UK's Energean Suspends Production Offshore Northern Israel
British gas producer Energean said on Friday it has temporarily suspended the production and activities of its power floating production storage and offloading (FPSO) located offshore Northern Israel due to the geopolitical escalation in the Middle East.
Israel launched widescale strikes against Iran on Friday, prompting a retaliation from Iran.
The company, which has operations in Israel, Egypt, and European countries, said it got a notice from Israel's Ministry of Energy and Infrastructure ordering the suspension.
"All production activities have now been temporarily suspended and notices have been issued to Energean's customers and other stakeholders," Reuters quoted the company as saying in a statement.
A spokesperson for Energean said the power FPSO contributes a "significant" amount to the group's total output.
Shares in Energean were down 6.9% at 0808 GMT.
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Arab News
5 hours ago
- Arab News
Analysis: Could Israeli strikes on Iran revive specter of $100 oil?
LONDON: Energy and oil market analysts, speaking to Independent Arabia, unanimously described the surprise Israeli military strikes on Iranian targets as creating an 'instantaneous market shock.' Amid escalating geopolitical tensions, the latest military confrontations between Israel and Iran are propelling crude oil prices into dramatic territory, rekindling fears of energy crises that have historically destabilized global markets. This unprecedented escalation sparks immediate questions about energy market disruptions, petroleum price movements, and short-term risk premium adjustments — including the possibility of crude breaching the $100 per barrel threshold. Conversely, with reports confirming that Iranian oil refining and storage facilities remained undamaged, this factor may help cushion the shock to global petroleum markets. Crisis background and market impact These significant developments emerge precisely as markets were starting to digest the International Energy Agency's 'Global Energy Review 2025,' which forecast a deceleration in oil demand growth stemming from the worldwide shift toward renewable energy and electric vehicle adoption. However, Israeli attacks on Iran's Natanz nuclear facility and additional military targets have completely reversed these projections, aggressively thrusting supply disruption concerns and price escalation back into the spotlight. Analysts portrayed the strike as 'converting the Iranian standoff from a political matter into actual combat,' propelling oil prices higher by 7 percent to 13 percent in the steepest single-session increase since March 2022. Subsequently, Brent crude exceeded $78 per barrel as West Texas Intermediate advanced past $73. International warnings and notable statements These incidents align with global warnings and prominent declarations from US President Donald Trump, who acknowledged that the American leadership possessed advance intelligence about Israeli attacks on Iran, while stressing Washington's detachment from the operations. Trump cautioned Tehran about its nuclear ambitions, declaring: 'We will not allow Iran to possess nuclear weapons... but we do not want a new war in the Middle East.' Such pronouncements intensify the complexity of circumstances, revealing that Washington maintains vigilant oversight, while seeking to circumvent direct participation in hostilities that could trigger catastrophic repercussions for the world economy. Throughout history, the Iranian matter has remained among the most convoluted subjects in global politics, where atomic weapon concerns merge with financial and geopolitical calculations. Momentary shock or open conflict? Energy and oil market analysts, speaking to Independent Arabia, unanimously described the surprise Israeli military strikes on Iranian targets as creating an 'instantaneous market shock,' heightening concerns that current tensions might spiral into full-scale warfare in one of the globe's most critical oil-producing areas. Industry experts verified that crude price movements in the upcoming phase will hinge on three primary elements: Tehran's likely retaliation strategy, major powers' diplomatic stances, and whether military activities persist in the short and intermediate timeframes. Market analysts pointed out that dramatic price spikes mainly represent 'uncertainty premiums' tied to geopolitical instability, which could stay heightened while hostilities continue. This premium constitutes the additional cost petroleum purchasers bear to hedge against possible supply interruptions. They observed that escalating geopolitical threats result in increased uncertainty premiums, pushing prices higher despite the absence of real supply constraints. Although undamaged Iranian oil processing and storage infrastructure serves as a significant stabilizing element, analysts contend that direct strikes on Iranian petroleum facilities would have triggered instant supply cuts, accelerating prices to substantially higher territory. They stressed that present price rises reflect anticipated future threats rather than genuine supply deficits thus far, offering the market some operational room. Put differently, the market currently confronts the prospect of oil supply interruptions rather than actual losses, constraining the scale of price increases that would have occurred had petroleum installations been specifically attacked. Reciprocal attacks Petroleum sector expert Kamel Al-Harami considers it challenging to forecast precise oil price targets amid present conditions, citing the potential for Middle Eastern warfare or Iranian supply interruptions affecting global markets in Asia, particularly China, India, and Japan. Al-Harami observed that although OPEC maintains spare capacity surpassing 5 million barrels per day, crude prices jumped $7 within a 24-hour period, hitting $73 per barrel. He characterized this surge as merely the initial phase of additional gains, speculating whether values might climb to $80 or potentially $90 per barrel. Al-Harami noted that any pricing above $65 per barrel would favor American shale operations and stimulate enhanced sector investment. He underscored that greater increases would arise from expanding warfare consequences and mutual attacks between Israel and Iran, potentially encompassing other Gulf Arab countries, thus 'commencing the actual calamity.' Strong blow to sentiment IG market specialist Tony Sycamore described the escalation as 'a major hit to market confidence' throughout financial sectors generally, not limited to energy trading, forecasting significant capital flight from risk investments by week's close. He observed that market participants are watching for 'potential Iranian reprisals,' which might shape trading patterns in upcoming sessions. Supply concerns Strategic analyst at Pepperstone Ahmed Aseeri explained that current price increases reflect a combination of immediate supply concerns and expectations of gradually escalating tensions, unlike previous Iran-Israel tension rounds that usually ended quickly or through international containment pressures. Contagion spread Phillip Nova Singapore market analyst Priyanka Sachdeva verified that Iran's preparation for military reprisals amplifies dangers, extending beyond supply interruptions to include prospects of geopolitical spillover affecting neighboring oil-producing nations, possibly driving crude prices back to heights not witnessed in 10 years. Production disruption Lipow Oil Associates President Andy Lipow outlined that crude prices might surpass $100 per barrel should any Gulf petroleum production installations face disruption, although he emphasized the baseline projection presumes leading nations will work to limit escalation and avoid further deterioration. Major doubts XM Australia's CEO Peter McGuire depicted 'Israeli-Iranian conflicts' as producing 'considerable anxiety' spurring market fluctuations, explaining that oil values react predominantly to imminent supply vulnerabilities compared with other elements. Price projections Natasha Kaneva, JPMorgan's global commodities strategy chief, projected possible price crests at $120, though she balanced this by saying that markets could tumble to $40 if additional supplies materialize and demand weakens. Geopolitics maintains its dominance. Broader conflict and worst scenario JPMorgan detailed in a latest research analysis that the gravest outcome entails possible hostilities spreading to encompass oil supply interruptions from surrounding states, including endangering maritime transit via the Strait of Hormuz. JPMorgan specified that this hard-line possibility holds approximately 7 percent likelihood, implying prices might achieve 'explosive' growth propelled by international market alarm if the area deteriorates into extensive conflict. Despite such warnings, the bank retained fundamental projections for Brent petroleum in the 60s per barrel territory for the remainder of 2025, expecting area and worldwide powers to suppress escalation, followed by approximately $60 in 2026. Future scenarios As regional geopolitical strain escalates, market observers concentrate on potential developments that might determine global crude price directions. If leading powers including the US and EU intervene to ease hostilities and forestall military reprisals between Iran and Israel, prices would likely diminish progressively toward pre-tension benchmarks. This pathway hinges on diplomatic effectiveness and immediate crisis management, which JPMorgan endorses in its fundamental outlook. Alternatively, if Iran strikes back forcefully or hostilities broaden to encompass Iranian oil installations or Strait of Hormuz transit, petroleum prices could climb beyond $100-120 per barrel within global energy market pandemonium. This scenario might worsen should obstruction of the Strait of Hormuz happen, which JPMorgan characterized as the direst possibility, cited by Andy Lipow and Priyanka Sachdeva as realistic. Three key factors to monitor Against this backdrop of tensions, markets demonstrate limited potential for immediate calm, particularly as the Iranian challenge represents one of the most convoluted international political crises spanning over two decades. While investors endeavor to absorb ongoing developments, the short-range objective involves 'stability' over inflated values. Hence, three principal indicators should be watched to determine pricing patterns: First, Iran's response style: Will it remain token or threaten supply continuity? Analysts regard Tehran's reaction approach as the decisive factor influencing market trends in coming days. Second, global powers' effectiveness: Will they manage to shield the area from regional conflict? International mediation efforts need to serve crucial roles in limiting escalation and preventing progression toward wider confrontation. Third, futures trading patterns: Do they demonstrate 'sustained crisis' or 'momentary surge' characteristics? Oil derivative contracts will deliver clear indications of market projections for extended timeframes. If pricing sustains long-term increases, this signals markets foresee continuing instability; if levels stabilize, this reflects perception of current turbulence as fleeting. Broadly speaking, geopolitical dynamics will maintain control over petroleum markets in the near future, but if balance fails, effects will reach beyond energy to global price indices and economic development, with possible return to $100 pricing, potentially shadowing the entire world economy.
Arab News
6 hours ago
- Arab News
Oil settles up 7% as Israel, Iran trade air strikes
HOUSTON: Oil prices jumped on Friday and settled 7 percent higher as Israel and Iran traded air strikes, feeding investor worries that the combat could widely disrupt oil exports from the Middle East. Brent crude futures settled at $74.23 a barrel, up $4.87, or 7.02%, after earlier soaring over 13% to an intraday high of $78.50, the strongest level since January 27. Brent was 12.5% higher than a week ago. US West Texas Intermediate crude finished at $72.98 a barrel, up $4.94, or 7.62%. During the session, WTI jumped over 14% to its highest since January 21 at $77.62. WTI climbed 13% to its level a week ago. Both benchmarks had their largest intraday moves since 2022 when Russia's invasion of Ukraine caused a spike in energy prices. Israel said it had targeted Iran's nuclear facilities, ballistic missile factories and military commanders on Friday at the start of what it warned would be a prolonged operation to prevent Tehran from building an atomic weapon. Iran has promised a harsh response. Shortly after trading ended on Friday, Iranian missiles hit buildings in Tel Aviv, Israel, according to multiple media reports. Explosions were also heard in southern Israel. US President Donald Trump urged Iran to make a deal over its nuclear program to put an end to the "next already planned attacks." The National Iranian Oil Refining and Distribution Company said oil refining and storage facilities had not been damaged and continued to operate. Iran, a member of the Organization of the Petroleum Exporting Countries (OPEC), currently produces around 3.3 million barrels per day (bpd), and exports over 2 million bpd of oil and fuel. Spare capacity among OPEC and its allies, including Russia, to pump more oil to offset any disruption is roughly equivalent to Iran's output, according to analysts and OPEC watchers. The latest developments have also stoked concerns about disruptions to the Strait of Hormuz, a vital shipping passage. "Saudi Arabia, Kuwait, Iraq and Iran are wholly locked into one tiny passage for exports," said Rabobank in a note, regarding the Strait. About a fifth of the world's total oil consumption passes through the strait, or some 18 to 19 million barrels per day (bpd) of oil, condensate and fuel. "Israeli action has so far avoided Iranian energy infrastructure, including Kharg Island, the terminal responsible for an estimated 90% of Iran's crude oil exports," said Ben Hoff, head of commodity research at Societe Generale. "This raises the possibility that any further escalation could follow an 'energy-for-energy' logic where an attack on one side's oil infrastructure might invite a retaliatory strike on the other's," Hoff said. Iran could pay a heavy price for blockage of the Strait of Hormuz, analysts said on Friday. "Iran's economy heavily relies on the free passage of goods and vessels through the seaway, as its oil exports are entirely sea-based. Finally, cutting off the Strait of Hormuz would be counterproductive to Iran's relationship with its sole oil customer, China, said analysts with JP Morgan. Money managers raised their net long U.S. crude futures and options positions in the week to June 10, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday. The speculator group raise its combined futures and options position in New York and London by 15,157 contracts to 121,911 during the period. Baker Hughes said the number of U.S. oil and natural gas rigs fell for seventh week in a row with the total count down by 35 rigs or 6% below this time last year. The oil rig count fell by three to 439 this week, its lowest since October 2021, while gas rigs slipped by one to 113. In other markets, stocks dived and there was a rush to safe havens such as gold, the U.S. dollar and Swiss franc.
Al Arabiya
8 hours ago
- Al Arabiya
Iraq reopens Syria crossing for trade and passenger traffic
Iraq has officially reopened the Qaim border crossing with Syria for trade and passenger traffic, a spokesman for the Iraqi border authority said on Saturday, marking a key step in efforts to normalize relations and revive economic ties between the two countries. 'The Qaim crossing is now fully operational for both cargo trucks and civilian movement,' the spokesman told Reuters, adding that the reopening followed joint security assessments by Iraqi and Syrian officials. The move comes three months after Syrian Foreign Minister Asaad al-Shaibani visited Baghdad and urged Iraq to resume cross-border trade. The crossing had been shut in the wake of the revolt that toppled President Bashar al-Assad. A statement from the Iraqi border crossings authority said the first Syrian truck entered the crossing on Saturday after inspection, marking a significant step in strengthening economic cooperation between Iraq and Syria. "Passenger movement has also resumed in order to ease the burden on Iraqi citizens when traveling in and out of the country", the statement said. The reopening is also seen as a sign of warming ties between Baghdad and Syria's new leadership under President Ahmed al-Sharaa, who has sought to re-establish diplomatic and economic relations with regional neighbors. Iraqi officials say the two governments have intensified coordination on border security and trade facilitation since al-Sharaa took office last year. 'This crossing will serve as a strategic corridor for commodity trade between Iraq and Syria,' said Turki al-Mahallawi, mayor of the town of al-Qaim, where the border post is located.
