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Oil Daily | Global Oil Demand Forecasts Lowered by OPEC; Chevron and Shell Launch Major Projects

AInvestTuesday, Aug 13, 2024 4:00 am ET
2min read
【Global Oil Supply and Demand】

The Energy Information Administration (EIA) reported that publicly traded oil and gas companies saw an increase of 2 billion barrels in proved reserves last year, despite rising costs of exploration and development. Global consumption of liquid fuels is forecasted to rise by 1.1 million bpd this year and 1.6 million bpd next year.

OPEC revised its global oil demand growth forecast for 2024 to 1.78 million barrels per day, down from 1.85 million bpd, and expects global oil demand growth for this year to average 104.32 million bpd. For 2025, OPEC's projection has also been lowered to 2.11 million bpd.

War risks and lower differentials between summer and winter prices are keeping Europe’s natural gas traders away from the underused underground gas storage sites in Ukraine. Heightened risks of attacks on Ukrainian storage sites and lower cost differentials are deterring traders.

【Oil-Producing Countries Dynamics】

OPEC’s crude oil production increased by 185,000 bpd in July compared to June, driven by higher output from Saudi Arabia, Iraq, and Iran. Total production from all 12 OPEC members averaged 26.75 million bpd last month.

Saudi Arabia is expected to ship lower volumes of crude oil to China next month due to a recent hike in official term prices. Exports are projected to drop to 43 million barrels in September, down from 46 million barrels in August.

【Latest Oil Policies】

The Canadian federal government is not interested in investing in LNG projects or supporting them financially through subsidies. Despite this, Canadian energy companies are moving forward with LNG projects due to bullish global demand trends.

The Indian Oil Ministry has requested the Finance Ministry to scrap the windfall tax on petroleum products due to falling crude oil prices. The oil ministry argues that current prices do not result in windfall profits for oil companies, making the tax unnecessary.

【Industry News】

Chevron Corporation launched production at its $5.7-billion Anchor project in the Gulf of Mexico, marking the first successful use of new high-pressure technology for ultra-deep reservoirs. The project is expected to produce 300,000 boepd by 2026 and operate for three decades.

Shell and PetroChina will invest in the second phase of a coal seam gas project in northeast Australia to boost supply for domestic customers and long-term LNG shipments. The project is expected to contribute around 22,400 boepd at peak production, with first gas expected in 2026.

【Company News】

Canada’s Tourmaline Oil Corp. announced the acquisition of Crew Energy for approximately $950 million as part of its expansion plans. The deal represented a 72% premium over Crew Energy’s last closing price before the acquisition.

Chevron announced an executive reshuffling and plans to move its headquarters from California to Houston, Texas, to cut costs. This follows second-quarter earnings below analyst expectations due to lower refining margins and weak natural gas prices.

【Others】

A Hong Kong-flagged container ship owned by a China mainland firm damaged a natural gas pipeline between Estonia and Finland in the Baltic Sea last autumn, according to Chinese authorities. The damage was reportedly accidental, caused by a strong storm, but investigations by Estonia and Finland continue.

Ukrainian president Volodymyr Zelensky accused Moscow of setting the Zaporizhzhia nuclear power plant on fire. The International Atomic Energy Agency reported multiple explosions at the site, with both sides trading accusations over responsibility for the fire.
Disclaimer: the above is a summary showing certain market information. AInvest is not responsible for any data errors, omissions or other information that may be displayed incorrectly as the data is derived from a third party source. Communications displaying market prices, data and other information available in this post are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any security. Please do your own research when investing. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit, or protect against loss in a down market.