Crude oil futures drop in Aisa following reports of Europe-Iran talks

Crude oil futures drop in Aisa following reports of Europe-Iran talks

MOSCOW (MRC) -- Crude oil futures inched lower in mid-morning trade in Asia Oct. 26 amid reports of talks this week between Iran and the EU, opening the possibility of an eventual return of Iranian oil to global oil markets, reported S&P Global.

At 10:10 am Singapore time (0210 GMT), the ICE December Brent futures contract was down 4 cents/b (0.05%) from the previous close at USD85.95/b, while the NYMEX December light sweet crude contract dipped 11 cents/b (0.13%) to USD83.65/b.

Tehran's top nuclear negotiator Ali Bagheri Kani said in a tweet late Oct. 25 that he will be meeting with his EU counterpart Enrique Mora in Brussels on Oct. 27 to revive the country's stalled 2015 nuclear talks.

This follows an initial round of discussions between the EU and Iran held in Tehran on Oct. 14.

A deal will potentially bring back at least 1.3 million barrels of Iranian oil, according to some analyst estimates, helping to ease a severe shortage of oil at a time when the world needs it going into winter season.

"Prices gave up gains following reports that the EU will hold discussions with Iran later this week," said ANZ Research analysts in a note.

Nonetheless, analysts at ING said markets will likely take a cautious approach toward the talks.

"There is plenty of uncertainty around the timing and how talks will evolve. The market will likely take a more cautious approach in terms of pricing in the potential for a deal, given how talks broke down over the summer," ING's Warren Patterson and Wenyu Yao said.

"We are forecasting in our balance sheet that Iranian oil output will end 2022 around 1.3 million b/d higher than where it starts the year, but clearly this assumes a lifting of sanctions," they said.

In the near term, investors will be looking at US oil inventory data for a gauge of oil demand.

As MRC informed before, US commercial crude stocks fell 3.48 million barrels to 413.96 million barrels in the week ended Sept. 17, to more than 8% below the five-year average, Energy Information Administration data showed. Stocks were last lower Oct. 5, 2018.

We remind that in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.

We also remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, the US Energy Information Administration (EIA) said in a monthly report, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC

Explosion and fire occurred at illegal refinery in Nigeria

Explosion and fire occurred at illegal refinery in Nigeria

MOSCOW (MRC) -- At least 25 people, including some minors, were killed in an explosion and fire at an illegal oil refinery in Nigeria's Rivers state on Friday, a local leader and a resident told Reuters on Sunday.

"The casualties involved are very high ... we are counting 25 bodies," Ifeanyi Omano, a community leader, told Reuters, adding: "We aren't certain of their identities yet," he said, adding that the dead included some minors.

Omano and local resident Chikwem Godwin said the explosion took place in the early hours of Friday, adding people from several communities were killed. A local police spokesman previously confirmed the incident but did not disclose the numbers of casualties.

Illegal refining is common in the oil-rich Delta region of Nigeria as impoverished locals tap pipelines to make fuel to sell for a profit. The practice, which can be as basic as boiling crude oil in drums to extract fuel, is highly dangerous.

Nigeria is Africa's largest oil exporter.

As MRC informed earlier, in August 2021, gunmen killed a police officer and six employees of a Nigerian oil and gas services contractor during an attack on buses transporting workers to a Shell project site in the southeastern state of Imo, Nigeria. Attacks on oil and gas facilities have long been a problem in Nigeria, where the multi-billion dollar industry sits alongside impoverished communities that have seen little benefit from it. In this case, the motive was unclear.

We remind that Royal Dutch Shell plans to reduce its refining and chemicals portfolio by more than half, it said in July 2020 without giving a precise timeframe. The move is part of the Anglo-Dutch company's plan to shrink its oil and gas business and expand its renewables and power division to reduce greenhouse gas emissions sharply by 2050.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,638,370 tonnes in the first eight months of 2021, up by 10% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 989,570 tonnes in the first eight months of 2021, up by 30% year on year. Deliveries of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas shipments of injection moulding PP random copolymers decreased significantly.
MRC

Brazilian president considering privatization of Petrobras

Brazilian president considering privatization of Petrobras

MOSCOW (MRC) -- Brazilian President Jair Bolsonaro reiterated on Monday that he is considering the privatization of state-run oil company Petrobras, formally known as Petroleo Brasileiro SA, boosting its shares along with news of a fresh price hike in the domestic gasoline and diesel market, reported Reuters.

"This is on our radar," the far-right president said during a radio interview. "But privatizing a company is not just putting it on a shelf and whoever offers the highest bid takes it, it is very complicated."

Bolsonaro had first mentioned a potential privatization of Petrobras earlier this month, indicating that he was frustrated for being blamed for fuel price increases in the country.

Petrobras announced on Monday it will raise diesel and gasoline prices at the refinery gate starting on Tuesday, following a recent spike in oil prices and a sharp depreciation of Brazil's currency.

The company has become a hot political topic as energy costs have driven Brazil's annual inflation into double digits, hurting Bolsonaro's popularity ahead of next year's election.

As MRC informed before, Petrobras said earlier this month it had halted talks with Brazilian conglomerate Ultrapar on the sale of the state-run oil company's Refap refinery, part of its program to sell eight plants. The company said it would relaunch the process of selling Refap in the future but did not provide a date.

We remind that in August 2021, Petrobras hired JPMorgan Chase & Co as an advisor to sell its stake in the petrochemical company Braskem SA.

We also remind that Braskem is no longer pursuing a petrochemical project, which would have included an ethane cracker, in West Virginia. And the company is seeking to sell the land that would have housed the cracker. The project, announced in 2013, had been on Braskem's back burner for several years.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,638,370 tonnes in the first eight months of 2021, up by 10% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 989,570 tonnes in the first eight months of 2021, up by 30% year on year. Deliveries of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas shipments of injection moulding PP random copolymers decreased significantly.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

Celanese declares quartely dividend of USD0.68 per share

Celanese declares quartely dividend of USD0.68 per share

MOSCOW (MRC) -- Celanese Corporation, a global chemical and specialty materials company, has declared a quarterly cash dividend of USD0.68 per share on its common stock, payable November 15, 2021, as per the company's press release.

The dividend is payable to stockholders of record as of November 1, 2021.

As MRC reported earlier, Celanese Corporation has recently announced a force majeure (FM) in China for vinyl acetate monomer (VAM) shipments from its plant Nanjing, China. Celanese has temporarily shut down its acetic anhydride and VAM production in Nanjing to comply with recent requirements of government departments in order to achieve dual energy consumption targets in the Jiangsu Province in 2021. Thus, its VAM plan with the capacity of 300,000 mt/year was shut on 17 September, 2021, and its resumed operations on 9 October, 2021.

According to MRC's DataScope report, August EVA imports to Russia fell by 19,15% year on year to 2,990 tonnes from 3,290 tonnes a year earlier, and overall imports of this grade of ethylene copolymer into the Russian Federation rose in January-August 2021 by 26,36% year on year to 30,26 tonnes (23,950 tonnes in the first eight months of 2020).

Celanese Corporation is a global technology leader in the production of differentiated chemistry solutions and specialty materials used in most major industries and consumer applications. Based in Dallas, Celanese employs approximately 7,700 employees worldwide and had 2020 net sales of USD5.7 billion.
MRC

Crude oil prices extend gains on tight global supply and stronger fuel demand as economies recover from pandemic

Crude oil prices extend gains on tight global supply and stronger fuel demand as economies recover from pandemic

MOSCOW (MRC) -- Oil prices extended pre-weekend gains on Monday to hit multi-year highs, lifted by tight global supply and strengthening fuel demand in the United States and beyond as economies recover from pandemic-induced slumps, reported Reuters.

Brent crude futures rose by USD1.10, or 1.3%, to USD86.63 a barrel by 1406 GMT, the highest since October 2018.

US West Texas Intermediate (WTI) crude futures rose USD1.46, or 1.7%, to USD85.22 and reached their highest level since October 2014.

Both benchmarks closed last week with slight gains despite rising coronavirus cases in Britain and Eastern Europe, signaling a potentially difficult winter ahead.

"The global energy supply crunch continues to show its teeth, as oil prices extend their upward march this week, a result of traders pricing in the ongoing rise in fuel demand - which amid limited supply response is depleting global stockpiles," said Louise Dickson, senior oil markets analyst at Rystad Energy.

Goldman Sachs said a strong rebound in global oil demand could push Brent crude prices above its year-end forecast of USD90 a barrel. The bank estimated gas-to-oil switching could contribute at least 1 MM barrels per day (bpd) to oil demand.

After more than a year of depressed fuel demand, gasoline and distillate consumption is back in line with five-year averages in the United States, the world's largest fuel consumer. Meanwhile, US energy companies last week cut oil and natural gas rigs for the first time in seven weeks even as oil prices rose, energy services firm Baker Hughes Co said on Friday.

Oil prices have also been bolstered by worries over coal and gas shortages in China, India and Europe, which spurred fuel switching to diesel and fuel oil for power.

As MRC informed before, US commercial crude stocks fell 3.48 million barrels to 413.96 million barrels in the week ended Sept. 17, to more than 8% below the five-year average, Energy Information Administration data showed. Stocks were last lower Oct. 5, 2018.

We remind that in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.

We also remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, the US Energy Information Administration (EIA) said in a monthly report, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC