Oil Daily | Texas Drops BlackRock Boycott, Iran-China Exports Fall, OPEC Production Decision Spurs Prices

【Oil-Producing Countries Dynamics】

Texas has removed BlackRock from its list of oil and gas investment boycotters after BlackRock reduced its ESG footprint and exited certain net-zero alliances. This decision followed Texas legislation in 2022 targeting companies boycotting the oil and gas industry. BlackRock had $120 billion invested in Texas public energy companies.

Crude oil exports from Iran to China decreased last month due to U.S. sanctions and refinery maintenance. Iran shipped 1.1 million barrels of crude daily to China, 20% lower than May 2024. Iranian crude exports face challenges with tankers concealing their origin to bypass sanctions.

Venezuela's oil exports remained stable in May despite U.S. pressure and license expirations for sanctioned trade. Increased shipments to China helped offset reduced U.S.-authorized sales. The shift follows Venezuela's controversial election and tightening U.S. sanctions, redirecting oil flows through intermediaries.

Algeria initially opposed a pause in OPEC production increases, unlike Russia and Oman, preferring to raise output by 411,000 bpd. OPEC maintained the planned increase, citing healthy market fundamentals. The decision energized oil prices due to short covering and geopolitical tensions.

【Latest Oil Policies】

The U.S. and Iran are negotiating a nuclear deal that could lift sanctions if Iran suspends uranium enrichment. Iran is unwilling to completely halt enrichment. The discussions impact oil exports and international trade relationships amid ongoing geopolitical tensions.

【Industry News】

Energy companies are prepared to purchase $115 billion in LNG from Alaska, pending completion of Glenfarne's $44-billion export facility. Interest spans across U.S., Europe, Asia, supported by the Trump administration. The project aims to provide reliable supply to Asian allies and boost U.S. energy exports.

The American Petroleum Institute reported a 3.3 million barrel decline in U.S. crude oil inventories for the week ending May 30. Despite SPR replenishment efforts, inventories remain below pre-withdrawal levels. Gasoline and distillate inventories rose, exceeding seasonal averages amid market tightness.

【Company News】

Viper Energy will acquire Sitio Royalties Corp for approximately $4.1 billion in an all-equity deal, including debt. The acquisition enhances Viper's production profile and free cash flow growth in the fragmented minerals industry. The transaction is set to close in the third quarter of 2025.

BP’s refinery in Rotterdam has both crude units offline, impacting 400,000 bpd capacity. The shutdowns may boost refining margins as demand peaks during the driving season. Global refining margins have risen, benefiting refiners from tightened fuel markets and increased demand.

【Others】

Diamondback Energy announced a slowdown in U.S. oil mergers due to fewer high-quality targets and weaker crude prices. Onshore crude oil production is expected to decline unless oil prices increase, reflecting broader industry challenges amid fluctuating market conditions.