Oil Daily | Russia's Reduced Fuel Exports Impact Global Diesel and Jet Fuel Prices Amid Drone Disruptions

【Oil-Producing Countries Dynamics】

Egypt plans to drill 480 new exploratory oil wells over five years, aiming to recover from years of declining production. The ambitious $5.7 billion plan involves exploring Egypt's main producing regions and signing new deals with major companies like BP and Eni. This move seeks to boost production and energy independence.

Russia's export revenue from crude and fuels declined in September due to reduced refined product shipments despite an increase in crude oil exports. Ukrainian drone attacks have disrupted Russian refineries, leading to lower fuel production and exports. The International Energy Agency notes the global impact of decreased Russian exports on diesel and jet fuel prices.

【Latest Oil Policies】

The U.S. Treasury sanctioned China's Rizhao port for handling Iranian crude, causing three large crude carriers to divert from their original destination. Washington's sanctions target over 100 entities, including the Rizhao terminal, affecting Chinese oil imports. The impact on China's overall oil imports is uncertain, as importers may reroute shipments.

Chevron expressed concern over a possible delay in Venture Global's second LNG plant, potentially affecting its delivery plans under a long-term contract. Venture Global requested a postponement of the Plaquemines LNG plant's commissioning to 2027, citing Covid-related impacts. Chevron seeks clarity on future deliveries, given past delays at another Venture Global LNG plant.

A report by the International Renewable Energy Agency and collaborators highlights the slow progress on renewable energy and efficiency needed to meet climate goals. Despite record capacity additions in 2024, current trends fall short of the UAE Consensus targets for 2030. The report urges more ambitious and binding targets as COP30 approaches.

Non-OPEC crude production is expected to decline at oil prices of $60 per barrel or lower, according to TotalEnergies' CEO Patrick Pouyanne. U.S. shale output could plateau if prices remain in the low $60s. The IEA forecasts a record oil supply overhang due to slower demand growth and increased supply.

【Industry News】

The International Energy Agency reports an expected larger global oil oversupply amid increased supply and subdued demand. The agency revised down its oil demand growth estimates for the next two years and increased supply growth projections, leading to a record supply surplus and soaring oil stocks.

Global sales of electric vehicles reached a record high of 2.1 million in September, driven by Chinese demand. China accounted for over half of the total, while sales in Europe and the U.S. surged due to subsidies. Despite strong sales, EVs remain less profitable for manufacturers outside China.

【Company News】

Pennpetro Energy Plc plans to acquire the Limnytskyi oil and gas exploration license in western Ukraine, marking a significant addition to Ukraine's energy independence. The acquisition is pending legal and financial due diligence and regulatory approvals. Pennpetro has identified several promising prospects, including re-entering a previously abandoned well.

Shell and Sunlink Energies and Resources Limited have made a final investment decision on the HI gas project offshore Nigeria, which will supply additional gas to Nigeria LNG. The project aligns with Shell's goal to increase LNG volumes by 4-5% per year until 2030 and support its global LNG commitments.