Brent crude is heading for its biggest weekly drop in two months as markets bet on a 60-day ceasefire extension and partial reopening of the Strait of Hormuz.
ICE Brent is set to post its largest weekly loss in two months, dropping by almost 10%, as media reports present a 60-day extension of the current ceasefire and a temporary Hormuz navigation deal as close to being a done deal. Whether US President Trump and Iran’s Supreme Leader Khamenei agree to the deal or not, Brent at $92 per barrel suddenly feels much more comfortable for oil importers.
Japan’s Oil Imports Collapse on Iran War. According to data from Japan’s Ministry of Economy, Trade and Industry (METI), the Asian country’s crude imports plummeted by 66% from a year ago to just 850,000 b/d, the smallest monthly volume since 1967, as flows from the Middle East have dissipated.
Mozambique Questions Total’s Cost Overruns. The government of Mozambique has challenged French energy giant TotalEnergies (NYSE:TTE) with its $2 billion cost overrun estimate for the Mozambique LNG project, having commissioned a third-party audit that couldn’t confirm the cost of the 5-year hiatus.
BP’s Ousted Chair Fires Back. Albert Manifold, the short-lived chairman of British Petroleum (NYSE:BP) fired earlier this week, snapped back at the UK oil major by saying he was fired without warning or explanation and will challenge the decision, rejecting the ‘false bullying narrative’ put forward by BP.
US Tightens the Screws on Iran Oil Sales. Amidst speculation that the US-Iran ceasefire extension could be formalized over the upcoming days, the US Treasury Department tightened sanctions on Iran’s oil trade, adding 8 tankers and 15 commercial entities based in Hong Kong and the UAE to its OFAC list.
Kazakhstan’s Key Oil Field Goes Down After Accident. Oil production at Kazakhstan’s largest oil field, the Chevron-operated Tengiz (NYSE:CVX) fell sharply on May 26 due to an undisclosed accident, with media reports suggesting output at the field plunged from 950,000 b/d to just 60,000 b/d.
Scorching Heat Prompts Korea to Buy More LNG. South Korea’s bracing for two weeks of intense heatwaves, prompting the country’s power utility firms to ratchet up purchases of LNG to avoid supply shortfalls with 6 LNG cargoes already diverting towards South Korean ports, mostly from China.
Russia Resumes Northern Sea Route Shipping. The Novatek-controlled Christophe de Margerie LNG carrier became the first vessel to start transiting the Northern Sea Route via the Arctic Ocean this year, the earliest start since 2020, carrying liquefied gas from the sanctioned Arctic LNG 2 project to China.
Greek Shippers Go on a Spending Spree. Greek shipowners United Overseas and Navios Maritime Partners ordered 18 VLCCs last week, equivalent to around 2% of the currently operational fleet of very large crude carriers, all to be built in Chinese shipyards on cash garnered from windfall freight revenues.
Europe to Approve US Trade Deal in June. The European Parliament is expected to approve the EU-US trade deal agreed with US President Trump in July last year on 16 June, setting zero tariffs on a wide range of US goods including iron, steel, aluminium, fertilizers as well as agricultural goods.
Chevron Shareholders Back Current CEO. Shareholders of US major Chevron (NYSE:CVX) rejected a proposal brought by the National Legal and Policy Center and supported by proxy advisor Glass Lewis to appoint an independent board chair separate from Chevron’s CEO role, supporting Mike Wirth.
Russia Warns Armenia of Gas Supply Fallout. Russia has warned Armenia that if its accession talks with the European Union continue (being already a member of the Moscow-led Eurasian Economic Union), the Kremlin would terminate preferential prices for the supply of natural gas and petroleum products.
BlackRock Hypes Up Giant Mining M&A Deals. US investment giant BlackRock (NYSE:BLK) has advocated for consolidation among large mining companies, saying it would open the sector to generalist investors on a scale unseen so far, hinting at a potential revival of a Rio-Glencore merger.
Export Tax Slashes Brazil Oil Outflows. Brazil’s oil exports are expected to drop by 50% in May from a year ago after the country’s government introduced a 12% export tax two months earlier, with preliminary data showing the pace of outflows dipping to 216,700 tonnes per day (1.6 million b/d).
Russia to Build Kazakhstan’s First Nuclear Power. Russia’s Rosatom has signed an agreement with Kazakhstan to build the first nuclear power plant in Central Asia at a cost of some $16.5 billion, with construction set to begin next year and commissioning of the first reactor planned for early 2034.
Dry Bulk Freight Shifts into a Higher Gear. Longer routes around the Cape of Good Hope, rising bunker fuel costs and robust raw material flows have been combining to push the Baltic Exchange’s dry bulk freight index to its highest since December 2023, seeing a 5% jump this week across all vessel segments.
By Tom Kool for Oilprice.com
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