Saudi Arabia’s cut surprises after the OPEC + meeting have provided a significant increase to oil oxen, which has caused Brent to exceed $ 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 further has built a strong recovery. Other forces are also at play, including monetary stimulus, prospects for deeper fiscal stimulus in the United States, and vaccine optimism. “The last ten weeks of trading have only seen a weekly decline, which was relatively small,” said Carsten Fritsch, an analyst at Commerzbank AG. “This is a testament to the strength of the oil market in the last two and a half months.”
The cold winter brings together coal and gas. Thermal coal prices in China are rising and LNG prices are skyrocketing. Spot prices of liquefied natural gas (LNG) supply in Asia rose to six-year highs. A cold winter in the northern hemisphere contributes to rising prices. Javier Blas of Bloomberg notes that at least one point load of LNG sold for $ 33-36 / MMBtu, which would be a historically high price.
3 reasons to do all-in lithium. Stocks of major lithium producers and explorers, included Chemical and Mining Society of Chile (NYSE: SQM), Albemarle Corp. (NYSE: ALB), i Orocobre Ltd (ASX: ORE) received heavy hammering after Morgan Stanley predicted that low-cost Chilean brine producers could add up to 200kt per year in 2025, while the expansion of hard rock mines in China and Australia could be bombed in half a million metric tons in time. But there are three main reasons to use all lithium.
U.S. LNG exports hit a record high in December. U.S. LNG exports set a new record in December after a November 2020 record, averaging 9.8 billion cubic feet per day (Bcf / d).
Pioneer paints a gloomy perspective on the shale. The immediate future of the American shale remains bleak despite Saudi Arabia’s commitment to reduce an additional million in production to raise prices. “I don’t really see a big increase in the Permian Basin or the American shale over the next few years,” said Scott Sheffield of Pioneer Natural Resources (NYSE: PXD) he said this week. I never expect it to grow above 5% under any conditions … Even if oil went to $ 100 a barrel and the world ran out of supply. ” Related: How the first oil rally of 2021 is played
Restriction of shale promises. Devon Energy (NYSE: DVN) he said he will not start drilling aggressively even with higher oil prices. “I have a hard time seeing the need for U.S. producers to double-digit growth over the next few years,” new CEO Rick Muncrief told Bloomberg. “For this management team, if we really think about 2021, we’re going to keep it clear.”
2020 is tied to the warmest year on record, the disaster costs twice as much. According to new data, 2020 was equal to 2016 for the warmest year on record. 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 wants to build bridges with Biden. Saudi Crown Prince Mohammed bin Salman this week called off a multi-year blockade in Qatar and also said he would voluntarily cut 1 mb / d of oil production. Some analysts say the new tone, at least in part, is aimed at correcting goodwill with the incoming Biden administration.
Exxon publishes GHG data for the first time. ExxonMobil (NYSE: XOM) has disclosed emissions data for the first time for its scope 3 emissions, those burned by end users. Exxon sales in 2019 were equivalent to 730 million metric tons of carbon dioxide, roughly the same amount as the rest of Canada. It is also the highest of all major Western oil companies.
The sale of ANWR is an “epic failure.” The long-awaited first lease sale at the Arctic National Wildlife Refuge (ANWR) was a big mistake. Only 50% of the supply area received bids and the sale only generated $ 14 million in sales, a fraction projected 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 i Regenerate Alaska Inc. – treatments obtained. Environmental groups called the sale an “epic failure.”
Banks criticize the rule that obliges loans. Wall Street banks exploited a proposed Trump administration rule that would force them to lend to energy and firearms companies.
Rivian valued about $ 25 billion. Rivian Automotive Inc., the electric truck start-up supported by Amazon.com Inc. and Ford Motor Co., is close to securing a new round of funding valued at about $ 25 billion.
Biden intends to build an international coalition to fight China. By moving away from the Trump administration’s approach, the Biden administration will seek to build an international coalition to confront China on multiple fronts, including trade, according to the WSJ. Related: Rising LNG Prices Welcome News for US Exporters
Canada’s oil sands are growing. Canadian oil sands production hit a record high in November at 3.16 mb / d.
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’s Senate races open up Biden’s more aggressive plans. The twin wins in Georgia by two Democrats with control of the Senate. This opens up many more possibilities for the Biden administration for various energy and climate initiatives. S&P Global Platts gives a summary.
The Army Corps completes the pipeline permit program. The Army Corps of Engineers completed its National Permits Program (NWP), a technically complex program that allows for a quick permit for pipes. However, the Biden administration could suspend the program.
By Tom Kool for Oilprice.com
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