WTI crude oil could fall into the 50s, says Pickering Energy's Dan Pickering
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
27 minutes ago
- Yahoo
Tengku Zafrul: Malaysia controlling stream of rare earth in bid to keep value, keeping both US and China at bay
KUALA LUMPUR, Aug 18 — Malaysia is banning exports of unprocessed rare earths while at the same time attempting to court downstream investment to retain their value added at home, Investment, Trade and Industry Minister Datuk Seri Tengku Zafrul Aziz said. Speaking in an interview with US-based CNBC's 'Squawk Box Asia', Tengku Zafrul said Malaysia has discussed its rare-earth strategy with both Washington and Beijing during broader negotiations. 'Today, we engage both sides. And to be fair, both China and US have never said that you can't supply to the other, right? You can't not do business with the other,' he said. He also said that both countries have reminded Malaysia that it cannot have two different standards on rare earth exports. 'So we have to be consistent, to be neutral. You have to consider, we can't have policies which differentiates our relationship with one party to the other, to one country to another. 'So that's, I think, key. Once you do that, then it's very hard to defend that neutrality position,' he added. Tengku Zafrul pointed to the moratorium on rare earth elements exports, highlighting Australian miners Lynas as among firms operating under rules that permit exports after processing. 'So what we are doing now is we're saying that, look, we invite all companies to come to Malaysia and to be part of the supply chain to invest in the downstream activities of rare earth, and then we can then export the value-add of those right now,' he said. Tengku Zafrul argued the approach maximises economic spillovers and strengthens the case for keeping processing domestic. He also framed the policy as a way to anchor higher-value activity in Malaysia while staying open to all buyers under equal rules. Earlier this month, Tengku Zafrul announced that Malaysia will no longer allow the export of raw rare earth minerals, in a move to promote local downstream development. Tengku Zafrul said Malaysia remains open to foreign investment, but it must involve local processing, job creation, and technology transfer.
CNBC
an hour ago
- CNBC
Energy supermajors are betting big on LNG, shrugging off peak gas predictions
Oil majors are betting big on liquified natural gas (LNG), throwing down the gauntlet to predictions of peak gas by the end of the decade. Britain's Shell , a leading player in the global LNG market, has identified the super-cooled commodity as a primary focus amid the energy transition. France's TotalEnergies said it expects LNG volumes managed by the company to grow by 50% between 2023 and 2030, while BP , which recently doubled down on fossil fuels as part of a green strategy U-turn , has significant LNG investments. Stateside, Exxon Mobil is seeking to double its LNG portfolio by 2030, Chevron has been expanding existing LNG projects and developing new facilities, while Baker Hughes recently said it would buy Chart Industries for $13.6 billion as part of a move to increase its LNG exposure. Big Oil's LNG push comes as the industry seeks to capitalize on growing global demand and as major players look to diversify their portfolios. Energy analysts, however, have raised some concerns. The bottom line is it is a very risky bet — and a bet against the energy transition. Electricity and data analyst at Ember Euan Graham LNG is derived from natural gas, a fossil fuel, although it is often presented as a cleaner alternative to other fossil fuels, like coal and oil. Critics argue that LNG can't be considered a viable " bridge fuel " due to concerns over its environmental impact, particularly regarding methane leaks in the supply chain. Speaking to CNBC during earnings season, Shell CEO Wael Sawan said the company will need to keep an open mind through the energy transition, noting that this shift "will not be linear." Sawan singled out LNG as one "much sought-after energy form" that will play an integral role in the firm's long-term strategy, alongside plans to build out some of its low carbon projects. "But to the heart of your question, where can Shell predominantly play, I'd say first and foremost it's in LNG," Sawan told CNBC's " Squawk Box Europe " on July 31. "Here is a versatile fuel that is able today to respond to droughts a few years ago in Brazil, respond to the needs of Europe after the Russia invasion of Ukraine, respond to the needs of Asia when you have a hot summer or a very cold winter — and one that is going to grow by 60% between now and 2040." Shell's bullish LNG outlook largely stems from projected economic growth in Asia, which represents the biggest market for LNG, emissions reductions in heavy industry and transport and the impact of an artificial intelligence boom . The LNG demand forecast, however, jars with expectations from the International Energy Agency. 'Something has to give' The world's leading global energy watchdog said recently that global demand is expected to pick up next year, following a slowdown in 2025, as more supply comes to market. Yet the IEA still expects gas demand to plateau, or peak, by the end of the decade. As clean energy sources rapidly gain prominence , the Paris-based agency has previously warned that "something has to give" in the LNG market. The IEA said in its World Energy Outlook 2024 that amid an increase of nearly 50% in global export capacity, led by the U.S. and Qatar, the prices that many suppliers will need to recover their investments may not encourage low-income economies to switch to natural gas at scale. The IEA has upwardly revised its forecast for LNG, saying that it expects demand to grow at 2.5% per year through to 2035 under a scenario of announced energy and climate policies. That's faster than the overall rise in gas demand but it says an LNG supply glut could be exacerbated by an accelerated energy transition. "The bottom line is it is a very risky bet — and a bet against the energy transition," Euan Graham, electricity and data analyst at energy think tank Ember, told CNBC by telephone. The rapid rise of solar power , in particular, appears to be undercutting global LNG demand, Graham said, noting that the scale of renewables growth has "completely changed the game." "Geopolitical tensions have also laid bare the risks of relying on fossil fuels, with some countries in Asia uniquely exposed," Graham said. For several Asian countries, elevated geopolitical risk around the Strait of Hormuz has raised concerns about the potential for oil and gas supply disruptions. The Strait of Hormuz, which connects the Persian Gulf to the Arabian Sea, is recognized as one of the world's most important oil chokepoints. Japan, South Korea, China and India are all known to be vulnerable to potential LNG supply shocks from the waterway. Capital discipline "Big Oil is trying to increase their exposure to LNG, so to talk about an LNG push is correct. We need, however, to diversity slightly among the oil majors," Maurizio Carulli, energy and materials analyst at wealth manager Quilter Cheviot, told CNBC by telephone. For Shell, Carulli said the focus on LNG represents a "natural continuation" of a business it effectively created from scratch several decades ago, thus providing the London-listed firm with a "competitive advantage" over its industry peers. TotalEnergies is another major player in this space, Carulli said, while the likes of Exxon Mobil and Chevron in the U.S. also have significant LNG market share — albeit below that of their European peers. Read more Why Europe is pivoting back to nuclear — one of its most divisive energy sources Like defense, Goldman says ESG investors should bring oil and gas stocks in from the cold Mining giant Fortescue says Big Oil is getting it wrong: 'Your customers want green energy' Given LNG projects can run for 30 or 40 years, Carulli said energy majors need to make sure that any bets on facilities coming online today will still be profitable even if demand growth slows from around 2040. "This is where oil companies need to be very careful," Carulli said. He added, however, that the process of capital budgeting among energy supermajors for large LNG operations "is very disciplined indeed. And therefore they make sure that these projects are profitable and competitive with respect to other fuels, also in the event that demand for LNG after 2040 may decline."
CNBC
2 hours ago
- CNBC
CCTV Script 18/08/25
Air Canada was already under pressure from weak profits and sluggish demand on cross-border routes, and now a massive strike is making the situation even worse. The airline's latest quarterly earnings report shows that profitability declined in the second quarter. Net profit fell from 410 million Canadian dollars a year earlier to 186 million Canadian dollars, about 967 million yuan, a drop of more than 50%. One major factor was weakening demand for flights between the U.S. and Canada, as relations between the two countries have grown tense. In the second quarter, Air Canada's passenger revenue on U.S.-Canada routes dropped 11% year on year. The airline's CEO also told CNBC that bookings on these routes are expected to decline further in the second half of the year. "We fly to over 50 cities within the United States. Our traffic, our bookings going over the next six months are down. We're down about 10%." Amid the strike, former Air Canada executive John Gradek estimates that the airline is losing at least 50 to 60 million dollars in daily revenue. He noted that Air Canada's profit margins were already thin, and with revenue falling and its reputation damaged, the company will likely return to the negotiating table soon. Driven by these pressures, Air Canada's share price has fallen nearly 6% in the past month. The strike comes at the peak of the summer travel season, when Canada had hoped tourism could help boost its economy. Analysts warn that the walkout could hurt the tourism industry. Canada's major destinations—including Toronto, Montreal, and Vancouver—rely heavily on Air Canada's domestic and international flights. Flight cancellations are expected to ripple through related sectors such as hotels, restaurants, and transportation. According to travel industry platform , Air Canada is expected to cancel about 5,000 flights during the strike, affecting more than one million passengers worldwide. Impacted routes include major international hubs such as London Heathrow, Paris Charles de Gaulle, and Tokyo Haneda. The platform also predicts that many travelers planning trips to Canada may be forced to change plans at the last minute and head to other destinations. The strike could also disrupt global cargo supply chains. Air Canada's cargo unit operates in 50 countries and has overseas hubs in London and Frankfurt. Canada's minister of labor has warned that the walkout could threaten the transport of medicines and organ donations. Canada's air travel market is dominated by two airlines—Air Canada and WestJet—which together control between half and three-quarters of the market. When either carrier suffers an operational shutdown, the entire Canadian aviation sector feels the shock. A report by the Fraser Institute argues that the strike highlights the lack of competition in the country's airline industry. The report points out that Canada's federal rules allow foreign airlines to land at Canadian airports but bar them from operating purely domestic routes. Analysts say this policy limits options for travelers and reduces competition, urging the government to loosen restrictions.
