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US to stay course on Venezuela sanctions

  • Spanish Market: Crude oil
  • 23/11/21

The US administration will stay the course on Venezuela oil sanctions after deeming the country's 21 November local elections as neither free nor fair, all but ending a brief flirtation with a more conciliatory policy.

Venezuelan president Nicolas Maduro's government "deprived Venezuelans yet again of their right to participate in a free and fair electoral process," US secretary of state Tony Blinken said a day after Maduro celebrated the victory of his United Socialist Party (PSUV), whose candidates swept most gubernatorial and local races amid low turnout.

President Joe Biden's administration earlier this year said it would consider lifting some of the financial and oil sector sanctions in effect against state-owned PdV and the Venezuelan government if the elections showed "substantive, credible advancements" toward restoring democracy in Venezuela.

But even before the balloting began, US officials described the process as neither free nor fair and said the sanctions would remain in place.

Financial sanctions in effect since 2017 and 2019 oil sanctions have taken a toll on PdV's output. But Venezuela has found ways to adapt — crude output has surpassed 600,000 b/d, partly reflecting condensate imports from Iran that are helping PdV to dilute extra-heavy crude from the Orinoco oil belt. Venezuela was producing over 1.2mn b/d before the oil sanctions took effect.

Biden's administration has maintained its predecessor's policy of sanctions and recognition of opposition leader Juan Guaido as the country's interim leader, despite misgivings about whether the policy can achieve the US goal of forcing Caracas to hold competitive presidential and parliamentary elections.

The Treasury Department's sanctions enforcement arm, the Office of Foreign Assets Control (OFAC), in a September filing with a US court weighing how to auction PdV's US refining arm Citgo on behalf of creditors suggested that the end of the Venezuelan opposition-controlled National Assembly's mandate in January 2022 would also end Guaido's authority as interim president.

But some hawkish Democrats and Republicans in US Congress, sensitive to conservative voter sentiment ahead of November 2022 midterm elections, have called on Biden to maintain the fiction that Guaido is Venezuela's legitimate leader, even though other opposition forces are gaining ground inside the country. And that domestic pressure seems to have worked.

"We recognize interim president Guaido and his government," assistant secretary of state Brian Nichols told lawmakers last week. "We continue to work with them closely, and I do not expect any change in that regard."

The Venezuelan government withdrew from negotiations with the mainstream opposition in October. Ahead of the 21 November election, opposition divisions deepened, particularly over whether to participate in the 21 November elections as a mobilization tactic. US diplomats had to shield opposition candidates who participated in the process from criticism from more hardline figures who insisted on maintaining an electoral boycott.

"We commend the political parties and candidates as well as voters who decided to participate in this process despite its flaws," Blinken said.

After Guaido's formal mandate ends in January, the US is likely to maintain its recognition of him as the country's last legitimate leader, even though Guaido himself has dwindling support in Venezuela. This status quo scenario would reopen a policy gulf with the EU, which dispatched a mission to monitor the Venezuelan elections and has been more inclined to use carrots rather than sticks in dealing with Caracas.

The EU electoral mission gave an upbeat assessment of the vote despite noting shortcomings such as the failure to register some opposition candidates and the use of fuel and food giveaways to influence voters by members of the ruling party. The elections marked the return of "the majority of political parties and candidates to the electoral arena," EU foreign affairs commissioner Josep Borrell said today, expressing hope that its observer mission would help facilitate credible and inclusive elections in the future, including a presidential election.


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11/02/25

Power outage shuts Norway's Sverdrup oil field: Update

Power outage shuts Norway's Sverdrup oil field: Update

Updates throughout London, 11 February (Argus) — Norwegian state-controlled Equinor has confirmed that a power outage has forced it to shut down production from Johan Sverdrup, the North Sea's largest oil field, as well as other oil and gas fields in the area. "We have experienced an incident involving smoke development in a control room connected to one of the converter stations at Haugsneset near Karsto," the company said. "This station supplies power to Johan Sverdrup and other fields on the Utsira High. The incident has resulted in a temporary shutdown of production." Equinor said it is working to restore power supply to the fields. According to its website, the affected power line also supplies the Gina Krog, Ivar Aasen, Edvard Grieg and Gudrun fields. Edvard Grieg and Ivar Aasen feed into the medium sour Grane crude blend. It is the second time in a week that Johan Sverdrup has been disrupted by a power outage. The field was shut down briefly on 4 February because of power supply issues onshore. Power was restored the same day, and the field had been ramping back up up to full operations on 5 February. At the time, Equinor did not expect any delays to loadings. Johan Sverdrup produces the largest stream of middle distillate-rich crude in Europe, with a plateau capacity of 755,000 b/d. The field averaged around 712,000 b/d in 2024. Its output was around plateau levels in March, April and July last year, but Equinor expects capacity to drop early this year. The grade was valued at a $1.65/bl premium to benchmark North Sea Dated on 10 February, a seven-month high, supported by a perceived global tightness in the supply of medium grades. The US tightened sanctions on the Russian fleet last month, which pushed refiners in Asia-Pacific to look for alternative, unsanctioned grades. Grane is the second-largest medium sour stream in the region, with around 180,000 b/d exported last year, according to loading programmes. Official production data show Ivar Aasen contributed around 18,000 b/d to the Grane stream last year and Edvard Grieg accounted for 38,000 b/d. Grane prices surged to a $2.50/bl premium to Dated in recent assessments, up from a $1/bl discount in early January. By Lina Bulyk Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

BP promises strategy reset after sharp drop in profit


11/02/25
11/02/25

BP promises strategy reset after sharp drop in profit

London, 11 February (Argus) — BP today promised to "fundamentally reset" its strategy later this month after reporting a drop in underlying profit last year. The company alluded to what the reset might entail, noting that last year it had "laid the foundations for growth" by committing capital to new oil and gas projects and "refocusing" its investments in low-carbon assets. Details of the strategy shift will be outlined at a capital markets day for investors on 26 February. Key actions in 2024 included taking a final investment decision on the 80,000 b/d Kaskida oil field in the US Gulf of Mexico and raising its exposure to biofuels in Brazil . The company also took steps via a joint venture with Japanese utility Jera that will see it commit less capital to its wind energy investments. BP reported an underlying replacement cost profit — excluding inventory effects and one-off items — of $1.2bn for the fourth quarter of 2024, compared with $3bn a year earlier. For the full year, underlying replacement cost profit fell by 36pc compared with 2023 to $8.9bn, while cash flow from operations dropped to $27.3bn from $32bn. The company benefited from higher oil and gas production last year — up by 2pc on 2023 at 2.36mn b/d of oil equivalent (boe/d). But lower prices, a drop in refining margins and lower contributions from both oil and gas trading weighed on profitability. BP said it expects upstream production to be lower this year and refining margins "broadly flat". It expects a similar level of refinery maintenance in 2025, with the work "heavily weighted towards the first half" and the second quarter in particular. For now, BP is sticking with its share repurchasing programme, announcing a further $1.75bn of share buybacks for the fourth quarter. It has maintained its quarterly dividend at 8¢/share. The company's capital expenditure remained steady at $16.2bn last year. It will provide guidance on this year's investment budget at the strategy day later this month. By Jon Mainwaring Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Trump imposes new tariffs on steel, aluminum


11/02/25
11/02/25

Trump imposes new tariffs on steel, aluminum

Washington, 10 February (Argus) — US president Donald Trump today imposed a 25pc tariff on all US imports of steel and aluminum effective 12 March, although he said he would consider making an exemption for imports from Australia. In remarks to reporters at the White House Trump complained that many of the steel and aluminum tariffs he imposed since 2018 have been moderated or reduced for some countries. Currently Australia and Canada can export any steel and aluminum they want to into the US without tariffs, while Mexico can export steel melted and poured in the US-Mexico-Canada (USMCA) agreement region into the US without tariffs, while any material with an origin outside of USMCA is subject to 25pc tariffs. "Our nation requires steel and aluminum to be made in America, not in foreign lands," Trump said. "It's 25pc without exceptions, and that's all countries, no matter where it comes from, all countries." But Trump, prompted by reporters, confirmed that he may make an exemption for Australian-sourced steel, after Canberra threatened to take reciprocal measures. "We have a surplus with Australia, one of the few," Trump said, referring to an overall trade surplus the US runs with Australia. "And the reason is they buy a lot of airplanes." Trump said he spoke with Australian prime minister Anthony Albanese earlier today. "I told him that [steel tariff exemptions] is something that we will give great consideration." A similar exemption for the UK is unlikely since the US already is running a trade deficit with that country, Trump said. Trump contended that his initial volley of tariffs in 2018 led to the creation of hundreds of thousands of jobs in the US and boosted economic growth. A 2019 study from the Federal Reserve Board that was updated in 2024 estimates that taking into account retaliatory tariffs, there was a net decrease in US jobs and economic growth from the tariffs. US oil and gas midstream companies were among the industries hit by the 2018 tariffs, which led to higher costs for pipeline steel. Most steel imports from non-tariffed US steel imports are heavily reliant on the countries that are currently not subject to US tariffs, with their volumes making up 80pc of the 26.2mn metric tonnes (t) of steel products imported in 2024, according to US Department of Commerce data. Steel tariff rate quota (TRQ) systems are in place for Argentina, Brazil, the EU, Japan, South Korea and the UK for steel products, with specifics dependent on the country. The CME Midwest hot-rolled coil (HRC) futures market jumped today, after Trump said on Sunday he would impose new tariffs, by $51/short ton (st) for March to $856/st, while April increased by $48/st to $858/st. Steel costs would rise by $6.38bn based on the $25.5bn value of 2024 steel imports from those nontariffed countries, if volumes remained the same. Those higher costs would lead to more US steel mill price increases, with one buyer expecting another round of price increases coming soon from US steelmakers. Steelmaker Nucor has increased its published hot-rolled coil (HRC) spot price by $40/short ton (st) in the last three weeks to $790/st. Other steelmakers like ArcelorMittal USA, Cleveland-Cliffs, and US Steel are at $800/st offers for their spot HRC. Canada key aluminum supplier In the aluminum market, the US imported over 6mn t of products in 2024, according to customs data. Canadian aluminum exporters currently have no restrictions on their volumes into the US. They shipped the highest volumes into the US and are responsible for an even larger share of primary aluminum imports. Current US primary aluminum smelting capacity, excluding idled operations, is around 795,000t/yr, which equaled less than one-third of Canadian imports and one-fifth of total imports. There are multiple idled primary aluminum facilities and a greenfield plant currently under construction, but observers and company representatives challenged the feasibility of idled plant restarts in the past. TRQ systems exist for US aluminum imports from Argentina, the EU, and the UK. By Haik Gugarats Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Nigeria Dangote targets full capacity within a month


10/02/25
10/02/25

Nigeria Dangote targets full capacity within a month

London, 10 February (Argus) — Nigeria's privately-owned 650,000 b/d Dangote refinery could reach maximum operating capacity within a month, according to sources with knowledge of the matter who said the plant touched 85pc of nameplate capacity at the end of January. The stated goal appears ambitious, with data from Kpler and Vortexa showing Dangote ran at an implied range of 395,000-430,000 b/d to date this month, which is between 61-66pc of capacity. The implied range was 350,000-400,000 b/d in January, or 54-62pc operating capacity. Argus pegged Dangote's crude receipts at 405,000 b/d in January, a record. Dangote runs may be boosted by upstream regulator NUPRC's decision in early February to ensure Nigeria's crude is supplied to meet domestic refinery demand, before it issues crude export permits. Routine maintenance at state-owned NNPC's 125,000 b/d Warri refinery could have made more domestic crude available for Dangote use. Crude allocations to Warri were cancelled and offered out to the wider market last week, according to a market participant. But this would have been a short-term measure, with a source saying the work at Warri was completed as of 9 February, and around 1.15mn bl of crude are scheduled to be pumped to the plant. Downstream regulator NMDPRA projected that Dangote will require 550,000 b/d of Nigerian crude grades for the period January–June 2025, while NNPC's 210,000 b/d Port Harcourt and 125,000 b/d Warri plants will require 60,000 b/d and 75,000 b/d, respectively. Nigeria produced 1.51mn b/d of crude in January, according to Argus' estimate. Warri restarted at the end of 2024, having been offline since 2019. Diesel loadings from the refinery have averaged eight trucks per day, sources said last week, with sufficient supply available to sustain ongoing truck load-out operations. Warri has not started producing gasoline, according to sources. By George Maher-Bonnett, Adebiyi Olusolape and Sanjana Shivdas Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Mexico inflation slows to 4-year low in January


10/02/25
10/02/25

Mexico inflation slows to 4-year low in January

Mexico City, 10 February (Argus) — Mexico's consumer price index (CPI) eased to an annual 3.59pc January, the lowest in four years, as deceleration in agriculture prices offset faster inflation in energy and consumer goods prices. This marks the lowest annual inflation since January 2021 and a significant slowdown from July's annual peak of 5.57pc, which was driven by weather-impacted food prices. The result, reported by statistics agency Inegi on 7 January, was slightly below than the 3.63pc median estimate from 35 analysts polled in Citi Research's 5 February survey. It compares with the 4.21pc headline inflation in December, marking five months of declines in the past six months. Mexican core inflation, which excluded volatile energy and food, sped slightly to 3.66pc in January from 3.65pc in December, while non-core inflation decelerated to 3.34pc from 5.95pc the previous month. Movement, in the non-core, said Banorte, was mostly explained by a positive basis of comparison, and "will reverse as soon as the second half of February to push the headline metric above 4pc," said Banorte. Core inflation accelerated slightly to 3.66pc in January from 3.65pc in December, marking the second uptick after 22 consecutive months of deceleration. Services inflation slowed to 4.69pc from 4.94pc, while consumer goods inflation ticked up to 2.74 from 2.4pc. Non-core inflation slowed sharply to 3.34pc from 6.57pc in December. This was largely due to base effects, Banorte said, adding these base effects are likely to fade this month to speed headline annual inflation back above 4pc. The base effects most clearly impacted fruit and vegetable price inflation, contracting 7.73pc in January from 6.65pc annual inflation the previous month. Moving forward, agriculture prices are highly exposed to the coming hot, dry season in Mexico, with the La Nina climate phenomenon, adding a layer of uncertainty. Meanwhile, energy inflation accelerated to 6.34pc in January from 5.73pc the previous month, driven by higher LPG prices. Electricity inflation, meanwhile, sped to 4.32pc in January from 2.65pc in December, while inflation slowed to 0.02pc in January for domestic natural gas prices from 5.67pc in December. Monetary policy The January inflation report followed the central bank's decision Thursday to reduce its target interest rate to 9.50pc from 10pc. This was the bank's sixth rate cut since March 2024, winding down from 11.25pc. The 4-1 decision marked an acceleration in the current rate cycle, opting for a half-point reduction rather than the previous five 25-basis-point cuts. In board comments with the announcement, the bank cited "significant progress in resolving the inflationary episode derived from the global shocks" in 2021 and 2022. These triggered rate hikes from 4pc in June 2021 to 11.25pc in April 2022, the target rate's historic high. Taking into account the "country's weak economic activity" and this progress in reducing inflation, the board said it would "consider adjusting [the target] by similar magnitudes" at upcoming meetings. By James Young Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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