Oil price – Atlanti Gaz http://atlantigaz.com/ Wed, 18 May 2022 06:29:59 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://atlantigaz.com/wp-content/uploads/2021/04/cropped-icon-1-32x32.png Oil price – Atlanti Gaz http://atlantigaz.com/ 32 32 Countries banning food exports amid rising prices and inflation https://atlantigaz.com/countries-banning-food-exports-amid-rising-prices-and-inflation/ Wed, 18 May 2022 01:46:00 +0000 https://atlantigaz.com/countries-banning-food-exports-amid-rising-prices-and-inflation/

India has banned wheat exports as grain prices have jumped this year partly due to the Russian-Ukrainian war.

T.Narayan | Bloomberg | Getty Images

India has banned wheat exports, becoming the latest country to do so as grain prices have surged this year in part due to the Russia-Ukraine war.

The war triggered a huge spike in wheat prices, with Russia and Ukraine being among the biggest wheat exporters. The two countries account for 29% of global wheat exports, according to the World Bank.

Wheat prices climbed about 6% on Monday after India’s weekend announcement.

“With food prices already high due to COVID-related supply chain disruptions and drought-reduced yields last year, Russia’s invasion came at a bad time for global food markets” , said the Peterson Institute for International Economics (PIIE), a Washington DC-based think tank, in an April note.

Russia and Ukraine are among the world’s top five exporters of many important grains and oilseeds, such as barley, sunflower and sunflower oil, as well as corn, according to the PIIE.

India is not alone. Besides Russia and Ukraine, Egypt, Kazakhstan, Kosovo and Serbia have also banned wheat exports.

Inflation and fears for food security

And it’s not just wheat. Many countries also implemented a ban on other food exports as global inflation soared following the Ukraine crisis.

Prices have soared for a wide variety of other food items, contributing to rising inflation around the world. Some of these products include sunflower oil, palm oil, fertilizers and cereals.

In addition to rising food prices, the supply of many food products is also uncertain.

As the war continues, it is increasingly likely that food shortages, particularly of grains and vegetable oils, will become acute…

Peterson Institute of International Economics

Ukraine has been unable to export grain, fertilizer and vegetable oil, while the conflict is also destroying cultivated fields and preventing a normal planting season. The government also accused Russia of stealing several hundred thousand tons of grain and reselling it. The Russian Foreign Ministry did not immediately respond to CNBC’s request for comment.

“As the war continues, it is increasingly likely that food shortages, particularly of grains and vegetable oils, will become acute, leading more countries to turn to trade restrictions,” the analysts wrote. from PIIE Joseph Glauber, David Laborde and Abdullah Mamun.

Over the weekend, the Group of 7 industrialized nations issued a warning of the risk of a world hunger crisis unless Russia lifts a blockade on Ukrainian grain currently stuck in Ukrainian ports, according to the Financial Times.

Countries banning food exports

Here is a list of countries that banned food exports in the months after the start of the Russian-Ukrainian war, according to a live tracker developed by the PIIE.

List of countries prohibiting food exports

Country Type of food product End date of the ban
Argentina Soybean oil, soybean meal, December 31, 2023
Algeria Pasta, wheat derivatives, vegetable oil, sugar December 31, 2022
Egypt Vegetable oil, corn June 12, 2022
Wheat, flour, oils, lentils, pasta, beans June 10, 2022
India Wheat December 31, 2022
Indonesia Palm oil, palm kernel oil December 31, 2022
Iran Potatoes, eggplant, tomatoes, onion December 31, 2022
Kazakhstan Wheat, wheat flour June 15, 2022
Kosovo Wheat, corn, flour, vegetable oil, salt, sugar, December 31, 2022
Turkey Beef, mutton, goat meat, butter, cooking oils December 31, 2022
Ukraine Wheat, oats, millet, sugar December 31, 2022
Russia Sugar, sunflower seeds August 31, 2022
Wheat, meslin, rye, barley, maize June 30, 2022
Serbia Wheat, corn, flour, oil December 31, 2022
Tunisia Fruits and vegetables December 31, 2022
Kuwait Chicken meat products, cereals, vegetable oils December 31, 2022

Source: Peterson Institute of International Economics

India said it was banning wheat exports “to manage the country’s overall food security”, according to local media.

Other countries that have recently implemented food export bans include Indonesia, which has restricted exports of palm oil, a key ingredient used in many food and non-food products.

Like India, Indonesia spoke of the need to ensure food availability domestically, after global food inflation reached post-war record highs. Indonesia represents more than half of the palm oil supply.

Anakpawis party list urges Congress to hold special session to deal with rising oil prices https://atlantigaz.com/anakpawis-party-list-urges-congress-to-hold-special-session-to-deal-with-rising-oil-prices/ Mon, 16 May 2022 04:38:53 +0000 https://atlantigaz.com/anakpawis-party-list-urges-congress-to-hold-special-session-to-deal-with-rising-oil-prices/

By Billy Begas

The Anakpawis party list on Monday called on lawmakers to “decisively perform the patriotic act” and hold a special session to deal with rising oil prices.

National Anakpawis President Ariel Casilao has called on incumbent lawmakers to repeal provisions relating to excise duties and Value Added Tax (VAT) on petroleum products and to repeal the Petroleum Deregulation Act altogether .

Excise tax and VAT impose a surcharge of 13 to 17 pesos per liter on gasoline and diesel products, based on the Tax Reform Act for Acceleration and Inclusion (TRAIN) and the extended VAT law.

Casilao added that in March, jeepney drivers incurred additional fuel costs of 8,000 to 20,000 pesos per month, farmers for land preparation and irrigation more than 8,000 pesos, and fishermen of 3,800 pesos for their 16 days of fishing in a month. .

At the same time, Casilao urged local governments to implement financial aid of 10,000 pesos to the affected economic sectors to support the workings of production.

“The national government is hopeless with its token help in fuel vouchers, made worse by the monthly insulting P200 ‘limousines’. We call on local governments to take up the noble task of helping their affected constituents avoid the catastrophic crisis of displacement and unemployment, and its consequences of deepening poverty and hunger of poor families,” Casilao added.

Anakpawis revealed that he is preparing for more mass actions in the coming weeks.

Faster transition to renewable energy will get Canada off fuel price roller coaster, economist says https://atlantigaz.com/faster-transition-to-renewable-energy-will-get-canada-off-fuel-price-roller-coaster-economist-says/ Fri, 13 May 2022 22:26:59 +0000 https://atlantigaz.com/faster-transition-to-renewable-energy-will-get-canada-off-fuel-price-roller-coaster-economist-says/

While Canadians are paying record prices at the gas pump, fossil fuel companies have reaped record profits.

Calgary-based Suncor tripled its profits over the past year, from $821 million to $3 billion.

The cost of producing petroleum-based products like gasoline and diesel has not increased, according to Jim Stanford, an economist and director of the Center for Future Work, a Vancouver-based labor think tank.

Stanford said energy companies profit from high prices at the pump that are unrelated to their cost of production.

“What that means is that in Canada we have tied our energy prices to this roller coaster of the global energy market,” he said. “And that means when that roller coaster goes up, we pay a lot more.”

Stanford spoke with CBC Radio Information morning host Portia Clark on how renewable energy could relieve high prices. Their conversation has been edited for length and clarity.

Information Morning – N.S.6:43Why Oil and Gas Companies Are Posting Massive Profits as Prices Rise

Canadians are paying record prices at the pumps, but oil companies like Suncor, Enbridge and Imperial Oil have all posted huge profits. In some cases, these profits are also setting records. To explain why this is happening, we reach out to economist Jim Stanford.

Is there no chance of getting out of this roller coaster, or are we bound to this arrangement?

We have not always been tied to the world price of oil.

Canada, like many countries around the world, used to regulate its oil prices until about the mid-1980s. And that’s because we’re a major oil producer. In this regard, we are under no obligation to pay world oil prices, since the vast majority of the oil we consume is produced here in Canada.

In the 1980s, however, the government – in its wisdom at the time – decided that the private market knew best about these things and that the government had to go. We deregulated prices, we tied our energy price to the world price of oil, and we also got rid of most rules regarding foreign investment in the Canadian oil patch.

The result of that [is that] most of these super profits[…]go to foreign owners because the majority of Canadian industry is foreign-owned. In that regard, it does not even necessarily benefit Canadians.

Even in the situation we find ourselves in now, do you hear a lot of talk about rethinking this arrangement since it does not serve most Canadians unless they are shareholders?

Well, there’s kind of a minimum and maximum approach to handling this.

The maximum approach would be to rethink how we set energy prices for petroleum products.

Our electricity, for example, is still regulated. The electricity bills we pay are tied in some way to the cost of generating electricity through the regulatory system. I think that’s probably a long shot. It would be a huge change in our energy policy. It would take, I think, a few years to debate and put in place.

Why don’t we levy an extra tax on the oil and gas industry while they make these super profits and use that money for something useful?

A potential use would be to accelerate the transition to renewable energy.

We all know that the fossil fuel sector will erode over time due to climate concerns and the shift to a net zero economy. And the faster we do it, the less dependent we are on this global roller coaster. So those are things that I think could reduce the overall harm of what’s happening without having to rethink the whole energy pricing system.

Should oil companies be equipped to invest in renewable energies? Are they doing all of this on their own now with some of this windfall?

No. There are a few oil companies that have, I would say, kind of side projects in some of the alternative or renewable energy agreements.

But for the most part they are not even reinvesting in conventional oil and gas production.

This surge in oil prices and oil profits should not be expected to trigger another oil boom in Canada for a variety of reasons.

Number 1, corporations distribute most of those excess profits to their investors and owners. They don’t put it in anything.

Number 2, the companies themselves know that the long-term outlook for fossil fuels is compelling.

We are heading towards a net zero economy, and this is an industry that will eventually die out.

We will see new projects announced with all this money, but for the most part this will not even translate into more activity in the oil and gas sector, let alone in renewable projects.


UK increases LNG imports, but consumers unlikely to see relief https://atlantigaz.com/uk-increases-lng-imports-but-consumers-unlikely-to-see-relief/ Thu, 12 May 2022 22:00:00 +0000 https://atlantigaz.com/uk-increases-lng-imports-but-consumers-unlikely-to-see-relief/

The UK bucked the pan-European trend of soaring wholesale gas prices as shipments of liquefied natural gas eased a shortage that drove prices up last year and kept them there. But consumers won’t feel price relief any time soon.

Bloomberg reported this week that the daily price of natural gas in the UK fell to around 156 euros or 164.88 dollars per megawatt hour this month. In comparison, the average daily gas price in Germany is 210 euros or $220.84 per MWh, and in France the price is 213 euros or $224 per MWh. In Italy, prices are even higher despite the country’s access to the gas pipeline from Algeria, at 241 euros or $253.44 per MWh.

But there are more factors that go into consumer prices.

The UK has increased its LNG imports in recent months in the middle of the heating season, but recently, as the weather started to warm up and the demand for energy for heating fell, the country began to run out of storage space for all the LNG it imported. , Bloomberg reported last month. It cannot even export everything to the European Union due to capacity constraints, the report notes. While this is good news for electric utilities running gas stations, for the end consumer it won’t make much of a difference, according to a recent Telegraph. report. According to the report, energy market regulator Ofgem was planning to extend a rule that requires electricity suppliers to pay consumers’ existing suppliers if they want to offer them lower tariffs. This will likely discourage utilities from offering such rates, regardless of where wholesale prices are.

Meanwhile, the UK’s life crisis, caused in large part by energy prices, is accelerating. One of Britain’s largest energy suppliers, ScottishPower, warned this week that households should prepare for another substantial jump in their annual electricity bills after Ofgem raised the price cap again in October.

“All of a sudden, a whole host of people who have never been in debt and have never had trouble paying their bills are going to be affected by this crisis,” the utility’s chief executive said, as cited by the Financial Times. “Time is running out fast. Let’s go into a room and find the solutions now,” added Keith Anderson.

The medium-term outlook isn’t too rosy either, despite the current drop in gasoline prices. Investment bank Stifel announced earlier this week that the current level of natural gas price volatility is going nowhere over the next three years, prolonging the cost of living crisis in one of the world’s most rich in the world.

Related: OPEC cuts global oil demand growth forecast again

“We expect energy markets to remain tighter than expected through 2024/2025; for oil, we are increasing our long-term oil price assumptions from $65 per barrel to $70 per barrel from 2024, reflecting higher longer-term supply risks. We also now expect high gas prices in the UK to persist into 2025,” said Stifel analyst Chris Wheaton, as cited by City AM

Factors driving this volatility range from continued supply chain disruptions to rising liquefied natural gas prices as the world swings toward a shortage. According to Stifel analysts, the United Kingdom will not be able to protect itself from the effects of this shortage even if it boosts local gas production. The reason: underinvestment.

“The global LNG industry has struggled with the availability and ability to produce the LNG its customers need – a combination of maintenance issues on an aging fleet of liquefaction capacity, but also declining supply in natural gas feedstock after years of underinvestment,” Wheaton said.

In other words, the current price drop is a temporary development that will not last long enough to make a tangible difference in the prices UK consumers pay for electricity. And that doesn’t bode well for the UK economy or, indeed, EU economies, which are struggling with much higher gas prices.

By Irina Slav for Oilprice.com

More reading on Oilprice.com:

Dana Gas more than doubled its first-quarter net profit amid rising oil prices https://atlantigaz.com/dana-gas-more-than-doubled-its-first-quarter-net-profit-amid-rising-oil-prices/ Wed, 11 May 2022 06:12:16 +0000 https://atlantigaz.com/dana-gas-more-than-doubled-its-first-quarter-net-profit-amid-rising-oil-prices/

Sharjah-based Dana Gas, one of the Middle East’s largest private natural gas companies, more than doubled its net profit in the first quarter as revenue surged amid rising oil prices.

Net profit for the three months to the end of March jumped 125% to 198 million dirhams ($54 million), the company said in a statement to the Abu Dhabi Stock Exchange, where its shares are listed. negotiated.

Revenues for the reporting period jumped 32% to Dh513m, boosted by a sharp rise in hydrocarbon prices and lower costs.

“Building on the positive momentum of 2021, Dana Gas delivered one of its best quarterly results, supported by strong energy prices, high KRI [Kurdistan region of Iraq] operational performance and our low-cost base,” said Patrick Allman-Ward, CEO of Dana Gas.

“The outlook for the remainder of 2022 is particularly encouraging as energy prices and demand remain elevated due to prevailing global economic challenges.”

More soon…

Updated: May 11, 2022, 06:06

!function(f,b,e,v,n,t,s) {if(f.fbq)return;n=f.fbq=function(){n.callMethod ? n.callMethod.apply(n,arguments):n.queue.push(arguments)}; if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version=’2.0′; n.tail=[];t=b.createElement(e);t.async=!0; t.src=v;s=b.getElementsByTagName(e)[0]; s.parentNode.insertBefore(t,s)}(window, document,’script’, ‘https://connect.facebook.net/en_US/fbevents.js’); fbq(‘init’, ‘797427810752825’); fbq(‘track’, ‘PageView’);

Oil Price Drop: Brent Crude Plunges as European Union Prepares to Vote on Russian Oil Ban | City & Business | Finance https://atlantigaz.com/oil-price-drop-brent-crude-plunges-as-european-union-prepares-to-vote-on-russian-oil-ban-city-business-finance/ Mon, 09 May 2022 05:40:42 +0000 https://atlantigaz.com/oil-price-drop-brent-crude-plunges-as-european-union-prepares-to-vote-on-russian-oil-ban-city-business-finance/

Brent crude fell 28 cents (23 pence) to $112.11 (£91.30) a barrel in the early hours of Monday morning. US crude West Texas Intermediate was also hit, falling 41 cents (33 pence) to $109.36 (£89.06) a barrel.

The market has been rocked by events in Brussels as the 27 EU member states debate whether the bloc should introduce an embargo on Russian oil.

This decision would require unanimity within the European Union.

However, Bulgarian Deputy Prime Minister Assen Vassilev said Sofia would block the proposal unless the Balkan state secured a waiver from the plan.

He said: “The talks will continue tomorrow, also Tuesday, a meeting of the leaders may be needed to conclude them.

JUST IN: “That’s a bonus!” Cummings targets Starmer departure by calling for ‘regime change’

“Our position is very clear. If there is a waiver for some countries, we also want to get a waiver. »

He added: “Otherwise, we will not support the sanctions.

“But I don’t expect it to come to that, based on the ongoing discussions.”

Hungary, Slovakia and the Czech Republic, three nations particularly dependent on Russian oil, have also asked for a waiver of the ban.

The talks with the EU come after the UK government announced Britain would phase out Russian oil over the course of the year in March.

READ MORE: Tide turns against Sturgeon’s IndyRef2 charge as less than 30% of Scots back 2023 poll

Speaking about the move at the time, Boris Johnson said: “In another economic blow to Putin’s regime following his illegal invasion of Ukraine, the UK will move away from dependence on Russian oil. throughout this year, building on our tough program of international economic sanctions.

“Working with industry, we are confident this can be achieved over the year, giving businesses enough time to adapt and ensuring consumer protection.”

Business Secretary Kwasi Kwarteng added: “Unprovoked military aggression will not pay and we will continue to support the brave people of Ukraine as they resist tyranny, building on our existing sanctions which are already crippling the Putin’s war machine.

“We have more than enough time for the market and our supply chains to adapt to these essential changes.

“Companies should use this year to ensure a smooth transition so that consumers are not affected.”

Brexit Live: Lord Frost says Boris will act according to protocol [LIVE]Boris said the ‘seismic’ results could be the ‘final chapter’ for the UK [REPORT]Boris set to hand over MASSIVE £1.3billion military package to Ukraine [REPORT]

Japan was also one of the G7 members to announce on Sunday that it would phase out oil imports from Russia “in principle”.

However, CMC Markets analyst Tina Teng suggested that events in China had weighed on prices.

Teng said: “The broader sense of risk aversion driven by recession fears and China’s lockdowns are the main factors putting pressure on the price of oil.”

She added: “The ongoing lockdowns in China could continue to weigh on oil prices in the near term.”

Riyadh has taken steps that will see Saudi Arabia lower crude prices for Asia and Europe for Europe on Sunday.

Will soaring energy prices derail reforms in the oil-exporting Middle East? | World | Latest news and insights from around the world | DW https://atlantigaz.com/will-soaring-energy-prices-derail-reforms-in-the-oil-exporting-middle-east-world-latest-news-and-insights-from-around-the-world-dw/ Sat, 07 May 2022 10:52:16 +0000 https://atlantigaz.com/will-soaring-energy-prices-derail-reforms-in-the-oil-exporting-middle-east-world-latest-news-and-insights-from-around-the-world-dw/

Two years ago, Iraq was almost out of money. The country is the fifth largest oil producer in the world and it should be rich. But because almost everything Iraq earns comes from its oil sales, the Middle Eastern nation’s budget is at the mercy of world oil prices.

Already in 2015, the International Monetary Fund predicted that Iraq could run out of money within five years if it did not diversify its economy away from oil. In 2020, the prediction came closer to reality when, thanks to the COVID-19 pandemic, oil prices fell by more than a third and Iraq’s national income nearly halved.

It was a huge problem because almost all the money Iraq earns is used to pay for state services and the salaries of state employees. The country has one of the largest public sector workforces in the world, and the Iraqi government pays salaries or benefits such as pensions to around seven million Iraqis.

In the last months of 2020, the government found itself unable to pay salaries on time, sparking protests across the country.

In Iraq, civil servants, including teachers and doctors, protested against the non-payment of salaries

In October 2020, the Iraqi Ministry of Finance released a “White Paper for Economic Reforms” which spoke of the desperate need for economic reforms. Not only that, but it was clear that as the world shifted to more environmentally friendly energy, Iraq would need to find other sources of revenue.

Reform projects

But that equation may have changed recently. The Russian invasion of Ukraine saw oil prices soar to new heights. They are being pushed even higher as European nations consider an embargo on Russian oil as part of a new sanctions package.

And what is bad news for European consumers is good news for oil and gas producing countries like Iraq, Saudi Arabia, Qatar and the United Arab Emirates.

According to the World Bank, oil prices rose by 55% between December last year and March this year, after the start of the war in Ukraine.

This has translated into a huge increase in cash for energy producers in the Middle East. In March, Iraq’s oil exports amounted to just over $11 billion (10.5 billion euros), the most the country has earned for oil in a month since 1972.

Clearly, Iraq can afford to pay all its bills this month and next. But what does this mean for the reforms planned before these price increases? Is there even more reason for them?

money changes everything

Similar reforms have been planned in other energy-exporting countries in the Middle East. Since 2016, Saudi Arabia has been working on its ambitious and very expensive Vision 2030 project, which combines financial and social change with a move towards renewable energy.

The United Arab Emirates and Qatar have also tried to future-proof their economies against the inevitable day when the world turns to renewable energy, with the former attempting to diversify its income by becoming a regional hub for business.

“While an influx of revenue reduces various pressures on the leaders of these countries and facilitates the assumption of distributive responsibilities [like paying public sector salaries]rising energy prices aren’t a political game-changer,” said Robert Mogielnicki, senior fellow at the Washington-based Arab Gulf States Institute.

People walk past a banner showing Saudi Crown Prince Mohammed bin Salman outside a shopping center in Jeddah, Saudi Arabia.

Until recently, progress on Saudi Arabia’s ambitious Vision 2030 had been slowed by low oil prices

But what he will do is facilitate the implementation of reforms that Mogielnicki says will not be abandoned. “There is no doubt that we are heading towards a greener future,” he told DW. “We don’t know when this will happen. That’s why states are making a huge effort to enter new energy markets, such as hydrogen.”

“Blood in the Water”

Karen Young, founding director of the economics and energy program at the Middle East Institute in Washington, agreed. The Gulf states in particular are benefiting from this moment, she said – and not just thanks to higher oil prices, but also general market volatility.

The prospect of rising inflation and food shortages, combined with rising oil prices, will exacerbate the differences between countries in the region, she said. Oil-producing nations will withstand crises better because they are full of money and can have an advantage over their neighbors.

Fuel prices displayed at an Esso service station near Cardiff,.

Talks of an EU embargo on Russian oil have driven oil prices to new highs

“As part of their foreign policy, the Gulf states have directed foreign aid and direct investment to support certain governments at certain times,” Young explained. Now they have more resources to do so.

For example, Egypt was particularly affected by the repercussions of the war in Ukraine and was forced to devalue its currency at the end of March. At the end of this month, Saudi Arabia deposited 5 billion dollars (4.75 billion euros) in the Egyptian central bank to support its economy. The increasingly wealthy Saudi public investment fund will also invest more in Egypt.

And gas producer Qatar, whose energy exports will reach $100 billion (95 billion euros) for the first time since 2014, has also pledged investments of around $5 billion in Egypt.

“There’s blood in the water,” Young explained. “They’re basically shopping. It’s opportunistic, but it also makes financial sense.”

national focus

However, experts do not believe that having more cash will encourage Gulf states to adopt undesirable foreign policy adventurism.

“While this windfall creates opportunities for interventions, the Gulf states may be more looking for return on investment and focusing on their national programs and future positions, including their own security,” Young said. “We are more likely to see investments in national defense and technology at home.”

It’s a different story in Iraq though, said Renad Mansour, project director of the Iraq Initiative at UK think tank Chatham House. Here, the problem is not necessarily the price of oil, but the country’s various persistent problems with governance, competing political interests and corruption.

Attendees look at a Future Investment Initiative panel during the investment conference in Riyadh, Saudi Arabia.

Mohammed bin Salman of Saudi Arabia ‘will now have more money to play’ says Robert Mogielnicki

In the short term, having enough cash to cover all state costs could bring competing political elites together because they aren’t under as much pressure to fight for a share of the federal budget, Mansour told DW.

But rising oil prices are unlikely to speed up or slow down reforms in Iraq. While the country’s economic “white paper” contained good ideas for economic reform, it ignored political realities, Mansour added.

“So yes, logic suggests there is less incentive to try to reform when oil prices are high,” he concluded. “However, even when the price of oil is low, we still haven’t seen much reform in Iraq.”

Edited by: Sonia Phalnikar

JPMorgan slashes demand outlook amid soaring oil prices https://atlantigaz.com/jpmorgan-slashes-demand-outlook-amid-soaring-oil-prices/ Thu, 05 May 2022 15:00:00 +0000 https://atlantigaz.com/jpmorgan-slashes-demand-outlook-amid-soaring-oil-prices/

  • JP Morgan has revised its forecast for oil demand this year down 1 million barrels per day.
  • JP Morgan forecasts total oil demand to average 100 million bpd in 2022, 400,000 bpd below 2019 levels

JP Morgan revised its oil demand forecast this year down 1 million barrels per day, citing high rates Oil prices.

By a report by Reuters, the bank meanwhile left its Brent price forecast unchanged at $114 a barrel for the current quarter and $104 a barrel for the year.

However, if another million barrels disappear from global supply daily, the bank added, Brent crude could add another $18 to $35 a barrel above its price target.

Bernard Looney, CEO of BP mentioned earlier this week, Russia had already lost 1 million bpd of production and could lose another this month.

“We now see total oil demand averaging 100 million bpd, 400,000 bpd below 2019 levels,” the bank’s analysts also said.

Meanwhile, prices jumped to over $110 a barrel for Brent and $108 for West Texas Intermediate after the European Commission announcement a proposal to impose a gradual oil embargo on Russia within six months for crude oil and until the end of the year for petroleum products.

Some EU members have expressed doubts about the move due to their heavy reliance on Russian oil imports. Exemptions are on the table. There are also other critics of this kind of embargo.

“In the short term, this could leave Russian revenues high while implying negative consequences for the EU and the global economy in terms of higher prices – not to mention the risks of retaliation (by Russia) on the supply of natural gas,” Belgian think tank Bruegel said. , following the EC announcement.

Whatever the EU decides, the sanctions would also include a ban on European companies providing shipping, insurance, brokerage and financing services to Russian oil producers, which would come into effect in a month. . It would also negatively impact Russian oil shipments to Europe, like the sanctions imposed on the country’s shipping industry earlier this year.

By Irina Slav for Oilprice.com

More reading on Oilprice.com:

Download the free Oilprice app today

Back to the homepage

Fossil fuels aren’t going away any time soon https://atlantigaz.com/fossil-fuels-arent-going-away-any-time-soon/ Sun, 01 May 2022 23:00:00 +0000 https://atlantigaz.com/fossil-fuels-arent-going-away-any-time-soon/

Calls for an end to all investment in new oil and gas production, protests demanding the immediate suspension of oil production, and whistleblower reports from environmental NGOs accusing banks of continuing to finance fossil fuels have become essentials of today’s life in the West. But fossil fuels aren’t going anywhere, at least in the observable future.

“The idea that we can turn off the taps and end fossil fuels tomorrow, that’s obviously ridiculous and naive,” Standard Chartered chief executive Bill Winters told CNBC in an interview this week. “Well, first of all it’s not going to happen and secondly it would be very disruptive.”

Why this won’t happen should be obvious and can be gleaned from a quick glance at any oil price chart. Global demand for oil is currently greater than available supply; so the prices are high. What followed the loss of only a relatively small part of the world’s supply with the anti-Russian sanctions should suggest what would happen if all oil production were to stop.

Yet the pressure on the oil industry remains and intensifies. Two years ago the International Energy Agency said that investment in new oil and gas exploration should be phased out by the end of 2020 because we wouldn’t need more oil and gas in the future. And now the Secretary General of the United Nations is call oil-producing countries “dangerous radicals” to increase the production of fossil fuels.

The IEA, for its part, has reversed its calls for less investment in oil and gas. In just a few months, the industry body has reversed its message: it is now calling on oil producers to produce more oil and gas. How long will it be before the UN’s Antonio Guterres joins these calls for more oil and gas because prices have become unbearable?

Meanwhile, demand for oil remains robust despite environmental protests, despite whistleblower reports and despite calls for less investment in oil and gas. In its March oil market report, the IEA said oil demand in 2022 would increase by 2.1 million bpd since last year. This, for context, is about the same as the combined oil production of Nigeria and Venezuela in March this year, according to the latest Oil Market Monthly Report of OPEC.

Yet demand for oil is not static, and this month the International Energy Agency downgraded its demand forecast to 1.9 million bpd since last year. This is about the same as the combined production of Libya and Algeria. OPEC also lowered its demand forecast, although it still expects demand growth to be stronger than the IEA, at 3.7 million bpd.

The reason for the revisions is not the action of climate NGOs and the EU government’s shift from oil to renewables. On the contrary, the reason for the revisions has nothing to do with climate-related issues. Instead, it has to do with inflation projections.

The demand for crude oil is a fairly inelastic demand. What is that means is that this demand is rather stable even when prices go up or down. The reason for this inelasticity is the world economy’s dependence on oil, a dependence that so many organizations and governments have tried to challenge for years with limited success.

Related: U.S. oil refiners brace for explosive year

The sustainability of oil demand is also reinforced by the emerging debate on the need to make the energy transition fairer. A concept that had been glossed over as students demonstrated across Europe for urgent action on climate change, the idea of ​​a just transition has finally started to gain attention.

The idea, as described by Greenpeace, is to “move to a more sustainable economy in a fair way for everyone, including people working in polluting industries”.

Indeed, proponents of the just transition focus on the most important aspect of the shift to less use of fossil fuels from the perspective of an individual: that no one suffers the negative consequences of this change.

Yet, beyond “people working in polluting industries”, the idea of ​​a just transition also concerns entire nations of the developing world. Unlike proponents of climate change in the so-called first world, these nations have not had the chance to reap the full economic and social benefits of the oil-based economies that many believe have industrialized and even post-industrialized. precisely because of their generous use of fossil fuels.

The developed world, argue just transition advocates, has no right to deny these benefits to the developing world simply because it has reached a level where it has sufficient economic comfort to solve problems such as the effects of human activity on the environment.

It is this idea of ​​a just transition that will help secure the future of fossil fuels for some time to come. For all the promotion of renewable energy as cheaper than fossil fuels, the fact is that the big rich economies have the most capacitywhile the poorest countries lag considerably behind, even in the EU.

Oil, however, is everywhere, even in the poorest countries. And it will stay there for decades.

By Irina Slav for Oilprice.com

More reading on Oilprice.com:

Oil price crash: Joy for British motorists as the cost of a barrel drops to $104 | World | News https://atlantigaz.com/oil-price-crash-joy-for-british-motorists-as-the-cost-of-a-barrel-drops-to-104-world-news/ Sat, 30 Apr 2022 05:40:00 +0000 https://atlantigaz.com/oil-price-crash-joy-for-british-motorists-as-the-cost-of-a-barrel-drops-to-104-world-news/

Market-pioneer Brent crude futures fell 12 cents (10p) to settle at $107.14 (£85.22) a barrel while the contract expiring the previous month rose 1 $.75 (£1.39) to settle at $109.34 (£86.95) a barrel. US crude West Texas Intermediate fell 67 cents (53p) to settle at $104.69 (£83.26) a barrel.

It comes as oil prices were hit by the US heating oil contract which fell more than 20% at one point on its expiry day.

The first month US heating oil contract, which is a proxy for diesel prices, hit a record high of $5.8595 (£4.66) a gallon before falling to $4.4067 (£3.51 £) per gallon.

Diesel futures soared as investors grew nervous about global supplies following Russia’s invasion of Ukraine.

However, Andrew Lipow of Lipow Oil Associates in Houston said the price drop could be a temporary blow due to the heating contract issue.

He said: “The fireworks were all in the expiring diesel contract.

“Today’s expiry is particularly volatile and may not reflect true tightness.”

It is likely that prices will start rising again soon due to global supply concerns among investors given the ongoing war in Ukraine.

For example, futures have risen this week on the increased likelihood that Germany will join other European Union member states in an embargo on Russian oil.

READ MORE: Ukraine LIVE: Putin launches underwater missiles for the first time

Despite the suspension of the Nord Stream 2 pipeline, Berlin has so far been cautious about supporting a full embargo on Moscow, as it relies heavily on imported Russian oil.

Russian oil production could fall by 17% this year, according to an economy ministry document seen by Reuters on Wednesday.

This is likely to happen partly because of Western sanctions, but also because of Moscow’s decision to insist that all oil be purchased in Russian rubles.

The ruble is an unstable currency, especially right now due to Western sanctions, despite the erroneous doomsday predictions that the Russian economy would collapse.

Massive fire in Moscow after car explosions [REVEAL]
Putin ‘throws Russian generals into gulags’ as Russian president str [INSIGHT]
Ukraine warns of failed peace talks with Moscow [SPOTLIGHT]

It is an unpopular currency with investors due to its volatility and low exchange value.

There are also concerns about Chinese demand, which could mean prices are starting to fall again.

Beijing is continuing its Dynamic Zero Covid response to the pandemic based on lockdowns, mass testing, contract tracing and quarantining positive cases.

These had led to an extensive lockdown of China’s economic capital Shanghai and the possibility of similar measures being introduced in Beijing itself.

This has already led to a drop in demand which could hurt prices even more if these measures continue.