Oil Falls, Weighed by OPEC+ Decision to Proceed With Planned Output Increase
0118 GMT — Oil falls in the early Asian session. On Monday, OPEC+ said it would go ahead with its plan to boost production starting in April. This is the first in a series of monthly increases to reverse 2.2 million barrels per day of voluntary reductions implemented more than two years ago by several key members of the alliance, ANZ Research analysts say in a research report. Given the market was mostly expecting OPEC+ to delay the restart of planned production increases, oil prices are likely to remain under downward pressure, the analysts add. Front-month WTI crude oil futures are 0.4% lower at $68.09/bbl; front-month Brent crude oil futures are 0.7% lower at $71.14/bbl. (ronnie.harui@wsj.com)
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2 hours ago
First direct flight from US to Greenland since 2008 lands on Trump's birthday
NUUK, Greenland -- The first direct flight from the U.S. to Greenland by an American airline landed in the capital city of Nuuk on Saturday. The United Airlines-operated Boeing 737 Max 8 departed from Newark International Airport in New Jersey at 11:31 a.m. EDT (1531 GMT) and arrived a little over 4 hours later, at 6:39 p.m. local time (1939 GMT), according to the flight-tracking website FlightAware. A seat cost roughly $1,200. Saturday's flight marks the first direct passage between the U.S. and the Arctic Island for nearly 20 years. In 2007, Air Greenland launched a route between Baltimore/Washington International Thurgood Marshall Airport and Kangerlussuaq Airport, some 315 kilometers (196 miles) north of Nuuk. It was scrapped the following year due to cost. The United Airlines flight took place on U.S. President Donald Trump's 79th birthday, which was being celebrated in Washington with a controversial military parade that's part of the Army's long-planned 250th anniversary celebration. Trump has repeatedly said he seeks control of Greenland, a strategic Arctic island that's a semi-autonomous territory of Denmark, and has not ruled out military force. The governments of Denmark, a NATO ally, and Greenland have said it is not for sale and condemned reports of the U.S. stepping up intelligence gathering on the mineral-rich island. United announced the flight in October, before Trump was re-elected. It was scheduled for 2025 to take advantage of the new Nuuk airport, which opened in late November and features a larger runway for bigger jets. 'United will be the only carrier to connect the U.S. directly to Nuuk — the northernmost capital in the world, providing a gateway to world-class hiking and fascinating wildlife under the summer's midnight sun,' the company said in a statement at the time. Saturday's flight kicked off the airline's twice weekly seasonal service, from June to September, between Newark and Nuuk. The plane has around 165 seats. Previously, travelers had to take a layover in Iceland or Copenhagen, Denmark, before flying to Greenland. The new flight is beneficial for the island's business and residents, according to Greenland government minister Naaja Nathanielsen. Tourists will spend money at local businesses, and Greenlanders themselves will now be able to travel to the U.S. more easily, Nathanielsen, the minister for business, mineral resources, energy, justice and gender equality, told Danish broadcaster DR. The route is also an important part of diversifying the island's economy, she said. Fishing produces about 90% of Greenland's exports. Tourism is increasingly important. More than 96,000 international passengers traveled through the country's airports in 2023, up 28% from 2015. Visit Greenland echoed Nathanielsen's comments. The government's tourism agency did not have projections on how much money the new flights would bring to the island. 'We do know that flights can bring in much more than just dollars, and we expect it to have a positive impact -- both for the society and travellers,' Tanny Por, Visit Greenland's head of international relations, told The Associated Press in an email.
Yahoo
10 hours ago
- Yahoo
Analysis-OPEC+ would struggle to cover major Iranian oil supply disruption
By Ahmad Ghaddar and Seher Dareen LONDON (Reuters) -Oil market participants have switched to dreading a shortage in fuel from focusing on impending oversupply in just two days this week. After Israel attacked Iran and Tehran pledged to retaliate, oil prices jumped as much as 13% to their highest since January as investors price in an increased probability of a major disruption in Middle East oil supplies. Part of the reason for the rapid spike is that spare capacity among OPEC and allies to pump more oil to offset any disruption is roughly equivalent to Iran's output, according to analysts and OPEC watchers. Saudi Arabia and the United Arab Emirates are the only OPEC+ members capable of quickly boosting output and could pump around 3.5 million barrels per day (bpd) more, analysts and industry sources said. Iran's production stands at around 3.3 million bpd, and it exports over 2 million bpd of oil and fuel. There has been no impact on output so far from Israel's attacks on Iran's oil and gas infrastructure, nor on exports from the region. But fears that Israel may destroy Iranian oil facilities to deprive it of its main source of revenue have driven oil prices higher. The Brent benchmark last traded up nearly 7% at over $74 on Friday. An attack with a significant impact on Iranian output that required other producers to pump more to plug the gap would leave very little spare capacity to deal with other disruptions - which can happen due to war, natural disasters or accidents. And that with a caveat that Iran does not attack its neighbours in retaliation for Israeli strikes. Iran has in the past threatened to disrupt shipping through the Strait of Hormuz if it is attacked. The Strait is the exit route from the Middle East Gulf for around 20% of the world's oil supply, including Saudi, UAE, Kuwaiti, Iraqi and Iranian exports. Iran has also previously stated that it would attack other oil suppliers that filled any gap in supplies left due to sanctions or attacks on Iran. "If Iran responds by disrupting oil flows through the Strait of Hormuz, targeting regional oil infrastructure, or striking U.S. military assets, the market reaction could be much more severe, potentially pushing prices up by $20 per barrel or more," said Jorge Leon, head of geopolitical analysis at Rystad and a former OPEC official. CHANGE IN CALCULUS The abrupt change in calculus for oil investors this week comes after months in which output increases from OPEC and its allies, a group known as OPEC+, have led to investor concern about future oversupply and a potential price crash. Saudi Arabia, the de facto leader of OPEC, has been the driving force behind an acceleration in the group's output increases, in part to punish allies that have pumped more oil than they were supposed to under OPEC+ agreements. The increases have already strained the capacity of some members to produce more, causing them to fall short of their new targets. Even after recent increases, the group still has output curbs in place of about 4.5 million bpd, which were agreed over the past five years to balance supply and demand. But some of that spare oil capacity - the difference between actual output and notional production potential that can be brought online quickly and sustained - exists only on paper. After years of production cuts and reduced oilfield investment following the COVID-19 pandemic, the oilfields and facilities may no longer be able to restart quickly, said analysts and OPEC watchers. Western sanctions on Iran, Russia and Venezuela have also led to decreases in oil investment in those countries. "Following the July hike, most OPEC members, excluding Saudi Arabia, appear to be producing at or near maximum capacity," J.P. Morgan said in a note. 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JP Morgan estimates, however, that Moscow can only ramp up output by 250,000 bpd to 9.5 million bpd over the next three months and will struggle to raise output further due to sanctions. The UAE says its maximum oil production capacity is 4.85 million bpd, and told OPEC that its production of crude alone in April stood at just over 2.9 million bpd, a figure largely endorsed by OPEC's secondary sources. The International Energy Agency, however, estimated the country's crude production at about 3.3 million bpd in April, and says the UAE has the capacity to raise that by a further 1 million bpd. BNP Paribas sees UAE output even higher at 3.5-4.0 million bpd. "I think spare capacity is significantly lower than what's often quoted," said BNP analyst Aldo Spanjer. The difference in ability to raise production has already created tensions inside OPEC+. Saudi Arabia favours unwinding cuts of about 800,000 bpd by the end of October, sources have told Reuters. At their last meeting, Russia along with Oman and Algeria expressed support for pausing a hike for July. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Miami Herald
11 hours ago
- Miami Herald
Everyone should keep an eye on this Persian Gulf island
Kharg Island is a small island in the Persian Gulf. It lies 16 miles off the northwest coast of Iran. It's 451 miles from Tehran, Iran's capital - roughly the distance from Detroit to New York City. It is just five miles long, about 40% the size of New York's Manhattan Island. And 125 from Iran's border with Iraq. Don't miss the move: Subscribe to TheStreet's free daily newsletter It is also unique in the Persian Gulf. The island's limestone foundation allows it the luxury of fresh water reserves. Most importantly it also is the key port that exports Iranian crude oil. About 90% of Iran's oil exports flow through Kharg's terminal complex. And about a third of those exports go to China. Related: Stock Market Today: Attacks in Middle East Batter Stocks; Oil and Gold soar; Bitcoin Off Kharg could prove to be one of two key strategic places if the Israeli-Iran War (let's call it that for now) spins out of control. The other is the Strait of Hormuz, 21 miles wide at its narrowest, same as the English Channel. About a third of the world's liquified natural gas and 25% of its crude oil must pass through the strait to pass from the 615-mile Persian Gulf to reach buyers in Europe, Asia and elsewhere. Giant oil tankers with oil and natural gas from Iran, Iraq, Saudi Arabia, the United Arab Oman and Abu Dhabi, Qatar and Bahrain flow though the strait Iran is the northern side of the strait, Oman on the southern. For years, whenever there's a conflict involving Iran, there are fears the country might block the strait. The importance of Kharg and the Strait of Hormuz helps explain why crude oil prices shot up as much as 14% late Thursday on the very first reports of Israel's attack on Iranian military and nuclear facilities. Related: Tesla makes a desperate move as it continues to lose customers Ultimately, West Texas Intermediate, the benchmark U.S. crude closed Friday up 7% to $71.29, and Brent, the benchmark global crude, was up the same amount to $74.23. If the worst of the conflict scenarios come to pass - Kharg's terminals and the strait are shut down, all bets are off on oil prices and, by extension, natural gas and gasoline prices. Kharg's terminal were blown up during the Iraq-Iran War of 1980-1988. If it happened again, Reuters reported, some analysts were suggesting crude prices could top $120 a barrel or higher, which would send gasoline prices much higher, maybe up to the top U.S. average price of $5.22 a gallon in May 2022. Global economies would be disrupted, and inflation would almost certainly jump. AAA's daily U.S. average gasoline price was up a penny to $3.133 a gallon on Saturday. The price is up just 3.1% so far in 2025.U.S. oil and gas stocks jumped on the Israeli-Iran news Friday. The Energy Sector of the Standard & Poor's 500 Index was alone among the 11 sectors of the index to post a gain for the day. Related: Starbucks CEO admits the struggling chain made a major mistake The Energy Select Sector SPDR exchange-traded fund (XLE) , which matches the index's Energy Sector, was up 1.7%. Oil services giant Halliburton (HAL) was up 5.5%. APA Corp. (APA) , parent of oil-and-gas producer Apache, was up 5.3%. The S&P 500 was down 1.13%. The Dow Jones Industrial Average, down as many as 887 points in the afternoon, finished with a 700-point loss, or 1.8%, to 42,198. The major stock indexes - Dow, S&P 500, Nasdaq Composite, Nasdaq-100 and Russell 2000 - all finished lower on the week. More Economic Analysis: Hedge-fund manager sees U.S. becoming GreeceA critical industry is slamming the economyReports may show whether the economy is toughing out the tariffs That said, many analysts do not believe things will get that out of hand. Similar worries about Kharg and the Strait of Hormuz have generated similar worries and price projections. But, in a note on Friday, Amarpreet Singh, an analyst with Barclay's, said "cool heads have prevailed." Moreover, as Ian Bremmer, president of the Eurasia Group, a consulting firm that watches matters like these, thinks Iran has few cards to play in this conflict. Israeli intelligence capabilities are just too capable, he said on a podcast, and Iran's military capacity has been diminished substantially by the attacks this week. Still, attention must be paid. Most definitely. Related: Veteran fund manager issues dire stock market warning The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
