11th April 2025

Hello dear readers. Here’s what’s been going on the world’s most epic industry:

• 🩸 “It’s a bloodbath”

• 😬 Kazakhstan’s scolding

• 💸 Mubadala’s big US LNG investment

• 💋US and Iran get in a room

• ➕ plus environmental burdens lifted for US drillers; Keystone still offline; Petrobras in India; MidOcean takes Lake Charles stake; China’s fraccing vessel; Russia, Ukraine, and US LNG; and barrels more.

Have a cracking weekend. See you Monday.

📈 THE NUMBERS

Brent and WTI remain perilously close to the $50s…will OPEC+ cave and reverse course re their planned production increases? One thing’s for sure, those bloated government budgets in Saudi and the UAE don’t work with oil prices at these levels.

🗞️ WELL-HEADLINES

 🗽 North America

• “It’s a bloodbath” - the words of Bryan Sheffield, CEO of US shale company Formontera. “The industry needs to cut immediately and hunker down to let the tariff war play out”, he warned. S&P has warned that WTI at $50/bbl could result in a decline of 1 mmb/d of US oil output.

• Abu Dhabi splashes out in the US - Mubadala Energy has bought a 24% in Kimmeridge subsidiary that owns a 500 mmcf/d unconventional gas business in the Eagle Ford, and Commonwealth LNG, which is a 9.3 mmtpa pre-FID LNG export facility in Louisiana. The value of the deal wasn’t disclosed.

• Keystone still offline - over 200 workers are carrying out remediation and repair work after a 3500 bbls spill at the Keystone Pipeline earlier in the week. It’s not clear when the 626 kb/d pipeline from Canada will be back online.

• MidOcean to invest in Lake Charles LNG - the Saudi-backed LNG player has agreed terms with Energy Transfer to fund 30% of the construction cost of the planned 13.5 mtpa LNG facility in return for 30% of its production.

• Environmental burdens lifted for US drillers - a new government ruling has removed the requirement for environmental impact statements across thousands of oil & gas leases across the US West. Meanwhile, Trump has signed an order to tackle states that trying to fine oil & gas companies for their greenhouse gas emissions.

🏰 Europe

• Spirit closes Morcambe Bay platform - following a request from the health and safety regulator, the Morecambe Central Processing Complex in the east Irish Sea will be shut for a month.

🕌 The Middle East

• Aramco and Sinopec plan Saudi refinery expansion - the expansion of the Yanbu refinery “aligns with our downstream strategy to unlock the full potential of our resources, including converting up to 4 mmb/d of crude oil into petrochemicals by 2030”, Aramco said.

• Caspian Pipeline delays facility restart - a pumping station at a major export pipeline system in south Russia will be offline until the end of May following a Ukrainian drone attack.

⛩️ Asia & Oceania

• Kazakhstan’s on the naughty step - the serial OPEC+ quota-breaker is reportedly in talks with O&G companies operating in the country, like Exxon and Chevron, to reduce output. It’s currently producing ~400 kb/d above its quota. Some are suggesting that OPEC’s recently announced production ramp up is a warning shot to its disobedient members.

• Petrobras in India - the Brazilian NOC is rumoured to be eyeing up offshore opportunities in India’s relatively under-developed O&G patch.

• China launches world’s largest offshore fraccing vessel - the ship is part of China’s ambitious plan to to tap into offshore shale and low-permeability hydrocarbon reserves.

• 20-year extension for key SE Asia asset - Petronas, hibiscus, and PetroVietnam have reached an agreement to to extend the production licence that spans 2000 km2 across the maritime border of Malaysia and Vietnam and hosts various oil & gas fields.

• Coro exits Mako - the Asian indy is offloading its 15% stake in the undeveloped field to Conrad following a long-running dispute over outstanding cash calls.

🦁 Africa

• ReconAfrica gears up for new Namibia well - the company is preparing for a second onshore exploration well at the frontier Kavango basin, targeting a prospect with ~350 mmbbls of of oil resources. Fingers crossed.

🗿 Central & South America

• Looks like they’re already off for the weekend down here.

🌍 GEOPOLITICS & MACRO

• Markets’ wild ride continues - after the S&P500 enjoyed its third largest daily gain since WWII on Wednesday thanks to Trump’s tariff reversal for most countries, markets have again retreated as the US - China spat escalates. China has just slapped 125% tariffs on US goods.

• US and Iran to talk face-to-face - the adversaries are set to hold direct talks this weekend to discuss Iran's nuclear program. Trump has threatened military action if Iran doesn’t agree to a deal.

• Oil stuttering, gas booming - the EIA has cut its 2025 global oil demand growth forecasts from 1.2 mmb/d to 0.9 mmb/d citing the impact of new US tariffs on economic growth. There is some good news for US oil though - its exports reached new highs in 2024. It’s a brighter picture for gas, where EIA expects US gas supply and demand to reach new records this year.

• Russia, Ukraine, and US LNG - Wood Mackenzie has laid out various scenarios for the war in Ukraine - ranging from “no quick peace” to “a stable peace” - and how they might impact global gas trade. In a nutshell, the more amicable and stable the peace, the more likely Russian gas is to re-enter European and global markets, at the expense of US LNG.

💨 CARBON, CLIMATE, & OTHER ENERGY STUFF

• Equinor merges renewables unit into a new "Power division - its renewables, including offshore wind and solar, will be combined with assets from the Marketing, Midstream and Processing unit to create the Power division, which it is calling PWR.

🛢️ BOTTOM OF THE BARREL

China doing some trolling! Fair play.

👋 BEFORE YOU GO

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Thanks for reading. Have a day out there. 🛢️🛢️

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