Oil Daily | US Oil Inventories Rise Unexpectedly; Russia Boosts Shipments Amid New Sanctions on Iran
Wednesday, Dec 4, 2024 7:00 am ET
2min read 【Global Oil Supply and Demand】
Crude oil inventories in the United States rose by 1.232 million barrels for the week ending November 22, according to the American Petroleum Institute (API). Analysts had expected a draw of 2.06 million barrels. This year, crude oil inventories have fallen by just over 4 million barrels since the beginning of the year. Gasoline inventories rose by 4.623 million barrels, while distillate inventories increased by 1.014 million barrels. Cushing inventories also rose by 112,000 barrels.
One of the biggest hydropower plants in South America, the Santo Antonio plant in Brazil, is ramping up electricity generation as the historic drought in the Amazon has eased with the start of the rainy season. The plant managed to generate electricity even during the drought, creating a system to artificially raise downstream water levels.
Russia's crude oil shipments jumped by 570,000 barrels per day last week to 3.36 million bpd, driven by increased vessel loading from its western ports. The four-week average crude oil exports by sea also rose. This comes ahead of the OPEC meeting to discuss production plans for early next year.
Strengthening winter demand from China and higher prices of Iran's crude have pushed the spot premiums of Russia's ESPO blend to its highest level against ICE Brent since the Russian invasion of Ukraine in 2022. Increased winter demand for ESPO by Chinese refiners is a key factor.
Russia’s crude oil and LNG exports to Asia are on track to see only small declines this year compared to 2023, as major Asian buyers continue to purchase Russian energy commodities despite Western sanctions. China remains a significant importer of Russian oil and gas, while Japan continues to buy LNG from Russia's Sakhalin-2 project.
【Oil-Producing Countries Dynamics】
The U.S. Treasury Department announced new sanctions on Iran's energy sector focusing on oil exports and financial networks that enable Tehran to bypass existing restrictions. The measures aim to address Iran's "destabilizing behavior" in the Middle East and constrain its ability to fund activities undermining regional stability.
【Latest Oil Policies】
EDF has announced it would keep four of Britain's nuclear power plants operating longer than planned, following a review. The extension supports UK's net-zero goals and bridges the gap to the planned Hinkley Point C nuclear power plant, slated to begin operations in 2030.
Canada’s Enbridge Inc. expects higher core profit in 2025 compared to 2024, driven by strong asset utilization and contributions from recently acquired U.S. natural gas assets. The company plans to raise its dividend by 3% next year, marking the 30th consecutive annual increase.
The European Commission earmarked $4.83 billion to support net-zero technologies, including electric vehicle battery manufacturing and renewable hydrogen production. The funds aim to accelerate decarbonization technologies in Europe despite challenges in the EV market.
【Company News】
Dan Ammann, former president of General Motors, has been appointed head of Exxon's oil and gas business, replacing Liam M. Mallon, who retires in February. Exxon plans further production growth, particularly in Guyana, amid overall strong performance in recent quarters.
Meta has joined the race for nuclear power generation to secure energy for its AI ambitions, looking to contract developers for 1-4 GW of nuclear capacity in the U.S. by the early 2030s. This move complements its ongoing investments in wind and solar energy.
【Others】
The UK's National Energy System Operator (ESO) issued and swiftly canceled an electricity capacity margin notice, highlighting the challenges in balancing power supply with demand. The event underscores the UK's energy transition challenges, particularly during calm, windless days when renewables fall short.
Crude oil inventories in the United States rose by 1.232 million barrels for the week ending November 22, according to the American Petroleum Institute (API). Analysts had expected a draw of 2.06 million barrels. This year, crude oil inventories have fallen by just over 4 million barrels since the beginning of the year. Gasoline inventories rose by 4.623 million barrels, while distillate inventories increased by 1.014 million barrels. Cushing inventories also rose by 112,000 barrels.
One of the biggest hydropower plants in South America, the Santo Antonio plant in Brazil, is ramping up electricity generation as the historic drought in the Amazon has eased with the start of the rainy season. The plant managed to generate electricity even during the drought, creating a system to artificially raise downstream water levels.
Russia's crude oil shipments jumped by 570,000 barrels per day last week to 3.36 million bpd, driven by increased vessel loading from its western ports. The four-week average crude oil exports by sea also rose. This comes ahead of the OPEC meeting to discuss production plans for early next year.
Strengthening winter demand from China and higher prices of Iran's crude have pushed the spot premiums of Russia's ESPO blend to its highest level against ICE Brent since the Russian invasion of Ukraine in 2022. Increased winter demand for ESPO by Chinese refiners is a key factor.
Russia’s crude oil and LNG exports to Asia are on track to see only small declines this year compared to 2023, as major Asian buyers continue to purchase Russian energy commodities despite Western sanctions. China remains a significant importer of Russian oil and gas, while Japan continues to buy LNG from Russia's Sakhalin-2 project.
【Oil-Producing Countries Dynamics】
The U.S. Treasury Department announced new sanctions on Iran's energy sector focusing on oil exports and financial networks that enable Tehran to bypass existing restrictions. The measures aim to address Iran's "destabilizing behavior" in the Middle East and constrain its ability to fund activities undermining regional stability.
【Latest Oil Policies】
EDF has announced it would keep four of Britain's nuclear power plants operating longer than planned, following a review. The extension supports UK's net-zero goals and bridges the gap to the planned Hinkley Point C nuclear power plant, slated to begin operations in 2030.
Canada’s Enbridge Inc. expects higher core profit in 2025 compared to 2024, driven by strong asset utilization and contributions from recently acquired U.S. natural gas assets. The company plans to raise its dividend by 3% next year, marking the 30th consecutive annual increase.
The European Commission earmarked $4.83 billion to support net-zero technologies, including electric vehicle battery manufacturing and renewable hydrogen production. The funds aim to accelerate decarbonization technologies in Europe despite challenges in the EV market.
【Company News】
Dan Ammann, former president of General Motors, has been appointed head of Exxon's oil and gas business, replacing Liam M. Mallon, who retires in February. Exxon plans further production growth, particularly in Guyana, amid overall strong performance in recent quarters.
Meta has joined the race for nuclear power generation to secure energy for its AI ambitions, looking to contract developers for 1-4 GW of nuclear capacity in the U.S. by the early 2030s. This move complements its ongoing investments in wind and solar energy.
【Others】
The UK's National Energy System Operator (ESO) issued and swiftly canceled an electricity capacity margin notice, highlighting the challenges in balancing power supply with demand. The event underscores the UK's energy transition challenges, particularly during calm, windless days when renewables fall short.
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