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Brazil fossil fuel subsidies outpace renewables: Study

  • Market: Crude oil, Electricity, Oil products
  • 29/10/24

Brazil's spending on fossil fuels subsidies in 2023 was around 4.5 times larger than its spending on renewables subsidies, according to a study published by the institute of socioeconomic studies Inesc.

The country spent R99.8bn ($17.49bn) in subsidies for both fossil fuels and renewables in 2023, a 3.6pc increase from 2022, the study said. Of the total, R81.74bn were related to fossil fuels — a 0.5pc decrease from a year prior — while R18.06bn went to renewable sources, a near 27pc hike from 2022.

The slight fossil fuel subsidies reduction was due to the return of taxes on gasoline, such as the VAT-like PIS/Confins, the study said. "The government lost the chance of providing greater relief for public coffers as it decided to maintain exemptions for diesel," it added.

But while incentives to fossil fuel consumption decreased, those for exploration and production activities increased by R5.55bn.

Cassio Carvalho, a co-author of the study for Inesc, said the fossil fuels subsidies will harm Brazil's energy transition. "The study indicates that consumers are bearing the subsidies for renewables through electricity bills, while the oil and natural gas industry remains untouched," Carvalho said.

Ending subsidies to fossil fuels is an "unavoidable global commitment" laid out in the UN Cop 28 climate summit in Dubai, said Alessandra Cardoso, the other co-authored of the study.

"What is expected of the Brazilian government is that it recognizes the problem of production subsidies as a domestic problem, the solution to which involves global reform," she said. "Brazil needs to take on this agenda as part of its leading role in the global climate scenario, especially as it will host Cop 30."

Brazil will host Cop 30 in 2025 in Para's state capital Belem, on the edge of the Amazon forest.


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08/11/24

Argentina’s YPF sees jump in shale oil output

Argentina’s YPF sees jump in shale oil output

Montevideo, 8 November (Argus) — Argentina's state-owned YPF saw output of unconventional crude surge by 36pc to 126,000 b/d in the third quarter of the year compared to a year earlier. YPF's third quarter statement put total production at 559,000 b/d of oil equivalent (boe/d) with crude at 256,000 b/d, up by 8pc, and natural gas at 40.3mn m³/d, or 253,000 boe/d, an increase of 7pc, and 49,000 boe/d of natural gas liquids, up by 4pc. Unconventional crude accounted for 49pc of overall output. It was 39pc of total production a year earlier. YPF is the major player in Vaca Muerta, Argentina's unconventional formation that holds an estimated 16bn bl of crude and 308 trillion cf of gas, according to the US Energy Information Administration. The formation is at the heart of YPF's plans for Argentina to produce 1mn bl of crude and export up to 30mn metric tonnes/yr of LNG by the end of the decade. YPF is now Argentina's largest crude exporter, dispatching an average of 40,000 b/d in the third quarter, nearly all of this going by pipeline to neighboring Chile, according to Federico Barroetavena, chief financial officer. He said the company invested $1.35bn in the third quarter, with more than 70pc on upstream. It drilled 50 wells in the third quarter. YPF is moving ahead with its southern Vaca Muerta oil pipeline as it looks for partners for the full project. It has completed 50pc of the first 130km (81.4mi) segment. The second 440km, as well as storage tanks and a monobuoy platform, will require $2.5bn. The company anticipates construction to start in the first quarter of 2025. The initial capacity will be 180,000 b/d in 2026, increasing to 500,000 b/d in 2027 and, eventually, to 700,000 b/d. YPF is also the largest shareholder, with 37pc, in the Oldelval pipeline from Vaca Muerta to the coast. It is undergoing an expansion to 530,000 b/d in 2025. The state-owned energy company, Enarsa, completed in October the reversal of the country's northern gas pipeline to move Vaca Muerta gas to the north of the country. It will move more than 15mn m³/d of gas to northern Argentina. It previously moved gas from northern gas fields, now depleted, and Bolivia, to the capital, Buenos Aires. By Lucien Chauvin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Fund woes to hit Australian post-winter bitumen imports


08/11/24
News
08/11/24

Fund woes to hit Australian post-winter bitumen imports

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Hungary’s Mol cuts forecast for 2024 refinery runs


08/11/24
News
08/11/24

Hungary’s Mol cuts forecast for 2024 refinery runs

Budapest, 8 November (Argus) — Hungarian integrated oil firm Mol has revised down its 2024 forecast for crude runs at its two landlocked refineries after a "turnaround-heavy" third quarter, it said today. The company expects to refine around 11.5mn t of crude combined at the 161,000 b/d Szazhalombatta plant in Hungary and the 115,000 b/d Bratislava complex in Slovakia this year, down from its previous guidance of about 12mn t. The two refineries processed 8.25mn t of crude in January-September, down from 9.09mn t a year earlier. Their combined crude throughput was down by 11pc on the year at 2.81mn t in the third quarter. Mol carried out scheduled maintenance at Szazhalombatta between 26 July and 19 September and expects to complete maintenance work on petrochemical units at Bratislava in the first half of November. Crude intake at Mol's third refinery, the 90,000 b/d Rijeka plant on Croatia's Adriatic coast, rose by 2.6pc on the year to 802,000t in the third quarter and was largely unchanged year-on-year at 1.26mn t in January-September. The company's crude throughput forecast only includes the Hungarian and Slovakian refineries. Mol cut the share of imported crude in its overall slate to 3.35mn t, or 93pc, in the third quarter from 3.8mn t, or 97pc, a year earlier, while it almost doubled intake from its own crude production to 255,000t in July-September from 129,000t in the same period last year. Szazhalombatta and Bratislava mostly process Russian crude received through the Druzhba pipeline system under an EU oil ban waiver, while Rijeka mainly takes non-Russian seaborne crude. The profitability of Mol's refining business was hit by a 71pc year-on-year fall in its refinery margin indicator — calculated based on the Dated Brent crude benchmark — to just $3.70/bl in July-September. Its oil product sales fell by 4.2pc from a year earlier to 4.88mn t in the third quarter. This included 1.52mn t of products Mol had to buy from third parties to complement its own output and satisfy demand, a significant rise from 1.25mn t of third-party oil products it sold a year earlier. The firm's upstream oil and gas production rose by 11pc on the year to 96,100 b/d of oil equivalent (boe/d) in the July-September quarter. It has raised its full-year forecast to about 92,000-94,000 boe/d from previous guidance of around 90,000 boe/d. Mol's profit fell to 111.5bn forint ($295mn) in the third quarter from Ft175.8bn a year earlier. By Béla Fincziczki Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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US extends oil service firms' Venezuela waiver


07/11/24
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07/11/24

US extends oil service firms' Venezuela waiver

Washington, 7 November (Argus) — The outgoing administration of US president Joe Biden extended authorization for oilfield services companies Halliburton, SLB, Baker Hughes and Weatherford to continue working in Venezuela until 9 May 2025. The waiver allows the service companies to pay their staff and maintain limited operations, but it prevents them from drilling new wells or otherwise contributing to state-owned PdV's production and exports. The Biden administration reimposed sanctions on Venezuela's oil sector in April, after a six-month reprieve. The sole exemption is a waiver for Chevron allowing it to import oil into the US from its joint venture with state-owned PdV. US crude imports from Venezuela averaged 212,000 b/d in January-August, US Energy Information Administration data show. Chevron's Venezuela output has stood at about 200,000 b/d. Neither president-elect Donald Trump nor his campaign addressed the Venezuela sanctions regime or indicated if they would change it. Republicans in Congress ahead of the election called for the Chevron exemption to be revoked. The Biden administration separately extended a prohibition for holders of $3.4bn in PdV 2020 bonds guaranteed by 50.1pc in US refiner Citgo's holding company to exercise their claim, this time until 7 March 2025. The PdV bondholders in theory hold a superior claim to Citgo Holding — a legal entity that directly owns Citgo and, in turn, is owned by Citgo parent company PdVH. A federal court in Delaware recently oversaw an auction of PdVH shares that yielded a $7.3bn bid from a company backed by investors including Elliott Investment Management. Legal wrangling over the bids and the distribution of auction proceeds is likely to keep Citgo ownership unresolved in the near term. By Haik Gugarats Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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German government collapse could delay energy policies


07/11/24
News
07/11/24

German government collapse could delay energy policies

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