Oil Weekly: US Exports to EU and China Grow to Russia's Dismay
Higher US Exports, Tighter WTI/Brent Spreads
Includes:
Brynne Kelly’s Weekly Institutional Oil Recap
Current Oil reports from the majors including JPM, BBG, GS
EIA Data updates
Higher US Exports, Tighter WTI/Brent Spreads
Contributions VBL
Analysts say the Oil market will face a shortage by the second half of the year, — a topic that will likely factor significantly with industry leaders meeting in Houston for CERAWeek, the major annual energy conference run by S&P Global next week.
On March 6-7, 2023, Under Secretary for Economic Growth, Energy, and the Environment Jose W. Fernandez will travel to Houston, Texas for CERAWeek 2023 to engage with government officials and private sector leaders on global energy issues including: supply chains, clean fuels and technologies, energy security, and the critical minerals needed to build the clean energy economy of the future.
Special Presidential Envoy for Climate John Kerry and Assistant Secretary for Energy Resources Geoffrey Pyatt will also participate in CERAWeek to promote clean energy transition and global energy security policy objectives.
CERAWeek, taking place in the George R. Brown Convention Center and the Hilton Americas Hotel, is focused on the entire energy industry, with several themes this year — including shifting geopolitics, supply-chain and infrastructure constraints, tech and innovation, future of work, and more.
CHINA RECOVERY
On another note, China met over the weekend and set a modest economic growth target of around 5% for the year, with the nation’s top leaders avoiding any large stimulus to boost a recovery still being weighed down by weak business confidence and an uncertain property market. The China data out over the weekend that isn't particularly promising. But, this could be how they manage expectations. China's State affiliated Global Times said this Sunday night:
China's 5% growth target clearly leaves some leeway. It’s possible that it can grow by more than 6%. Because as long as tourism this year can recover to 85% of that in 2019, it will contribute 3 percentage points to GDP. And last year's GDP growth was 3%. Hu Xijin .
Overall, the China recovery is at least on paper a little slower than anticipated thus far.
FRIDAY'S WICKED REVERSAL
Friday's reversal in summary: Oil got slammed from a story in the WSJ that there was dissension in OPEC, implying there would be rogue UAE selling soon.
Still formally allies, Saudi Arabia and the U.A.E. have diverged on several fronts, competing for foreign investment and influence in global oil markets and clashing on the direction of the Yemen war. The disagreements once unfolded behind closed doors but are increasingly spilling out into the open, threatening to reorder alliances in the energy-rich Persian Gulf at a time when Iran is trying to exert more sway across the region and Russia's war in Ukraine has raised crude prices and roiled OPEC decision-making.
Then Reuters posted a comment that the OPEC insurrection was “Far from the truth”
MEDIA REPORT ON UAE CONSIDERING LEAVING OPEC IS "FAR FROM THE TRUTH" - RTRS SOURCE WITH DIRECT KNOWLEDGE OF THE MATTER
Bloomberg broke the tie saying; “UAE OFFICIALS SAY PRIVATELY NO PLANS TO LEAVE OPEC”
And zoom...oil took off, undoing the dive, and catching up to stocks on the day. One thing is increasingly certain: Oil is a very big political football now. We would not be surprised if that story was ”leaked” to the WSJ by someone who wished harm, only to see it backfire a bit. Oil is increasingly becoming a geopolitical weapon with the back and forth between the Biden administration and OPEC+ last year. We just cannot put it past anyone these days.
