US producer Talos Energy has finalised the unitisation agreement for its shallow-water Zama discovery in Mexico following an operatorship dispute with state-owned Pemex. In 2017, Talos announced the Zama find of up to 950mn bl of recoverable oil equivalent in block 7, which neighbours Pemex acreage. But after more than two years of talks, the parties failed to agree and the energy ministry designated Pemex as operator in July last year. That decision was criticised for deterring investors, for the strain it will put on Pemex's stretched finances, and because of Pemex's lack of experience drilling a reservoir at Zama's depth. The block could produce up to 160,000 b/d of oil equivalent, Talos says, making it the largest exploration and production contract awarded since 2014's energy reforms.
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LatAm squeezes west African crude in key markets
LatAm squeezes west African crude in key markets
London, 27 July (Argus) — Brazilian and Guyanese grades are outperforming west African crudes in terms of price and volume in Europe and China, with the potential to turn west African crude into arbitrage rather than base-load supply in its key markets. Brazilian and Guyanese output has been ramping up in recent years — combined exports have risen by roughly 500,000 b/d from 2025 to 3.28mn b/d this year, trade analytics firm Vortexa data show. The higher production has weighed on prices for Latin American crude, and differentials for Brazilian crude have been particularly pressured in recent weeks due to weak spot demand from key buyer China — leaving extra supply for Europe. Chinese refiners cut their buying of Brazilian crude by more than a third for August and September delivery compared with previous months, Argus deal tracking shows, and buying has remained slow for October arrivals. If those cargoes draw a blank in China, sellers are likely to try to offer them in Europe — for September delivery, due to the shorter voyage. This rising amount of Latin American crude competes in its main export markets — Europe and China — with more established west African grades. Most of the time, Latin American crude is cheaper than west African shipments. Medium sweet Buzios on average has been $5.50/bl cheaper than Nigerian Forcados on a delivered-northwest Europe basis over the past year. "Brazilian crude is way cheaper, but the gross product worth of Nigerian crude is better in this market because of higher diesel yields," a European trader says. Argus refinery gate values show that Forcados is currently around $13/bl more valuable than Buzios in terms of products output, leaving refiners having to choose between optimising runs or having lower feedstock costs. The latter often wins out. European imports of Brazilian and Guyanese crude have risen by 135,000 b/d from last year to roughly 1mn b/d this year, whereas its west African imports have fallen by around 115,000 b/d over the period. Shifting cycles The rising supply of cheaper Latin American crude is not only starting to oust west African crude from its core market, but is also forcing it to trade more promptly. It is increasingly common for unsold prompt west African cargoes to accumulate even as producers release fresh loading programmes for the following months. Roughly half of the Nigerian programme for August had yet to find a home in late July, when September dates were already emerging. Producers hotly contest that this is an "overhang". The cargoes still find a buyer, but only once refiners have covered the bulk of their requirements through the forward trading markets. As of late July, a European refiner can lock in a cargo of Buzios for September arrival that is roughly $10/bl cheaper than Forcados, and revisit west African purchases in a couple of weeks. Angolan and Congolese crudes that mainly go to China have also been trading more promptly in recent months, although to a lesser extent than Nigerian grades. Subdued Chinese demand only partly explains the delay, as plentiful and cheaper Latin American supply gave refiners the flexibility to delay west African crude purchases. "There is a strong link between west African and Brazilian crude in the Chinese market. Buyers usually use delivered Brazilian prices as a reference to calculate [economical] west African fob levels," a Chinese trader says. This slow but consistent shift means that west African grades are at risk of becoming arbitrage supply sources in their core markets, while Brazilian and Guyanese grades meet their base-load requirements. But this might change if the strait of Hormuz remains largely shut, and global supply dries up. By Lina Bulyk China purchases of Brazilian crude Buzios, Forcados cfr ARA Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
Military action will not reopen Hormuz: Analysts
Military action will not reopen Hormuz: Analysts
New York, 24 July (Argus) — Iran's ability to control commercial traffic through the strait of Hormuz is unlikely to be deterred by US military operations given the effectiveness of Iran's asymmetrical warfare tactics, according to analysts following the war. The amount of firepower Iranians need to disrupt commercial shipping is quite small, Center for Naval Analyses (CNA) research program director Joshua Tallis told Argus, making it very difficult for the US to degrade Iranian capabilities to a point where they pose no threat to commercial shipping. "I do not believe, short of a massive ground invasion, that there is a military solution to the Iranians' ability to disrupt and coerce commercial traffic moving through the strait," Tallis said. "The only solution is ultimately a diplomatic negotiated solution." CNA is an independent, nonprofit research and analysis organization funded by the US government to advise its military forces. Reducing Iran's motivation to attack, which can be done through diplomatic means, may prove easier than reducing Iran's ability to attack, shipping association BIMCO told Argus in March at the outset of the conflict between the US and Iran. Iran has retained its ability to inflict severe damage to commercial shipping through the strait of Hormuz using unconventional tactics, despite intense US and Israeli strikes specifically aimed at degrading Iran's ability to attack mariners and commercial vessels. Iran's asymmetric capabilities to pressure vessel traffic in Hormuz include fast attack craft, cruise missiles and drones. Maritime security firm Windward tracked 219 "speed crafts" in the strait of Hormuz on 21 July, the largest single-day total since 15 May. Vessel traffic through the strait of Hormuz this week has increasingly been concentrated in the northern traffic lanes overseen by Iran, suggesting that its attacks on commercial shipping following other routes has been successful. Windward data for 20-24 July shows that the northern lane carried between around 88-100pc of all Hormuz traffic. All vessels that transited the strait of Hormuz on 24 July did so on the northern Iranian controlled lane, according to Windward. But commercial vessel traffic through the strait remains at a fraction of prewar levels, with a combined 12 vessels transiting through the waterway on 24 July, around 9pc of prewar levels, data from Windward shows. By Charlotte Bawol Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
US levels new tariff threat against EU
US levels new tariff threat against EU
Washington, 24 July (Argus) — President Donald Trump's administration is threatening to impose new tariffs on US imports from the EU, just a month after the European parliament approved the economic bloc's trade agreement with the US. "The European Union is at it again and, as usual, taking direct aim at GREAT American Companies," Trump said in a social media post. The US Trade Representative's office (USTR) complained that the European Commission has just imposed a $1bn fine on Google, following other recent anti-trust measures against US tech giants. The US will launch a "Section 301" investigation against the EU's "practice of 'ROBBING' American Companies and, in turn, the American Taxpayer," Trump posted. The US has just imposed a 10pc tariff on imports from the EU, following an investigation under Section 301 of the Trade Expansion Act of 301 into Europe's alleged lack of diligence in banning imports of products produced by forced labor in third party countries. There is another Section 301 investigation underway against the EU related to "structural excess capacity and production in manufacturing sectors." The US-EU trade deal last year capped potential punitive US tariff rates at 15pc for imports from the European bloc. Trump earlier this month said he would to cut off all trade with Spain , an EU member, for not supporting the US war effort against Iran, but he did not follow up on his threat. The EU mission in Washington did not immediately comment on Trump's threat. The European Commission on Thursday highlighted the benefits of the US-EU deal signed almost a year ago, highlighting that EU companies closed deals with US exporters worth €230bn ($262bn) of energy resources in the past year. The EU has refrained from retaliating in kind against Trump's tariff in order to preserve cooperation on defense and weapons sales to Ukraine. By Haik Gugarats Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
VLCC takes Cape route to avoid Red Sea
VLCC takes Cape route to avoid Red Sea
London, 24 July (Argus) — South Korea's SK Energy has booked the VLCC DHT Stallion to carry Saudi crude from Egypt to South Korea around the Cape of Good Hope, avoiding the Red Sea and Bab el-Mandeb strait after Yemen's Iran-backed Houthi militant group said it would target Saudi-linked shipping in the area, market participants said. The cargo will load at Sidi Kerir on Egypt's Mediterranean coast after being pumped through the Sumed pipeline from Ain Sukhna on Egypt's Red Sea coast. The Bab el-Mandeb strait, at the southern end of the Red Sea off Yemen, links the Red Sea with the Gulf of Aden. Saudi Arabia has continued to shuttle crude to Ain Sukhna for delivery into Sumed, despite the heightened risk to shipping in the Red Sea. The pipeline allows Saudi crude to move across Egypt to the Mediterranean, where it can be loaded at Sidi Kerir without the onward voyage needing to pass through the Red Sea. A Saudi Red Sea loading to northeast Asia would usually sail south through Bab el-Mandeb. But the DHT Stallion will instead sail west from the Mediterranean into the Atlantic and around southern Africa, avoiding the strait and the area where the Houthis have threatened Saudi-linked shipping. SK Energy fixed the DHT Stallion at a lumpsum of $17mn-18.5mn, market participants said. That range is comparable with recent Yanbu-northeast Asia rates through Bab el-Mandeb, but the Cape route adds around 30 days to the voyage and reduces daily earnings. Owners are still willing to take the longer voyage because it avoids the higher risk linked to Red Sea and Bab el-Mandeb transits. Yanbu-northeast Asia rates through Bab el-Mandeb have risen sharply as owners price additional war risk insurance premiums into spot deals. The Cape of Good Hope route avoids that risk area, so owners do not need to build the same premium into the fixture. The DHT Stallion is already north of the Suez Canal and is expected to ballast from the UK Continent after discharging its current cargo in Rotterdam. That ballast leg would also avoid the Red Sea and Bab el-Mandeb. The fixture comes as US president Donald Trump has stepped up threats against Iran after the Houthis said they were following through on their vow to target Saudi shipping in the Red Sea. "The US will hold Iran responsible, in that the Houthis are a Surrogate and/or Proxy of Iran," Trump said in a social media post on 23 July. He threatened "major military punishment" against Iran and the Houthis. By Rhys van Dinther Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
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