Opec continues to see healthy oil demand growth

: Crude oil
26/05/13

Opec continues to see "healthy" global oil demand growth this year and has upgraded its forecast for 2027.

In its Monthly Oil Market Report (MOMR) released today, the Opec secretariat lowered its oil demand forecast for April-June by 500,000 b/d, bringing its total consumption downgrades for the quarter since the Iran war began to 1mn b/d.

It also made a first downgrade to its annual oil demand growth forecast since the war started, but still sees consumption increasing by 1.17mn b/d. This is down by 210,000 b/d from both its previous forecast and its pre-war forecast, putting demand this year at 106.33mn b/d.

But the group upgraded its 2027 oil demand growth forecast by 200,000 b/d to 1.54mn b/d, which would leave total consumption at 107.87mn b/d — the same level as its pre-war forecast.

Opec's projections are diametrically opposite those from the IEA, which sees global oil demand falling by 420,000 b/d in 2026 as the world adjusts to the effective closure of the strait of Hormuz.

Opec again made few direct references to the Iran war, but it said the world is well placed to withstand the disruptions to energy markets.

"Given the size and underlying resilience of the global economy, it is expected to generally absorb temporary events such as trade-related challenges and the current geopolitical developments in the Middle East," Opec said.

Opec does not forecast its own members' oil output, but it publishes production estimates from secondary sources that includes Argus. These showed Opec+ production — including Mexico — fell by 1.74mn b/d on the month to 33.19mn b/d in April.

The fall was driven by the Mideast Gulf members Saudi Arabia, Iraq, Iran, Kuwait, the UAE and Bahrain, which saw a combined decrease of just under 1.9mn b/d. This brings their total production losses, compared with pre-war February, to around 10mn b/d.

Opec kept its non-Opec+ supply growth forecast this year at 630,000 b/d and 620,000 b/d for 2027, bringing these totals to 54.83mn b/d and 55.45mn b/d, respectively.

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26/05/13

Railroads blast UP-Norfolk Southern merger plan

Houston, 13 May (Argus) — Union Pacific (UP) and Norfolk Southern's four Class I competitors urged US federal regulators to once again reject as incomplete the merger proposal to create the first US transcontinental railroad company. UP and Norfolk Southern in December filed their original merger application with US rail regulator the Surface Transportation Board (STB), starting the clock on a multi-year process. It will be the largest merger the STB has ever scrutinized, and the process will likely feature high-profile hearings and congressional scrutiny. The three-member STB in January ruled that the would-be partners' merger application was incomplete, sending it back to UP and Norfolk Southern to fill in key informational gaps. The railroads on 30 April refiled their proposal, which they say reinforces their argument the merger would drive growth, save shipping costs and bolster the US supply chain. UP said its updated analysis shows the merger will shift freight shipments from the roads to the rails, saving shippers an estimated $3.5bn/yr and removing about 2.1mn trucks from the road. However, all of the remaining Class I competitors heaped criticism on the merger application. According to BNSF Railway, UP's western Class I competitor, "the amended merger application makes things worse, not better." The refiled application "largely repackages" the first version while offering only "cosmetic changes to gloss over the serious and fundamental competition, pricing, and service concerns that were previously raised", BNSF said in an 8 May filing with the STB. In its updated analysis, UP said the combined railroad will hold a 39pc market share of US rail freight market, which the railroad says would put it roughly on par with BNSF by certain metrics. BNSF said that UP's actual market share would be considerably higher, a fact that it has downplayed in its application. "UP continues to lowball its projected market shares to the board but signals to Wall Street — the engine behind this proposed merger — that the market shares and pricing power will be even higher," BNSF said, urging the STB to reject the application again as incomplete. Canadian Class I railroads Canadian Pacific Kansas City and Canadian National both filed separate comments urging the STB to reject the application as incomplete, as did eastern US Class I railroad CSX. In response to the filings, UP on 12 May said its updated application "is comprehensive and complete, and provides all the information" that the STB needs, including market share data. The merger would create a single rail network stretching about 55,000 miles, handling about half of US freight traffic. UP and Norfolk Southern say that a coast-to-coast network will speed transit times by 24 to 48 hours and lead to greater efficiency. The two companies expect the transaction to be completed in the first half of 2027. The UP-Norfolk Southern merger will be the first test of STB rules enacted in 2001 requiring Class I railroads to demonstrate that major mergers enhance, rather than merely preserve, competitive shipping options. By Chris Baltimore Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

Chevron, TotalEnergies advance Nigeria offshore plans

26/05/13

Chevron, TotalEnergies advance Nigeria offshore plans

Lagos, 13 May (Argus) — Canada's Meren Energy has said appraisal and infill drilling at the Chevron-operated Ikija and Agbami oil fields, offshore Nigeria, has been brought forward into the fourth quarter of this year. Meren has an 8pc stake in the undeveloped Ikija and producing Agbami fields, where the latest drilling work had been planned for the first quarter of 2027. Infill drilling is one method international operators are using to reverse a fall in Nigerian offshore production. Combined output of the seven Nigerian deepwater leases operated by international oil companies was 352,000 b/d in the first four months of 2026, down by 20pc on the year according to upstream regulator NUPRC. Output was 704,000 b/d in the first half of 2020, when NUPRC data began. Production of the very light Agbami, which Argus categorises as crude but that Nigerian authorities define as condensate, was 63,000 b/d in January-April, down by 20pc on the year according to NUPRC. Meren said Agbami's output had "to recover" from maintenance on the floating production, storage and offloading (FPSO) facility in November–December. The drilling campaign is planned to start with an appraisal well at Ikija. First oil is expected in 2032, Meren previously said, with the field to be developed as a tie-back to the Agbami FPSO. "The broader infill drilling [for] Agbami remains on track, with six infill wells currently planned across 2027 and 2028", Meren said. It also said TotalEnergies is on course to mobilise a rig for an extensive drilling campaign that will start with the Akpo Far East exploration well in the second half of this year. Meren has a 32pc stake in the TotalEnergies-operated Akpo, Akpo Far East, Akpo South, Egina and Preowei fields. Akpo Far East is estimated to hold about 144mn bl of oil equivalent with the targeted liquids similar to the condensate produced from the Akpo field. Successful exploration drilling will utilise existing infrastructure, including the Akpo FPSO. TotalEnergies will then restart Akpo and Egina infill drilling, having paused this in the third quarter of 2025 while it examined seismic data. Akpo condensate production was about 46,000 b/d in January-April, down by 18pc on the year. Egina crude output was about 51,000 b/d, down by 25pc. Infill drilling is expected to add to production from early 2027, Meren said, and intervention activities will boost production this year. Meren said an Egina South appraisal well is planned for this year. By Adebiyi Olusolape Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

IEA sees big oil demand fall, but still 2026 deficit

26/05/13

IEA sees big oil demand fall, but still 2026 deficit

London, 13 May (Argus) — Global oil demand in 2026 will contract at a vastly quicker pace than previously forecast, but not by enough to close the supply shortfall, the IEA said today. In its latest Oil Market Report (OMR), the IEA said it sees demand at 104mn b/d in 2026, a 420,000 b/d contraction on the year. The IEA's pre-war forecast for the year was 640,000 b/d of demand growth, and its previous monthly forecast was for an 80,000 b/d contraction. Weakening economies and demand-saving measures are having an effect on consumption, it said, as governments and consumers alike respond to the price volatility recorded in the 10 weeks since the US and Israel began their war with Iran. "For now, the steepest losses are seen in the petrochemical sector where feedstock availability is becoming increasingly constrained," the IEA said. "Aviation activity is also running well below normal levels". Around half the demand downgrade from pre-war levels, or 700,000 b/d, is for LPG/ethane and naphtha. Jet fuel demand is cut by 210,000 b/d. The agency sees the biggest hit coming in the current quarter, when it forecasts demand to fall by 2.45mn b/d. Of this, 1.5mn b/d is in non-OECD countries, mostly in the Middle East and Asia-Pacific. Net lost supply since February now stands at 12.8mn b/d, with 14mn b/d of shut-in Mideast Gulf production relieved only slightly by higher exports from the US, Kazakhstan, Russia and Venezuela. The IEA sees supply this year at 102.2mn b/d, on the assumption that the strait of Hormuz reopens to tanker traffic in June. The resulting deficit will see inventories falling throughout the year, the IEA said. Global stocks drew by 129mn bl in March and by 117mn bl in April, the latter a preliminary figure. Overall drawdown, including from industry stocks and from the IEA co-ordinated release in March , could reach 900mn bl by September. Rebuilding this will require around an extra 1mn b/d of supply for the next three years on top of underlying demand growth, the IEA said, again assuming a June resumption of shipping through Hormuz. The IEA has postponed publication of its Oil 2026 report, which was scheduled for June, until "a later date". The report was to give analysis and forecasts to 2031. By Ben Winkley Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

IRGC widens Hormuz into ‘vast operational area’

26/05/12

IRGC widens Hormuz into ‘vast operational area’

Dubai, 12 May (Argus) — Iran's Islamic Revolutionary Guard Corps (IRGC) said on Tuesday it has widened its definition of the strait of Hormuz into a "vast operational area", extending it from the coast of Jask to Siri Island. The move broadens the area the IRGC says falls under its Hormuz operations beyond the narrow strait itself, through which around a fifth of global oil supply transited before the US-Iran war began. In a statement carried by Iranian state media, Mohammad Akbarzadeh, deputy political director of the IRGC Navy, said the strait of Hormuz had previously been "defined as a limited area around the Hormuz and Hengam islands", but that definition has now changed. "Within our new framework, the area of the strait of Hormuz has been significantly expanded, and today it extends beyond the large islands, from the coast of Jask to Siri Island." Iran's Siri Island lies in the Mideast Gulf around 70km west of the UAE emirate of Umm al-Quwain. The port of Jask is on Iran's southern coast, east of the strait of Hormuz. Akbarzadeh said the area had expanded from 20-30 miles previously to more than 200-300 miles. He described the new footprint as "a complete crescent". This is the second expansion the IRGC has announced since war with the US and Israel prompted Iran to effectively close the strait. On 4 May, the IRGC published two maps showing an expanded area it said was "under its management and control". The outlined area extended from the western tip of Iran's Qeshm Island in the Mideast Gulf to Umm al-Quwain west of the strait, and to Kuh Mobarak in southern Iran and the UAE emirate of Fujairah east of the strait. The area outlined on Tuesday by the IRGC Navy extends beyond the borders shown in the 4 May maps. The new definition comes as tensions between Iran and the US grow over the continued disruption of shipping. US president Donald Trump has repeatedly claimed agreements with Iran that he said should restore at least some traffic through the strait. But little has changed since the war began, prompting the US to impose a blockade of its own on vessels travelling to and from Iranian ports last month. Washington and Tehran have been exchanging proposals in recent weeks aimed at ending the conflict, but prospects for a breakthrough appear remote. Trump on Monday described Iran's latest offer as a "piece of garbage" and warned that the ceasefire, in place since 8 April, is under strain. By Nader Itayim Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

Equatorial Guinea offers 13 blocks for negotiation

26/05/12

Equatorial Guinea offers 13 blocks for negotiation

Lagos, 12 May (Argus) — Equatorial Guinea's oil ministry, MHMD, is offering 13 oil blocks for direct negotiations, cancelling previously announced plans for a licensing round. MHMD said the blocks on offer include four frontier, two onshore and seven offshore exploration blocks. The ministry previously said it would launch a licensing round last month, but has now said three years of direct negotiations have yielded seven production sharing contracts, 11 reconnaissance licences and four heads of agreement. "The government has decided to maintain this approach until further notice", the ministry said. Two of the heads of agreement were signed with US firm ConocoPhillips for offshore blocks B4 and EG-27 in September 2025. The estimated 50mn–70mn bl of condensate and 500bn–700bn ft³ of natural gas in the Esmeralda field of B4 and the estimated 3.8 trillion ft³ of natural gas in the Ebano field of EG-27 are the targets of development. The Equatorial Guinea government previously said it also plans to spend $4.5bn building a 2.5mn t/yr gas liquefaction plant that will process gas from the planned developments. Equatorial Guinea's vice president Teodoro Nguema has now said the country and ConocoPhillips have submitted a financing proposal to oil trading firm Vitol, "so that, subsequently, we can discuss the financing conditions". MHMD also said that two blocks are currently the subject of talks as a result of the direct negotiations policy, but did not provide further details. Direct negotiations have led to "the successful conclusion of 24 agreements", the ministry said. By Adebiyi Olusolape Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.

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