NEW OIL COALITION
PLATTS - The divergence between oil supply and demand had been "markedly broken," and the market had moved into backwardation less than a year into OPEC's agreement with major non-OPEC producers to curtail oil output, Saudi oil minister Khalid al-Falih said Thursday.
Inventories were steadily being reduced, and it was now clear supply is less than demand, Falih told delegates at the Russian Energy Week conference in Moscow.
"Floating inventories have almost vanished. The structure of the forward curve has flipped into backwardation," Falih said.
After saying he was no more optimistic on oil market fundamentals than he had been for the last two or three years, Falih added that OPEC would continue to look at supply, demand and inventories as the three "key controllables."
Demand had increased by 1.5 million b/d in 2017, and this would be sustained into 2018, Falih said, adding that this was a "good planning basis."
He also welcomed the contribution of US shale oil to global output, but warned that it was unreasonable to expect shale oil production to "somehow spring up at certain places and grow exponentially." This had been proven to be unrealistic, he said, and "we are well over the hump."
As the world's two largest oil producers, Saudi Arabia and Russia have led the 24-country OPEC/non-OPEC coalition in its 1.8 million b/d supply cut, which is scheduled to end in March.
Falih paid tribute to his Russian counterpart, Alexander Novak, for his role in "bringing the industry towards understanding that this is not a zero- sum game."
The agreement had breathed life back into OPEC, Falih said, with the group previously finding itself unable to cope with surging supplies and rising global inventories. The coalition members are due to meet on November 30 in Vienna to discuss the future of the deal.
Speaking on the same panel, Novak said inventories had halved in the first eight months of the deal, which became effective in January. They had previously been more than 340 million barrels over the five-year global average.
"In the first eight months, stock levels have halved. That contributes to the re-balancing of the market, and the return of investment we are observing," Novak said.
Compliance was also on the rise, with 100% adherence to the agreement, he said, adding that the new found trust among the coalition's disparate members would foster "future cooperation, the recovery of the market in order to make energy sustainable and safe."
|December, 15, 13:20:00|
|December, 15, 13:15:00|
|December, 15, 13:10:00|
|December, 15, 13:05:00|
|December, 15, 13:00:00|
|December, 15, 12:55:00|
LUKOIL - The plan is based on the conservative $50 per barrel oil price scenario. Sustainable hydrocarbon production growth is planned in the Upstream business segment along with the growth in the share of high-margin projects in the overall production. In the Downstream business segment, the focus is on the improvement of operating efficiency and selective investment projects targeted at the enhancement of product slate.
BP - BP will acquire on completion a 43% equity share in Lightsource for a total consideration of $200 million, paid over three years. The great majority of this investment will fund Lightsource’s worldwide growth pipeline. The company will be renamed Lightsource BP and BP will have two seats on the board of directors.
REUTERS - Brent crude was up 69 cents, or 1.1 percent, at $64.03 a barrel by 0743 GMT. It had settled down $1.35, or 2.1 percent, on Tuesday on a wave of profit-taking after news of a key North Sea pipeline shutdown helped send the global benchmark above $65 for the first time since mid-2015. U.S. West Texas Intermediate crude was up 45 cents, or 0.8 percent, at $57.59 a barrel.
ROSATOM - On December 10, 2017, the construction start ceremony took place at the Akkuyu NPP site under a limited construction licence issued by the Turkish Atomic Energy Agency (TAEK). Director General of the ROSATOM Alexey Likhachev, and First Deputy Minister of Energy and Mineral Resources of the Turkish Republic, Fatih Donmez, took part in the ceremony.