Oil Daily | Middle East Shifts to Gas, Kazakhstan Diversifies Exports, ADNOC Drops Santos Bid

【Global Oil Supply and Demand】

The Middle East is seeing a decline in crude oil use for power generation, resulting in more crude available for export, according to the IEA. Despite growing electricity demand driven by population and economic growth, the region is shifting towards natural gas for energy, forecasting a significant decrease in oil use by 2035.

【Oil-Producing Countries Dynamics】

Kazakhstan has resumed oil exports through the BTC pipeline, bypassing Russia, after resolving contamination issues. This strategic move is part of Kazakhstan's efforts to diversify export routes, reducing reliance on Russia's CPC pipeline amidst geopolitical tensions. The resumed export reinforces Kazakhstan’s export diversification intent.

【Latest Oil Policies】

The European Union is set to miss the United Nations' deadline for setting emission-reduction targets aligned with the Paris Agreement due to internal disagreements. Some member states argue that stringent targets could harm their economies. The delay reflects broader challenges in aligning climate goals with economic realities.

【Industry News】

Morgan Stanley is merging its Global Energy and Global Power & Utilities teams to enhance client coverage across oil, gas, and renewables, reflecting the evolving energy landscape. This reorganization is aimed at capturing opportunities in cross-sector transactions and supporting clients in the energy transition space.

【Company News】

Abu Dhabi's ADNOC has withdrawn an $18.7 billion bid for Australia's Santos due to disagreements on valuation and terms. This marks the third failed sale attempt for Santos, which holds significant LNG assets in Australia and Papua New Guinea.

Japanese firm JERA is in talks to acquire U.S. shale gas assets worth $1.7 billion, a move aligned with the U.S.-Japan trade agreement. This investment underlines Japan's strategic interest in securing LNG supply and supporting its energy needs through U.S. partnerships.

Chevron and Israel Natural Gas Lines have agreed to build a new pipeline from Israel's Leviathan gas field to Egypt, enhancing regional energy trade. The pipeline will support Egypt's growing gas demand, reinforcing Israel's role as a key supplier.

Commodity traders Vitol and Glencore plan to bid for Chevron's 50% stake in Singapore's Refining Company as Chevron reshuffles its downstream assets. This move reflects ongoing strategic adjustments by big oil firms to focus on core growth areas.

【Others】

The U.S. and Russia continue economic discussions, including potential U.S. involvement in the Sakhalin-1 oil project. This dialogue indicates ongoing efforts to explore cooperation despite geopolitical tensions, focusing on energy sector partnerships as a means to ease sanctions and promote peace.