The monthly average U.S.-dollar price of West Texas Intermediate (WTI) crude oil dropped by $6.73 (-6.2%) to $101.78 per barrel in April. That decrease occurred within the context of a marginally stronger U.S. dollar (broad trade-weighted index basis -- goods and services), the lagged impacts of February’s rise of 705,000 barrels-per-day (BPD) in the amount of petroleum products demanded/supplied (to 20.4 million BPD, and accumulated oil stocks that have essentially “flat lined” below the bottom of the five-year-average range (April average: 416 million barrels).
Selected
highlights from the 29 April 2022 issue of OilPrice.com’s Oil & Energy
Insider include:
Russia Cuts Poland and Bulgaria Gas Supply. Russia halted gas supplies to Poland and Bulgaria after the countries refused to open new bank accounts and pay for Gazprom deliveries in rubles, a decision that the European Commission denounced as blackmail.
OPEC+ Expected to Ram Through Another Agreement. Already in their second year of supply discipline,
OPEC+ countries are expected
to greenlight another 432,000 b/d monthly increase for June at their monthly 05
June meeting, even as Kazakhstan and Russia have been going down in terms of
oil production.
Russia's Sakhalin-1 Goes into Force Majeure. The Sakhalin-1 project in the Russian Far East,
producing some 270,000 b/d of crude, saw its operator ExxonMobil declare
force majeure as it became increasingly difficult to ship crude from there.
US Congress Vows to Go After Oil Companies. US Democrats in Congress have accused
domestic oil companies of gouging and profiteering off high gasoline prices,
seeking to introduce legislation that would allow the US Federal Trade
Commission to go after them and double the penalty to $2 million per day.
ExxonMobil Makes Three New Stabroek Discoveries. US oil major ExxonMobil made
three new discoveries in offshore Guyana, namely Patwa, Barreleye, and Lukanani,
taking the total recoverable resource of the Stabroek Block to 11 billion
barrels.
No One Knows How To
Pay for Russian Gas. Amidst the continent-wide confusion as to whether
using Gazprombank accounts to pay for Russian gas breaches EU sanctions, Germany's
economy ministry stated
that if the companies declare that contracts have been fulfilled with the euro
payment, it should not contradict the sanctions regime.
China to Cut Coal Import Tariffs to Zero. As domestic coal production reached an all-time high
of 395 million tons in March, China scrapped
import tariffs altogether from May 01 amidst unprecedentedly high global
prices, potentially freeing up the way for more discounted Russian coal into
the country.
Shell
Tightens Russia Restrictions on Crude Buying. UK energy major Shell revised its restrictions on buying Russian oil,
stating that it would no longer accept products with any Russian content after
rumors of an emerging 'Latvian Blend' stoked fears of tacit blending.
Germany Wants to Take Over Rosneft Refinery. Germany is preparing
to take over the Schwedt refinery operated by Russia's state-owned oil company
Rosneft, the only refinery remaining in the country that is running
predominantly on Russian oil, in a drive to bring total imports to zero.
No Quick COVID Rebound Looming for China. Despite a five-day Labor Day coming up, China's crude demand is set to stay depressed as some 180 million residents remain under some form of lockdown, with gasoline and demand still more than 25% below year-ago levels and jet fuel demand down more than 50% year-on-year.
For
other oil-related headlines, see the 2 May 2022 edition of The Energy Bulletin Weekly.
The foregoing comments represent the general economic views and analysis of Delphi Advisors, and are provided solely for the purpose of information, instruction and discourse. They do not constitute a solicitation or recommendation regarding any investment.
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