Oil Daily | Saudi Aramco Issues Islamic Bonds Amid Financial Strain from Lower Oil Prices

【Oil-Producing Countries Dynamics】

Cnergyico, Pakistan's largest refiner, plans to boost fuel oil exports by up to 40% by June 2026 due to high domestic taxes. The Oil Companies Advisory Council warns that increased taxes could make fuel oil unaffordable and reduce sales tax revenues, prompting Cnergyico to export more of its production.

The EU is hesitant to impose tariffs on India and China for purchasing Russian oil, fearing trade repercussions. Instead, the EU prefers targeted sanctions, as tariffs may increase international oil prices. Discussions continue as geopolitical tensions influence energy strategies.

The U.S. has deployed fighter jets to Guyana amid tensions with Venezuela over oil-rich regions. Guyana's Stabroek block, managed by ExxonMobil and partners, sees rising production, threatening regional stability. Venezuela claims parts of Guyana's territory, raising military tensions.

Turkey's BOTAS has secured 15 billion cubic meters of LNG via contracts with eight suppliers, diversifying energy sources and reducing dependence on Russian gas. The deals reflect Ankara's strategy to enhance energy security and market flexibility, with supplies beginning this winter.

Saudi Aramco is issuing dollar-denominated Islamic bonds to fund growth amid financial strain from lower oil prices. This marks Aramco's second debt issue this year, with Saudi Arabia's finances pressured by a growing budget deficit.

【Latest Oil Policies】

The International Energy Agency admits that oil and gas demand could grow for decades, revising previous forecasts of peak demand by 2030. The IEA's scenarios have faced criticism for inconsistent assumptions, affecting forecasts and policy decisions.

The EPA's plan for addressing exemption backlogs under the U.S. Renewable Fuel Standard involves large refiners covering half of waived renewable fuel obligations. This compromise aims to balance biofuel producers' demands and the oil industry's resistance to compliance costs.

The EU's General Court ruled that natural gas and nuclear projects can be labeled as "sustainable investments." Austria's challenge was dismissed, allowing these projects to be classed as transitional under the EU's updated taxonomy, despite environmentalists' concerns.

【Industry News】

JERA is considering a commitment to purchase 1 million tons of LNG annually from the Alaska LNG project for 20 years. The project developer, Glenfarne, seeks commitments for the $44-billion venture, with Japan showing interest due to geographical and trade reasons.

The U.S. EIA projects record-high electricity consumption in 2025 and 2026 due to data center and industrial demand, adjusting its generation forecasts upward. Utilities are increasing investments to meet demand growth driven by AI and onshoring manufacturing activities.

【Company News】

Edison will buy U.S. LNG from 2028 under a 15-year agreement with Shell, enhancing Italy's energy security. The deal is part of Edison's strategy to diversify gas supply, contributing to national energy security and strengthening its LNG portfolio.

【Others】

Europe's clean energy supply faces challenges as wind electricity output fell, while solar peaked in summer. Favorable autumn wind speeds could boost wind generation, vital for offsetting increased gas and coal power use during colder months.