Since our last edition of What’s Affecting Oil Prices, Brent rose $0.49/bbl last week to average $77.38/bbl, and WTI fell $0.86/bbl to average $68.53/bbl. We expect Brent to maintain its recent strength, averaging about $77/bbl this week.
This month will start to prove which countries will continue to import Iranian crude oil. Purchases for delivery in early November will typically be loaded in mid-October, but secured up to a month in advance, aka now. China and India continue to express an interest in receiving Iranian crude, likely via tankers owned by Tehran. Short-term Brent has flipped into backwardation, indicating market expectations for a supply crunch.
While the outlook for demand remains positive, there is increasing chatter about higher prices for refined products both this fall and over the next eight quarters. Petrobras this week introduced a gasoline price-hedging mechanism in an attempt to cut down on fuel price volatility heading into hurricane season and election season. A similar mechanism is being considered for diesel prices. At the same time, concerns are rising about the potential fuel price impact of upcoming IMO regulations, with airlines reportedly hedging 2020 fuel purchases in anticipation of higher prices.
2023-09-25 - As public E&Ps hold fast with capital discipline, even exuberant prices might not be enough to substantially bump up production, although private operators remain a wild card, analysts said.
2023-11-21 - As the oilfield service market faces headwinds from consolidation and a dwindling rig count, ProPetro CEO Sam Sledge sees Permian Basin demand picking up for next-generation equipment.
2023-10-13 - The oil and gas rig count, an early indicator of future output, rose three to 622 in the week to Oct. 13.
2023-11-06 - Amid an all-stock buying bonanza in recent weeks spurred on by Exxon Mobil and Chevron to snatch up shale and international assets, APA remains focused on creating value.
2023-09-12 - Woodside Energy is making a massive bet offshore Mexico at the large, high-quality conventional resource Trion development, checking key production, climate and financial boxes for both Mexico and partners Woodside and Petroleos Mexicanos.