Oil Daily | Vietnam's First U.S. Crude Purchase and Saudi Budget Cuts Highlight Industry Shifts

【Global Oil Supply and Demand】

Vietnam has purchased its first cargo of U.S. crude oil for 2025, securing 1 million barrels of West Texas Intermediate crude for November delivery. The acquisition was made by Binh Son Refining and Petrochemical BSR from Mercuria. Earlier, a $4.15 billion U.S.-Vietnam energy deal was signed, involving LNG contracts and sustainable aviation fuel studies.

A Ukrainian strike hit Russia's Bryansk region oil-pumping station, causing a fire at a facility feeding the Druzhba pipeline. Despite explosions, crude deliveries through the network remain unaffected. The ongoing energy infrastructure strike highlights tensions between Ukraine and Russia amidst diplomatic efforts.

India plans a major nuclear power expansion, considering ending the state monopoly in uranium procurement by allowing private companies to mine, process, and import uranium. This change aims to boost nuclear power capacity from 9 GW to 100 GW by 2047, meeting 5% of India's electric demand.

【Oil-Producing Countries Dynamics】

A South African court halted TotalEnergies' exploration project due to a flawed environmental assessment. Despite setbacks, TotalEnergies aims to begin drilling in 2026 across South Africa's offshore areas. Environmental groups have succeeded in halting multiple oil projects over ecological concerns.

The Saudi Private Investment Fund has written down $8 billion from megaprojects like Neom due to budget overruns and weaker oil prices. The reassessment of Saudi Arabia's Vision 2030 infrastructure program follows financial strains, affecting the kingdom's breakeven oil price and necessitating spending adjustments.

Erbil and Baghdad have reached a new export protocol for Kurdistan's oil, yet need Turkey's approval to resume exports via the Iraq–Turkey pipeline. Baghdad plans to buy 230,000 bpd from Kurdistan under a July agreement, with federal government payments covering May wages for public sector salaries in the Region.

【Latest Oil Policies】

The U.S. Department of Energy announced nearly $1 billion in funding to boost domestic mining and processing of critical minerals, including battery metals and rare earths, to reduce reliance on imports. The initiative supports projects focusing on battery recycling and mining.

【Industry News】

Petrobras nears obtaining an exploration permit in the Amazon basin's Equatorial Margin. After receiving approval for a pre-operational assessment, Petrobras plans to invest $3 billion to drill 15 wells over five years, amidst interest from ExxonMobil and Chevron.

Financial markets anticipate a Federal Reserve rate cut at the September meeting, influenced by inflation data and job growth concerns. While some policymakers advocate rapid easing, others warn against premature cuts due to persistent inflation, highlighting political pressures and economic implications.

【Company News】

Indian state-owned ONGC reported lower profits in the April-June quarter due to falling oil prices and flat production. With crude realizations down, ONGC plans to diversify into refining, petrochemicals, and renewables, anticipating a global oil supply glut and lower prices.

【Others】

India considers allowing private companies to mine and process uranium, aiming to boost nuclear capacity from 9 GW to 100 GW by 2047. The shift requires amending laws to attract foreign investments and align with India's energy transition strategy.