Oil Daily | Libya Export Halt Tightens Supply; Dangote Refinery to Shift Gasoline Markets; OPEC Cuts Under Review

【Global Oil Supply and Demand】

Libya is yet to resume oil exports following a blockade by the Haftar clan. Engineers report halted exports at major ports despite some local production increases. This impacts the global oil market by tightening supply, though fears of a U.S. economic downturn have kept prices from rising.

The Dangote refinery in Nigeria, Africa’s largest, is set to begin gasoline production, potentially shifting global gasoline flow patterns. The refinery will use primarily Nigerian crude and is expected to meet Nigeria’s domestic needs while exporting surpluses, impacting European and African markets.

Russian natural gas pipeline exports to Europe decreased by 2% in August compared to the previous month and year. Despite conflict near the Russia-Ukraine border, gas flows continue through Ukraine. Gazprom’s shipments to Europe have increased by 19.2% this year compared to last year.

On Monday, Turkey signed a ten-year LNG supply agreement with Shell, starting in 2027. This deal aims to diversify Turkey’s natural gas supply and support its goal of becoming a regional gas hub. The agreement allows Shell to supply up to 4 billion cubic meters of LNG annually.

【Oil-Producing Countries Dynamics】

Russia was in compliance with its OPEC oil production cut obligations as of August, despite previously exceeding quotas. OPEC insiders suggest some members may reverse output cuts soon, depending on market conditions. The next OPEC meeting on October 2 will review these developments.

The Yemeni Houthis hit two tankers in the Red Sea, including a Saudi-flagged vessel. Both tankers sustained minor damage and continued their voyages. The Houthis have expanded their campaign to target non-Israeli ships, disrupting regional and global commerce and efforts to halt the attacks have so far failed.

【Latest Oil Policies】

Germany plans to extend its trusteeship over Rosneft's German assets, amid talks with Qatar over a potential sale. The trusteeship was imposed following the Russian invasion of Ukraine to ensure energy security. The extension anticipates the sale negotiations and would be the fourth since September 2022.

【Industry News】

Finnish utility Fortum has started using nuclear fuel from U.S.-based Westinghouse Electric to replace Russian supply. This change aims to ensure a reliable Western fuel alternative amid efforts to distance from Russian energy. Fortum’s Loviisa plant now uses fully Western-sourced fuel.

【Company News】

U.S. renewable energy and cleantech companies face significant challenges, with the highest bankruptcy filings since 2014. High interest rates, delayed federal incentives, and competition for funds have led to bankruptcies, including SunPower and Moxion Power. TotalEnergies, a major stakeholder in SunPower, is affected.

Tesla's China-made electric vehicle sales grew 17% in August from July, continuing growth despite layoffs. Tesla's Shanghai-made Model Y was recently included in a government purchase catalog, boosting sales. China remains a key market, contributing to nearly a quarter of Tesla’s revenue in 2023.

【Others】