Oil Prices Climb As Bullish News Continues To Mount
Oil prices continued to climb on Tuesday morning as the EIA predicted a continued slowdown in U.S. shale production, adding to concerns about a tightening oil market.
Chart of the Week
- Low inquiry levels stemming from Saudi Arabia’s production cuts, reoccurring congestion in China, and seasonally declining demand have driven freight rates to their lowest since May 2022.
- Losing steam after their November 2022 peaks, freight rates from West Africa to East Asia have dropped to Worldscale 43.5, whilst Gulf-to-East Asia rates are even lower than that, with most recent deals done at w37.
- Saudi Arabia accounts for more than a quarter of VLCC deliveries, with more than 90% of Aramco exports taking place by means of VLCC tankers, hence the oversized impact of Saudi cuts on freight rates.
- Whilst the freight market expects depressed VLCC rates to recover later this year, so far there’s been little upside – quite the contrary with Suezmax tankers that bottomed out earlier this month and the Gulf-East Asia route strengthened from w75 to w90 over the past two weeks.
- Losing steam after their November 2022 peaks, freight rates from West Africa to East Asia have dropped to Worldscale 43.5, whilst Gulf-to-East Asia rates are even lower than that, with most recent deals done at w37.
- Saudi Arabia accounts for more than a quarter of VLCC deliveries, with more than 90% of Aramco exports taking place by means of VLCC tankers, hence the oversized impact of Saudi cuts on freight rates.
- Whilst the freight market expects depressed VLCC rates to recover later this year, so far there’s been little upside – quite the contrary with Suezmax tankers that bottomed out earlier this month and the Gulf-East Asia route strengthened from w75 to w90 over the past two weeks.
Market Movers
- UK oil major BP ( $BP PLC(BP.US$ ) intends to invest up to $11 billion in low-carbon fuels, renewables, and EV charging stations in Germany by 2030 as it seeks to expand in Europe’s largest economy.
- US refiner Valero Energy $Valero Energy(VLO.US$ announced it had authorized a share repurchase of up to $2.5 billion, with no expiration date, in addition to the $2.5 billion already authorized earlier this February.
- French energy company TotalEnergies ( $TotalEnergies(TTE.US$ ) is reportedly in talks with Adani Green Energy to invest up to $700 million in the Indian firm’s clean energy projects, the first deal since Hindenburg Research’s short-selling recommendations. $Invesco QQQ Trust(QQQ.US$ $SPDR S&P 500 ETF(SPY.US$ $S&P 500 Index(.SPX.US$ $Dow Jones Industrial Average(.DJI.US$ $Nasdaq Composite Index(.IXIC.US$ $Occidental Petroleum(OXY.US$ $Chevron(CVX.US$ $Exxon Mobil(XOM.US$
- US refiner Valero Energy $Valero Energy(VLO.US$ announced it had authorized a share repurchase of up to $2.5 billion, with no expiration date, in addition to the $2.5 billion already authorized earlier this February.
- French energy company TotalEnergies ( $TotalEnergies(TTE.US$ ) is reportedly in talks with Adani Green Energy to invest up to $700 million in the Indian firm’s clean energy projects, the first deal since Hindenburg Research’s short-selling recommendations. $Invesco QQQ Trust(QQQ.US$ $SPDR S&P 500 ETF(SPY.US$ $S&P 500 Index(.SPX.US$ $Dow Jones Industrial Average(.DJI.US$ $Nasdaq Composite Index(.IXIC.US$ $Occidental Petroleum(OXY.US$ $Chevron(CVX.US$ $Exxon Mobil(XOM.US$
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
Read more
Comment
Sign in to post a comment
