Oil Daily | Kenya's Oil Production Plans and Gulf Energy Asset Acquisition Signal Market Growth

【Company News】

Brookfield Asset Management and KKR might bid for DIG Airgas, South Korea's third-largest industrial gas supplier, valued at up to $3.6 billion. Macquarie Asset Management plans to sell DIG Airgas, with JP Morgan and Goldman Sachs managing the sale. Other interested bidders include Air Liquide and Air Products.

【Global Oil Supply and Demand】

Energy commodity imports from the U.S. to Asia declined over five months due to tariffs and price reasons, especially in LNG. Despite this, U.S. LNG exports rose 20% between January and April, driven by strong European demand. Meanwhile, India's U.S. crude oil and coal imports increased.

【Latest Oil Policies】

The UK government announced a £14.2 billion investment in the Sizewell C nuclear power plant to enhance energy security. The project is expected to meet 7% of the UK's energy needs for 60 years. Despite cost overruns and delays, nuclear power remains a key part of the UK's clean energy strategy.

【Industry News】

US residential solar financing faces challenges as Mosaic files for Chapter 11 bankruptcy due to rising interest rates and policy uncertainties. Sunnova also filed for Chapter 11, citing weakened demand and subsidy rollbacks. This disrupts momentum for residential solar growth, with Congress debates on tax-credit extensions being pivotal.

Amazon AWS plans a $20-billion expansion to build new data centers in Pennsylvania, using nuclear power from Talen Energy for carbon-free operations. This reflects a strategic shift towards clean energy in the AI-driven data economy and could significantly impact Pennsylvania's economy with substantial investment and job creation.

International companies are re-engaging with Argentina's energy sector due to President Javier Milei's business-friendly reforms. The Large Investment Incentive Regime offers tax breaks to attract large-scale investments. These reforms have sparked excitement among investors, especially in Argentina's shale province, Vaca Muerta, which is boosting oil production.

【Oil-Producing Countries Dynamics】

Kenya aims to start commercial oil production and exports next year, with Gulf Energy acquiring Tullow Oil's assets. The South Lokichar Basin project plans to produce 60,000-100,000 barrels per day. Kenya's renewed efforts include tax incentives to establish an oil and gas industry, potentially boosting its global market presence.

【Others】

Trend-following commodity trading advisors might cover short positions in oil, potentially driving prices higher. Despite OPEC's production increase, geopolitical events supported oil prices. Speculators are raising net long positions, and renewed U.S.-China trade talks provide additional support. Divergent opinions exist about OPEC's production strategies.