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CNA
12 hours ago
- Business
- CNA
Oil leaps 4% after OPEC+ keeps output increase unchanged
LONDON :Oil prices jumped by about 4 per cent on Monday after producer group OPEC+ kept output increases in July at the same level as the previous two months. Brent crude futures climbed by $2.49, or 3.97 per cent, to $65.27 a barrel by 1220 GMT. U.S. West Texas Intermediate crude was up $2.70, or 4.44 per cent, at $63.49. Both contracts lost more than 1 per cent last week. The Organization of the Petroleum Exporting Countries and its allies, known collectively as OPEC+, decided on Saturday to raise output by 411,000 barrels per day (bpd) in July, the third consecutive monthly increase of that amount, as it looks to wrestle back market share and punish members that have produced more than their quotas. Sources familiar with OPEC+ talks said on Friday that the group could discuss an even larger increase. Oil traders said the 411,000 bpd increase had already been priced in to Brent and WTI futures. "Had they gone through with a surprise larger amount, then Monday's price open would have been pretty ugly indeed," Onyx Capital Group analyst Harry Tchilinguirian wrote on LinkedIn. Kazakhstan has informed OPEC that it does not intend to reduce oil production, Russia's Interfax news agency reported on Thursday, citing Kazakhstan's deputy energy minister. Oil prices would need to fall to $58 a barrel or lower to make it unprofitable for Kazakhstan to overproduce its quota, said Bjarne Schieldrop, SEB's chief commodities analyst. Goldman Sachs analysts expect OPEC+ to implement a final 410,000 bpd production increase in August. "Relatively tight spot oil fundamentals, beats in hard global activity data and seasonal summer support to oil demand suggest that the expected demand slowdown is unlikely to be sharp enough to stop raising production when deciding on August production levels on July 6," the bank said in a note. Morgan Stanley analysts also said they expect 411,000 bpd to be added back each month up to a total of 2.2 million bpd by October. "With this latest announcement, there is little sign that the pace of quota increases is slowing," the bank's analysts said.
CNA
4 days ago
- Business
- CNA
CNA938 Rewind - Stock take today: Trump tariffs reinstates, safety from Taco Trade, Asia opens
CNA938 Rewind On the daily markets analysis on Open For Business, Andrea Heng and Hairianto Diman speak with Sean Yokota, Head of Markets Asia, SEB.
Observer
4 days ago
- Business
- Observer
Oil prices climb as US court blocks Trump tariffs
LONDON: Oil prices rose by around $1 a barrel on Thursday after a US court blocked most of President Donald Trump's tariffs, while the market was watching out for potential new US sanctions curbing Russian crude flows and an OPEC+ decision on hiking output in July. Brent crude futures climbed $1.12, or 1.7%, to $66.02 a barrel. US West Texas Intermediate crude advanced by $1.14, or 1.8%, to $62.98 a barrel at 0800 GMT. A US trade court on Wednesday ruled that Trump overstepped his authority by imposing across-the-board duties on imports from US trading partners. The court was not asked to address some industry-specific tariffs Trump has issued on automobiles, steel and aluminium using a different statute. "Markets are positive since Donald Trump got the setbacks on the tariffs," said Bjarne Schieldrop, chief commodities analyst at SEB. "That's less headwind for the global economy, so more demand for oil because the machine of the global economy moves better and faster." The ruling buoyed risk appetite across global markets, which have been on edge about the impact of the levies on economic growth. Some analysts said the relief may only be temporary given the Trump administration has said it will appeal. "But for now, investors get a breather from the economic uncertainty they love to loathe," said Matt Simpson, an analyst at City Index in Brisbane. On the oil supply front, there are concerns about potential new sanctions on Russian crude. At the same time, the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, could agree on Saturday to accelerate oil production hikes in July. "We're assuming the group will agree on another large supply increase of 411,000 barrels per day," said ING analysts in a note. Chevron has terminated oil production and several other activities in Venezuela after its key license was revoked by the Trump administration in March. US crude and gasoline stocks fell last week while distillate inventories rose, according to market sources familiar with API data.— Reuters
Observer
5 days ago
- Business
- Observer
Opec+ meets as oil output hike looms
LONDON: Ministers of the Opec+ oil alliance, led by Saudi Arabia and Russia, hold talks on Wednesday to discuss their production levels as another hike looms despite falling prices. The 22-nation group began a series of cuts in 2022 to prop up crude prices, but Saudi Arabia, Russia and six other members surprised markets recently by sharply raising output for May and June. The move has put pressure on prices, which have also fallen as investors worry that US President Donald Trump's tariff onslaught will cause an economic slump and weigh on demand. Analysts say the hikes have likely been aimed at punishing Opec members that have failed to meet their quotas, but it also follows pressure from Trump to increase production. Opec+ ministers are not expected to change the alliance's collective policy during their online meeting on Wednesday. Instead, a decision to accelerate output hikes in July is expected to be made by its leading members — known as the "V8" or "voluntary eight" — at a meeting on Saturday. Such a decision, however, is not expected to have a major effect on oil prices, which have hovered around a relatively low $60-$65 per barrel. "This potential hike seems largely priced in already (by the markets)," said Ole Hvalbye, commodities analyst at SEB research group. "We expect market reactions to remain relatively muted," Hvalbye said. Analysts see several possible motivations for the production hikes. The move is seen as Saudi Arabia and others penalising members for failing to meet their quotas under the cuts first agreed in 2022. Kazakhstan, which is seen as one of the main laggards, "continues to produce roughly 350,000 barrels above its quota," said Arne Lohmann Rasmussen, an analyst at Global Risk Management. Analysts also note that the production increases came after Trump called on Opec to hike output in order to contain inflation. A third reason could be an attempt by Saudi Arabia to drive prices down to add pressure on the US shale business and increase its market share. At a meeting in December, Opec+ decided to wait until late 2026 to reverse collective cuts of some two million barrels per day (bpd), as well as additional cuts by some member countries of 1.65 million bpd. But the V8 decided to reopen the valves this year, raising output by 411,000 bpd in May. It then shocked the markets by unveiling a similar increase for June, much higher than an initial plan of 137,000 bpd. "There are rumours that the group will move ahead with another triple hike (411,000 barrels) in July" at its meeting on Saturday, said analysts at Norwegian financial services group DNB. — AFP
Borneo Post
6 days ago
- Business
- Borneo Post
Premier: Sarawak's energy policies to unlock up to RM430 bln investments, create 44,000 jobs
Abang Johari says the initiatives form part of Sarawak's broader strategy to become a regional renewable energy powerhouse. – Photo by Roystein Emmor KUCHING (May 28): The Sarawak government's new energy policies are expected to unlock investment opportunities worth between RM350 billion and RM430 billion, while creating approximately 44,000 new high-value jobs in the energy sector for Sarawakians. Premier Datuk Patinggi Tan Sri Abang Johari Tun Openg said the initiatives form part of Sarawak's broader strategy to become a regional renewable energy powerhouse. 'These jobs will be generated by new industries, which can boost opportunities for local small and medium-sized enterprises (SMEs), attract domestic and foreign direct investments, and strengthen our regional and global competitiveness,' he said in his winding-up speech at the Sarawak Legislative Assembly (DUN) sitting here today. He added that the policies would also support Sarawak's long-term goals of economic prosperity, environmental sustainability, and energy security. Among the key policies to be introduced are the Sarawak Hydrogen Economy Roadmap, the Sarawak Sustainability Blueprint, the Sarawak Energy Transition Policy (SET-P), and the Sarawak Energy Efficiency Roadmap. Abang Johari said energy security is a cornerstone of Sarawak's ambition for rapid and inclusive economic development, especially as demand rises with the state's growing population and industrial base. He noted that Sarawak has set a target for renewable energy to account for 60 to 70 per cent of its energy mix by 2035, in line with the Post Covid-19 Development Strategy (PCDS) 2030 and the forthcoming SET-P. 'Sarawak is developing four strategic energy hubs – the Renewable Energy Hub, Natural Gas Hub, Hydrogen Hub, and Carbon Capture, Utilisation and Storage (CCUS) Hub – each playing a complementary role in ensuring long-term energy security,' he said. To support the state's ambition of achieving 10 gigawatts (GW) of installed capacity by 2030 and 15GW by 2035, Abang Johari said the state will continue to develop renewable energy projects through the Independent Power Producer (IPP) model. He also announced a major restructuring of Sarawak Energy Berhad (SEB), which will see the separation of power generation and distribution. Under this model, the private sector will participate in power generation, while SEB will remain the single buyer for electricity distribution. 'SEB must be empowered to evolve in support of Sarawak's energy ambitions. This restructuring is key to ensuring SEB is fully able to drive Sarawak's vision of becoming both a Battery of Asean and a renewable energy powerhouse,' he said. He highlighted that large-scale solar, bioenergy, and waste-to-energy projects are already drawing strong private sector interest, but infrastructural challenges such as feedstock aggregation and grid modernisation must be addressed. In a further move to bolster Sarawak's position in the global energy market, Abang Johari said Sarawak is advancing hydrogen-ready technologies, including a Combined Cycle Gas Turbine (CCGT) facility, to improve energy efficiency and enhance interconnections with neighbouring regions like Sabah and Brunei. On the international front, the Premier said the World Economic Forum (WEF) has recognised Sarawak's leadership in the green transition and invited him to present Sarawak's energy agenda at the WEF Annual Meeting of the New Champions in Tianjin, China on June 26. He also revealed that Bintulu has been nominated as Malaysia's first candidate for the WEF's Transitioning Industrial Cluster (TIC) initiative. 'Transitioning industrial clusters are geographic areas where co-located businesses and industries collaborate to transition from traditional practices to cleaner, low-carbon operations aligned with net-zero goals,' he said. 'We are not just preparing for recognition in Davos early next year, we are laying the foundation for Sarawak to stand among global leaders in shaping the low-carbon industrial future,' he added. abang johari DUN lead new energy
