Brazilian crude exports retreat in August
Brazilian crude exports fell by around 30pc to 5.47mn t (1.29mn b/d) in August compared with July, partly reflecting congestion at Chinese ports caused by severe floods in the Yangtze basin.
But crude outflows were up almost 15pc compared with August 2019, according to preliminary data from Brazil's trade ministry MDIC.
In terms of crude export receipts, China accounted for around 88pc in August compared with 73pc of the around 1.94mn b/d dispatched in July, according to the MDIC data.
The Netherlands, Portugal and France increased their share of export receipts compared with August 2019, with the US reducing its share in the same period.
Exports could retreat further starting in September as Brazil's state-controlled Petrobras launches major upstream maintenance that could reduce the company's monthly production by around 200,000 b/d. The delayed campaign, which was originally scheduled for January 2020, will be coupled with downstream maintenance that is not expected to significantly impact domestic fuel production, a Petrobras executive tells Argus.
In late August, Petrobras, which accounts for around 75pc of domestic oil production, said that lower price premiums and floods had disrupted crude flows to China, the main destination for its light sweet pre-salt grades.
"The lineups in China are going down from 30 days, less than 15 days, some ports less than one week. With the floods part of the river basin stopped. Demand is slightly lower, more on premium than demand, but we believe it will come back in the coming weeks," Petrobras' head of international trading Alexandre Leite told Argus in a recent interview.
Brazil produced 3.078mn b/d of crude in July, confirming a steady climb off of an April trough caused by the pandemic, according to data from oil regulator ANP.
Petrobras has said its decision to retain a 2020 domestic production target of around 2.7mn b/d of oil equivalent (boe/d) is associated with a Chinese economic rebound, but the firm is also monitoring recovering domestic fuel demand and the production of low-sulfur fuel oil for export.
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US M&A deals dip after record 1Q: Enverus
US M&A deals dip after record 1Q: Enverus
New York, 26 April (Argus) — US oil and gas sector mergers and acquisitions (M&A) are likely to slow for the rest of the year following a record $51bn in deals in the first quarter, consultancy Enverus says. Following an unprecedented $192bn of upstream deals last year, the Permian shale basin continued to dominate first-quarter M&A as firms competed for the remaining high-quality inventory on offer. Acquisitions were led by Diamondback Energy's $26bn takeover of Endeavor Energy Resources. Other private operators, such as Mewbourne Oil and Fasken Oil & Ranch, would be highly sought after if they decided to put themselves up for sale, Enverus says. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Start-ups to help Total keep output stable in 2Q
Start-ups to help Total keep output stable in 2Q
London, 26 April (Argus) — TotalEnergies said it expects its oil and gas production to hold broadly steady in the second quarter as planned maintenance is partially offset by rising output from new projects in Brazil and Denmark. The company expects to average 2.4mn-2.45mn b/d of oil equivalent (boe/d) in April-June, compared with 2.46mn boe/d in the previous three months and 2.47mn boe/d in the second quarter of 2023. Production is being supported by the restart of gas output from the redeveloped Tyra hub in Denmark late last month and the start of the 180,000 b/d second development phase of the Mero oil field on the Libra block in Brazil's Santos Basin at the beginning of the year. TotalEnergies first-quarter output was flat compared with the previous three months but 2pc lower than a year earlier as a result of Canadian oil sands divestments. The company reported a robust set of first-quarter results today, broadly in line with analysts' expectations. Profit for the first three months of 2024 was $5.7bn, compared to $5.6bn in the same period last year. Adjusted profit — which takes into account inventory valuation effects and special items — came in at $5.1bn, down by 22pc on the year but slightly ahead of the consensus of analysts' estimates of $5bn. Adjusted operating profit from the firm's Exploration & Production business was down by 4pc year-on-year at $2.55bn, driven in part by lower natural gas prices. The Canadian oil sands asset sales weighed on the segment's production but this was partly compensated by start-ups. As well as Mero 2, the Akpo West oil project in Nigeria started production during the first quarter. TotalEnergies' Integrated LNG segment saw a 41pc year-on-year decline in its adjusted operating profit to $1.22bn in January-March. The company said this reflects lower LNG prices and sales. But while its LNG sales for the quarter fell by 3pc in year-on-year terms, its LNG production was greater by 6pc. TotalEnergies achieved an average $78.9/bl for its liquids sales in the first quarter, an improvement on $73.4/bl a year earlier. But the average price achieved for its gas sales was 43pc lower on the year at $5.11/mn Btu. In the downstream, the company's Refining & Chemicals segment's first-quarter adjusted operating profit was $962mn in January-March, down by 41pc on the year but 52pc higher than the preceding quarter. TotalEnergies attributes the quarter-on-quarter rise to higher refining margins and a rise in refinery throughput . For the second quarter, it expects refinery utilisation rates to be above 85pc, compared with 79pc in the first quarter, boosted by the restart of 219,000 b/d Donges refinery in France. Total's Integrated Power segment continued to improve, registering a quarter-on-quarter and year-on-year increased of 16pc and 65pc respectively in its adjusted operating profit to €611mn. Net power production increased 14pc year-on-year to 9.6 TWh, while the company's portfolio of installed power generation capacity grew 54pc to 19.5GW. Total's cash flow from operations, excluding working capital, was down by 15pc on a year earlier at $8.2bn in the first quarter. The company has decided to raise its dividend for 2024 by 7pc to €0.79/share and plans a $2bn programme of share buybacks for the second quarter. By Jon Mainwaring Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
India's crude output steady, throughput rises in March
India's crude output steady, throughput rises in March
Mumbai, 26 April (Argus) — India's March crude production was steady on the year and up by 2pc on the month at 543,000 b/d. Output fell by 2pc to 546,000 b/d during the April 2023-March 2024 fiscal year. Total crude and condensate production was 590,000 b/d in March, up from 580,000 b/d in February and steady from March 2023, data from the oil ministry show. Crude output from state-controlled upstream firm ONGC was 354,000 b/d in March, up by 0.2pc on the month and down by 6pc on the year. This was likely because of a shutdown at the Panna-Mukta offshore platforms to commission a new crude pipeline and to modernise its evacuation facilities. The windfall tax for domestic crude production was raised to 4,600 rupees/t ($7.58/bl) during 1-15 March and then to Rs4,900/t during 16 March-3 April. The rate is reviewed every two weeks. The Indian government first imposed the windfall tax in July 2022 as a sharp increase in crude prices then resulted in domestic crude producers making windfall gains. Indian crude producers sell crude to domestic refineries at international parity prices. ONGC and fellow state-controlled upstream firm Oil India continued to produce the most of India's crude in March at 425,000 b/d, making up 78pc of the total production. Private-sector producers and joint ventures made up the remainder. India's dependence on crude imports declined to 88pc in March from 89pc in February and March 2023. Its dependence on crude imports rose to around 88pc in April 2023-March 2024 from 87pc in the previous year. India has steadily been trying to reduce its dependence on imports. It extended the deadline to 15 May for submitting bids for 28 upstream oil and gas blocks in the ninth Open Acreage Licensing Program bidding round. India's oil product exports fell to 5.3mn t in March from 6mn t in March 2023, but rose from 4.1mn t in February. Higher throughput Indian refiners processed 5.53mn b/d in March, higher from 5.28mn b/d in February and 5.44mn b/d in March 2023. Processing rose to 5.24mn b/d in April 2023-March 2024, up from 5.11mn b/d the previous year. Processing likely picked up as product demand increased in March. India's product demand — including diesel, gasoline, jet fuel, LPG, bitumen, naphtha and petroleum coke — increased by nearly 7pc from the previous month and was steady on the year to 21mn t in March. Crude throughput at state-controlled IOC's nine refineries was 1.6mn b/d, up by 8pc from a year earlier and by 10pc against the previous month. State-controlled BPCL processed 874,000 b/d at its refineries in March, up by 3pc from a year earlier and by 8pc from February. State-controlled HPCL's throughput rose by 3pc from the previous year and was steady from a month earlier at 709,000 b/d. ONGC's refineries processed 354,000 b/d in March, 6pc lower on the month and steady against a year earlier. India imported 4.7mn b/d of crude in March, 4pc lower from the previous year and up by 4pc from a month earlier, according to oil ministry data. By Roshni Devi Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US reimposes Venezuela oil sanctions
US reimposes Venezuela oil sanctions
The US' decision reopens the door for Chinese independent refiners to procure Venezuelan Merey at wide discounts to other crude grades, writes Haik Gugarats Washington, 25 April (Argus) — The US administration reimposed sanctions targeting Venezuela's oil exports and energy sector investments on 17 April, and set a deadline of 31 May for most foreign companies to wind down business with state-owned oil firm PdV. The decision rescinds a sanctions waiver issued in October, which allowed Venezuela to sell oil freely to any buyer and to invite foreign investment in the country's energy sector. The waiver was due to expire on 18 April, with an extension dependent on Caracas upholding a pledge to hold free and fair elections. Venezuelan president Nicolas Maduro's government reneged on that deal by refusing to register leading opposition candidate Maria Corina Machado or an alternative candidate designated by her, a senior US official says. The US considered the potential effects on global energy markets and other factors in its decision but "fundamentally the decision was based on the actions and non-actions of the Venezuelan authorities", the official says. China's imports of Venezuelan Merey — often labelled as diluted bitumen — decreased following the instigation of the waiver in October. Independent refiners in Shandong previously benefited from wide discounts on the sanctioned crude, but they drastically cut back their Merey imports as prices rose. Meanwhile, state-controlled PetroChina was able to resume imports under the waiver. The reimposition of sanctions this month was widely expected and Merey's discount to Ice Brent began to widen in early April, before the decision was announced. Merey's discount to Brent averaged $9/bl in March, but had reached $12/bl by the start of April and $13/bl after the reimposition of sanctions was formally announced. Buyers are expecting final deals for May at discounts of $14/bl or lower, and for prices to drop by a further $3-4/bl in the short term. Longer-term prices for Merey will be influenced by supply and prices for Iranian crude — another mainstay of Shandong independents. Venezuela's crude output reached 850,000 b/d in March, up by 150,000 b/d on the year, according to Argus estimates. PdV has begun looking to change the terms of its nine active joint ventures with international oil companies, in an effort to keep production elevated now sanctions are back in place. Chasing the deadline The end of the waiver will affect Venezuela's exports to India as much as those to China. India emerged as a major destination for Venezuelan crude after sanctions were lifted, importing 152,000 b/d in March. Two more Venezuelan cargoes are expected to arrive in India before the 31 May deadline. The 2mn bl Caspar left Venezuela's Jose port on 14 March and is expected to arrive in India on 26 April, and Suezmax vessel Tinos is due at India's Sikka port on 30 April. Separate sanctions waivers granted to Chevron and oil field service companies Halliburton, SLB, Baker Hughes and Weatherford will remain in place. Chevron can continue lifting oil from its joint venture with PdV, solely for imports to the US. Oil-for-debt deals between PdV and Spain's Repsol and Italy's Eni are expected to be allowed to continue. Repsol imported 23,000 b/d of Venezuelan crude into Spain last year and 29,000 b/d so far this year, according to data from oil analytics firm Vortexa. And a waiver enabling a Shell project to import natural gas from Venezuela's Dragon field to Trinidad and Tobago is expected to remain in place. The US says it would consider other requests for sanctions waivers for specific energy projects. It will consider lifting sanctions again if Maduro's government allows opposition candidates to participate in the July presidential election. The resumption of sanctions "should not be viewed as a final decision that we no longer believe Venezuela can hold competitive and inclusive elections", a US official says. Chinese imports of Venezuelan crude Venezuelan crude exports Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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