Well Permits Issued for PA-OH-WV Jun 17 – 23 --Marcellus Drilling News --We didn’t bring you the latest permit numbers on Friday because the Pennsylvania Dept. of Environmental Protection’s report website was down (again, for the umpteenth time). The site was back online this morning, so we ran our weekly query and discovered PA issued a whopping three permits for the week of June 17-23, all of them issued to Coterra Energy in (gasp) the township of Dimock! Yes, drilling in Dimock is back. Love it! In addition, Ohio issued nine new permits, with seven going to Encino Energy for oil drilling in Guernsey and Harrison counties. Ohio also issued two permits to Ascent Resources in Jefferson County. West Virginia issued no new shale permits for that period. ASCENT RESOURCES | COTERRA ENERGY (CABOT O&G) | ENCINO ENERGY | ENERGY COMPANIES | GUERNSEY COUNTY | HARRISON COUNTY | JEFFERSON COUNTY (OH) | SUSQUEHANNA COUNTY

SRBC Approves 7 Water Withdrawals for Shale Drilling at June Mtg Marcellus Drilling News The highly functional and responsible Susquehanna River Basin Commission (SRBC), unlike its completely dysfunctional and irresponsible cousin, the Delaware River Basin Commission (DRBC), continues to support the shale energy industry by approving water withdrawals for responsible and safe shale drilling. On June 13, the SRBC board approved 19 new water withdrawal requests within the basin, seven of them for water used in drilling and fracking shale wells in Pennsylvania. The Marcellus/Utica shale drillers (and one water company) receiving a green light from SRBC included BKV (3 requests), EQT, Keystone Clearwater Solutions, Seneca Resources, and Southwestern Energy.

Dividends from Drillers Remain High Even as Cash Flows Sink Lower -- Marcellus Drilling News Investors grew tired of putting money into oil and gas companies during the go-go early years of the shale era from the early 2000s until the early 2020s because O&G companies didn’t pay dividends, and their stock prices plunged in value, in some cases, 90% or more. Drillers got the message, and beginning around four years ago, there was a conversion to a new religion — the religion of free cash flow, dividends, and stock buy-backs. Shareholder returns soared to a peak of over 10% in 2022. But since then, prices (at least for natural gas) have tanked, and along with it, shareholder returns. However, O&G companies are still giving respectable (more than any other sector) returns to shareholders, even amid low commodity prices for oil and gas. Of the three sub-groups in O&G (oil-focused, diversified, and gas-focused), the gas group, of which most M-U drillers belong, is doing the worst with returns to shareholders.

MVP Lowers Gas Prices in Southeast, Raises Prices in Northeast On Friday, June 14, the 30mile Mountain Valley Pipeline (MVP) that runs from Wetzel County, WV, to Pittsylvania County, VA, announced the pipeline had, after a decade of planning and building, finally begun to flow Marcellus/Utica molecules (see Confirmed: M-U Gas Now Flowing Through Mountain Valley Pipeline). The effect of the molecules flowing through MVP has been profound and immediate, raising prices for M-U gas at the source and lowering the gas price at the destination.

Left Freaks Out Over Supreme Court Ruling re Chevron Deference -- Marcellus Drilling News --Yesterday, MDN brought you the news the U.S. Supreme Court rendered a decision that overturned a 40-year-old case establishing the leftist utopian administrative state, colloquially called the Chevron deference case (see U.S. Supremes Overturn Chevron Case, Reins in Leftist Bureaucrats). Now faced with the dismantling of their power (power derived via backdoor regulations), the left is, quite literally, freaking out. And they are doing so publicly, trying to scare the general public into thinking life as they know it will end. Life as the parasitic left knows it will end, but life for the common citizen will become dramatically better.In 1984, a Supreme Court case called Chevron v. NRDC gave broad powers to federal agencies like the EPA and other executive branch agencies to create, in essence, their own laws (called regulations) without any specific delegation of authority by Congress to do so. The case allows executive branch agencies to “color in between the lines” by saying that they are the experts and that members of Congress are too dumb to create specific laws to control things like “parts per million” for emissions, etc.The problem is, the bureaucratic weenies have gone FAR beyond the original scope of the Chevron decision and now make up their own laws whole cloth (with no input from Congress) because they believe they know better than you how you should live. Chevron has led to the radical loss of freedom. No more! Last Friday, the U.S. Supreme Court threw out the Chevron deference doctrine. This has HUGE implications for the entire oil and gas industry.The left is now freaking out, in print, about what the future holds for them. (They’re right to be afraid because their rule and reign are quickly coming to an end.)We have several stories to share that illustrate our observation about a mass freakout. The first is from the uber-left POLITICO and its environmental wing called E&E News:The Supreme Court’s decision Friday to give judges more authority over federal agencies creates new hurdles for the Biden administration as it seeks to promote low-carbon energy and address climate change.Forty years after the justices first decided Chevron v. NRDC, the high court opted to upend legal doctrine directing courts to defer to agencies’ interpretations of ambiguous laws, as long as the decisions were “reasonable.” Now, courts could have more say in interpreting rules on everything from EPA’s latest effort to curb power plant emissions to the Federal Energy Regulatory Commission’s orders on transmission lines.“Where agencies appear to be carrying out sweeping and adventurous regulatory efforts to address our most pressing issues, that sort of effort is going to be immediately called into question,” said Joel Eisen, a law professor at the University of Richmond.The 6-3 decision written by Chief Justice John Roberts came after the court had curbed agency deference in a series of recent rulings, even as the Chevron doctrine continued to be applied in lower courts.Friday’s decision affected two cases — Loper Bright v. Raimondo and Relentless v. Commerce — and could have wide-ranging implications for a host of energy and environmental rulemakings.Along with affecting EPA’s power plant rules and FERC orders, the decision could also make it more difficult for the administration to defend its efforts to reduce climate-warming pollution from cars and trucks. It could complicate the already embattled Securities and Exchange Commission’s effort to force public companies to disclose more information about their climate risks.“In the short run, we expect a significant increase in regulatory litigation, including challenges to existing regulations, ongoing rulemakings and existing precedents,” said Gordon Todd, who co-chairs the regulatory litigation practice group at the firm Sidley Austin.

Europeans Presume to Impose Their Regulations on American Gas - Marcellus Drilling News -This one gets under our skin. The European Union’s idiotic methane regulations will soon come into full force, prompting oil, gas, and coal companies to monitor, measure and report their emissions. The same restrictions will also apply to energy imports. That impacts the United States, the EU’s largest liquefied natural gas supplier. In other words, the arrogant Europeans presume to tell us that we must follow *their* regulations! To which we say (multiple expletives deleted)…

Aethon Energy Takes Crown as Top Private Lower 48 Natural Gas E&P -- Aethon Energy Management LLC overtook Ascent Resources LLC as the Lower 48’s top privately held natural gas producer in 2023, according to new research by Enverus. Aethon Energy's lower 48 portfolio (map) Aethon’s gross operated natural gas production stood at 2.52 Bcf/d as of end-2023, up from 2.01 Bcf/d at the end of 2022. Ascent’s production held steady at 2.43 Bcf/d from 2.45 Bcf/d a year earlier. Dallas-based Aethon’s upstream operations primarily target the Haynesville Shale of North Louisiana and East Texas. Aethon recently completed the purchase of Haynesville assets of Tellurian Inc. It also signed a 20-year offtake agreement to purchase 2 million metric tons/year of LNG from Tellurian’s proposed Driftwood liquefaction project.

Aramco ups gas game with US project in hot pursuit of shoo-in to global LNG club’s kingpins - Saudi Arabia’s energy heavyweight Aramco is taking steps to spread its liquefied natural gas (LNG) wings in the United States (U.S.) with non-binding heads of agreement (HoA) for equity and offtake from a planned expansion project related to a natural gas liquefaction and export terminal in Southeast Texas. Once formalized, the project will pave the way for the Saudi giant to come closer to joining the top ranks of the global LNG playground’s players. After stepping into the global LNG market with a stake in MidOcean Energy, the Saudi player has worked on carving a spot for itself. To this end, the firm inked another HoA a few weeks ago to purchase 1.2 million tonnes per annum (mtpa) of LNG for 20 years on a free-on-board basis from NextDecade’s Train 4 of the Rio Grande LNG (RGLNG) project at the Port of Brownsville, Texas. In a bid to further boost its gas arsenal and position in the LNG arena, Aramco executed a non-binding HoA with Sempra, a North American energy infrastructure company, for a 20-year sale and purchase agreement (SPA) for LNG offtake of 5 million tonnes per annum from the Port Arthur LNG Phase 2 (PALNG2) natural gas liquefaction and export terminal expansion project in Southeast Texas with direct access to the Gulf of Mexico.In addition, acquiring a stake in the project is not beyond the realms of possibility for the Saudi giant, as the HoA further contemplates the firm’s 25% participation in the project-level equity of Phase 2. Sempra and Aramco expect to execute a binding LNG SPA and definitive equity agreements with terms substantially equivalent to those in the HoA. However, both of these are subject to several conditions.Nasir K. Al-Naimi, Aramco’s Upstream President, commented: “We are excited to take this next step into the LNG sector. As a potential strategic partner in the Port Arthur LNG Phase 2 project, Aramco is well placed to grow its gas portfolio with the aim of meeting the world’s growing need for lower-carbon sources of energy. This agreement is a major step in Aramco’s strategy to become a leading global LNG player.”Following a final investment decision (FID) for Port Arthur LNG Phase 1 in March 2023, Bechtel Energy was hired to build the project, which is currently under construction and consists of trains 1 and 2, with a nameplate capacity of approximately 13 mtpa, as well as two LNG storage tanks and associated facilities. The start of commercial operations for trains 1 and 2 are expected in 2027 and 2028, respectively.On the other hand, the Port Arthur LNG Phase 2 project is said to be a competitively positioned expansion of the site to include the addition of two trains capable of producing up to 13 mtpa. The Federal Energy Regulatory Commission (FERC) approved the permitfor the expansion project with two liquefaction trains (trains 3 and 4) in September 2023. This project could lift the total liquefaction capacity of the facility to around 26 mtpa.

US weekly LNG exports reach 29 shipments - US liquefied natural gas (LNG) exports reached 29 shipments in the week ending June 26, and pipeline deliveries to US terminals decreased compared to the week before, according to the Energy Information Administration. The agency said in its weekly report that 29 LNG carriers departed the US plants between June 20 and June 26. Citing shipping data provided by Bloomberg Finance, the EIA said the total capacity of these LNG vessels is 105 Bcf. The EIA did not release its weekly report in the prior week due to holidays. US LNG terminals shipped 25 cargoes in the week ending June 12. Based on the agency’s previous weekly reports, the 29 LNG cargoes sent during this week represent the highest number of cargoes this year. Natural gas deliveries to US terminals Average natural gas deliveries to US LNG export terminals decreased 0.4 Bcf/d from last week to 12.2 Bcf/d, according to data from S&P Global Commodity Insights. Natural gas deliveries to terminals in South Louisiana decreased by 5.3 percent (0.4 Bcf/d) to 7.2 Bcf/d, while natural gas deliveries to terminals in South Texas increased 0.3 percent (less than 0.1 Bcf/d) to 3.8 Bcf/d. The agency said that natural gas deliveries to terminals outside the Gulf Coast were essentially unchanged at 1.2 Bcf/d. Cheniere’s Sabine Pass plant shipped nine cargoes and the company’s Corpus Christi facility sent four shipments during the week under review. The Freeport LNG terminal shipped five cargoes and Sempra Infrastructure’s Cameron LNG terminal shipped four cargoes, while Venture Global LNG’s Calcasieu Pass facility and the Cove Point facility each shipped three cargoes during the period. Also, the Elba Island facility sent one cargo during the week under review. Henry Hub up This report week, the Henry Hub spot price rose 6 cents from $2.39 per million British thermal units (MMBtu) last Wednesday to $2.45/MMBtu this Wednesday. The agency said the July 2024 NYMEX contract expired this Wednesday at $2.628/MMBtu, down 11.3 cents from last Thursday. Moreover, the August 2024 NYMEX contract price decreased to $2.745/MMBtu, down 10.9 cents from last Thursday to this Wednesday. The price of the 12-month strip averaging August 2024 through July 2025 futures contracts declined 8.5 cents to $3.268/MMBtu, the agency said. TTF averaged $10.75/MMBtu The agency said that international natural gas futures were mixed this report week. Bloomberg Finance reported that weekly average front-month futures prices for LNG cargoes in East Asia increased 25 cents to a weekly average of $12.61/MMBtu. Natural gas futures for delivery at the Dutch TTF decreased 27 cents to a weekly average of $10.75/MMBtu. In the same week last year (week ending June 28, 2023), the prices were $11.96/MMBtu in East Asia and $10.72/MMBtu at TTF, the agency said.

With Many Unknowns, LNG Pause Could Set Back U.S. Projects By Several Years --More than half a year after the Department of Energy (DOE) halted non-free trade (FTA) agreement permits for new U.S. LNG projects, the length of the pause and the potential impacts to the export supply outlook are still pending. NGI chart showing commercially advanced NAM LNG projects impacted by DOE review. Immediately after the Biden administration ordered DOE to review its policies for authorizing more worldwide exports, the development timelines for at least 17 proposed liquefied natural gas projects fell into uncertainty. That list includes at least seven facilities proposed for the United States and Mexico that are commercially advanced, according to an NGI review of pending projects. Those seven projects amount to a combined 9.3 Bcf/d in export capacity previously expected to come online around 2030 that are now under increased risk for delays. However, “given there are many projects with non-FTA approvals in place, and pre-final investment decision (FID) stage projects outside of the United States, near term global LNG balances remain unaffected,” International Gas Union researchers wrote in the industry group’s latest annual report.

District Court Orders Biden Administration to Cancel LNG Permit Pause, but Quick Action Not Expected --A federal court has ruled the Department of Energy (DOE) should resume considerations for new worldwide LNG export permits while it reviews the impact of natural gas trade on the U.S. economy and climate. Chart showing commercially advanced LNG projects impacted by DOE review. On Monday, U.S. District Court Judge James Cain of the Western District of Louisiana issued a preliminary order and sided with 16 Republican attorneys general (AG) who filed a lawsuit after the White House ordered DOE to halt non-free trade agreement (FTA) permits. In his decision, Cain referred to the pause as an “export ban” using the same phrasing as Republican and industry opponents of the agency’s review (No. 2:24-CV-00406). While the Natural Gas Act (NGA) allows DOE to review policies for granting permits, the decision to halt considerations altogether in January was an “unlawful action” that harmed developers and states where projects were planned, Cain wrote.

Judge overturns Biden’s LNG export pause - A federal judge reversed the Department of Energy’s freeze on new liquefied natural gas export approvals Monday, handing a win to industry and red states that had challenged the Biden administration plan.Judge James Cain of the U.S. District Court for the Western District of Louisiana said in an order late Monday that DOE’s export pause would be “stayed in its entirety, effective immediately.”In January, the administration halted reviews of new LNG export applications to non-free-trade-agreement countries, saying it needed to review how to account for climate risks of projects before approving exports. The pause was praised by environmentalists who had been critical of President Biden’s record on fossil fuels. Monday’s court ruling does not force DOE to now approve LNG applications, but it does require the department to restart the process of considering them.DOE’s decision went against the language of the Natural Gas Act and was subverting “Congress’s determination that LNG exports are presumptively in the public interest,” said Cain, a Trump pick.The ruling came in response to a lawsuit filed by coalition of 16 Republican-led states, which claimed the administration had overstepped its authority when it launched the freeze.The department had said the pause would remain in place temporarily as it reviewed how it would account for climate risks when determining whether new gas exports were in the public interest. The freeze did not affect exports to non-free-trade agreements that had already been approved at the time.According to Cain, the Natural Gas Act instructs DOE to ensure “expeditious completion” of reviewing export applications.He acknowledged that DOE has previously used studies to update how it makes public interest determinations.But “the decision to wholesale halt the process of approving applications for non-FTA countries is a complete reversal of how the DOE processed these applications in the past,” he wrote.The pause affected exports for pending LNG projects, including Commonwealth LNG and Venture Global’s CP2 project in Louisiana, as well as the second phase of Sempra’s Port Arthur LNG project in Texas. In a statement, DOE said that it disagreed with Monday’s ruling, adding it “continues to review the court’s order and evaluate next steps.”DOE has noted that the United States remains the largest LNG exporter in the world, despite claims from opponents that the pause caused economic harm.The country has an operating gas export capacity of 14 billion cubic feet per day, with projects under construction that could add 12 billion more cubic feet per day in this decade, according to the department.DOE has also authorized another 22 billion cubic feet per day of exports from facilities that are not yet under construction and were not affected by the pause. Craig Segall, vice president of the climate advocacy group Evergreen Action, emphasized in a statement that the court’s decision would not determine what DOE could consider in deciding whether LNG export permits are in the public interest. “Pause or no pause, the science is clear: No sound analysis that accounts for the climate and environmental harm inflicted by LNG exports could possibly determine that these deadly facilities are in the public interest,” Segall said. Lauren Parker, an attorney at the Center for Biological Diversity’s Climate Law Institute, said “coupled with last week’s court rulings, rolling back the LNG pause shows that Trump judges are hellbent on torching environmental safeguards, the climate and our democracy.” West Virginia Republican Attorney General Patrick Morrisey, however, lauded the court’s decision late Monday. West Virginia was one of the 16 states backing the lawsuit.

Federal court lifts Biden's pause on natural gas export approvals - A federal court has halted the Biden administration’s pause on new approvals for natural gas exports. Judge James Cain, a Trump appointee in Louisiana, approved a request from Republican-led states to lift the pause while the litigation against it plays out. “The Court will grant Plaintiffs’ Motion for Preliminary Injunction, and order that the LNG Export Ban be stayed in its entirety, effective immediately,” Cain wrote. The Biden administration announced in January that it would pause approvals of new permissions to ship natural gas abroad to countries that don’t have free trade with the U.S. The pause did not impact existing exports. The Biden administration said the pause was being done in order to update the criteria on which it decides whether to OK new gas export terminals — including whether to revamp its considerations of environmental issues in that process. In his ruling, Cain said the states that challenged the administration’s move are likely to succeed in their case and that they will suffer irreparable harm if the pause continues while the case plays out. “The Court is convinced that the Export Ban will and is irreparably harming the Plaintiff States. Plaintiff States have submitted evidence of harm specifically to Louisiana, Texas, and West Virginia in the loss of revenues, market share, and deprivation of a procedural right,” he wrote. Those who sued over the pause cheered the ruling. “This is a big win for the country’s energy industry and the millions of jobs it supports against the attacks from the Biden administration to further its radical climate change agenda at the expense of our economy,” West Virginia Attorney General Patrick Morrisey (R), who is running for governor, said in a written statement. “The U.S. Department of Energy disagrees with today’s ruling. The Department continues to review the court’s order and evaluate next steps,” a DOE spokesperson told The Hill. The Biden administration’s move to halt the approvals of new LNG export facilities was supported by climate-focused organizations. Craig Segall, vice president of Evergreen Action, called Monday’s ruling “deeply misguided,” but said it would not stop the Biden administration from updating its criteria for new exports. “Pause or no pause, the science is clear: No sound analysis that accounts for the climate and environmental harm inflicted by LNG exports could possibly determine that these deadly facilities are in the public interest,” Segall said in a statement. The move also prevented the administration from having to make tough choices that could anger its base ahead of the November election.

Gas export projects likely to remain in limbo despite court ruling - New gas export projects will likely remain in limbo for many months despite a judge halting the Biden administration’s pause on approving such projects on Monday. The administration still has discretion in its review of new projects, and experts don’t expect it to approve any ahead of the November election, in which President Biden looks to face a closely fought rematch with former President Trump.Approving new gas export facilities would likely alienate progressive voters who already have a tenuous relationship with Biden and have raised concerns about gas’s environmental impact.“I don’t think it’ll have much impact at all,” Ira Joseph, senior research associate at Columbia University’s Center on Global Energy Policy, said of the order lifting the administration’s pause. Joseph added that the Energy Department “has the ability to review the license for non-[free trade agreement] approval for as long or as short as they want.”The Biden administration said in January that it would temporarily stop authorizing gas export terminals to ship fuel to countries that don’t have free trade agreements with the U.S., otherwise known as non-FTA countries. Opponents of the move sued, and Judge James Cain, a Trump appointee, earlier this week blocked the administration’s pause “in its entirety, effective immediately” while the litigation against it plays out.However, the Energy Department still has the right to review the projects waiting in its queue for non-FTA approval. In response to the ruling, the department said that it “continues to review the court’s order and evaluate next steps.” Meanwhile, the White House said that it is “committed to informing our decisions with the best available economic and environmental analysis.” Updating such analysis is the reason that it gave for the pause to begin with. Having the pause in place also made it unlikely that the Biden administration would have to issue any politically difficult decisions in an election year.The move won praise from climate activists, who had pushed the administration not to approve new gas export projects. Climate advocates’ opposition to the gas expansion is among the reasons why analysts say the administration is unlikely to approve any new projects in the months ahead.“There’s several constituency reasons for why the Biden administration wouldn’t want to move … any faster. One is, of course, environmentalists who think that exporting more [U.S. gas] is going to lock in fossil fuels,” “Two is also the domestic audience considerations — the more [natural gas] you export, the higher natural gas prices go in the U.S., and in an election defined by inflation, that’s not a button you want to push either,” Flakoll added.

US natgas prices fall 5% to six-week low on output rise, lower demand forecast (Reuters) -U.S. natural gas futures fell about 5% to a six-week low on rising output in recent weeks, forecasts for less demand over the next two weeks than previously expected and an ongoing oversupply of gas in storage. Analysts forecast there was still about 19% more gas in storage than usual for this time of year even though output reductions earlier in 2024 helped keep weekly injections below normal over the past seven weeks. That price decline came even though a heat wave blanketing much of the country for weeks will linger through at least mid-July, forcing power generators to continue burning lots of gas to keep air conditioners humming. Looking beyond the current heat wave, analysts at energy consulting firm EBW Analytics said "storm clouds remain on the horizon (for gas prices) with high gas inventories, rising gas production, and tropical demand destruction risks rising into late summer." Front-month gas futures NGc1 for August delivery on the New York Mercantile Exchange fell 12.3 cents, or 4.7%, to settle at $2.478 per million British thermal units (mmBtu), their lowest close since May 15. In Texas, the Electric Reliability Council of Texas (ERCOT), the power grid operator for most of the state, said peak demand came close but did not break the record for the month of June last week, as had been expected. ERCOT, however, projects demand will break the July record on Tuesday as homes and businesses crank up their air conditioners to escape the heat blanketing the state. Financial firm LSEG said gas output in the Lower 48 U.S. states rose to an average of 98.8 billion cubic feet per day (bcfd) in June, up from a 25-month low of 98.1 bcfd in May. That compares with a monthly record high of 105.5 bcfd in December 2023. Meteorologists projected weather across the Lower 48 states would remain hotter than normal through at least July 16. With hotter weather expected next week, LSEG forecast average gas demand in the Lower 48, including exports, will rise from 99.8 bcfd this week to 105.8 bcfd next week. Those forecasts were lower than LSEG's outlook on Friday. Gas flows to the seven big U.S. LNG export plants eased to 12.8 bcfd in June, down from 12.9 bcfd in May and a monthly record high of 14.7 bcfd in December 2023. That decline was due to plant and pipeline maintenance at several facilities, including Freeport LNG and Cheniere Energy's Corpus Christi in Texas and Cameron LNG, Cheniere's Sabine Pass and Venture Global's Calcasieu Pass in Louisiana. Feedgas to the 2.1-bcfd Freeport, one of the most watched U.S. LNG plants because it has a history of swaying global gas prices when it shuts, was on track to rise to 1.9 bcfd on Monday after dropping to an eight-week low of 1.3 bcfd on Sunday, according to LSEG data. That compares with an average of 1.8 bcfd over the prior seven days. Freeport told Texas environmental regulators that the second of three liquefaction trains tripped on June 29 due to issues with compressor systems.

US natgas prices slide 2% to 6-week low on rising output, lower LNG feedgas (Reuters) -U.S. natural gas futures slid about 2% to a six-week low on rising output on Tuesday, forecasts for less demand over the next two weeks than previously expected due to lower liquefied natural gas (LNG) feedgas and an ongoing oversupply of gas in storage. Front-month gas futures NGc1 for August delivery on the New York Mercantile Exchange fell 4.3 cents, or 1.7%, to settle at $2.435 per million British thermal units (mmBtu), their lowest close since May 15 for a second day in a row. In other news, a federal judge dealt U.S. President Joe Biden's climate agenda a setback by blocking the Democrat's administration from continuing to pause the approval of applications to export liquefied natural gas (LNG). Separately, Texas Governor Greg Abbott and Lieutenant Governor Dan Patrick said they will seek to expand the Texas Energy Fund program to $10 billion to build more gas plants to meet the state's growing demand for electricity. In the spot market, next-day gas prices at the Waha hub NG-WAH-WTX-SNL in West Texas plunged by about 123% to a negative 52 cents per mmBtu for Tuesday as pipeline constraints trapped gas in the Permian Shale. It was the third time in six days that Waha prices fell into negative territory during the current heat wave and the 20th time so far this year. Next-day Waha prices first averaged below zero in 2019. It happened 17 times in 2019, six in 2020, none in 2021 or2022, and once in 2023. In the Caribbean Sea, Hurricane Beryl, an extremely dangerous major hurricane, will hit Jamaica on Wednesday before slamming into Mexico's Yucatan Peninsula on Friday, according to the latest U.S. National Hurricane Center (NHC) outlook. After marching across the Yucatan, the NHC projected that Beryl will weaken into a tropical storm on Saturday by the time it enters the Bay of Campeche in the Gulf of Mexico, where Mexico produces much of its oil, before approaching the Texas-Mexico border on Sunday. Financial firm LSEG said gas output in the Lower 48 U.S. states rose to an average of 101.5 billion cubic feet per day (bcfd) so far in July. That was up from an average of 100.1 bcfd in June and a 17-month low of 99.5 bcfd in May as many producers reduced drilling activities after prices fell to 3-1/2-year lows in February and March. U.S. output hit a monthly record high of 105.5 bcfd in December 2023. Meteorologists projected weather across the Lower 48 states would remain hotter than normal through at least July 17. With hotter weather expected next week, LSEG forecast average gas demand in the Lower 48, including exports, will rise from 98.5 bcfd this week to 104.5 bcfd next week. Those forecasts were lower than LSEG's outlook on Monday.

Cat 4 Hurricane Beryl Heads Towards Texas, Threatening Major Oil Refineries - The National Oceanic and Atmospheric Administration's (NOAA) National Hurricane Center (NHC) downgraded Hurricane Beryl to a Category 4 storm from a Category 5 on the Saffir-Simpson Hurricane Wind Scale on Wednesday morning. Beryl is the earliest hurricane on record to strengthen into a Category 5 as it churns across the southeastern Caribbean Sea. It is forecasted to hit the Yucatán Peninsula on Friday and afterward poses a threat to US oil and energy critical infrastructure on the Gulf Coast. NHC said Beryl's winds peaked at about 157 mph before weakening to 145 mph on Wednesday morning. Government weather forecasters expect "some weakening" of the storm over the "next day or two," however, it will still be a "major hurricane" as it impacts "Jamaica on Wednesday and the Cayman Islands."On Wednesday, Mexico's Meteorological Service posted a hurricane warning for the coast of the Yucatán peninsula from Puerto Costa Maya to Cancún, with forecasted landfall on Friday. After the Yucatán Peninsula, Beryl's forecasted path heads directly to the Texas coast and is expected to move up towards Louisiana. This area is home to major US oil and gas refineries. Ahead of the storm, Shell announced Wednesday that it paused some drilling operations in the Gulf of Mexico. Here's more from Bloomberg:

• Company also began evacuating non-essential personnel as precautionary measure
• Shell is also evacuating non-essential staff from the Whale asset, which is not scheduled to begin operations until later this year
• Production from the Shell-operated Perdido platform feeds into the HOOPS Blend, a medium sour oil with 29.2 API and 1.55% sulfur
• Oil from Perdido is delivered by the Hoover Offshore Oil Pipeline System (HOOPS) to the Quintana terminal, south of Freeport, Texas; from Quintana oil flows into the Houston refining hub but mainly to the Texas City area

"There remains uncertainty in the track and intensity forecast of Beryl over the western Gulf of Mexico this weekend. Interests in the western Gulf of Mexico, including southern Texas, should monitor the progress of Beryl," NHC wrote in the most recent update. Computer models show the storm's future path along the Texas coast, which is home to 32 oil refineries. Refineries are critical for processing crude into products such as gasoline and diesel. "We have to wait and see where it lands," Mark Schieldrop, a spokesperson for the travel club AAA Northeast, told newspaper The Record. Schieldrop said, "But if the storm makes a direct hit to oil and gas infrastructure, it could cause prices to go up here if refineries down there are knocked offline for more than a few days." At the start of hurricane season, we penned a note titled "La Nina Will Complicate Things For Biden Ahead Of Elections As Hurricanes Threaten Oil Refineries," and that's exactly what could happen next week. All it takes is one major hurricane to disrupt major US Gulf Coast refineries, which could drive average gasoline prices at the pump to the politically sensitive level of $4 a gallon. Currently, AAA average prices of gas at the pump stand at... If Beryl causes refinery closures on the US Gulf Coast, the Biden team will have a whole lot more issues to deal with (currently, it's just chaos in Washington: ""No One Is Pushing Me Out" Biden Tells Staff As New NYT Poll Shows Trump Lead Widening").

1,200 gallons of oil removed from Flint River since spill last week (WJRT) - The investigation continues into how more than 1,000 gallons of an oily substance leaked into the Flint River last week. Flint Mayor Sheldon Neeley's office says authorities have removed about 1,200 gallons of an oil and water mix since the leak was reported one week ago from a storm sewer outfall in the 1400 block of James P. Cole Boulevard between Merrill and Wood streets. The flow of oil appears to have stopped, but absorbent booms deployed across the river remained in place Tuesday. The Genesee County Health Department's no-contact order for the Flint River between Hamilton Avenue and Grand Traverse Street remained in place Tuesday. Investigators are not sure what the oily substance is or where it entered the storm sewer system. Samples have been taken to a laboratory for identification and analysis. Results are expected within a week or two. The city also has traced sewer lines in the area to help determine where the oily substance originated. As of Tuesday, authorities had not identified a party responsible for the spill or issued any sanctions. The June 25 spill was the fourth reported along the Flint River in Flint over the past year. Environmental investigators are looking into whether the spills are a result of illegal dumping or soil contamination. The Michigan Department of Environment, Great Lakes and Energy will assist the city with soil testing around storm sewer outfalls into the Flint River for any evidence of contamination entering the system. Anyone who sees someone possibly dumping into Flint's storm system should call 810-766-7079. A permanent absorbent boom has been placed across the river at the Utah Dam and another will be placed between Merrill and Wood streets to soak up any oil contamination from the water surface.

Permian Basin truckers protest over restrooms, unpaid hours — Low wages and working conditions that truck drivers describe as degrading have sparked an organized labor movement in the Permian Basin, a historic first for the nation’s busiest oil field.About a dozen truckers and local environmental activists descended Monday on three West Texas cities — Kermit, Mohanans and Odessa — and blocked entrances to sand mines with a row of cars to hand out fliers listing their demands to other truckers.Workers said the one-day demonstration, which slowed production in the nation’s largest oil supplier, was a sequel to a similar protest last year that was largely ignored and a warning of the steps they’ll take to be heard.The truckers are demanding to be paid for the long hours they spend waiting to load and unload frac sand — or sand used during fracking to separate the rock, prop it open and prevent it from closing — more restroom facilities near loading areas and the ability to negotiate pay rates based on driving times and cargo weight, said Billy Randel, a lifelong trucker and organizer with the Truckers Movement for Justice.“There are no bathrooms for the men and women to keep this economy running out here to use while sitting from two to four to 12 to 36 hours at the wellheads,” Randel said. “There's no facility to go to the bathroom. You know how dehumanizing that is for either a man or a woman to have to use a bucket? This is insanity.”Federal law mandates that drivers take a ten-hour break before beginning their shifts and may not drive for more than 14 hours straight afterward. After driving for eight uninterrupted hours, they must take a 30-minute break. And truckers may only drive for 70 hours within eight consecutive workdays, according to the Federal Motor Carrier Safety Administration. The law says nothing about access to amenities like restrooms. Randel said there are loopholes in the law that can significantly prolong a driver’s shift. Truckers have to wait in hours-long lines at drilling sites to collect frac sand, for example, and the time they spend waiting does not count toward their pay.Drivers deal with similar wait times when delivering their cargo. Drivers can’t abandon their place in line, no matter how long the wait is — if they do they could be fined, suspended or fired.Many truckers also foot repair costs when their contracts do not include insurance.“I couldn’t afford tires or oil changes,” said Luis Ramirez, one of the protesters Monday. “My family’s suffering because of this. The money’s not enough.”Drivers made similar grievances last year in August. Approximately 20 truckers held signs outside sand mines in Kermit and refused to fulfill their deliveries for one day to pressure their employers into improving the terms of their contracts. They wanted pay for every hour they spent on the truck and demanded restroom facilities at every well site requiring sand deliveries. Two days later, about 30 truckers were fired from their jobs, workers told The Texas Tribune.

Eni to Sell Two Alaska Fields to Hilcorp -- Eni SPA has said it is divesting the non-strategic Nikaitchuq and Oooguruk fields in Alaska to Hilcorp Energy Co. “The value of the transaction will be announced upon its closing”, the Italian government-controlled Eni said in a brief statement. The transaction is subject to regulatory approvals and other customary conditions. Nikaitchuq started producing January 2011. Located offshore the North Slope in a water depth of three meters (9.8 feet), the field is estimated to hold 200 million barrels of oil. It is Eni’s first operated asset in Arctic waters, according to the company. Oooguruk meanwhile began production 2008. It sits around five kilometers (3.1 miles) off the North Slope coast. “This transaction is consistent with Eni's strategy focused on the rationalization of the upstream activities by rebalancing its portfolio and divesting non-strategic assets”, Eni said. Eni cut its target net capital expenditure for 2024–27 by over 20 percent compared to last year’s plan. The new goal is to keep capital costs at EUR 7 billion ($7.5 billion) yearly during the period. The integrated energy company plans to execute capital discipline through “optimization, improved project quality and greater portfolio management”, Eni said in a statement March 14 announcing strategic targets for 2024–27. Announcing the Alaska sale, it said, “Within Eni’s financial framework, supporting the company’s distinctive growth-oriented strategy, Eni is committed to delivering a net €8 billion [$8.6 billion] of net portfolio inflow, front-end loaded, over the 2024-27 Plan”. “Proceeds are anticipated to come from three main sources: high-grading the upstream portfolio, diluting down high equity ownership exploration discoveries, and accessing new pools of capital via Eni’s satellite strategy to support the growth of its transition businesses while confirming progress in value creation”. Bloomberg reported Monday Eni is purportedly considering upstream disposals from its global portfolio to raise EUR 4 billion ($4.3 billion). On the radar for potential divestment are some operations in Cyprus and Indonesia, the news agency said, citing people familiar with the matter.

New shipping fuel requirements in Arctic risk worse oil spills, report says -- New shipping fuel requirements in Arctic risk worse oil spills, report says - The Arctic could face more severe environmental impacts from oil spills if shippers switch to very-low sulfur fuel oil following new, restrictive fuel regulations in the region, the Arctic Council said in a statement on Monday. Ships sailing through Arctic waters can no longer use or carry heavy bunker fuel oil as of Monday, following a new regulation from United Nations shipping agency the International Maritime Organization that aims to reduce pollution. The widely used alternative to heavy fuel oil is VLSFO. European shippers broadly opted for VLSFO in 2020 when the same regulation took effect there. If exposed to cold water in a spill, VLSFO forms clumps, whereas HFO remains liquid. Current oil spill equipment is not designed to collect oil clumps, Arctic Council working groups Emergency Prevention, Preparedness and Response and Protection of the Arctic Marine Environment have found. "We are not in a position to comment on specific studies. However, IMO welcomes submissions from Member States and international organizations to the relevant IMO body," a spokesperson for the agency told Reuters on Monday. Shipping traffic in Arctic waters rose by more than a third from 2013 to 2023, according to PAME, and the distance traveled by vessels more than doubled, raising the risk of a spill. "The IMO had the best intentions when they introduced the Heavy Fuel Oil ban, and it will no doubt make a positive environmental impact in many ways," expert and project lead for PAME and EPPR, Jon Arve Royset said in Monday's Arctic Council statement. "However, in the event of an oil spill, the new fuels being used as a result of this ban could have a far worse environmental impact than the old fuels they are banning."

U.S. Oil Production Extends Massive Lead Over Russia And Saudi Arabia -- In June, the Energy Institute released the 2024 Statistical Review of World Energy. The Review provides a comprehensive picture of supply and demand for major energy sources on a country-level basis. Each year, I do a series of articles covering the Review’s findings. In two previous articles, I discussed the trends in global carbon dioxide emissions, as well as the overall highlights of the Review. Today, I want to cover the production and consumption of petroleum. The Review lists several categories of oil production. When the Energy Information Administration (EIA) reports U.S. oil production, they are reporting crude oil plus lease condensate. The latter consists of light liquid hydrocarbons recovered in the field at natural gas wells. The Review reports oil production as the total of crude oil, lease condensate, NGLs, and oil sands. However, they report a separate category of crude oil plus condensate, which would be consistent with the EIA’s definition of oil production. The differences in definitions are why the oil production numbers and oil consumption numbers may seem inconsistent.For the first time, global oil consumption surpassed 100 million barrels per day in 2023. The demand for gasoline, diesel, and kerosene has returned to or exceeded pre-2019 levels, although there are variations across different regions. Global gasoline consumption slightly exceeded its pre-COVID level at 25 million barrels per day, while kerosene, despite showing strong growth of 17.5% in 2023, has not yet returned to its peak levels from 2019.Global oil production reached a record high of over 96 million BPD in 2023. The United States retained its position as the top producer, with an output increase exceeding 8.5%. This was a new record for U.S. oil production, smashing the previous record set in 2022.However, Russia experienced a decline in production by more than 1% due to the ongoing impact of international sanctions. Saudi Arabia, the other major global oil producer besides the U.S. and Russia, experienced a 6.6% decline from the previous year. This was attributed to ongoing voluntary production cuts from OPEC members.The Southern and Central American regions saw significant growth in their oil production, with an 11% increase, marking the highest growth rate of any region in the year as they continued to recover from the effects of the COVID-19 pandemic.In the Asia-Pacific region, China’s oil production grew by 2%, contributing to about 57% of the total production in the region. China surpassed the U.S. as the largest oil refining market by capacity, reaching 18.5 million barrels per day, although its refinery utilization rate of nearly 82% was still lower than the U.S. rate of around 87%.In both the conventional categories of crude plus condensate — as well as the category that includes NGLs — the United States was the world’s top oil producer in 2023. The U.S. produced 15.6% of the world’s oil in 2023, extending its lead over Saudi Arabia and Russia.Here were the Top 10 producers of crude oil plus condensate in 2023: Although the U.S. enjoys a lead over Saudi Arabia and Russia of more than 2.4 million BPD, that lead is far greater when NGLs are considered. With NGLs included U.S. production in 2023 was 19.4 million BPD. That’s 8.0 million BPD ahead of Saudi Arabia and 8.3 million BPD ahead of Russia’s numbers in that category. Those are massive leads driven by the increase in U.S. natural gas production over the past two decades, which substantially boosted U.S. NGL production.

US crude exports to Europe hit two-year low in June - (Reuters) - U.S. crude shipments bound for Europe fell to a two-year low in June as European buyers bought cheaper regional and West African oil, traders and analysts told Reuters. Exports of U.S. crude to Europe slowed to 1.45 million barrels per day (bpd) last month, the lowest for any month since July 2022, according to data from ship tracking firm Kpler. That marks a 14% decline from May and down 27% from June 2023. The fall came as a result of a narrowing difference between the price of U.S. benchmark WTI crude and European benchmark Brent crude, as Brent futures fell at a faster pace on average through May than WTI, as North Sea crudes weakened. A narrow difference between the two makes it difficult to make a profit shipping U.S. crude to Europe. Total U.S. crude exports to all destinations were 3.94 million bpd last month, down from 4.21 million bpd in May. The bulk of the exports to Europe were WTI Midland crude, which has become a staple of European refineries' crude diets. The U.S. has become a major oil exporter due to the rapid rise in output that came with the shale revolution. Growing flows of WTI into Europe led to the grade's inclusion in the dated Brent oil price benchmark by pricing agency S&P Global Commodity Insights in 2023, meaning that fluctuating U.S. export volumes can have a wider significance on oil prices globally. West African grades became cheaper in May because of an overhang of supply, as Africa's top crude exporter Nigeria was in April struggling to offload cargoes for May loading, driving some sellers to reduce offers. Nigerian Bonny Light differentials to Dated Brent have been on a downward trend the last couple months, said Gus Vasquez, Americas crude editor at price indexing agency, Argus Media. That made West African grades more attractive than U.S. crude, said Patricio Valdivieso, Rystad Energy's vice president of oil markets research. A narrower WTI-Brent spread makes it cheaper for European buyers to import dated-linked grades on shorter haul voyages rather than cargoes from the United States. "The Dated complex was fairly weak, limiting Brent's ability to price in marginal U.S. sweets," said Energy Aspects analyst Richard Price. In May, when June-loading cargoes would have traded, WTI's discount to Brent narrowed in 15 out of 23 sessions, and hit its narrowest since October at -$3.95 per barrel on May 30, LSEG data shows. Taking freight costs into account, the WTI-Brent spread typically needs to average -$5 to -$6 per barrel for transatlantic arbitrages to be profitable, said Gus Vasquez, Americas crude editor at pricing agency Argus Media. Lower exports of WTI Midland and a flurry of buying by trading firms Gunvor and Trafigura tightened the European market in recent weeks. That is likely to lead to a recovery of exports from the United States to Europe in July and August. "The drop in U.S. crude exports has supported the value of Brent," veteran oil trader and director of Surrey Clean Energy Adi Imsirovic said. A stronger Dated Brent market has also coincided with a weakening of crude prices in Asia. "WTI Midland arbitrages are now workable to Europe but incredibly weak to Asia, which we expect to reroute WTI Midland exports towards Europe in July and August," Energy Aspects' Price said. Weaker prices for UAE crude Murban are pricing Brent-linked crudes and WTI out of Asia, according to Sparta Commodities analyst Neil Crosby. Increased Murban output has pressured prices for the grade, with its monthly average spot premium to benchmark Middle East Dubai quotes sinking to a one-year low of 83 cents a barrel for August-loading cargoes.

Atlantic LNG shipping rates climb to $87,000 per day, European prices steady --Atlantic spot liquefied natural gas (LNG) freight rates jumped this week, while European prices remained steady compared to the previous week.Last week, freight rates increased in both the Atlantic and Pacific basins.“Spark30s Atlantic rates continued to experience record week-on-week increases for 2024, rising by $12,000 to $87,000 per day and increasing by over $35,000 in the last month. This mirrors a similar rally seen in 2023,” Qasim Afghan, Spark’s commercial analyst told LNG Prime on Friday.At the same time, Spark25S Pacific rates are also starting to increase, rising by $4,000 this week to $51,750 per day, he said.“After an extremely steady period in April and much of May, Spark30S rates have increased by over $30,000 in the last month, amid increasing demand in the Atlantic basin and the US arb to NE-Asia (via COGH) remaining open for July and August,” he said.“Whilst the US arb to NEA via COGH is currently closed, the arb to NEA via Panama remains open for the next few months, continuing to apply upward pressure on Atlantic freight rates,” Afghan said.In Europe, the SparkNWE DES LNG front month was slightly up compared to the prior week.“SparkNWE DES LNG prices remained steady this week, with the front month price for July delivery assessed at $10.731/MMBtu and at a $0.12/MMBtu discount to the TTF,” Afghan said.He said DES LNG prices remain at “approximately the tightest discount to the TTF of the year”.Data by Gas Infrastructure Europe (GIE) shows that volumes in gas storages in the EU continued to rise and storages were 76.20 percent full on June 26.Gas storages were 74.34 percent full on June 19, and 76.33 percent full on June 26 last year.In Asia, JKM, the price for LNG cargoes delivered to Northeast Asia, for August settled at $12.660/MMBtu on Thursday.Last week, JKM for July settled at 12.465/MMBtu on Friday.JKM rose to 12.610/MMBtu on Monday and to 12.735/MMBtu on Tuesday, while it dropped to 12.620/MMBtu on Wednesday.Several reports said this week that Egypt has awarded a large tender for LNG cargoes.S&P Global Commodity Insights said that Egyptian General Petroleum Corp., the parent company of EGAS, awarded a total of 20 cargoes on June 26.In addition to the original 17 cargoes, EGPC awarded three more cargoes, two of which were for August delivery and one for September delivery, S&P Global Commodity Insights said, citing an EGPC spokesperson.The company received offers from around 15 market players and the awarded tender comprised both fixed prices and TTF-linked cargoes.According to S&P Global Commodity Insights, the price levels ranged between TTF plus $1.6/MMBtu and TTF plus $2/MMBtu.The awardees included Total, BP, Vitol, Trafigura, and Aramco, the report said.

Asian Demand Pushing Atlantic Basin Vessel Rates Higher — Hot weather in Asia continues to attract LNG cargoes from the Gulf Coast, which has created a lopsided shipping market. Charts showing European and Asian weather patterns. Temperatures are forecast to be above normal in Japan, South Korea and Southeast China over the next 6-10 day period, according to Maxar’s Weather Desk. Hot weather has blanketed parts of Asia and South Asia since the spring. Global gas prices have risen sharply since that time when the restocking season got underway. Both the Japan-Korea Marker (JKM) and the Dutch Title Transfer Facility (TTF) in Europe traded sideways last week. But the weather, plant outages and geopolitical risks have kept JKM near $13/MMBtu, or about $2 higher than European gas prices.

China Driving Asian LNG Import Surge as Mexico Liquefaction Projects Advance --Asian LNG imports rose by 10.5 million metric tons (mmt) in 2023 versus 2022, the largest year/year change for any market, according to the International Gas Union’s (IGU) newly published 2024 World LNG Report. China regained its spot as the world’s top importer at 71.2 mmt in 2023, up 11.95% from 2022. India saw an increase of 9.7% to nearly 22.0 mmt, while new importers Vietnam and the Philippines added their names to the list of liquefied natural gas-thirsty consumers in Southeast Asia. The trend supports the business case of the dozen or so LNG export terminals proposed for Mexico, most of which plan to re-export U.S. pipeline gas to the Asia Pacific market from Mexico’s Pacific Coast.

Carlyle Creating Natural Gas-Rich Mediterranean Portfolio, with Former BP Chief at Helm - Global investment firm Carlyle is leveraging its expertise in carving out exploration and production (E&P) assets by building a standalone natural gas-weighted business focused in Croatia, Egypt and Italy. Map of Middle Eastern natural gas connectivity. The binding transaction with London-based Energean plc is estimated to be worth more than $900 million. Energean’s portfolio is 80% weighted to natural gas. Carlyle plans to use the assets to develop more resources in the Mediterranean, an area teeming with natural gas prospects. Croatia, Egypt and Italy “are actively encouraging new gas development, which we believe will play a central role in the energy transition,” Carlyle International Energy Partners (CIEP) co-head Bob Maguire said.

China completes its largest LNG storage base -- A subsidiary of China National Offshore Oil Corporation (CNOOC) has completed the construction of China's largest liquefied natural gas (LNG) storage base, a move that aims to ensure energy security and support green growth in the Yangtze River economic belt. The base in the city of Yancheng, east China's Jiangsu Province, has a group of gas tanks with a combined LNG storage capacity of 2.5 MMm3, the company said. It has four tanks each with a storage capacity of 220,000 m3 and six larger tanks each with a storage capacity of 270,000 m3. Li Feng, vice president of CNOOC Gas and Power Group, said the base is connected to the country's major gas pipelines and provides supplies to provinces including Jiangsu, Henan, Anhui and Shandong. Once fully operational, the base will have the capacity to process up to 6 metric MMtpy of LNG, equivalent to 8.5 Bm3 of natural gas. This volume is enough to sustain residential gas needs in Jiangsu Province, which has a permanent population of about 85 MM, for about 28 months.

Aramco Doubles Down on Saudi Arabia’s Natural Gas Outlook with $12.4B Jafurah Field Development --State-owned Saudi Arabian Oil Co., better known as Aramco, is moving forward with a multi-billion dollar project to boost natural gas production, and possibly fuel its export ambitions. Aramco has awarded 16 contracts, worth a combined $12.4 billion, and initiated the second phase of its plan to tap more natural gas resources in the Jafurah gas field near Saudi Arabia’s northeast coast. It also secured 23 gas rig contracts worth $2.4 billion and two directional drilling contracts worth $612 million. In anticipation of expanded gas supply, Aramco awarded another $8.8 billion in contracts to expand its “master gas system” used to transport the fuel across Saudi Arabia.

Russian Government Oil Revenue Was Up Almost 50Pct in June - Russia’s government revenue from the oil industry was almost 50% higher in June compared with a year earlier as the nation’s producers adapted to international sanctions and obtained higher prices for their crude exports. Oil-related taxes jumped to 590.6 billion rubles ($6.7 billion) last month compared with 402.8 billion rubles in June 2023, according to Bloomberg calculations based on Finance Ministry data. Total oil and gas revenue rose by 41% to 746.6 billion rubles, the ministry said. The spike follows higher prices for Urals crude, Russia’s key export blend, as well as weaker ruble. The Finance Ministry calculated June taxes based on a Urals price of $67.37 a barrel, up from $53.50 a year ago. At the same time, Russia’s currency depreciated by 15% in the calculated tax period from year earlier to 90.88 per US dollar, contributing to higher budget revenues. Russia’s crude has been trading above a $60 price cap imposed by the Group of Seven industrialized nations. The measure was intended to reduce the inflow of petrodollars and limit Kremlin’s ability to finance its war against Ukraine, while still keep Russian oil on the global market. The G-7 threshold, which limits access to Western shipping and insurance, was combined with a European ban on the most imports of Russian crude and petroleum products. Moscow has adapted to these restrictions by using a massive shadow fleet of tankers and re-directing its oil flows to non-western buyers, mainly in Asia. The Russian state budget’s oil proceeds would have been higher in June if they hadn’t been dented by big state subsidies to the nation’s refiners. The government paid out over 158 billion rubles to fuel producers for domestic supplies of diesel and gasoline, according to the Finance Ministry. The payments partially compensate refiners for the difference in car fuel prices in Russia and abroad. In the first half of the year, Russia’s budget oil and gas revenue rose by over two thirds from the same period a year ago to almost 5.7 trillion rubles, according to the Finance Ministry’s data. The nation expects to receive 10.99 trillion rubles from the industry this year.

Overall OPEC Production Steady while Some Members Exceed Limits --OPEC’s crude production remained steady for a third month, while some key members continued to pump above agreed limits. The Organization of Petroleum Exporting Countries produced an average of 26.98 million barrels a day in June, or 80,000 a day less than during the previous month, according to a Bloomberg survey. Small reductions in Iraq and Nigeria drove the decline. The survey showed that Iraq and the United Arab Emirates have yet to fully implement cutbacks agreed in tandem with other leading members at the start of this year. Baghdad has also failed to follow through on additional compensation curbs pledged to offset earlier cheating. The cuts by OPEC and its partners, spearheaded by group leader Saudi Arabia, have had some success in balancing global markets against a tide of new supplies from the US and other parts of the Americas. Brent crude futures are trading near $87 a barrel, close to the highest in almost two months. The recovery — while potentially painful for consumers still reeling from years of inflation — should bolster revenue for OPEC+ members, who largely rely on petroleum sales to cover government spending. However, it may still not be enough: Riyadh requires prices close to $100 a barrel to finance an ambitious economic overhaul, according to the International Monetary Fund. To push crude higher the alliance may need to fully deliver its pledged reductions, but efforts to improve implementation have shown limited results. In June, Iraq reduced output by 30,000 barrels a day to 4.25 million a day. A pullback in exports brought the country closer to its designated ceiling, but Baghdad still remains about 250,000 barrels a day above that quota, even before the lack of extra “compensation cuts” are factored in. The nation has chafed for years against OPEC+ limits as it seeks to rebuild a war-shattered economy. Saudi Arabia’s production remained broadly steady at 8.99 million barrels a day, according to the survey. It reduced exports sharply, by 9 percent to 5.61 million a day, though shipments often fall at this time of year as the country burns more fuel at home for power generation and air conditioning. Last month, the OPEC+ coalition outlined plans to gradually reverse its supply restraints and begin to revive output from the fourth quarter. But when prices immediately slumped, ministers emphasized that the increases are provisional and could be postponed. The alliance is due to review its next move when major members hold an online monitoring meeting on Aug. 1. Bloomberg’s survey is based on ship-tracking data, information from officials and estimates from consultants, including FGE, Kpler Ltd. and Rapidan Energy Group.

Nigeria oil regulator approves Eni, Equinor divestment deals | S&P Global Commodity Insights --Nigeria's upstream regulator said it has approved long-awaited divestment deals by Eni and Equinor, allowing local players Oando and Chappal Energies, respectively, to acquire their oil-producing assets. Addressing an oil and gas conference in Abuja on July 3, Gbenga Komolafe, head of the Nigerian Upstream Petroleum Regulatory Commission, said the body has greenlit a deal between Nigerian Agip Oil Company – Italian major Eni's Nigerian subsidiary – and Oando, which is set to become one of Nigeria's largest oil producers through the deal. Komolafe added that Equinor's deal with Project Odinmim, Chappal's special-purpose vehicle for the transaction, has also been approved. "The [Eni] divestment has been concluded and the signing ceremony will come up any moment," said Komolafe. "The Equinor-Project Odinmim project divestment was also completed." Eni first announced the sale of its Nigerian unit to Oando in September 2023, but the deal stalled after state-owned Nigerian National Petroleum Company, which holds 60% equity in the blocks, floated the idea of exercising its right of first refusal on the licenses. Oando chief operating officer Alex Irune said the NUPRC approval was "a welcome development" and praised the recently enacted and "rigorous" Petroleum Industry Act. However, Irune added that of the company's four transactions, just two have so far been approved. "We have no choice after acquiring those oil and gas assets but to adopt integrated operations," said Irune, an advocate of greater cooperation between local Nigerian companies. Eni did not immediately respond to a request for comment

India’s crude oil imports from Russia at 12-month high in June - According to data from energy intelligence firm Vortexa, imports from Russia were up by almost 15 per cent month-on-month and 2 per cent on an annual basis. Data shows that both public and private sector refiners continued to import in record quantities from Russia. Public refiners such as Indian Oil Corporation (IOCL), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) imported 1.10 mbpd crude oil, which is also a 12-month high. The cargoes last month were higher by 6 per cent M-o-M. However, imports were down by almost 11 per cent on an annual basis. During May-July 2023, public refiners imported more than 1.2 mbpd on a monthly basis from Russia. Private refiners Reliance Industries (RIL) and Rosneft-backed Nayara Energy imported a record 871,200 barrels per day (bpd) from Russia in June 2024. The cargoes were higher by 28 per cent M-o-M and 20 per cent Y-o-Y. Vortexa’s head of APAC analysis Serena Huang told businessline, “India’s imports of Russian crude at 1.97 mbpd in June 2024 is the highest since last July. China’s lower appetite of Russian crude has led to more barrels heading to India.” India’s crude imports have remained robust at 4.62 mbpd in June, Huang said. “We expect the country’s crude imports to remain robust, with downside risks from softer refining margins due to slowing global oil demand,” she added. While Indian refiners procured more barrels from Russia, cargoes from traditional suppliers in West Asia, such as Iraq and Saudi Arabia, declined. Crude oil imports from India’s second largest supplier, Iraq, fell by 20 per cent M-o-M and by 3.5 per cent Y-o-Y to roughly 754,000 bpd in June 2024. The decline was steeper in in-bound shipments from Saudi Arabia at 36 per cent M-o-M and 46 per cent Y-o-Y to around 387,000 bpd. Some trade sources said that the higher official selling price (OSP) of its flagship medium sour grade Arab Light in June could have been a reason for the lower cargoes. Crude oil shipments from the US continued to rise for the second consecutive month in June 2024. India imported roughly 331,000 bpd from the US last month, compared to around 224,000 bpd in May 2024 and 112,000 bpd in April. Trade sources said the imports were of light sweet grade due to weak market fundamentals amid refinery outages in Europe.

Russia's seaborne crude exports rise in June despite OPEC+ pledges | S&P Global Commodity Insights -- Russian seaborne crude exports rose 5% in June from a six-month low in May, according to tanker tracking data, despite pledges by Moscow to adhere more strictly to its OPEC+ output target from this month. At the same time, oil product exports fell 9% on the month despite Russian refineries damaged by Ukrainian drone strikes having largely been restored. Work affecting Primorsk on the Baltic Sea and Kozmino on the Pacific coast cut shipments through Russia's two busiest oil terminals in the previous week, with no departures from either for four days during that period. But flows from both recovered fully in Crude shipments from Russian ports averaged 3.71 million b/d in June, up 188,000 b/d from 3.52 million b/d in May led by a rise in cargoes of Urals crude from its Baltic and Black Sea ports of Ust-Luga and Novorossiisk, according to S&P Global Commodities at Sea. Russia's June crude exports, which are above the average levels of 3.5 million b/d over the last year, come as Russian refiners repaired nearly all damaged capacity caused by Ukrainian drones since the start of the year. The rise in crude shipments also comes despite Moscow's pledges to OPEC+ to transition Russia's voluntary crude supply cut to a crude production cut during the third quarter. This includes May exports of 71,000 b/d below its May-June 2023 average, down from 121,000 b/d in April. The rise from May also came despite a brief slump in export shipments from Russia's two busiest oil terminals --Primorsk on the Baltic Sea and Kozmino on Russia's Pacific coast-- in the third week of June, the data shows. The biggest rise in crude exports during June headed to Russia's top oil buyer India, according to the data, with an additional 130,000 b/d of crude flowing to Indian ports during the month. Meanwhile, Russia's seaborne exports to China slipped by 130,000 b/d to a 10-month low of 980,000 b/d, according to the data, as Chinese refiners continued to undergo seasonal maintenance. On June 24, the EU added Russia's largest shipping company Sovcomflot, and 17 oil tankers to its latest sanctions against Moscow, mirroring a move by the US earlier this year to tighten curbs on one of the key transporters of Moscow's oil. According to Commodities at Sea, Sovcomflot-owned tankers transported 16% (112.8 million barrels) of Russian-origin crude bound for international markets since the start of the year. The 17 tankers shipped another 22.37 million barrels of Russian-origin crude and products since the start of the year.

Iran becomes 4th largest oil exporter in OPEC: report - Tehran Times --Iran has risen to become the fourth largest oil exporter within the Organization of the Petroleum Exporting Countries (OPEC) due to a surge in oil production and sales. Iran's oil and gas condensate exports have now reached their highest level since 2018, when the United States withdrew from the Iran nuclear deal and introduced tough economic sanctions against the country, targeting its oil sales in particular, according to a report by Vortexa, which provides data on the global energy sector. The report emphasized that Iran's oil and gas condensate exports now account for 9% of OPEC's total crude oil and gas condensate exports. Iran exported 1.56 million barrels of oil per day from January to May of this year, 250,000 bpd more than Kuwait and Nigeria. This has elevated Iran's ranking to the fourth spot among OPEC's largest crude oil exporters. Despite Western sanctions, Iran managed to increase its crude oil and gas exports to 1.7 million bpd in May, the highest level in the past five years. The report cited the rise in Chinese oil demand and the expansion of Iran's oil tanker fleet as the main factors contributing to the surge in Iran's oil exports. Ever since the late Iranian President Ebrahiam Raisi took power in August 2021, the country’s oil exports have been on an upward trajectory. The rise in Iran’s oil exports has taken place despite tough U.S. sanctions which aimed to choke off Iran’s oil industry as a main source of revenue for the Islamic Republic. Financial Times cited figures by data company Vortexa last month noting that Iran was exporting more oil than at any time for the past six years, giving its economy a $35bn-a-year boost. The report said that Tehran sold an average of 1.56mn barrels a day during the first three months of 2024, almost all of it to China and its highest level since the third quarter of 2018. “The Iranians have mastered the art of sanctions circumvention,” said Fernando Ferreira, head of a geopolitical risk service at the Rapidan Energy Group in the U.S. Iran’s oil minister Javad Oji said in March that oil exports had “generated more than $35bn” in the preceding year. On another occasion, he said that while Iran’s enemies wanted to stop its exports, “today, we can export oil anywhere we want, and with minimal discounts”.

Iran exporting crude oil to 17 countries: Oji - Tehran Times - Iran’s oil minister said that the country is currently exporting crude oil to 17 countries, including some in Europe. Iran will not face any problem in exporting oil no matter who comes to power in the US, Javad Oji stressed. Speaking at a ceremony on Tuesday, he stated that good investment has been made in the past three years in the oil industry. Iran produced 2.2 million barrels of oil per day (bpd) at the outset of the administration of the late President Ebrahim Raisi (August 2021) but the current oil production rat is about 3.570 million bpd, showing a considerable hike, Oji underlined. He went on to say that Iran’s oil exports rose from 182 million barrels in 2019 to 565 million barrels last year. In addition, the value of the export of oil and gas condensates and other oil and petrochemical products rose from $10.8 billion in 2019 to $36 billion last year, registering a 3.5fold growth, the oil minister added. Iran has risen to become the fourth largest oil exporter within the Organization of the Petroleum Exporting Countries (OPEC) due to a surge in oil production and sales. Iran's oil and gas condensate exports have now reached their highest level since 2018, when the United States withdrew from the Iran nuclear deal and introduced tough economic sanctions against the country, targeting its oil sales in particular, according to a report by Vortexa, which provides data on the global energy sector. The report emphasized that Iran's oil and gas condensate exports now account for 9% of OPEC's total crude oil and gas condensate exports. Iran exported 1.56 million barrels of oil per day from January to May of this year, 250,000 bpd more than Kuwait and Nigeria. This has elevated Iran's ranking to the fourth spot among OPEC's largest crude oil exporters. Despite Western sanctions, Iran managed to increase its crude oil and gas exports to 1.7 million bpd in May, the highest level in the past five years. The report cited the rise in Chinese oil demand and the expansion of Iran's oil tanker fleet as the main factors contributing to the surge in Iran's oil exports.

Oil Moves Higher Ahead of Peak Driving, Hurricane Season - West Texas Intermediate futures closest to expiration on the New York Mercantile Exchange started the week up more than $1 per barrel (bbl) ahead of the July 4 weekend which traditionally marks peak seasonal fuel demand in the U.S. AAA expects a record number of travelers this Independence Day week, propelled by a 5% year-on-year increase in road travel. Demand woes are persisting, however, as recent manufacturing data disappointed once more.The Energy Information Administration on Wednesday reported commercial crude oil inventories expanding by 3.6 million bbls, and gasoline stocks adding some 2.7 million bbls in the last week of June. Weak manufacturing and freight activity have been denting fuel demand, with 1.5% less gasoline and 3.8% less distillate fuel oil supplied to domestic markets over the past four weeks compared to the same period last year. The Institute of Supply Management on Monday released their June U.S. manufacturing PMI, which at 48.5 slid even deeper into contraction.Manufacturing data out of China released over the weekend, meanwhile, was mixed. While the Caixin manufacturing PMI in June rose to 51.8, the highest in two years, official data indicated no change from May at 49.5. Aside from the brief respite in March and April, the state manufacturing PMI has been stuck below 50 since October. Chinese oil demand has largely trailed expectations so far this year, with official customs data recently showing a year-on-year drop in refining activity.Near 10:30 a.m. EDT, WTI futures for August delivery were trading near $81.85 bbl, up $0.31, and Brent for September delivery hovered around $85.33 bbl, up $0.33. RBOB for August delivery was up $0.0265 gal near $2.5280, and ULSD nearest delivery gained $0.0246 gal, trading near $2.5577.

The Oil Market on Monday Continued on its Upward Trend, Supported by Increasing Geopolitical Concerns - The oil market on Monday continued on its upward trend, supported by increasing geopolitical concerns. There are fears of conflict in southern Lebanon in light of a military build-up, the possibility of Iran entering directly into a conflict and Russia’s potential to provide support to partners in the region amid a stagnation of negotiations between Israel and Hamas in Gaza. The market traded mostly sideways in overnight trading and looked ready to post an inside trading day. However, it breached its previous high of $82.72 by mid-day and rallied a high of $83.52 ahead of the close. The August WTI contract ended the session up $1.84 at $83.38 and the September Brent contract settled up $86.60 at $1.60. The August WTI contract later posted a new high of $83.64 in the post settlement period. The product markets ended the session sharply higher, with the heating oil market settling up 8.16 cents at $2.6147 and the RB market settling up 7.68 cents at $2.5783. The Department of Energy said the U.S. added 2.4 million barrels of sour crude to the SPR over the four week period that ended on Friday, bringing the stockpile to 372.6 million barrels. The SPR now holds 228.8 million barrels of sour crude and 143.8 million barrels of sweet crude.IIR Energy said U.S. oil refiners are expected to shut in about 92,000 bpd of capacity in the week ending July 5^th, increasing available refining capacity by 84,000 bpd. Offline capacity is expected to increase to 256,000 bpd in the week ending July 12^th.According to vessel-tracking data, about 20 ships loaded crude oil on Canada’s West Coast in the first full month of operation on the expanded Trans Mountain pipeline. The 20 vessels loaded were less than the 22 ships that Trans Mountain had initially expected to load for the month. Total crude exports from Vancouver were around 350,000 bpd with the last two vessels for June-loading at the Westridge Marine terminal. The vessels, partially loaded Aframaxes able to carry about 550,000 barrels each, mostly sailed to the U.S. West Coast and Asia. According to data providers LSEG, Kpler and Vortexa, some cargoes were loaded onto larger ships for delivery to India and China. The expanded Trans Mountain pipeline is running around 80% full with some spot capacity used. Trans Mountain forecasts 96% utilization from next year. It has capacity to load 34 Aframax ships a month.Colonial Pipeline Co announced a freeze notice for Cycle 38 on Line 2, its main distillate line from Houston, Texas to Greensboro North Carolina. The allocation is for the pipeline segment north of Collins, Mississippi. Colonial Pipeline is also allocating space for Cycle 39 shipments on Line 2, its main distillate line.U.S. manufacturing fell for a third consecutive month in June and a measure of prices paid by factories for inputs fell to a six-month low amid weak demand for goods. The Institute for Supply Management said that its manufacturing PMI fell to 48.5 in June from 48.7 in May.S&P Global reported that its manufacturing PMI for the U.S. stood at 51.6 in June compared with a flash reading of 51.7.

Oil prices up 2% to two-month high on summer demand hopes, supply worries (Reuters) - Oil prices gained about 2% to a two-month high on Monday on hopes of rising demand during the Northern Hemisphere's summer driving season and worries that conflict in the Middle East could spread and reduce global oil supplies. Brent futures rose $1.60, or 1.9%, to settle at $86.60 per barrel, while U.S. West Texas Intermediate (WTI) crude rose $1.84, or 2.3%, to settle at $83.38. That was the highest close for Brent since April 30 for a third day in a row and the highest for WTI since April 26. "The (energy) complex is beginning this new week in strong fashion as it continues to acquire support from ... increasing geopolitical risk premium related to Israel-Hezbollah tensions (and) bullish demand expectations for this month with some increased hurricane premium," Israel and Iran-backed Hezbollah have been trading fire since the start of the Gaza war, and concern is rising that an all-out war could break out between the two sides. "Hezbollah and Israel seem to be drifting closer and closer to a full scale war that runs the risk of drawing in OPEC member Iran and its Shiite allies in Iraq, Yemen and Syria," OPEC is the Organization of the Petroleum Exporting Countries (OPEC), which along with its allies, a group known as OPEC+, has already extended most of its oil output cuts into 2025. Those output cuts have led analysts to forecast supply deficits in the third quarter as transportation and demand for air-conditioning during the summer eat into fuel stockpiles. Rising demand for fuel helped lift prices for U.S. oil products by around 3% on Monday with diesel futures closing at their highest in 10 weeks and gasoline futures closing at their highest in eight weeks. In the Caribbean Sea, Hurricane Beryl, an extremely dangerous major hurricane, was expected to pass Jamaica on Wednesday and slam into the Yucatan Peninsula in Mexico on Friday before weakening into a tropical storm and entering the Bay of Campeche in the Gulf of Mexico, where Mexico produces much of its oil on Saturday.

An Expected Rise in Demand as the Summer Travel Season Increases with the Independence Day Holiday This Week - On Tuesday, the oil market ended the session lower after the market extended its previous gains to two-month highs early in the session. The market was well supported by an expected rise in demand as the summer travel season increases with the Independence Day holiday this week. The American Automobile Association forecast travel during the holiday period will increase 5.2% on the year, with car travel up 4.8% on the year. Also, while Hurricane Beryl, which strengthened into a category 5 storm on Monday is not expected to affect operations in the Gulf of Mexico immediately, the market was closely watching the forecasts. The market continued to extend its recent gains and posted a high of $84.38 by mid-morning. However, it erased its sharp gains and sold off to a low of $82.72 on profit-taking as fears of supply disruptions caused by Hurricane Beryl dissipated. The August WTI contract settled down 57 cents at $82.81 and the September Brent contract settled down 36 cents at $86.24. The product market settled in mixed territory, with the heating oil market settling up 1.5 cents at $2.6297 and the RB market settling down 49 points at $2.5734. The U.S. Department of Energy said it has completed awarding contracts for the sale of 1 million barrels of gasoline from the Northeast Gasoline Supply Reserve to lower prices ahead of the Fourth of July holiday. The Energy Department said the barrels were sold at an average price of $2.34/gallon to five companies, with BP buying 500,000 barrels, Vitol buying 200,000 barrels and Freeport Commodities, Irving Oil and George E. Warren purchasing about 100,000 barrels each. Iran’s Oil Minister, Javad Owji, said Iran is selling crude oil to 17 countries, including some countries in Europe, indicating some countries may not be honoring U.S. sanctions. He said he could not provide additional detail regarding the amounts sold or the identity of buyers due to the sensitivity of the subject. On Monday night, Hurricane Beryl strengthened into a “potentially catastrophic” category 5 storm as it moved across the eastern Caribbean. The National Hurricane Center said Hurricane Beryl, packing winds of up to 155 mph, was about 485 miles east-southeast of Kingston, Jamaica. The storm struck the Caribbean region earlier in the day as the earliest Category 4 storm on record. Meanwhile, a private weather forecaster said the environmental conditions will gradually become less favorable for Beryl to maintain its extremely powerful hurricane status by late Tuesday. The forecaster said it is likely that Beryl will begin weakening and this weakening will continue when the eye of the hurricane passes just south of Jamaica on Wednesday night. The hurricane will still be close enough to produce hurricane conditions across Jamaica during Wednesday. Beyond this, there continues to be quite a bit of uncertainty as to how much Beryl will have weakened by the time it reaches the southern Yucatan Peninsula on Thursday night and model consensus seems to suggest that Beryl may be a tropical storm when it comes ashore on the eastern Yucatan Peninsula on Friday. Environmental conditions are not expected to be favorable for major strengthening in the Gulf of Mexico. However, a tropical storm impact somewhere between Tampico, Mexico and Corpus Christi, Texas is a possibility around Sunday or Monday.

U.S. crude oil pulls back as traders monitor war, hurricane risks - U.S. crude oil pulled back from a two-month high Tuesday, as traders assessed the risk of war between Israel and Hezbollah, while monitoring the potential threat of Hurricane Beryl to Gulf Coast refineries.Oil has rallied in recent days with gasoline prices have hit an average of $3.50 per gallon ahead of the Fourth of July holiday, according to the motorist association AAA. Prices at the pump are about 3 cents higher than last week but still lower than last month.West Texas Intermediate crude hit a high of $84.38 earlier in the session, the highest level since April 26, but ultimately closed lower at $82.81 per barrel. Brent rose to $87.46 earlier in the session, the highest level since April 30, before also settling lower. Here are Tuesday's closing energy prices:

• West Texas Intermediate August contract: $82.81 per barrel, down 57 cents, or 0.68%. Year to date, U.S. crude oil has gained 15.6%.
• Brent September contract: $86.24 per barrel, down 36 cents, or 0.42%. Year to date, the global benchmark is ahead by 12%.
• RBOB Gasoline August contract: $2.57 per gallon, down 0.19%. Year to date, gasoline has advanced 22.4%.
• Natural Gas August contract: $2.43 per thousand cubic feet, down 1.74%. Year to date, gas is down about 3%.

Rising gasoline prices will likely continue into Fourth of July and could hit $3.69 per gallon in the coming weeks if the oil rally continues, Patrick De Haan, head of petroleum analysis at GasBuddy, wrote on social media Tuesday. "I expect the national retail price of gasoline to increase 5 to 10 cents per gallon over the next 7 days," Andy Lipow said in a note Tuesday. Oil prices gained 6% last month after sagging in May as geopolitical risk entered the market again. Eighteen Israeli soldiers were injured Sunday in a drone attack launched by the Iran-backed militia Hezbollah, according to the Israel Defense Forces. Israel and Hezbollah have exchanged fire across the Lebanon border for months, but tensions have escalated in recent weeks as the two sides have threatened war. An Israeli invasion of Lebanon to push back Hezbollah could lead to a confrontation with OPEC-member Iran, analysts have warned. Traders also worry that an early and active hurricane season could disrupt refineries and oil production along the U.S. Gulf Coast. Hurricane Beryl has strengthened into a Category 5storm after making landfall on Grenada's Carriacou Island. "While Hurricane Beryl is currently not a direct threat to USA crude oil production or refineries on the Gulf Coast, the National Hurricane Center is now showing a northerly turn on Sunday that could impact refineries in Corpus Christi," There are five refineries in the Corpus Christi area with 942,000 barrels per day of capacity, which is 4.8% of total U.S. refining capacity. With Gulf refiners operating at 90% to 95% to capacity, there is no slack in the system to make up for lost production if a significant number of refineries are shut down."Supply shortfalls are partially solved by drawing down inventories in the distribution system," he said. "That results in depleting terminals of gasoline and ultimately the consumer sees the dreaded 'out of gas' signs at the pump."

WTI Spikes After Biggest Crude Draw In A Year | ZeroHedge Oil prices briefly spiked after last night's API-reported big crude draw, but that reverted back lower fast. Overnight has seen a small roller-coaster with prices slipping during the US session and then a series of bad news data point in the US sparking a 'good news for Fed cuts' response in oil prices, holding just above green on the day. The question is - was API's data fluke... API

• Crude -9.16mm - biggest draw since mid-Jan 2024
• Cushing +404k
• Gasoline +2.47mm
• Distillates -740k

DOE

• Crude -12.16mm - biggest draw since Jul 2023
• Cushing +345k
• Gasoline -2.21mm
• Distillates -1.54mm

Nope. The official data confirms the huge crude draw last week (which we suspect was pre-emptive draws ahead of 'Beryl'. Graphics Source: Bloomberg Adjusted for the 398k barrel addition to SPR, the 11.579mm barrtel draw was the largest since the last week of July last year... Oil prices spiked on the big crude draw...

Oil prices rise on deep weekly draw in US crude inventories (Reuters) - Oil prices gained about 1% on Wednesday after a larger-than-expected decline in U.S. crude stocks, but gains were capped by concerns about rising global inventories in thin trading ahead of the U.S. Independence Day holiday.Brent crude futures rose $1.10, or 1.3%, to settle at $87.34 a barrel. U.S. West Texas Intermediate (WTI) crude futures gained $1.07, or 1.3%, to $83.88. The U.S. Energy Information Administration (EIA) reported a 12.2 million draw in the country's crude oil barrels in storage last week, which was larger than analysts' expectations in a Reuters poll for a 680,000-barrel draw."Strong exports, a slight drop in imports, and a rebound in refinery runs colluded to draw crude inventories by a whopping 12 million barrels," said Kpler oil analyst Matt Smith.But the market's reaction was muted partly due to lower trading volumes ahead of Independence Day, analysts noted.Potential supply disruptions to Hurricane Beryl have also kept prices elevated, although concerns eased after the U.S. National Hurricane Center said the storm was expected to weaken by the time it entered the Gulf of Mexico this week. The rain and wind impacts could still disrupt Mexico's offshore oil production as well as its export infrastructure and tighten supply, said Andrew Lipow, president of Lipow Oil Associates. Mexico is a major crude oil exporter.OPEC output rose for a second consecutive month in June, a Reuters survey found on Tuesday, which weighed on oil prices. Higher supply from Nigeria and Iran offset the impact of voluntary supply cuts by other members and the wider OPEC+ alliance."OPEC+ was reported to have increased production in June despite pledges to keep quotas in check through the third quarter, and lingering concerns over a tepid recovery in China sent a bearish signal," .Also dampening prices were surveys that showed that China's services activity expanded at the slowest pace in eight months and confidence hit a four-year low in June. Overall business growth across the euro zone also slowed sharply last month. China is the largest importer of crude barrels, and a slowdown in the country's economic activity can damage oil demand.

The Market Weighed Larger Than Expected Draws in Oil Stocks Against Bearish Economic Data from the U.S., the Euro Zone, and China - The oil market ended the session higher on Wednesday as the market weighed larger than expected draws in oil stocks against bearish economic data from the U.S., the euro zone and China. The crude market traded sideways in overnight trading despite the larger than expected draw in crude stocks of over 9 million barrels in the week ending June 28^th reported by the API. The market’s gains were limited by economic headwinds from China, which reported that its services activity expanded at the slowest pace in eight months and confidence fell a four-year low in June, while overall business growth across the euro zone also slowed sharply in June. The market later posted a trading range from $83.53 to $82.46 following the release of the EIA report. The market was initially well supported by the EIA report, which showed larger than expected draws across the board, with a draw in crude stocks of over 12 million barrels on the week. However, the market quickly erased its gains and sold off to its low as the market reassessed some bearish U.S. economic data, with U.S. factory orders unexpectedly falling in May and a measure of U.S. services sector activity falling to a four year low in June. The crude market later settled in a sideways trading range before some late buying ahead of the Independence Day holiday on Thursday pushed the market to a high of $83.93 ahead of the close. The August WTI contract settled up $1.07 at $83.88 and the September Brent contract settled up $1.10 at $87.34. The product markets ended the session higher, with the heating oil market settling up 46 points at $2.6343 and the RB market settling up 2.79 cents at $2.6013. IIR Energy said U.S. oil refiners are expected to shut in about 117,000 bpd of capacity in the week ending July 5^th, increasing available refining capacity by 59,000 bpd. Offline capacity is expected to increase to 261,000 bpd in the week ending July 12^th.Colonial Pipeline Co is allocating space for Cycle 40 shipments on Line 1, its main gasoline line from Houston, Texas to Greensboro, North Carolina. The current allocation is for the pipeline segment north of Collins, Mississippi.The EIA reported that U.S. crude oil stocks fell by about 12.2 million barrels in the week ending July 28^th, the largest weekly withdrawal since July 2023. Total U.S. commercial crude inventories, which exclude the SPR, were at 448.5 million barrels by the end of last week, the lowest level since March.Citi Research said its three month price target for Brent remains at $82/barrel and its 6-12 month target remains at $72/barrel. It stated that geopolitical risks do not necessarily translate into oil supply disruptions.Shell Plc started evacuating non-essential personnel from at its Perdido and Whale oilfields in the Gulf of Mexico due to Hurricane Beryl. It shut down drilling operations ahead of the approaching storm.

Oil settles 1% lower as Mideast ceasefire talks ease supply disruption concerns – CNA -- Oil prices settled lower on Friday as the rising possibility of a ceasefire deal in Gaza outweighed strong summer fuel demand and potential supply disruptions from Gulf of Mexico hurricanes.Brent crude futures settled down 89 cents, or 1.02 per cent lower, to $86.54 a barrel, after reaching their highest since April earlier in the session. U.S. West Texas Intermediate (WTI) crude futures settled at $83.16 a barrel, down 72 cents, or 0.9 per cent.For the week, Brent rose 0.4 per cent, while WTI futures posted a 2.1 per cent rise.The head of Israel's Mossad has returned from Doha after an initial meeting with mediators trying to reach a Gaza ceasefire and hostage release deal, and negotiations will resume next week, Prime Minister Benjamin Netanyahu's office said on Friday.Netanyahu's office said in a statement that gaps remain between the sides.“Obviously a breakthrough there would help calm the waters”, said John Kilduff, partner at Again Capital. An easing of the Middle Eastern conflict reduces the risk premium of barrels out of the region and weighs on oil prices.WTI did not settle on Thursday due to the Independence Day holiday, giving way to thin trading, but prices have risen this week on strong summer oil demand expectations in the U.S."The last couple of days represent the peak of the drive season, in terms of demand and prices continue to creep higher. This is coming from stronger consumer demand and the effects of Hurricane Beryl," Tim Snyder, economist at Matador economics said in a note on Friday.The U.S. Energy Information Administration (EIA), on Wednesday, reported a much larger-than-expected 12.2 million barrel inventories draw last week, compared with analyst expectations for a draw of 700,000 barrels.On the supply side, Hurricane Beryl, a Category 2 storm, made landfall in Mexico, after killing least 11 people in the Caribbean, tearing through buildings and power lines across several Caribbean islands.Mexico's major oil platforms are not expected to be affected by the storm, but oil projects in U.S. waters to the north may be disrupted if the hurricane continues on its expected path.The possibility that U.S. interest rate cuts are approaching, meanwhile, raised expectations for an increase in oil demand.U.S. job growth slowed marginally in June, but a rise in the unemployment rate to more than a 2-1/2 year high of 4.1 per cent and moderation in wage gains pointed to an easing of labor market conditions, and could put a rate cut at the July meeting in their sights."This morning’s employment data shows that there are some cracks in the labor market, that could spur on a rate cut even this month”, said Kilduff at Again Capital.Lower interest rates can boost economic activity and increase crude oil demand.

Oil Posts Fourth Straight Weekly Gain - Oil posted its fourth straight weekly advance, with declining US stockpiles and Hurricane Beryl extending crude’s early-summer rally. West Texas Intermediate fell to settle near $83 a barrel on Friday, but still cemented a 2% weekly advance. The American benchmark hasn’t risen for four consecutive weeks since August 2023. Tropical Storm Beryl is expected to regain hurricane status and hit northern Mexico or southern Texas early Monday, potentially threatening some oil output. The storm also has traders weighing the risk of a “supercharged” hurricane season as its the earliest ever Category 5 to hit the Atlantic. Adding to the bullishness, a report Wednesday showed the biggest drop in US stockpiles in almost a year, signaling tightening supplies. Gasoline consumption on a four-week basis rose for the first time in a year, according to the Energy Information Administration. “Investors will want to keep an eye on inventories data to see whether the most recent drop was just an anomaly or whether more oil will be drawn from inventories,” said Fawad Razaqzada of City Index and Forex.com in a note Friday. “If we see more drawdowns, then this should further support the oil-price recovery.” Still, WTI is seeing resistance at $84 a barrel, Razaqzada added. Crude may break out of the range if the market gains confidence in stronger demand and tighter supply in the coming months, he said. Crude has climbed almost 14% since early June, partly due to a positive outlook for demand over the Northern Hemisphere summer, with bullish, backwardated timespreads indicating healthy near-term consumption. Hedge funds affirmed the bullish outlook, staking out the biggest net long position on Brent crude in seven weeks, according to Intercontinental Exchange data. The recent rally has been aided by positive sentiment across markets, and a stepdown in US hiring and wage growth last month is bolstering expectations of interest rate cuts. But some traders are weighing whether the economic slowdown will hurt US consumers and trim oil demand. Softer demand in Asia has tempered some of the recent optimism and led Saudi Aramco to slash prices of its crude to the region for a second month. Saudi Arabian seaborne oil flows dropped in June. Geopolitical risks also are showing signs of ebbing, with Israel in peace talks with Hamas. WTI for August delivery dipped 0.9% to settle at $83.16 a barrel in New York. Brent for September settlement slipped 1% to $86.54 a barrel.

June Saw the Most Houthi Attacks on Red Sea Shipping of the Year - There were more Houthi attacks on Red Sea shipping in June than any other month of this year, Middle East Eye reported Wednesday, citing data from the UK’s Maritime Trade Operations (UKMTO).According to the UKMTO, there were 16 confirmed Houthi attacks on shipping in June. Only December of 2023 saw more attacks since the campaign started in response to Israel’s onslaught in Gaza.The numbers demonstrate that the bombing campaign against the Houthis in Yemen that was launched by the US and the UK has done nothing to deter the Houthis, who are officially known as Ansar Allah.The US military continues to intercept Houthi missiles and drones over the Red Sea and Gulf of Aden and launch strikes in Yemen, which has cost the US over $1 billion. According to the commander of the US Navy destroyer USS Carney, which recently returned home from a Red Sea deployment, the campaign has been the largest US naval battle since World War II.The Houthis have been clear the only way they’ll stop their attacks on Israel-linked and other commercial shipping is if there’s a ceasefire in Gaza and an end to the Israeli siege. Tim Lenderking, the US’s envoy to Yemen, has acknowledged the Houthis would likely be true to their word, but the US continues to support Israel’s genocidal war in Gaza instead of pushing for a unilateral ceasefire.It was clear from the start that a new bombing campaign against the Houthis would only escalate the situation. The US backed a brutal Saudi/UAE war against the Houthis from 2015-2022 that involved heavy airstrikes and a blockade, and the Houthis only became more of a capable fighting force during that time.The war killed at least 377,000 people, with more than half dying of starvation and disease caused by the siege. A ceasefire between the Houthis and Saudis has held relatively well since April 2022, but new US sanctions are now blocking the implementation of a lasting peace deal.

Houthi Attacks On Ships Soar Most This Year In June As Critical Maritime Chokepoint Ablaze In Conflict - About eight months after the Houthi rebels began seriously disrupting maritime traffic in the southern Red Sea and Gulf of Aden, June recorded the highest number of missile and drone attacks on commercial vessels this year and the second-largest since December. As instability in the Middle East intensifies, Houthi rebels have sunk one commercial vessel in recent weeks and haveintroduced kamikaze drone boats to their arsenal. Despite efforts of the US, British, and European navies sailing in the critical maritime chokepoint, attempting to ensure freedom of navigation, the Houthis managed to conduct 16 confirmed attacks on commercial vessels in June, according to Bloomberg, citing new data from naval forces operating in the Middle East.The surge in attacks is alarming, considering President Biden's Operation Prosperity Guardian, launched at the start of this year to ensure freedom of navigation, has been without success in neutralizing threats and restoring security for commercial shipping. Instead, the consequence of failure has been emerging supply chain snarls and supply shocks, resulting in soaring containerized shipping rates. "The Houthis have proven to be quite the formidable force. This is a nonstate actor that fields a larger arsenal and is really able to give a headache to the Western coalition," said Sebastian Bruns, a naval expert at the Center for Maritime Strategy and Security and the Institute for Security Policy at Kiel University in Germany, who was quoted by Foreign Policy. Bruns said, "This is as high-end as it gets for now, and when navies are having a problem with sustainment at this evel, it is really worrisome." So, eight months on, the disruption to the critical shipping lane is getting a lot worse as rebels have expanded their use of uncrewed service vessels to attack commercial vessels. These are much harder to track than anti-ship missiles.

Iran Warns Israel of 'Obliterating War' If It Launches Full-Scale Attack on Lebanon - Iran’s mission to the UN has warned Israel that a full-scale attack on Lebanon would result in an “obliterating war” that could involve all of Iran’s allies in the region.The mission wrote on X that it believes Israel’s recent threats against Lebanon could be “psychological warfare” and “propaganda” but said that if Israel does “embark on full-scale military aggression, an obliterating war will ensue.”The mission added, “All options, including the full involvement of all Resistance Fronts, are on the table.”It’s unclear if Iran would directly intervene if Israel invades southern Lebanon, but it’s likely that Shia militias allied with Iran and Hezbollah would get involved. A full-scale war in Lebanon could also involve the US, as the White House reportedly conveyed to Lebanon that it would support Israel against Hezbollah.The US claims it is working to ease tensions on the Lebanon-Israel border, but it continues to provide military aid to Israel despite continued escalations and threats. Israeli Defense Minister Yoav Gallant recentlythreatened that Israel could bomb Lebanon “back to the stone age.”Amos Hochstein, an advisor to President Biden who has been serving as an envoy to discuss Israel-Lebanon tensions, warned Beirut that the US cannot hold Israel back from launching a full-scale war. Israeli media has reported that the Israeli military is not expected to be able to handle opening a second front in Lebanon due to losses it has taken in Gaza, signaling Israel might look for the US to bail it out if it invades.

US Official Says There Are No Plans To Withdraw from Syria - A State Department official has told Rudaw that the US has no plans to withdraw its troops from Syria.The US has about 900 troops in eastern Syria and backs the Kurdish-led SDF, allowing Washington to control and occupy about one-third of the country’s territory.The US claims the occupation is about fighting ISIS remnants, but the continued US presence is more about keeping Damascus and its ally Iran out of the area and controlling oil resources. The occupation is also part of the economic campaign against government-controlled Syria, which includes crippling sanctions that are specifically designed to prevent the country’s reconstruction.Ethan A. Goldrich, assistant deputy secretary of state for Near Eastern Affairs, said the US wouldn’t leave Syria until its “mission” was completed, referring to the anti-ISIS operations.“We are not planning to withdraw from Syria. We are planning to continue and complete our mission to prevent a resurgence of ISIS and to counter ISIS and to work with our partners,” Goldrich told Rudaw on Wednesday.Goldrich also said the US occupation was about “holding the regime accountable,” referring to the government of Syrian President Bashar al-Assad. He also reiterated US opposition to regional countries normalizing with Damascus, as Arab nations have accepted that Assad isn’t going anywhere and are re-establishing relations with the Syrian leader.

Israeli Minister Retweets Post Calling for Occupation of Egypt's Sinai Peninsula - Israeli Heritage Minister Amichai Eliyahu retweeted a post on X promoting a t-shirt that calls for the Israeli “conquest” of Egypt’s Sinai Peninsula, which Israel occupied from 1967-1982, The Times of Israel reported on Wednesday.The t-shirt shows a picture of what is supposed to be a map of Israel that covers Sinai, the West Bank, and Gaza, with a logo that says “Occupation Now.” The post links to a website that sells other merchandise that also promotes the Israeli occupation of southern Lebanon and Jordan.“The occupation begins with an idea,” the website reads in Hebrew, according to Google Translate. “Wear a shirt, drink a cup of coffee, and participate in the occupation of the land.”

Israeli Generals Want Truce in Gaza, Putting Them at Odds With Netanyahu - - Israel’s top generals want a ceasefire in Gaza even if it keeps Hamas in power, putting them at odds with Israeli Prime Minister Benjamin Netanyahu, The New York Times reported on Wednesday.The report, which cited current and former security officials, said one reason Israel’s top brass favored a pause in Gaza was so that the Israeli military could recuperate to prepare for a full-blown war against Hezbollah in LebanonThey also believe a ceasefire in Gaza could reduce tensions on the Israel-Lebanon border and make it easier to reach a deal with Lebanon, although Israeli Defense Minister Yoav Gallant has previously said a pause in Gaza would be an escalation in Lebanon. The Israeli military also believes a deal with Hamas is the best way to safely free the remaining Israeli hostages in Gaza. “The military is in full support of a hostage deal and a ceasefire,” former Israeli National Security Advisor Eyal Hulata told the Times.Responding to the report, Netanyahu vowed military operations in Gaza would continue until Hamas was eliminated, a goal the Israeli military has publicly said is not possible.“I do not know who these anonymous sources are, but I am here to make it unequivocally clear: This will not happen,” Netanyahu said. “The war will end once Israel achieves all of its objectives, including the destruction of Hamas and the release of all of our hostages.”Four senior Israeli officials who spoke with the Times agreed that a hostage deal that keeps Hamas in power for now is the least worst option for Israel at the moment. Hulata also made clear that the Israeli military’s thinking is for a temporary ceasefire, not the permanent truce that Hamas has been seeking.“They believe that they can always go back and engage Hamas militarily in the future,” Hulata said.Axios previously reported that Israeli officials thought the ceasefire deal unveiled by President Biden back in May was vague enough that Israel and Hamas could enter a temporary ceasefire and conduct a prisoner swap without Israel actually committing to a permanent truce. But Netanyahu repeatedly rejected the idea of a permanent ceasefire, leading Hamas to ask for stronger guarantees and sabotaging the chances of an agreement.

Israel Orders New Khan Younis Evacuation, Signaling It Will Re-Invade - Israeli forces withdrew from Khan Younis in April and left the city in complete ruins. Municipal officials estimated the Israeli assault destroyed more than 80% of the buildings in Khan Younis and left the rest mostly uninhabitable.Israel said it destroyed Hamas’ battalions’ military in the city and claimed victory, but another planned invasion signals the Palestinian group could be re-establishing itself, as it has in other parts of Gaza decimated by the Israeli military.Israeli Prime Minister Benjamin Netanyahu insists his goal is still to eliminate Hamas in Gaza even as his own military has said the goal is impossible. “This business of destroying Hamas, making Hamas disappear – it’s simply throwing sand in the eyes of the public,” Israeli Defense Forces spokesman Rear Adm. Daniel Hagari said last month.“Hamas is an idea, Hamas is a party. It’s rooted in the hearts of the people – whoever thinks we can eliminate Hamas is wrong,” Hagari added.On Sunday, Netanyahu again vowed to continue his genocidal war until Hamas is “eliminated” and rejected the idea of a permanent ceasefire.

Family That Evacuated Khan Younis Slaughtered by Israeli Strike in So-Called 'Safe Zone' - Nine members of the same family who evacuated Khan Younis were killed by an Israeli airstrike on Tuesday in an area of the central Gaza city of Deir al-Balah that Israel declared a so-called “safe zone,” The Associated Presshas reported.Around a dozen members of the Hamdan family fled Khan Younis after Israel gave an evacuation order for the eastern portion of the city, which the UN said will impact about 250,000 Palestinians. The Hamdans found refuge with extended relatives in Deir al-Balah, only for most of them to be slaughtered.According to AP, a total of 12 people were killed in the Israeli strike on the “safe zone,” including five children and three women. Israel has repeatedly bombed areas it declared safe in Gaza, including the al-Mawasi camp on the coast, which is where the Israeli military said Palestinians evacuating Khan Younis should go.After Israel ordered the evacuation of Khan Younis, it launched airstrikes on the city that killed at least nine people, including three children and two women. The strikes were launched near the European Hospital, which is also in the area Israel said should be evacuated. Patients and workers fled from the European Hospital, the largest operating medical facility in Gaza, after the Israeli evacuation order. “Some of the patients were dragged in hospital beds toward Nasser Hospital in Khan Younis by their families. Some of them were transported in ambulances and some of them went on foot,” Saleh al-Hams, who heads the hospital’s nursing department, told The Washington Post.

UN Says Israel Evacuation Order 'Wiped Out' Bid to Improve Gaza Aid (Reuters) - An Israeli military evacuation order covering a third of the Gaza Strip has "wiped out" the United Nations' attempts to improve humanitarian aid deliveries via the Kerem Shalom crossing, a senior U.N. aid official said on Wednesday. Israel has been critical of U.N.-led aid operations in the enclave of 2.3 million people, where the U.N. says distribution is not only hampered by the nearly nine-month long war between Israel and Palestinian militants Hamas, but also lawlessness.Israel's military announced this month a daily daytime pause in attacks to facilitate the collection of aid from Kerem Shalom, but the U.N. has said the lawlessness means it is still too dangerous and it is Israel's responsibility to restore public order and safety in Gaza.Andrea De Domenico, head of the U.N. Office for the Coordination of Humanitarian Affairs in the Occupied Palestinian Territory, said that in the past few weeks there had been a lot of discussions with Israel on how to improve the situation."We have been engineering a lot of solutions and trying and testing, improving and failing - at times - and now with this evacuation order all this has been, again, wiped out," he told reporters on Wednesday.De Domenico said alternative plans were now blocked by the evacuation order, but he hoped a protection agreement could be reached with the Israeli military for some areas.The United Nations has also long appealed for more effective coordination with the Israeli military for aid operations and approval for the U.N. and humanitarians to use essential security and communications equipment."Would it be Starlink? Would it be another technology? I don't really care as long as we have what we need to communicate safely with our teams for safety and for operations," said De Domenico, referring to a the SpaceX satellite internet service.

"Gaza Is Complicated!" No It Isn't. Grow Up. Caitlin Johnstone - It’s false to say that conflicts in the middle east are hard to understand. They’re not. What can be hard is opening your mind to the possibility that everything you’ve been told about the world is a lie, and that everyone you know and respect has been brainwashed by propaganda. Once you’ve done that, understanding conflicts in the middle east becomes easy — because the entire framework we’re indoctrinated with for understanding them is a lie.So much abusive bullshit hides behind the false modesty of “This issue is too complicated for me to understand.” You see it with Gaza, where westerners act like an empire-backed military force dropping bombs on a giant concentration camp and systematically using rape as a weapon of torture and deliberately starving civilians is just way too compwicated for a dumb widdle baby wike me, goo goo ga ga. People act like they’re being humble about their own intellect and understanding, but really they’re just lying and psychologically compartmentalizing away from self-evident reality. It’s not humility, it’s just another kind of dishonesty.You see this fraudulent act all the time with the average westerner’s general incuriosity about the behavior of their government and its allies throughout the world. “Oh I’m too dumb to know anything about foreign policy, I leave that to the experts.” No actually you’re just compartmentalizing away from the cognitive dissonance that would otherwise lead to the destruction of your mainstream worldview once you really looked at the publicly available information about what your government and its allies are doing to people in other countries..There absolutely is a benefit to having real humility about the limits of your own understanding, and to knowing that from a certain point of view everything about this strange reality we were birthed into is mysterious and ungraspable. But if you use this fact to hide from your own responsibility toward understanding your world, your society and your interpersonal relationships, it’s just cowardice and dishonesty. If you use this truth to hide from reality, it becomes a lie.If you accept that we all have a responsibility to act in an ethical way, then you must also accept that we have a responsibility to form a mature understanding of our world and our surroundings, because all of our actions necessarily flow from our understanding. This won’t always be convenient or comfortable, just conducting one’s behavior in an ethical way isn’t always convenient or comfortable, but that’s what being a responsible adult is. You can’t discern responsible action without having a responsible relationship with your understanding of the world.Gaza isn’t complicated. Those who says it is are just running from their own intellectual adulthood. Stop shirking your responsibility, learn the facts, take a stand, and grow up.

Israel Says It Will Send Delegation for Renewed Hostage Deal Negotiations - Israeli Prime Minister Benjamin Netanyahu told President Biden on Thursday that he agreed to send a delegation for renewed indirect hostage deal negotiations with Hamas.The conversation came a day after Hamas said it gave new “ideas” to Qatari mediators that US and Israeli officials described in comments to the media as a “breakthrough.” But there are signs that Netanyahu and members of his coalition government are working to sabotage the chances of an agreement.In his conversation with President Biden, Netanyahu also reiterated his position that the genocidal war in Gaza won’t end until all of Israel’s objectives are completed, which includes the eradication of Hamas, a goal the Israeli military has said is not possible. Hamas has been adamant that any hostage deal must include a permanent ceasefire.The Times of Israel reported that in a meeting with his negotiators before deciding to send a delegation, Netanyahu “stressed again that the war will end only after achieving all of its goals, and not one moment earlier.”Yedioth Ahronoth reported that Netanyahu was teaming up with some extremist elements of his government to sabotage a ceasefire. The report said that the prime minister’s office planted a story in the media claiming to be a security source that said Hamas’s response offered nothing new.Israeli security and intelligence officials were angered by the fake story, and according to Haaretz, genuine Israeli security sources said Hamas’s proposal gave Israel “something to work with.”Israel’s top brass appears ready for a temporary ceasefire in Gaza since the military has been struggling against Hamas. The Palestinian group has been able to re-establish itself in areas that have been decimated by the Israeli military. One reason they want a ceasefire in Gaza is to prepare for a potential full-blown war in Lebanon.But extremist ministers, including National Security Minister Itamar Ben Gvir and Finance Minister Bezalel Smotrich, have been opposed to any deal with Hamas and have the power to dissolve the coalition government, giving them significant sway with Netanyahu.