Oil price outlook volatile, says Baker Hughes: Update

Spanish Market: Crude oil, Natural gas
20/07/22

Updates with international activity outlook.

The outlook for global oil prices remains volatile but still supports "strong activity levels," according to oilfield services giant Baker Hughes.

Although demand prospects are set to weaken over the next 12-18 months because of inflation and as central banks aggressively hike interest rates, supply constraints are sufficient to keep prices at elevated levels, said chief executive Lorenzo Simonelli.

"If commodity prices remain resilient as we expect, our portfolio is well positioned to benefit from a strong LNG cycle and a multi-year upstream spending cycle," he said after the company posted second-quarter results.

The company continues to expect a broad-based recovery across major markets for oilfield services.

"As we look at the Middle East, that could be one of the strongest markets in 2022, with a lot of that coming through in the second half," Simonelli said, citing higher capital budgets.

Growth is also expected in Latin America, led by Brazil and Mexico, and to a lesser degree in the North Sea and Asia Pacific.

Activity and pricing remains robust in North America, with the rig count tracking above the company's expectations.

"Barring any big changes from a recessionary outlook perspective, we remain constructive," Simonelli said.

Earnings were mixed with challenges posed by component shortages and supply chain inflation, as well as the suspension of the company's operations in Russia due to sanctions. The company took a pretax charge of $365mn related to its halted operations in Russia.

It posted a quarterly loss of $839mn, which compared with a loss of $68mn in the same period of last year. Revenue fell by 2pc to $5bn.

Baker Hughes is the second of the top three oil services firms to report earnings. Halliburton yesterday brushed aside recent market volatility caused by concerns over an economic slowdown and predicted a "multiyear energy cycle."

By Stephen Cunningham

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19/12/25

Trinidad not part of US blockade of Venezuela: PM

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Mexico central bank cuts target rate to 7pc

19/12/25

Mexico central bank cuts target rate to 7pc

Mexico City, 19 December (Argus) — Mexico's central bank cut its benchmark interest rate by 25 basis points to 7pc, its lowest level since June 2022, maintaining a slower pace in the easing cycle on inflation concerns. The decision marked the eighth rate cut this year and the fourth quarter-point reduction following four consecutive half-point cuts. This year's cuts follow five quarter-point cuts in 2024 from a cyclical peak of 11.25pc in March. The board approved the cut in a 4-1 vote, with deputy governor Jonathan Heath dissenting in favor of holding the rate at 7.25pc. Heath has been the lone dissenter in the past five decisions, consistently urging greater caution. The central bank said the decision reflected "the behavior of the exchange rate, the weakness of economic activity and the possible impact of changes in global trade policies," repeating language used in its last four statements. Gabriela Siller, chief economist at Banco Base, pointed to a "significant change" in the bank's forward guidance, noting a shift toward a less dovish tone. The board said it "will consider when to make further adjustments" to the policy rate, replacing the "will consider cutting" language used in November. Mexican bank Banorte also said the central bank struck a less dovish tone, pointing to a change in its forward guidance. Annual inflation rose to 3.8pc in November from 3.57pc in October, according to statistics agency Inegi. Core inflation, which excludes volatile food and energy prices, accelerated to 4.43pc from 4.28pc. The central bank now sees headline inflation ending 2025 at 3.7pc, up from 3.5pc in its November forecast, while core inflation is projected at 4.3pc, revised from 4.1pc. It also raised its headline and core forecasts for the first two quarters of 2026, while maintaining that both will converge to its 3pc target by the third quarter. The bank said the revisions mainly reflect a "more gradual-than-expected" easing in services inflation, along with a smaller contribution from accelerating consumer goods prices. The board also addressed recent tax reforms, which it expects will have a temporary and not necessarily proportional impact on prices, adding it will update its forecasts as it conducts a comprehensive assessment of the revised tax code's effects. By James Young Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

W Australia's gas surplus outlook strengthens: Aemo

19/12/25

W Australia's gas surplus outlook strengthens: Aemo

Sydney, 19 December (Argus) — The Australian Energy Market Operator (Aemo) is forecasting a bigger gas supply surplus in Western Australia (WA) for most of 2026-30, according to its 2025 WA Gas Statement of Opportunities (GSOO) report released today. Aemo now projects that both gas supply and demand will be lower than previously expected in the period, because of cutbacks at major industrial users and downward revisions to its production forecasts. But its demand revisions were larger than its supply revisions, increasing its projected surplus. The state's gas supply will exceed demand over most of that period, except in 2028 and 2030 (see table) . It has increased its projections for the size of the surplus compared with those in its 2024 WA GSOO report. Supply side Aemo cut its WA gas supply forecast because of delays, gas reserve depletions, and decreased expected production at the Gorgon, Scarborough, and Pluto projects, it said. The market operator previously expected Australia producer Strike Energy to open its 87 TJ/d (2.3mn m³/d) West Erregulla project in 2026. But Strike only aims to make a final investment decision on the project in July-December 2026 , later than originally anticipated . Strike's West Erregulla delay lowered WA's expected gas production by 52 TJ/d in 2027 and 63 TJ/d in 2028, Aemo said. Aemo has also cut its production expectations for the Scarborough and Pluto gas fields by up to 24 TJ/d in 2030, it said. Australian developer Woodside Energy aims to process 7mn t/yr of Scarborough gas and 3mn t/yr of Pluto gas from early 2027, it said in November. Workers building a 5mn t/yr LNG train at the Pluto LNG terminal plan to launch a strike on 6 January. Their current enterprise bargaining agreement with Australian engineering firm Bechtel will expire on 19 December, Argus understands. Planned maintenance and lower utilisation at the Gorgon project contributed to a 16 TJ/d cut to Aemo's forecasts, it said. The project's owners — which include Chevron, ExxonMobil, Shell, Osaka Gas, Tokyo Gas and Jera — will modify its three-train Gordon LNG terminal as part of a A$3bn ($1.98bn) project, it said in December. Reserve downgrades and depletions at the Walyering, Beharra Springs, Macedon, and Varanus Island fields mostly account for the rest of the supply revisions, Aemo said. The Walyering and Beharra Springs field reserve downgrades cut Aemo's WA supply forecast by 5 TJ/d in 2026 and 23 TJ/d in 2029, it added. Demand side The closure of nickel mining and alumina refining operations cut Aemo's 2026-30 demand forecast, the operator said. But demand will still rise over that period, from 1,085 TJ/d in 2026 to 1,295 TJ/d, because of new mining and processing activity, it said. US producer Alcoa opted to permanently close its 2.2mn t/yr Kwinana alumina refinery on 30 September , after it paused the site in July 2024. It has not announced a full closure timeline yet, Alcoa Australia president Elsabe Muller told Argus at the time. Australian miner IGO has also paused its Forrestania and Cosmos nickel projects over recent years. Multiple developers including Australian producers Iluka Resources , Cobalt Blue , and RZ Resources will develop critical mineral mining or processing projects in WA over the coming years. By Avinash Govind WA projected gas surplus TJ/d Year Surplus (2024 WA GSOO) Surplus (2025 WA GSOO) 2026 4 54 2027 5 20 2028 -12 -89 2029 5 132 2030 -2 -11 *GSOO refers to Gas Statement of Opportunities Source: Australian Energy Market Operator Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Energy Transfer halts plans for Lake Charles LNG

18/12/25

Energy Transfer halts plans for Lake Charles LNG

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US House passes bill to expedite permitting

18/12/25

US House passes bill to expedite permitting

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