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By Michael Kern – Apr 29, 2025, 9:05 AM CDT
Oil prices are once again under pressure as supply concerns continue unabated, with a scarcity of bullish catalysts to counteract them.
– 142 executive orders and 100 days into the second presidential mandate of Donald Trump, commodity markets are reeling from disruptive policies launched by the U.S. President.
– The US dollar has shed a lot of strength as its standing vis-à-vis other currencies such as the euro deteriorated (the EU currency gained 10% since late January, with the EUR/USD rate now standing at 1.14).
– Whilst exchange-traded gasoline prices in the US have barely changed compared to where they were three months ago, Trump has been instrumental in lowering global oil prices, down 17% since he took the oath on January 20, a notable jump vs the 7% decline he achieved after the first 100 days of his 2017-2021 term.
– The future of the U.S.-China import tariff war will define energy prices of the upcoming months as the Trump administration’s 145% tariff on China (and the reciprocal 125% from Beijing) is starting to create an oversupply in LNG, LPG, and ethane markets.
Market Movers
– Aster Chemicals, a joint venture of Glencore and Indonesia’s Chandra Asri Group, is reportedly keen to take over ExxonMobil’s (NYSE:XOM) retail business in Singapore, valued at roughly $1 billion.
– Shell (LON:SHEL) agreed to sell its 16.125% interest in Colonial Enterprises to Canada’s investment giant Brookfield Infrastructure Partners for $1.45 billion, operator of the US’s largest gasoline pipeline.
– US natural gas major EQT (NYSE:EQT) announced it would purchase the upstream and midstream assets of Marcellus-focused producer Olympus Energy for $1.8 billion, boosting its output by 500 MMCf/day.
– The world’s leading offshore wind developer, Germany’s RWE (ETR:RWE) has stopped all work on its US projects, citing Trump’s moves against the industry, having paid some $7 billion on its leases in offshore Louisiana and New York.
Tuesday, April 29, 2025
Brent prices have dipped below $65 per barrel again as the seemingly inopportune willingness of Saudi Arabia and other OPEC+ countries to unwind even more production into the summer months depresses market sentiment. A potential Russia-Ukraine negotiations breakthrough or a rapprochement between the US and Iran loom large for oil markets, with bullish factors remaining scarce.
BP’s Corporate Strategy Falls Apart. Posting a 48% year-over-year plunge in Q1 net profits to $1.4 billion, UK oil major BP (NYSE:BP) announced its strategy chief, Giulia Chierchia, will be leaving the company on June 01 under pressure from activist investor Elliott Investment.
Power Outages Bring Spain to a Halt. An unprecedented power outage debilitated the economy of Spain this Monday, grinding every single oil refinery in the country to a forced halt, whilst also paralysing traffic and grounding flights, however, the cause still remains unknown.
White House Allows Higher Ethanol Content. The US Secretary of Agriculture, Brooke Rollings, signed an emergency waiver that allows the sale of E15, a higher-ethanol gasoline blend that biofuel producers sought to sell all year round, in a bid to lower summer gasoline prices across the Midwest.
US Targets Houthis’ Oil Deliveries. The White House imposed sanctions on three tankers delivering oil and refined products to Yemen’s Houthis, with the Tulip, Maisan, and White Whale vessels routinely shuttling to the port of Ras Isa, as the Trump administration ramps up pressure on them.
Iraq Revisits Syria Pipeline Plans. Iraq’s top political brass met with Syrian President Ahmed al-Sharaa this week to discuss restoring the Kirkuk-Baniyas oil pipeline, out of operation since 2003 when it was damaged by US airstrikes, seeking to avoid intermediaries in supplying the Syrian market.
Bill Gates Splashes the Cash on Congo Cobalt. KoBold Metals, the mining startup backed by Bill Gates, is preparing to announce huge deals in Africa’s heartland of Congo after a successful raise of $537 million in January, seeking to concurrently tap into the emerging US-DR Congo minerals pact.
Kuwait Gets into a Buying Frenzy. Almost immediately after announcing the $650 million purchase of a 25% stake in Chinese chemicals producer Wanhua Chemical, Kuwait’s national oil company, KPC, is now reportedly in active negotiations over taking a stake in Woodside’s (ASX:WDS) Louisiana LNG.
Beijing Approves New 27 Billion Nuclear Buildout. China’s State Council has approved the construction of 10 new nuclear power reactors at an estimated cost of $27.5 billion, with each unit being an extension of existing plants, as Beijing currently wields 60 GW of nuclear capacity.
Tankers Rush to Load Venezuelan Crude. At least six tankers have been queuing next to Venezuela’s oil ports, including 5 vessels chartered by Chevron and one by trading firm Vitol, as the Latin American country is bracing for the May 27 expiry of the US oil major’s production license.
India Tells Steel Industry to Invest Abroad. Faced with a 60-million-tonne import dependence on coking coal, India’s government has publicly encouraged its steel companies to acquire coking coal and iron ore mining assets abroad, with Indonesia and Australia topping the list of candidates.
Pre-Holiday Buying Lifts Copper Prices. Robust Chinese buying raised LME three-month copper prices to $9,460 per metric tonne as buyers prepare for the May Day holiday in the Asian country, with China stocks remaining low on the back of strong Asia-to-US flows that still keep CME futures at a premium to other regional prices.
China Eyes Lower Soymeal Demand. Seeking to curb reliance on imported agricultural feedstocks, Chinese authorities will be mandating a slash in soymeal use in animal feed to 10% by 2030, expanding production capacity in food waste, insect, and animal-based protein instead.
US Trade Pressure Starts to Bear Fruit. New Delhi is preparing to offer the United States a future-proof guarantee of a most-favored-nation clause in bilateral trade, potentially making India the first large country to sign a trade deal with the Trump administration.
By Michael Kern for Oilprice.com
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