Oil Daily | OPEC Delays Easing Production Cuts to 2025 Amid Market Confidence Despite Weak Projections

【Oil-Producing Countries Dynamics】

Russia's oil transit to China via Kazakhstan remained nearly unchanged in 2023, with a slight decrease of 0.25%. Discussions between Russia and Kazakhstan explored expanding oil and gas routes to China, highlighting opportunities for enhancing market operations and stabilizing the Asia-Pacific economy. Gazprom views China as a primary export market, having reached full capacity through the Power of Siberia pipeline.

【Latest Oil Policies】

OPEC decided to delay easing its 2.2 million bpd production cuts to April 2025, extending the period for unwinding these cuts to September 2026. Saudi Energy Minister Prince Abdulaziz bin Salman emphasized OPEC's flexibility and confidence in a stronger market next year, despite currently weak consumption projections.

【Industry News】

Barclays suggests pessimism in the oil market might be exaggerated, predicting tighter supply-demand dynamics post-2025. While OPEC maintains its cuts, the potential for oversupply could be offset by increased demand. Barclays anticipates Brent prices spending more time above $70, but OPEC's spare capacity remains a potential cap on price spikes.

【Company News】

Oman's national oil company OQ plans to list more subsidiaries following the successful IPO of OQ Exploration and Production Company, which raised $2.03 billion. Proceeds from these listings have significantly reduced OQ's debt. OQEP's IPO was oversubscribed, marking the largest IPO in Oman's history.

BP is exploring selling up to 49% of its U.S. natural gas pipeline network to reduce debt, potentially raising $3 billion. Additionally, BP might sell a minority stake in its offshore wind business, aligning with its strategy to pivot back to core oil and gas operations, aiming for higher shareholder returns.

【Others】

Oil supply via the Druzhba pipeline to the Czech Republic resumed after a temporary halt. Czech refiner ORLEN Unipetrol confirmed normal flow levels, although the cause of the interruption remains unclear. The Czech Republic plans to phase out Russian oil imports by 2025, with upgrades to the Trans Alpine TAL pipeline expected to enhance oil supply from Italy.