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Business Standard
3 days ago
- Business
- Business Standard
Oil prices seesaw as US Secy questions potential Russia sanctions
Oil prices pared earlier gains and eased to fresh five-week lows after US Secretary of State Marco Rubio indicated there would be an announcement later on Wednesday on whether potential sanctions against Russia over its war in Ukraine would proceed this week. "We'll have more to say about that later on today," Rubio said when asked about the timing of the possible sanctions, adding that there would hopefully be some announcements soon. "Maybe positive, maybe not." Russia, the second-biggest crude producer after the US, said US envoy Steve Witkoff held "useful and constructive" talks with Russian President Vladimir Putin on Wednesday, two days before the expiration of a deadline set by President Donald Trump for Russia to agree to peace in Ukraine or face new sanctions. A larger-than-expected US crude storage draw last week also boosted prices. Brent crude futures were down 35 cents, or 0.5 per cent, to $67.29 a barrel at 12:03 pm EDT (1603 GMT), while US West Texas Intermediate (WTI) crude fell 41 cents, or 0.6 per cent, to $64.75. Those moves marked a fifth consecutive day of losses for both crude benchmarks, with Brent on track for its lowest close since July 1 and WTI on track for its lowest close since June 24. "Prices bounced up on the potential higher tariffs on India, but the market is waiting for some sort of a formal implementation as well as which elements in the market are to be affected," said Janiv Shah, an analyst at Rystad Energy. Shah said a planned supply increase from the Opec+ group, which includes the Organisation of the Petroleum Exporting Countries and allies like Russia, would offset a potential decline in Russian oil supply. Indian Prime Minister Narendra Modi, meanwhile, will visit China for the first time in over seven years, a government source said on Wednesday, in a further sign of a diplomatic thaw with Beijing as tensions with the US rise. Oil markets also found support earlier in the day from a bigger-than-expected decline in US crude inventories last week. The US Energy Information Administration said energy firms pulled 3.0 million barrels of crude from inventories during the week ended August 1. That was much bigger than the 0.6-million barrel draw analysts forecast in a Reuters poll but was smaller than the decline of 4.2 million barrels that market sources said the American Petroleum Institute trade group cited in its figures on Tuesday.
The Star
4 days ago
- Business
- The Star
Opec+ gets lucky as it brings back oil output amid uncertainty
A COUPLE of months ago it would have been a brave call to say that the Organisation of the Petroleum Exporting Countries and its allies (Opec+) would be able to bring back 2.5 million barrels per day (bpd) of crude production and still keep oil prices anchored around US$70 a barrel. But this is exactly what has occurred, with the eight members of the producer group winding back the last of their 2.2 million bpd of voluntary cuts by September, as well as allowing a separate increase for the United Arab Emirates. The eight Opec+ members met virtually on Sunday, agreeing to lift output by 547,000 bpd for September, adding to the increases of 548,000 bpd for August, 411,000 bpd for each of May, June and July, as well as the 138,000 bpd for April that kickstarted the unwinding of their voluntary cuts. Opec+ stuck to their recent line that the rolling back of production cuts was justified by a strong global economy and low oil inventories. It's debatable as to whether this is actually the case. Certainly, demand growth in the top-importing region of Asia has been lacklustre. Asia's oil imports were about 25 million bpd in July, down from 27.88 million bpd in June and the lowest monthly total since July last year, according to data compiled by LSEG Oil Research. While China, the world's biggest crude importer, has been increasing purchases in recent months, much of this is likely because of lower prices that prevailed when June-and July-arriving cargoes were arranged. It's also the case that China has likely been adding to its stockpiles at a rapid pace, and while it doesn't disclose inventories, the surplus of crude once refinery processing is subtracted from the total available from domestic output and imports was 1.06 million bpd over the first half of 2025. It appears more likely that Opec+ has largely been fortunate in that it has been increasing output at a time of rising risks in the crude oil market, largely from geopolitical tensions. The brief conflict between Israel and Iran in June, which was later joined by the United States, did lead to an equally brief spike in crude prices, with benchmark Brent futures reaching a six-month high of US$81.40 a barrel on June 23. The price has since eased back to trade around the US$70 mark, with some early weakness in Asia on Monday seeing Brent drop to around US$69.35. But the point is that the Israel-Iran conflict arrested a downtrend in oil prices that had been in place for much of the first half of the year. Crude prices have also been supported in recent days by US President Donald Trump's threats of wide-ranging sanctions against buyers of Russian oil unless Moscow agrees to a ceasefire in its war with Ukraine. As with everything Trump, it pays to be cautious as to whether his actions will ultimately be as drastic as his threats. But it would also be foolhardy to assume that there will be no impact on crude supplies even if any eventual measures imposed by the United States are not as drastic as feared. Additionally, there are effectively only two major buyers of Russian crude, India and China. Of these two, India is far more exposed, given its refiners export millions of barrels of refined products, many made with Russian oil. India imported 2.1 million bpd of Russian oil in June, according to data compiled by commodity analysts Kpler, which is the second-highest monthly total behind only 2.15 million bpd in May 2023. In recent months, India has been buying about 40% of its crude from Russia and if it were to replace that with other suppliers, it would have a severe impact on oil flows, at least initially. It's likely that a combination of Middle East, Africa and Americas exporters could make up for India's loss of Russian barrels, but this would tighten supplies considerably and likely keep prices higher. Whether Russia and its network of shadowy traders and shippers could once again work around sanctions remains to be seen, but even if they could, it would still take some time for them to get Russian crude through to buyers. For now, much remains up in the air and Opec+ members are following a smart strategy in taking advantage of the uncertainty to bring their production back and rebuild market share. How long this play can work is the question. Furthermore, even if Russian barrels do leave the market, it's also possible that demand growth disappoints in the second half as the impact of Trump's trade war becomes more apparent, cutting global trade and lowering economic growth. — Reuters Clyde Russell is a columnist for Reuters. The views expressed here are the writer's own.
The Citizen
4 days ago
- Business
- The Citizen
Fuel price changes for August: Good and bad news for motorists
Fuel price changes for August: Good and bad news for motorists Following a cut in the repo rate to 7% earlier this week, more relief is on the cards for consumers as the petrol price is set to decrease at midnight tonight. The Department of Mineral and Petroleum Resources has confirmed that the petrol price will decrease by 28 cents per litre. Zululand Observer reports there is, however, bad news for diesel and illuminating paraffin users, who are set to pay 65 cents and 32 cents per litre more, respectively. 'The average Brent Crude oil price decreased slightly from 69.36 US Dollars (USD) to 69.06 USD during the period under review. 'The main contributing factor to the lower crude oil price is the decision by Organisation of the Petroleum Exporting Countries to increase production and the uncertainty caused by looming United States (US) trade tariffs, including secondary tariffs, which could affect global economic growth and demand for crude oil,' said Minister Gwede Mantashe. 'The average international petrol prices decreased in line with the decrease in crude oil prices. 'The prices of diesel and paraffin increased due to low stocks in the US, unplanned refinery shutdowns, and closures of refineries in the European Union, which have resulted in tight supply,' said Mantashe. Breaking news at your fingertips… Follow Caxton Network News on Facebook and join our WhatsApp channel. Nuus wat saakmaak. Volg Caxton Netwerk-nuus op Facebook en sluit aan by ons WhatsApp-kanaal. Read original story on
Time of India
15-07-2025
- Business
- Time of India
Kazakhstan's oil output rose in June, OPEC says
Moscow: Kazakhstan's oil output rose last month after slightly falling in May, and remained above the country's frequently-exceeded quota set by the OPEC+ group, OPEC monthly data showed on Tuesday. According to OPEC, Kazakhstan's oil production rose by 64,000 barrels per day in June to 1.847 million bpd. Under the latest agreement reached by OPEC+, which includes the Organisation of the Petroleum Exporting Countries and allies, Kazakhstan's quota for June stood at 1.5 million bpd. A source familiar with the data told Reuters earlier this month that Kazakhstan oil output matched an all-time high in June at 1.88 million bpd as the Chevron-led Tengiz field ramped up production. Kazakhstan's energy ministry has said it is committed to the OPEC+ agreement, while also saying it puts Kazakhstan's national interests first.
New Straits Times
11-07-2025
- Business
- New Straits Times
OPEC chief voices "full confidence" in China's economy
VIENNA: The head of the Organisation of the Petroleum Exporting Countries (OPEC) said he has "full confidence" in China's economic development and called the country a "strategic partner," highlighting growing energy ties during an exclusive interview with Xinhua. Haitham Al Ghais, secretary-general of OPEC, praised China's economic development in the interview on the sidelines of the 9th OPEC International Seminar in Vienna, describing China as "a well-structured economy, with good and forward planning, and forecasting." Al Ghais previously worked in Beijing for almost four years as the chief of Kuwait Petroleum Corporation's Beijing representative office. That experience, he said, gave him a first-hand understanding of how China is developing. Speaking on cooperation, he said OPEC member countries enjoy excellent relations with China and its oil companies. "We are in close contact," he said. "We have the OPEC-China dialogue where we meet every year at the technical level, and on the high level." "We value China as a strategic partner for OPEC member countries," he said, adding that Chinese companies are investing in OPEC countries, while some OPEC members are also investing in the Chinese petroleum refining sector. "OPEC is proud to be a partner in supporting the Chinese energy requirements for future growth," he said. "We are very confident in the Chinese economy. We have strong confidence in the Chinese government's plans for economic growth." In its June market report, OPEC noted that, despite external pressure, including US tariff measures, China's economy maintained a steady growth momentum in the first half of this year. The report also highlighted strong export performance, as well as resilient domestic consumption. Al Ghais also emphasised two significant challenges facing the global energy market: underinvestment in energy, which may lead to future issues with energy affordability, and persistent energy poverty in many parts of the world. He noted that the theme of the 9th OPEC International Seminar, "Charting Pathways Together: The Future of Global Energy," emphasised that each country should independently explore its own energy transition path, based on local conditions. The two-day event, starting on Wednesday, features exhibitions, ministerial sessions, and high-level roundtables, bringing together global energy leaders to discuss key issues such as energy transitions, market stability, energy security, investment, technology, and innovation. — BERNAMA-XINHUA
