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Yahoo
26-05-2025
- Business
- Yahoo
Europe's Natural Gas Prices Rise on Supply Outage in Norway
Europe's benchmark natural gas prices rose early on Monday following an unplanned cut to capacity of the giant Troll gas field in Norway, the single largest supplier of gas to Europe. Dutch TTF Natural Gas Futures, the benchmark for Europe's gas trading, jumped by 2.2% at trade open in Amsterdam on Monday, before easing some gains to trade 1.2% higher at 11:30 a.m. local time. The rise at the start of this week extends four consecutive weeks of weekly gains in European gas prices as the market is reacting to unplanned supply disruptions at a time when Europe races with time – and with Asia – to refill gas storage sites ahead of the 2025/2026 winter. The unplanned cuts to Troll's capacity in the North Sea comes ahead of planned extensive maintenance season at several Norwegian gas fields, which will reduce pipeline supply to Europe in the summer. Currently, Norwegian gas supply is somewhat restricted as there is planned maintenance at the Nyhamna processing plant and the Aasta Hansteen field. Thus, European countries will have to rely on more LNG cargoes to bring natural gas to the continent. Last year, Troll produced record-high volumes of natural gas, up by 10% compared to the previous high from 2022, the field operator Equinor said early this year. 'With record-high production in 2024, the Troll field confirms its position as a pillar of Europe's energy security. The field contributes to a stable gas supply for millions of households and is important for European industry,' Kjetil Hove, Equinor's executive vice president for Exploration & Production Norway, said at the time. Traders and analysts will be watching closely the pace of Europe's storage refills in the coming months, as well as LNG demand in Asia and whether North Asian demand would rise and potentially compete for spot cargoes with Europe. By Michael Kern for More Top Reads From this article on 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
Yahoo
13-05-2025
- Business
- Yahoo
Petrobras Announces Substantial Dividend Payment After Strong Quarter
Brazil's state oil firm Petrobras will pay $2.1 billion in dividends for the first quarter after posting a jump in net income due to one-off items. Petrobras reported a net income of $6.2 billion (35.2 billion Brazilian reals) for the first quarter, up by 48.6% from a year earlier, due to one-off items and more favorable exchange rates. Without the one-off items, net income dropped by 12.1% year-over-year. Petrobras' board of directors approved the payment of interim dividends of $2.1 billion (11.72 billion reals), saying that the proposed payment is in line with the current Shareholder Compensation Policy. Under the policy, if gross debt is equal to or less than the maximum debt level in the Strategic Plan (currently set at $75 billion), Petrobras must distribute 45% of free cash flow to its shareholders. 'This distribution is consistent with the financial sustainability of the company,' the Brazilian oil giant said. Higher investments than initial guidance raised concerns among investors that Petrobras could limit shareholder distributions. Petrobras generated higher cash flows, mainly due to a 5% increase in production volume compared to the previous quarter, chief financial officer Fernando Melgarejo said in a statement. This production growth was reflected in adjusted EBITDA, which rose 46% compared to the fourth quarter of 2024, Melgarejo added. Despite the significant slide in oil prices at the start of the second quarter, Petrobras remains committed to executing its current Business Plan, the executive said. Investments were $4 billion in the first quarter of the year, representing 22% of the annual guidance. 'These investments are focused on pre-salt projects, with emphasis on the Búzios and Atapu fields. We are drilling and connecting more wells and advancing in the construction of new units that will support the growth of our production curve,' Melgarejo said. 'These are projects that generate value for our shareholders and will translate into revenue in the upcoming years.' Last week, Petrobras announced a new oil discovery in the pre-salt Santos Basin, identifying 'high-quality oil without contaminants' at an exploratory well in the Aram block. By Tsvetana Paraskova for More Top Reads From this article on 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
Yahoo
13-05-2025
- Automotive
- Yahoo
EV Battery Giant Eyes $4 Billion in Hong Kong Share Issue
China's CATL, the world's largest electric vehicle battery maker is scheduled to issue new shares on the Hong Kong stock exchange, eyeing proceeds of as much as $4 billion. This will make its issue the largest this year in Hong Kong, the Financial Times reported, citing a prospectus filed with the stock exchange. The investors that have already signed up for stock from the issue include China's oil major CNOOC, the Kuwait Investment Authority, and investment firm Hillhouse Capital. The offering could fetch more than $5 billion, the FT noted in its report, if demand proves even more robust than the company expects. The main underwriters of the offering are U.S. heavyweights JP Morgan and Bank of America despite a sense of wariness among U.S. investors about buying CATL stock amid the ongoing trade tensions between Beijing and Washington. These tensions, which also feature national security concerns on the part of the U.S. government, saw the Pentagon add CATL to a list of companies with links to the Chinese military. The battery giant has rejected the designation, saying it had 'never engaged in any military-related businesses or activities'. Concerns among investors in the United States remain, however. CATL is on a massive global expansion path and will use most of the money it raises in the offering for expansion purposes. More specifically, some $3.5 billion from the expected proceeds would go towards building a new factory in Hungary as the company zeroes in on the European market. With the EU's electric vehicle mandates and no local battery industry to talk about, this is where the money is for EV makers of CATL's size. In its latest advance over competitors, the Chinese EV battery major announced a superfast charging battery that could achieve 80% charge in 10 minutes. By Irina Slav for More Top Reads From The Market Is Well Supplied - So Why Is Saudi Arabia Raising Oil Prices? Read this article on
Yahoo
13-05-2025
- Business
- Yahoo
The Real Reason China is Buying More Oil
China has accelerated crude oil imports in March and April, but the increased purchases this spring aren't necessarily a sign of recovering fuel demand in the world's biggest crude importer. It's more likely that Chinese refiners are aggressively stockpiling cheaper crude amid uncertainties about sanctioned barrels going forward, analysts say. In April, Chinese crude oil imports rose by 7.5% from a year earlier to 11.69 million barrels per day (bpd), China's customs data show. March also saw strong crude imports—Chinese imports topped 12 million bpd in March, the highest volume since August 2023, as flows of Iranian and Russian crude rebounded from the lows seen early this year with the U.S. sanctions. However, the strong March and April crude imports signal continued stockpiling at Chinese refineries and strategic storage, rather than an acceleration in demand, according to estimates by Clyde Russell, a Reuters columnist. Since China doesn't report oil inventories, Russell has calculated the rate of stockpiling or stock draws based on official Chinese data of imports, domestic production, and refinery processing rates. These calculations showed that China likely stockpiled 1.74 million bpd in March, and continued stockpiling crude in April. 'Uncertainty and lower oil prices prompt aggressive stockpiling by Chinese majors, while sanctioned crude imports hold near record highs,' Emma Li, senior market analyst at Vortexa, wrote in an analysis last week. Crude stock builds in China's onshore tanks accelerated significantly through April. The average rate of stock builds exceeded 1.1?million bpd over the five weeks ending May 4, Vortexa's data showed. The surge in China's seaborne crude imports in April 'was initiated by concerns over potential supply disruptions amid tightening US sanctions, prompting Chinese refiners to ramp up bookings and bolster onshore inventories.' Falling oil prices over recent months are likely to support and prolong this pattern, Li added. The rate of utilization of crude tanks owned by China's majors was 62% in April, which suggests ample capacity remains for further stockpiling. Inventory builds are expected to continue into the third quarter amid the ongoing seasonal refinery maintenance and strategic restocking, Li noted. By Tsvetana Paraskova for More Top Reads From this article on Sign in to access your portfolio
Yahoo
16-04-2025
- Business
- Yahoo
US Oil Production to Peak in 2027, Natural Gas by 2032: EIA
The idea of peak oil is familiar to most readers. It refers to the point at which global petroleum production reaches its maximum point and begins an irreversible decline. The concept was first introduced by M. King Hubbert in the 1950s. His theory proposed that oil production would follow a bell-shaped curve, with a peak representing the point at which half of the total recoverable reserves had been extracted. This prediction has been largely accurate, as we have witnessed a steady increase in global oil production followed by signs of plateauing and even decline in recent years. The implications of peak oil are far-reaching. As we deplete the most accessible oil reserves, extracting remaining resources becomes increasingly challenging and expensive. This leads to higher production costs, which are eventually passed on to consumers in the form of higher prices for gasoline, diesel fuel, and other petroleum-based products. Additionally, the transition to less accessible reserves can disrupt supply chains and geopolitical stability, further exacerbating the challenges associated with peak oil. The inevitability of peak oil is driven by a confluence of factors: geological constraints, geopolitical instability, technological limitations and rising demand. ( Aug. 29, 2024) Turning to the United States, another Oilprice article from last year quoted ConocoPhillps CEO Ryan Lance, who forecast that US production would advance to about 14 million barrels of oil per day a few years hence, and then plateau. He was quoted in an S&P Global article: 'Probably later this decade we'll see US production plateau and will probably stay there a long time,' he said. 'I don't know that we'll get to 15 [million b/d], but I think we'll pass through 14 million [b/d] on the way to 15 million [b/d].' Oilfield veteran David Messler wrote that from March of 2019 the average daily output per Permian rig has increased from 624 BOPD to 1,359 — a 60% rise. As of March 2024, though, Messler said that we are nearing the peak of the arc. When that happens, the curve will bend down, as noted in the graph below. This is referred to in shale professional circles as The Red Queen effect, referring to a scene in Lewis Carroll's Through the Looking Glass where Alice learns from the Red Queen that she must run increasingly fast just to stay in the same place. This has turned out to be a fairly apt metaphor for shale production. A report from energy analyst firm, Enervus, to this effect was summarized in a Journal of Petroleum Technology article August, 16th of last year. Dane Gregoris, report author and managing director at Enervus Intelligence Research, was quoted as saying: 'The US shale industry has been massively successful, roughly doubling the production out of the average oil well over the last decade, but that trend has slowed in recent years. The production decline rate has grown steeper at a rate of more than 0.5% annually since 2010. We've observed that decline curves, meaning the rate at which production falls over time, are getting steeper as well density increases. Summed up, the industry's treadmill is speeding up and this will make production growth more difficult than it was in the past.' (US oil production in recent years has been remarkably prolific. According to the Energy Information Administration (EIA), the United States produced more crude oil than any other country between 2018 and 2023. The average monthly total hit a record high in December 2023 at more than 13.3 million barrels a day, breaking the previous US and global record of 12.3 MBOPD set in 2019. Together, the United States, Russia and Saudi Arabia accounted for 40 percent (32.8 million b/d) of global oil production in 2023.) It seems that Messler and Gregoris are correct in their observations of US peak oil. According to the EIA via Reuters, US oil production will peak at 14 million BOPD in 2027, maintain that level through the end of the decade, then rapidly decline. By 2050, output from the world's largest oil producer will fall to about 11.3 MBOPD. Shale oil production will peak at 10 MBOPD in 2027, up from about 9.69 MBOPD this year, the EIA said in its Annual Energy Outlook, before declining to around 9.33 MBOPD by 2050. The forecasts show that the nearly two-decades old U.S. shale boom is drawing closer to its end, challenging U.S. President Donald Trump's vision of unleashing higher domestic oil supply. As for natural gas, output and demand will both peak in 2032, according to the EIA. That year, dry gas output will hit 119 billion cubic feet per day (BCFPD) and demand will reach 92.4 BCFD. Those numbers would surpass current record highs of 103.6 BCFD in 2023 and 90.5 BCFD of demand in 2024. By 2040, natural gas output is expected to ease to 112.9 BCFD, and edge back up to 115.2 BCFD in 2050, according to the EIA. Demand should fall to 80.7 BCFD in 2040 before rising to 82.5 BCFD in 2050, the agency stated. LNG exports are expected to soar from a record 11.9 BCFD in 2024 to 15.2 BCFD in 2025, 21.5 BCFD in 2030 and 26.8 BCFD in 2040 before easing to 26.7 BCFD in 2050, the EIA said via Reuters. Is peak oil and gas a foregone conclusion? Not according to a recent piece by Irina Slav. Despite volatility in commodities markets related to the Trump tariffs, analysts suggest that unless the trade war causes long-term economic damage, US shale output may hold steady or rebound. The outlook depends particularly on the duration of the US-China trade dispute: 'We need to wait and see what happens over the next quarter or two,' Gabelli Funds analyst Simon Wong says. 'I don't expect drastic changes if WTI falls below $60 and quickly rebounds. However, if WTI falls below $60 and stays there for 2 consecutive quarters, I would expect U.S. E&P producers to start lower capital expenditures and defer production. US production will still likely grow at or around $60, stay flat around $58-$60, but start declining under $55.' By Andrew Topf for More Top Reads From this article on
