Russia leaning towards leaving oil output unchanged ahead of OPEC+ meeting

Russia is leaning towards leaving oil production volumes unchanged ahead of an OPEC+ policy meeting on June 4 because Moscow is content with current prices and output, three sources with knowledge of current Russian thinking told Reuters.

OPEC+, which groups the Organization of the Petroleum Exporting Countries with Russia and other allies, surprised the market on April 2 with further output cuts that pushed up the price of oil.

Russian President Vladimir Putin said on Wednesday that energy prices were approaching "economically justified" levels. Putin's point man on oil, Deputy Prime Minister Alexander Novak, said on Thursday that he didn't expect new steps from OPEC+.

Novak said that Russia and its OPEC+ partners would make a decision on what is best for the oil market when they meet in Vienna.

By supporting current production levels, Moscow hopes it will be able to maintain stable oil prices without exceeding the West's imposed price cap of USD60 per barrel for its Urals blend. "Further production cuts are unlikely," a source familiar with Russia's position told Reuters on condition of anonymity due to the sensitivity of the matter.

A second source, who also spoke on condition of anonymity, said that it was not in Russia's interests to reduce oil output right now. Russia has already pledged to reduce its output by 500,000 barrels per day (bpd) to 9.5 million bpd from March until year-end.

"Russia is hardly coping with the promised production cuts, while it doesn't need additional cuts in the current market environment," a source in a Russian oil major told Reuters. The Russian government declined to comment on OPEC+ policy.

Russia is the world's second largest oil exporter after Saudi Arabia, whose energy minister Prince Abdulaziz bin Salman this week warned short sellers to "watch out". The West's attempt to impose a price cap on Russian oil has complicated Moscow's output calculations - unlike the rest of OPEC+, it isn't seeking to maximize prices.

If Russia can keep the Urals price below the price cap, it makes it easier to keep its oil flowing to the global market. Urals has been trading at between USD53 and USD57 per barrel per barrel this month, a comfortable range for Russia.

We remind, Czech Republic can cover its oil needs through shipments via the Transalpine Pipeline (TAL) pipeline from 2025, Prime Minister Petr Fiala said on Tuesday after the country signed a deal to boost capacity along the link.
The Czech government is looking to eliminate all dependence on Russian oil in the coming years, and thus end its exemptions from a European Union ban on imports from Moscow last year. Czech refineries are owned by Polish state-controlled refiner PKN Orlen, which said in April it terminated a contract for Russian oil supplies for its Polish refineries.

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LanzaTech Global and Plastipak Packaging announced that they have "successfully" produced PPKNatura, the "world's first" polyethylene terephthalate (PET) resin made from captured carbon emissions, said the company.

PPKNatura leverages CarbonSmart monoethylene glycol (MEG) from LanzaTech's carbon capture and transformation (CCT) process. It retains the technical properties of virgin PET and has a lower carbon footprint.

Also, products made with this material can be fully recycled at the end of its life. PPKNatura can be used for traditional food and pharmaceutical grade packaging and other sensitive applications. It can also be used for non-packaging applications.

We remind, Plastipak, a global leader in the design, manufacture and recycling of plastic containers has announced the formal opening of a major recycling investment at its manufacturing site in Toledo, Spain by Don Emiliano Garcia-Page, President of the Castilla-La Mancha Region. The new recycling facility converts PET flake into food-grade recycled PET (rPET) pellets suitable for direct use in new preforms, bottles and containers.

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Huntsman will announce the development of innovative polyurethane, carbon nanotube and epoxy materials at The Battery Show in May 2023, which are all designed to help improve the integration of batteries into electric vehicles and enhance their protection and performance, said the company.

In a move that helps to deliver high-performance composite battery structures, alongside design and production flexibility, Huntsman has assembled a portfolio of customizable, quick-cure, high-strength polyurethane and epoxy resins that can be used to create underbody and top cover battery protection components up to 30% quicker than some existing technologies. Crucially, the products can also lower overall part weight and increase strength and structural performance. A range of products is currently available covering various battery performance and protection needs: Targeting underbody battery protection, Huntsman offers RIMLINE WCM system - a low viscosity liquid resin that enables the moulding of high fibre volume fraction composites under low pressure.

Balancing a long working life and short cure time with easy mould release, this system can help reduce overall cycle times and is formulated for use on high pressure-mix machines. For battery enclosures, ARALDITE FST resins allow the design of flame retardant composite. These OEM- qualified systems have proven performance and reliability, meeting battery safety requirements.

Targeting battery underfloor protection, Huntsman has developed three products: RIMLINE FC (foam core) system can offer a cost-effective solution for manufacturing sandwich composites. This lightweight system has great flow properties, which can help with the creation of complex 3D shapes. This system can typically also adhere well to different overmoulding materials and cure quickly for fast cycle times. RIMLINE LFI (long fibre injection) resin system can be moulded into strong stiff parts with a density of - for example - 1100 kg/cu m including 30% glass fibre reinforcement.

The resulting parts can help to provide lower total sandwich thickness and improved damage tolerance. ARALDITE 3031 / 3032 WCM system has proven in operation to combine fastest processing cure time and outstanding mechanical properties and stiffness. Targeting top cover applications, VITROX WCM system enables the development of composite lid structures that can help achieve thermal resistance while reducing weight compared to metallic cover ARALDITE SMC solutions enable part design freedom for semi-structural applications and requirements. In the electric vehicle battery cell, Huntsman has also developed a range of materials that help with lightweighting and improved conductivity, as well as thermal, vibration, and structural protection.

SHOKLESS encapsulation foam and elastomer systems help to create potting foams and encapsulants that are mechanically strong and have the thermal insulation and vibration dampening properties needed to protect batteries at a cell, module, and pack level. ARATHANE thermally conductive adhesives and encapsulants provide excellent mechanical fixation and thermal connection, enabling effective heat management from the cells and enabling new battery pack designs and higher performance batteries. For battery cell producers looking to increase the capacity of their cells or interested in reduction of the weight of their cells, Huntsman has introduced MIRALON NMP Dispersions and MIRALON Current Collectors.

We remind, Huntsman completed the USD593m sale of its Textile Effects division to Archroma, a company owned by the private-equity firm SK Capital Partners. Archroma was set up by SK Capital Partners in 2013 after acquiring the textile chemicals, paper specialties and emulsions businesses from Swiss producer Clariant in 2013. It has about 3,000 employees in 25 facilities globally.

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Nigeria's state-owned oil company NNPC Ltd said on Thursday it had renewed a production sharing contract with Total, China National Offshore Oil Corp and others, a major step to resolving disputes on a deepwater oil block in the Niger Delta, said Hydrocarbonprocessing.

Oil Mining Lease 130 is located offshore Niger Delta at water depths of over 1000 meters. The block contains the producing Akpo and Egina fields and the Preowei discovery.

NNPC said in a statement that the agreements will pave the way "to firm up final investment decision on the Preowei amounting to USD 2.1 bn."

NNPC said the agreements would convert the oil mining lease into a petroleum mining license, in line with a new law.

Nigeria has struggled with low oil production due to massive crude theft, pipeline vandalism and underinvestment. Oil majors in the country are leaving onshore operations to concentrate on deepwater projects.

We remind, TotalEnergies and Paprec, leader in plastic recycling in France, have signed a long-term commercial agreement to develop a French value chain for advanced recycling of plastic film wastes. The agreement will secure the supply of TotalEnergies' future advanced plastic recycling plant in Grandpuits. Following the terms of this agreement, Citeo, the main organization in charge of end-of-life household packaging in France, will provide a stream of flexible plastic waste sorted from post-consumer packaging.

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Oil prices ticked up on Friday as the market weighed conflicting messages on supply from Russia and Saudi Arabia ahead of the next OPEC+ policy meeting, said Hydrocarbonprocessing.

Brent crude was up 77 cents, or 1%, at USD77.03 a barrel at 1342 GMT, while U.S. West Texas Intermediate rose 96 cents, or 1.3%, to USD72.79 a barrel.

Benchmarks had settled more than USD2 per barrel lower on Thursday after Russian Deputy Prime Minister Alexander Novak played down the prospect of further OPEC+ production cuts at its meeting in Vienna on June 4.

Both prices were still poised to post a second week of gains. A deal to raise the U.S. debt ceiling, which appears in sight, would likely boost oil prices.

Russian President Vladimir Putin said on Wednesday that energy prices were approaching "economically justified" levels, also indicating there could be no immediate change to OPEC+'s production policy.

The Russian remarks contrasted with comments this week from Saudi Arabian Energy Minister Prince Abdulaziz bin Salman, the de-facto leader of the Organization of Petroleum Exporting Countries (OPEC), warning short sellers to "watch out".

Some investors interpreted that as a signal OPEC+ could consider further output cuts. Worries of weaker-than-expected demand growth globally capped gains ahead of an expected rise in oil demand in the second half of the year, especially from China.

Meanwhile, bets on falling oil prices are on the rise. The dollar has strengthened this month against a basket of major peers, making dollar-denominated commodities such as oil more expensive for those holding other currencies.

We remind, oil prices gained on Wednesday after U.S. oil and fuel supplies tightened and as a warning from the Saudi energy minister to speculators raised the prospect of further OPEC+ output cuts. Brent crude futures rose 86 cents, or 1.1%, to USD77.70 a barrel by 0007 GMT, while the U.S. West Texas Intermediate crude (WTI) gained 88 cents, or 1.2%, to USD73.79 a barrel. Industry data late Tuesday showed U.S. crude oil and fuel inventories fell sharply.

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