Saudi Arabia’s surprising cuts following the OPEC + meeting gave oil bulls a major boost, sending Brent over $ 55.
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Friday, January 8, 2021
Brent topped $ 55 a barrel at the end of the week as Saudi Arabia’s commitment to cut deeper built a solid rally. Other forces are at play, including monetary stimulus, the prospects for a deeper fiscal stimulus in the US and vaccine optimism. “In the last 10 trading weeks, there was only one weekly decline, which was relatively small,” said Carsten Fritsch, an analyst at Commerzbank AG. “This is a testament to the power of the oil market in the last two and a half months.”
In the cold winter, it collects coal and gas. Thermal coal prices in China are rising and JKM LNG prices are rising. Spot prices for the delivery of liquefied natural gas (LNG) in Asia have risen to a six-year high. A cold winter in the northern hemisphere contributes to rising prices. Javier Blas of Bloomberg notes that at least one LNG spot commodity was sold for 33-36 USD / MMBtu, which would be a historically high price.
3 reasons to go all-in on lithium. Shares of major lithium producers and explorers, inclusive Sociedad Quimica y Minera de Chile (NYSE: SQM), Albemarle Corp. (NYSE: ALB), and Orocobre Ltd (ASX: ORE) received a major knock after Morgan Stanley predicted that Chilean low-cost brine producers could add up to 200kt per year by 2025, while expanding hard rock mines in China and Australia could pump up another half a million metric tons over time. But there are three main reasons to use all-in lithium.
US LNG exports reached a record high in December. US LNG exports set a new record in December, after a record high in November 2020, averaging 9.8 billion cubic meters per day (Bcf / d).
The pioneer creates a gloomy prospect for the schist. The immediate future of the American shale remains bleak, despite Saudi Arabia’s commitment to cut another 1 million bpd in production to support prices. “I really don’t see much growth in the Permian Basin or the US shale for the next few years,” said Scott Sheffield of Pioneer Natural Resources (NYSE: PXD) he said this week. I never anticipate it growing above 5% under any circumstances … Even if oil had reached $ 100 a barrel and the world would have run out of supplies. ” Related: How to play the first oil rally of 2021
Retention of shale commitments. Devon Energy (NYSE: DVN) he said he would not start drilling aggressively even with higher oil prices. “It’s hard for me to see the need for U.S. producers to double-digit growth in the next few years,” new CEO Rick Muncrief told Bloomberg. “For this leadership team, if we really think about 2021, let’s stick to our plan.”
2020 tied for the warmest year on record, the disaster costs double. 2020 was equal to 2016 for the warmest year on record, according to new data. The costs of natural disasters in the United States exceeded $ 95 billion last year, double the costs of the previous year.
Musk becomes the richest person in the world. Elon Musk overtook Jeff Bezos to become the richest person in the world, driven by the wild rise in Tesla stock prices (NASDAQ: TSLA). Musk’s net worth is estimated at $ 195 billion.
Saudi Arabia is trying to build bridges with Biden. Saudi Crown Prince Mohammed bin Salman this week lifted a multi-year blockade of Qatar and said he would voluntarily cut oil production by 1 mb / day. The new tone, some analysts say, is at least partially geared towards the flow of goodwill with the new Biden administration.
Exxon releases GHG data for the first time. ExxonMobil (NYSE: XOM) revealed for the first time the emission data for Scope 3 emissions – those burned by end – users. Exxon’s sales in 2019 were equivalent to 730 million metric tons of carbon dioxide, about the same amount as the entire Canadian country. It is also the highest of all Western oil companies.
The sale of ANWR is an “epic failure”. The long-awaited first lease in the Arctic National Wildlife Refuge (ANWR) was a major bust. Only 50% of the offered area received offers, and the sale generated only 14 million USD in sales, a fraction forecasted in recent years. To make matters worse, the state of Alaska was the main player in the successful bids and only two small private companies – Knik Arm Services LLC and Regenerate Alaska Inc. – the tracts obtained. Environmental groups have called the sale an “epic failure.”
Banks criticize the rules that impose loans. Wall Street banks have dropped a rule proposed by the Trump administration that will force them to lend to energy and firearms companies.
Rivian valued nearly $ 25 billion. Rivian Automotive Inc., the electric truck startup supported by Amazon.com Inc. and Ford Motor Co., is close to raising a new round of funding, valued at about $ 25 billion.
Biden aims to build an international coalition to counter China. In a deviation from the Trump administration’s simple approach, the Biden administration will aim to build an international coalition that will confront China on several fronts, including in the area of trade, according to the WSJ. Related: Rising LNG prices Welcome news for US exporters
Canada’s oil sands are rising. Canadian oil sands production reached a record high in November at 3.16 mb / day.
Electric vehicles in Norway reach 54%. Sales of electric vehicles in Norway reached a market share of 54% in 2020, surpassing petrol and diesel vehicles for the first time.
Georgia Senate races open up more aggressive Biden plans. Gemini wins in Georgia by two Democrats overturned control of the Senate. This opens up many more possibilities for the Biden administration on a number of energy and climate initiatives. S&P Global Platts offers a shortcoming.
The army corps completes the pipeline clearance program. The Army Corps of Engineers has completed its National Authorization Program (NWP), a technically complex program that allows rapid authorization of pipelines. However, the Biden administration could suspend the program.
By Tom Kool for Oilprice.com
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