Brazil real strengthens to 14-month high

: Agriculture, Crude oil, Natural gas
25/08/12

The Brazilian real closed at its strongest level since June 2024, with steadily-high interest rates in Brazil helping the currency gain as the US dollar has weakened globally this year.

The Brazilian real stood at R5.40/$1 on 12 August's market close, strengthening from R5.44/$1 a day before and the strongest to the dollar since late June 2024. The real has strengthened by nearly 17pc to the dollar since late December 2024.

Brazil posted inflation figures on Tuesday. Inflation in Brazil decelerated to an annual 5.23pc in July, while monthly inflation stood at 0.26pc in July, up from 0.24pc in June, according to national statistics agency IBGE.

But the central bank's aggressively hiking Brazil's target rate to 15pc — the highest level since July 2006 — has helped strengthen the real after it fell sharply late last year. The central bank, which hiked rates by 4.5 percentage points over seven hikes since September last year through this June, has said it will maintain the rate steady through 2025 to push inflation closer to the government's 4.5pc ceiling goal.

The US dollar index, which tracks the dollar against six major currencies, fell to 98.3 on Tuesday, and is down from a three-year high of 109.6 in mid-January. The dollar has weakened amid investor uncertainty fueled by US President Donald Trump's aggressive use of tariffs and his combative foreign policy style towards traditional US allies and partners. Plans to increase federal debt levels, and expectations of slowing growth in the US and of Federal Reserve rate cuts later this year have also fueled dollar weakness.

By Lucas Parolin

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

25/12/05

US LNG margins tighten on higher Henry Hub prices

Houston, 5 December (Argus) — A narrowing spread between US and European LNG prices and high freight rates in the Atlantic basin have pushed the front-month indicative long-term LNG contract cost above the spot Gulf coast fob price for the first time in two years. But the premium over the spot price will likely be brief, and limited flexibility in annual delivery plans will likely leave export schedules unchanged, with the impact solely on profit margins rather than fundamentals. A steeper backwardation in the US' Henry Hub forward curve compared to the northwest European LNG forward curve beyond February, as well as a steep backwardation in charter rates, means US LNG offtakers likely will not need to alter export plans. Liquefaction fees are also considered a sunk cost, and the Henry Hub remains comfortably below European LNG prices to more than cover the shipping cost between the two markets. This means there is still a strong financial incentive to maximise US LNG export volumes. The indicative long-term LNG contract price — 115pc of Henry Hub plus a $3/mn Btu liquefaction fee — has exceeded the Argus Gulf coast (AGC) spot fob price since 28 November, climbing to a premium of 69¢/mn Btu on 4 December. That premium came with the front-month Henry Hub price at a nearly three-year high of $5.06/mn Btu on forecasts for cold weather and US LNG exports at a record high. At the same time, the front-month NW Europe LNG des price was at $8.83/mn Btu, the lowest since May 2024, with warmer-than-normal weather forecast in Europe and EU underground storage well-supplied. A surge in freight rates, primarily driven by higher Atlantic basin loading demand, including at the 27.2mn t/yr Plaquemines plant, widened the spread between the AGC fob price and delivered spot prices in northwest Europe. The spread grew to 96¢/mn btu on 24 November, near the peak of the freight rally, up from 28¢/mn Btu in mid-October (see spread chart) . The wider spread pushed the AGC fob price for January loading below the indicative long-term LNG contract price for the same month. Forward freight rates are in steep backwardation in the first quarter of 2026, which is reflected in a tighter AGC-NW Europe spread over that span, as are Henry Hub futures contracts. This puts AGC prices above the indicative long-term contract prices from March through June (see forwards chart) . Although exports are unaffected because of liquefaction costs being considered sunk, the dynamic highlights the tightening margins for US LNG as a supply wave brings more liquefaction capacity on line through the end of the decade. The AGC fob's premium over the long-term indicative contract averaged $4.11/mn Btu through 4 December this year, down from $4.63/mn Btu, $5.37/mn Btu and $20.13/mn Btu in 2024, 2023 and 2022, respectively (see margins chart) . By Tray Swanson AGC-NWE spread and freight rates Tighter margins for US LNG $/mn Btu Indicative long-term contract forwards vs LNG spot prices $/mn Btu Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Eni and BP plan deepwater well in Libya in 1Q

25/12/05

Eni and BP plan deepwater well in Libya in 1Q

London, 5 December (Argus) — BP and Italy's Eni will drill a long-planned deepwater exploration well offshore Libya in the first quarter of 2026, a source at state-owned NOC told Argus . It is the most anticipated well since international oil companies, also including Spain's Repsol, Austria's OMV and Algerian state-owned Sonatrach, resumed exploration efforts late in 2024. "The first ultra-deepwater exploration well in Area C is scheduled in 2026," block operator Eni told Argus . NOC said the well is scheduled for January. The planned well is offshore Libya's Sirte Basin oil and gas heartland and targets a gas prospect. Eni and BP started a three-well exploration campaign in late 2024. The first well was drilled on their Area B in the Ghadames basin, but the NOC source said this yielded no commercial quantities of oil and gas. Eni and BP plan another exploration well on Area B in 2026, the source said. Any discoveries could be tied into Eni's nearby facilities. The two firms also hold the close by Area A. Eni is Libya's largest oil and gas producer by volume and is leading the country's exploration revival. It is currently drilling an offshore exploration well in Area D, close to its existing offshore production facilities. It will drill another after this is completed, the source said. IOCs were forced to abandon their exploration efforts in 2014 as the Libya's security situation deteriorated. Firms are returning because NOC lifted force majeure on these plans in 2024. "The companies are genuinely eager to explore," the source said. "This isn't just about them having to fulfill their contractual commitments." Repsol is drilling the third of a nine-well exploration campaign in the onshore Murzuq basin. So far, one of these has proven "successful", the source said. Discoveries will be tied into the Repsol-led 300,000 b/d El Sharara field. NOC has announced six new onshore discoveries this year, including one from OMV and one from Sonatrach . Exploration revival Libya has said it will announce winners of its first upstream licensing round in almost two decades in the first quarter of 2026. Firms including ExxonMobil, Chevron, Shell, BP, TotalEnergies and Eni have been shortlisted to participate in the licensing round. ExxonMobil , Chevron , Shell and BP have also signed bilateral preliminary agreements with NOC that could see them explore new areas and even develop existing onshore fields. The exploration programmes and licensing round are primarily aimed at boosting reserves and extending plateau production once Libya reaches its output goals, but discoveries could surprise to the upside. Libya aims to boost crude production from about 1.4mn b/d to 2mn b/d and gas production from about 1.2bn ft³/d (12.4bn m³/yr) to 4bn ft³/d over the next few years. By Aydin Calik Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Brazil increases 2025 coffee crop outlook

25/12/04

Brazil increases 2025 coffee crop outlook

Sao Paulo, 4 December (Argus) — Brazil is set to produce its third-largest coffee crop ever this year, despite it being a low productivity year in the crop cycle, according to national supply company Conab's last crop estimate for this cycle. Brazil will produce almost 56.5mn 60kg bags of coffee this year, up from the previous forecast released in September of 55.2mn bags. The upward revision was driven by higher average national productivity, reflecting a better performance of Conilon coffee crops, one of the two major types of coffee grown in Brazil. This is above the 51.8mn bags first projected for the season and surpasses the 2024 crop, which produced 54.2mn bags. Droughts, irregularly distributed rainfall and high temperatures severely hampered yields in the prior cycle, despite initial expectations for a high-producing one. Coffee cycles occur biennially in Brazil, with larger volumes produced in alternating years. During the lower producing years — known as negative years — plants replenish their nutritional reserves, leading to reduced output. The 2025 cycle is considered a negative year, with the current estimate representing an all-time high for a negative year, topping the record registered in the 2023 crop, when Brazil produced nearly 55.1mn bags. It is expected to rank as the third-largest in the nation's history, only behind the positive cycles of 2020 and 2018, which produced 63.1mn bags and 61.7mn bags, respectively. Conab revised the outlook for the current cycle based on an increase in expected yields to 30.4 bags/hectare (ha) from 29.7 bags/ha in the prior forecast. That is up by 5.5pc from 28.8 bags/ha in the positive 2024 year and compares with 29.4 bags/ha in the negative 2023 cycle. Brazil grows two types of coffee: the higher-grade Arabica coffee and the Conilon grade coffee, also referred to as Robusta. These varieties have different taste, caffeine content and productivity levels, as well as distinct producing regions and harvesting calendars. Arabica coffee production is forecast at around 35.8mn bags, ahead of the nearly 35.2mn bags projected in September, but down from 39.6mn bags in 2024. There has been significant vegetative recovery in crops, mainly in southeastern Minas Gerais state, Brazil's largest producer, which contributed to an increase compared to the previous estimate, according to Conab. Yields rose to 24.1 bags/ha from 23.7 bags/ha in September. That is behind the 26.2 bags/ha in 2024. Conilon coffee output should reach an overall record of 20.8mn bags, up from 20.1mn bags in the previous outlook following the consistent weather conditions in major producing states Espirito Santo and Bahia that promoted good conditions for areas and resulted in high yields. That compares with 14.6mn bags in the prior cycle. Yields are up to 55.9 bags/ha, from 53.8 bags/ha estimated in September and 39.2 bags/ha yielded in 2024. Conab continues to expect the total area allocated to both coffee grades to reach approximately 2.25mn ha this cycle, 0.9pc above on the year. The area set aside for coffee is split between space for production and new crops. Areas allocated to crops in production fell by 1.2pc on the year to nearly 1.86mn ha. New areas account for around 396,428ha, up by 12pc, as is usual for negative years. Coffee exports fall on year Brazil exported 34.2mn bags of coffee in January-October, around 17.8pc below the total shipped in the same period a year before, according to trade ministry Mdic data. This reduction in volume exported in the first ten months of 2025 is mainly because of limited domestic stocks at the beginning of the year, following a record shipment of 50.5mn bags in 2024. Tariffs imposed by the US from April onwards, a major buyer of Brazilian coffee, also contributed to the reduction in exports. Brazil exported coffee to 150 countries in the first ten months of 2025. The US and Germany accounted for the largest share of shipments, with 14.1pc and 14pc, respectively. Italy received 8.1pc of exports, Belgium and Japan 6.3pc each. By João Petrini Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Golden Pass LNG approved to receive cool-down cargo

25/12/04

Golden Pass LNG approved to receive cool-down cargo

Houston, 4 December (Argus) — QatarEnergy and ExxonMobil's 18.1mn t/yr (2.4bn ft³/d) Golden Pass LNG export terminal in Texas received federal approval today to unload a cool-down cargo, a key step in commissioning the plant. The Federal Energy Regulatory Commission granted the project's request to introduce hazardous fluids into various systems and receive the cool-down cargo. The 174,000m³ Imsaikah has been holding offshore Texas' Port Arthur since 29 November after departing QatarEnergy's 77mn t/yr Ras Laffan export terminal with a cargo on 27 October. The vessel's LNG will be used to cool down Golden Pass' equipment for its start-up process. The three-train project also has federal approval to introduce fuel gas to train 1 and train 1's gas turbine. Feedgas flows to Golden Pass have yet to materially rise. Pipeline nominations on 4 December were just over 8mn ft³, in line with daily flows since mid-October. Flows to LNG plants can be revised later in the day. The project's developers anticipate the facility will start production by the end of the year or in early 2026, with each of its three trains coming on line in six-month intervals. By Tray Swanson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Qatar presents 2040 climate target to UN

25/12/04

Qatar presents 2040 climate target to UN

Edinburgh, 4 December (Argus) — Qatar has pledged to reduce its emissions by 42mn t of CO2 equivalent (CO2e) by 2040 from a 2019 baseline, with the oil and gas sector "at the forefront of national mitigation efforts". Qatar does not provide its total greenhouse emissions for 2019, but said its climate plan encompasses CO2, methane and nitrous oxide gases. It covers the energy sector — oil and gas, power and water — construction and industry, transport, waste and agriculture, forestry and other land use. Parties to the Paris Agreement were required to submit climate plans, known as nationally determined contributions (NDCs), for 2035 to the UN climate body UNFCCC this year. Qatar had previously targeted emission reductions of 25pc, or 37mn CO2e, by 2030, compared with a business-as-usual (BAU) scenario. BAU scenarios typically assume emissions based on current policies, leaving room for potential increases. The country's emission cuts in its oil and gas sector will rely on "deploying cleaner fossil fuel technologies, developing engineered sinks to store emissions, diversifying the energy mix, and driving operational excellence across existing facilities and infrastructure", according to its climate plan. Qatar is the world's largest LNG producer, with a production capacity of 77mn t/yr, according to QatarEnergy, and its economy is heavily reliant on hydrocarbon revenues. The country's climate plan highlights the country's vulnerability to response measures to mitigate climate change, resulting from its economy's reliance on hydrocarbons. "Qatar is actively working to reduce the socio-economic effects of global climate action," the plan said, adding that it seeks to balance climate goals with national sustainable development. "Despite many efforts and considering its role as a leading producer and exporter of natural gas, Qatar remains significantly vulnerable to climate response measures," it said. Qatar is part of the Arab Group, a negotiating group in UNFCCC climate talks, which is seeking to focus on cutting emissions from fossil fuels, rather than hydrocarbon production and consumption, through increased adoption of carbon capture technologies. The country said it plays "a pivotal role" in supporting other countries' targets by "reliably supplying them with a cleaner alternative to coal and oil and providing a critical backup for intermittent renewables". Qatar's climate plan sees the secure and affordable supply of lower-carbon energy as well as the deployment of carbon capture and storage (CCS) and the management of emissions of energy production as the focus to pursue sustainable development and climate action. The country considers itself to be among the leaders in CCS with its Ras Laffan project, and aims to capture 11mn t/yr of CO2 by 2035. Engineering firm Samsung C&T was recently awarded a contract to build a 4.1mn t/yr CO2 facility to process and store emissions from Qatar's LNG liquefaction plants. Qatar, in its climate plan, highlighted the country's water supply vulnerability to temperature increases and heat. The power and water sector accounts for a large share of the country's emissions. Water scarcity is also responsible for increasing greenhouse gas emissions (GHG) in Bahrain through desalination, although its energy sector remains the main source of emissions, according to the country's new climate plan. The country is heavily reliant on fossil fuels for its energy and revenues, while "limited land availability and competing land-use demands constrain large-scale deployment" for the development of solar energy. Rising demand over the peak summer months this year meant that Bahrain had to import LNG for the first time since commissioning its 800mn ft³/d onshore LNG receiving and regasification terminal in 2020. But it is looking at renewables options and is in talks with Saudi Arabia for a link to a large-scale solar facility. Bahrain said that response measures to climate change "may lead to economic losses that, in turn, hinder Bahrain's ability to pursue effective climate action and achieve broader sustainable development objectives." By Caroline Varin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more

Brazil real strengthens to 14-month high

Related news posts

US LNG margins tighten on higher Henry Hub prices

US LNG margins tighten on higher Henry Hub prices

Eni and BP plan deepwater well in Libya in 1Q

Eni and BP plan deepwater well in Libya in 1Q

Brazil increases 2025 coffee crop outlook

Brazil increases 2025 coffee crop outlook

Golden Pass LNG approved to receive cool-down cargo

Golden Pass LNG approved to receive cool-down cargo

Qatar presents 2040 climate target to UN

Qatar presents 2040 climate target to UN

Argus North American Long-Term Electricity Forward Curves

Argus North American Long-Term Electricity Forward Curves

Argus North American Long-Term Electricity Forward Curves

Argus North American Long-Term Electricity Forward Curves

Argus Refinery Gate Values: A crucial piece of the crude supply chain puzzle

Unlock the True Value of Crude with Argus Refinery Gate Values (RGVs)

Argus Asia Crack Spread Forward Curves

Business intelligence reports