Oil Daily | Saudi Exports to China Surge Amid Price Hikes; EU Revamps Russian Oil Price Cap

【Oil-Producing Countries Dynamics】

Saudi Arabia's crude oil exports to China are projected to reach their highest levels in two years this August, with an average daily volume of 1.56 million barrels. This increase comes despite recent price hikes for Asian buyers, amid intensified competition from Russia and Iran.

Indonesia's attorney general has expanded the corruption investigation into state oil firm Pertamina, revealing losses amounting to $17.6 billion. Nine more suspects, including former Pertamina executives and private sector figures, have been implicated in the scandal involving irregular oil procurement and lease deals.

Equinor has discovered natural gas near its Johan Castberg oilfield in the Barents Sea. The find, estimated at 1.9 to 3.1 million barrels of oil equivalent, could potentially tie into the now fully operational Arctic field, bolstering Norway's role as Europe's leading gas supplier.

【Latest Oil Policies】

The European Commission has proposed a revamp of its Russian oil price cap, introducing a floating benchmark tied to global crude prices. This initiative aims to reinstate the impact of sanctions as Russia continues to bypass existing measures, with the proposal being part of the EU’s 18th sanctions package.

Fatih Birol, Executive Director of the IEA, emphasizes the need for better anticipation and preparation for energy crises. He advocates for diversification of supply, predictability in policy, and international cooperation, highlighting the importance of learning from past crises to enhance energy security.

【Company News】

Pertamina is striving to increase oil production in Indonesia to 1 million barrels per day by 2030, amidst ongoing corruption investigations. The government awarded five strategic oil and gas blocks earlier this year to reverse the declining production trend.

Equinor reports that the Johan Castberg oilfield has reached full capacity, producing 220,000 barrels per day. This achievement marks a significant contribution to Norway's oil exports, with plans for further exploration to support future production.

【Industry News】

OPEC's latest forecast anticipates the need for 19.5 million barrels per day of new refining capacity by 2050 to meet rising global oil demand. The expected growth in demand will be driven primarily by India, Other Asia, the Middle East, and Africa, with a notable decline forecasted for developed economies.

Sales of new energy trucks in China surged by 175% in the first half of the year, largely due to subsidies and an expanding charging network. This rapid growth is expected to accelerate China's peak oil consumption, initially anticipated for 2026, in light of increasing LNG and electric vehicle adoption.

【Others】

European natural gas markets are experiencing low price volatility, reaching levels not seen since 2021. However, with rising summer demand and reduced wind power generation, prices are expected to climb, driven by increased LNG imports to replenish storage ahead of winter.