2025-07-23 19:29

US-Japan trade deal puts brakes on oil's three-day slide Market cautious ahead of EU-China summit EIA reports US crude inventories fell last week NEW YORK, July 23 (Reuters) - Oil prices were little changed on Wednesday as investors assessed trade developments between the European Union and the U.S. after President Donald Trump reached a tariff deal , opens new tab with Japan. Brent crude futures settled 8 cents, or 0.12%, lower at $68.51 a barrel, while U.S. West Texas Intermediate crude futures were down 6 cents, or 0.09%, at $65.25 per barrel. Sign up here. On Wednesday, EU officials said they were heading towards a trade deal with Washington that would result in a broad 15% tariff on EU goods imported into the U.S., avoiding a harsher 30% levy slated to be implemented from August 1. Just hours earlier, Trump said the U.S. and Japan had struck a trade deal that lowers tariffs on auto imports and spares Tokyo from punishing new levies on other goods in exchange for a $550 billion package of U.S.-bound investment and loans. "The trade deal with Japan might be a template for trade deals with other countries," said Andrew Lipow, president of Lipow Oil Associates. "On the other hand, the market is still concerned about the U.S. coming to an agreement with the European Union and China." The European Commission planned to submit counter-tariffs on 93 billion euros ($109 billion) of U.S. goods for approval to EU members. A vote is expected on Thursday, though no measures would be imposed until August 7. Both benchmarks lost about 1% on Tuesday after the EU said it was considering countermeasures against U.S. tariffs. "The slide (in prices) of the past three sessions appears to have abated, but I don’t expect much of an upward impetus from news of the U.S.-Japan trade deal as the hurdles and delays being reported in talks with the EU and China will remain a drag on sentiment," said Vandana Hari, founder of oil market analysis provider Vanda Insights. On the supply side, U.S. Energy Information Administration data showed U.S. crude inventories fell last week by 3.2 million barrels to 419 million barrels, compared with analysts' expectations in a Reuters poll for a 1.6 million-barrel draw. "That’s a bullish swing," said Bob Yawger, director of energy futures at Mizuho. "It was largely a function of import-export dynamics." U.S. crude exports were up by 337,000 barrels per day (bpd) to 3.86 million bpd, while net U.S. crude imports fell last week by 740,000 barrels per day, the EIA said. In another bullish sign for the crude market, the U.S. energy secretary said on Tuesday that the U.S. would consider sanctioning Russian oil to end the war in Ukraine. The EU on Friday agreed its 18th sanctions package against Russia, lowering the price cap for Russian crude. https://www.reuters.com/business/energy/oil-prices-steady-with-trade-talks-focus-2025-07-23/

2025-07-23 19:20

SANTIAGO, July 23 (Reuters) - Top copper supplier Chile on Wednesday bumped up its outlook for prices of the red metal, though it flagged lagging output from a major mine operated by Glencore (GLEN.L) , opens new tab and Anglo American (AAL.L) , opens new tab as weighing on economic growth. Finance Minister Mario Marcel, in a presentation to Congress, upped the government forecast for average copper prices for this year to $4.28 per pound, from $4.26 per pound previously. Sign up here. Marcel maintained the official estimate for gross domestic product (GDP) growth for this year at 2.5%, though he said non-mining GDP had compensated for a drop in the mining sector's contribution. "In recent months we've seen a moderation in production, primarily due to a drop in Collahuasi's output," he said, referring to the mine operated by Glencore and Anglo American. Earlier on Wednesday, the chair of Chilean state miner Codelco, the world's largest copper producer, told Reuters that the 50% tariffs on copper set to go into effect on August 1 from the United States had influenced record prices there with global uncertainty causing price volatility. Chile's finance ministry maintained its average copper price forecast for next year, at $4.30 per pound. It also held its inflation outlook for this year and next, along with next year's GDP growth forecast. https://www.reuters.com/business/energy/chile-bumps-up-copper-price-forecast-flags-lagging-collahuasi-output-2025-07-23/

2025-07-23 19:16

NICOSIA, July 23 (Reuters) - Firefighters in Cyprus were battling on Wednesday to contain a huge wildfire forcing the evacuation of at least four villages on the first day of a heatwave which sent temperatures soaring. Authorities said the fire was raging in terrain north of the southern city of Limassol, stoked by strong winds and high temperatures. A fire brigade spokesperson said there had been 'considerable damage' to homes in the region, known for its vineyards. Sign up here. Cyprus said it had requested assistance to contain the fire under a European Union assistance scheme, while neighbouring Jordan would be sending help, President Nikos Christodoulides said. "The situation is very difficult and the fire front is huge. All forces have been mobilised," he told reporters at the scene. Authorities said 14 aircraft and workers on the ground were trying to extinguish the blaze, which broke out around midday on Wednesday. The cause of the blaze was not immediately clear. Temperatures on the east Mediterranean island hit 43 degrees Celsius (109.4 degrees Fahrenheit) inland on Wednesday, forcing authorities to issue an amber weather warning. It was expected to climb further to 44 C on Thursday, making it the hottest day of the year. Although heatwaves and forest fires are common, the impact on human life and the damage have become more pronounced in recent years. Four men from Egypt died in a fire in 2021. https://www.reuters.com/business/environment/cyprus-struggles-contain-wildfire-homes-damaged-2025-07-23/

2025-07-23 19:10

Shelved projects knock lofty ambitions for green hydrogen Subsidies alone are not enough to drive investment Prices remain uncompetitive compared with alternatives MADRID/LONDON/BERLIN, July 23 (Reuters) - Green hydrogen developers are cancelling projects and trimming investments around the world, raising the prospect of longer than targeted reliance on fossil fuels. The challenges facing the sector have exposed its initial ambitions as unrealistic. Sign up here. Hard-to-electrify industries that were seen as ideal candidates for green hydrogen, such as steelmaking and long-distance transportation, have found that transition to the low-carbon fuel looks prohibitively expensive. The gap between ambition and reality in Europe shows the extent of the reset happening within the industry, said Jun Sasamura, hydrogen manager at research company Westwood Global Energy. Only about a fifth of planned hydrogen projects across the European Union are likely to come online by the end of the decade, he said. That equates to roughly 12 GW of production capacity against an EU target of 40 GW, Westwood Global Energy data shows. "In the current state, I really don't see the EU 2030 (hydrogen production) target being reached," he added. INFLATED EXPECTATIONS Companies say that high costs and a lack of demand for green hydrogen have rendered many plans unprofitable. "Green hydrogen was an inflated expectation that has turned into a valley of disillusionment," said Miguel Stilwell d'Andrade, chief executive of Portuguese power company EDP (EDP.LS) , opens new tab. "What’s missing is the demand. There are 400 million euros ($464.2 million) of subsidies for hydrogen in Spain and Portugal, but we need someone to buy the hydrogen." The company has several projects in advanced stages but cannot move forward because of a lack of buyers, said Ana Quelhas, EDP's hydrogen chief and co-chair of the European Renewable Hydrogen Coalition. Across the border, Spain's Iberdrola (IBE.MC) , opens new tab has shelved plans to increase capacity at a green hydrogen plant with electrolyser capacity of 20 MW until it finds buyers for additional output, company executive Iban Molina said at an energy event in Madrid. They are among more than a dozen large companies that have trimmed spending or shelved projects across Europe, Asia, Australia and elsewhere in recent years. Companies had scrapped or delayed more than a fifth of all European projects by the end of last year, Westwood Global Energy says. At Aurora Energy Research, Emma Woodward said: "In 2020-2021 we had this view of hydrogen and the fact it was going to be used in almost every sector that hadn't been electrified. "I think we've realised now that there are other, probably more commercially viable, alternatives for lots of sectors. Maybe we don't need as much hydrogen as initially expected." TOO EXPENSIVE Many governments have long supported development of green hydrogen - produced through electrolysis that splits water into hydrogen and oxygen using electricity from renewables - to help to decarbonise energy, transport and industry. Countries including Australia, Britain, Germany and Japan announced ambitious investment strategies they hoped would bring down costs and eventually create a profitable green hydrogen sector that would no longer need support. Production, however, remains more expensive than for natural gas and other fossil fuel-based alternatives, said Minh Khoi Le, Rystad Energy's head of hydrogen research. It is at least three times more expensive than natural gas as a fuel for power generation, for example, and twice as expensive as grey hydrogen. The latter is produced from natural gas and coal and is already used in industries such as oil refining and production of ammonia and methanol. Costs could fall by 30-40% in 10-15 years if equipment prices decline and the broader supply chain scales up, he added, while Aurora's Woodward and Westwood Global Energy’s Sasamura said that green hydrogen is unlikely to become competitive before then. Only 6 million metric tons per annum (mtpa) of low-carbon hydrogen capacity - including green and blue hydrogen, which is made from gas - is either operational or under construction globally, consultancy Wood Mackenzie says. This is well below the 450 mtpa the consultancy says is needed as part of the global push for net zero greenhouse gas emissions by 2050. The EU has committed to reducing emissions by 55% from 1990 levels by 2030, en route to the 2050 target. BUYERS PRICED OUT THE MARKET The industry had counted on sectors such as steel, oil refining, cement and transport to be among the first buyers, but the expected demand has failed to materialise. German die forging company Dirostahl, which makes components for wind turbines, ships and oil and gas drill pipes, is dependent on furnaces fired by natural gas and is looking for a replacement. However, green hydrogen is still too expensive. Offers for the fuel do not come below 150 euros per megawatt hour (MWh) while natural gas can be bought for 30-35 euros/MWh, said Chief Executive Roman Diederichs. "It simply doesn’t work. You might not want to call it economic suicide, but in practice it would be just that. We'd be completely uncompetitive," he said. Prices remain elevated because of the high cost of electrolysers needed for large-scale production, infrastructure bottlenecks and increased energy costs resulting from rules on what constitutes green hydrogen. Some European countries have scaled back their ambitions. Italy has recently shifted more than 600 million euros in post-pandemic funds from hydrogen to biomethane. France lowered its 2030 hydrogen electrolysis capacity target by more than 30% in April and Portugal has cut its electrolysis capacity ambitions by 45%. The Dutch government last year made sharp cuts to funds it had originally reserved for green hydrogen projects and battery development, shifting the focus of its climate fund toward the planned construction of two new nuclear plants. Several players in Australia, meanwhile, have scaled back or withdrawn from projects despite more than A$8 billion ($5.2 billion) of pledged government support. Projects that are going ahead also face delays. Rystad Energy analysts estimate that 99% of A$100 billion of projects announced for the next five years have failed to progress beyond the concept or approval stage. INFRASTRUCTURE DIFFICULTIES Another problem is that hydrogen is difficult to store because it requires high-pressure tanks, extremely low temperatures and tends to leak, making for risky transportation through old gas pipelines while awaiting new infrastructure. Spain hopes to build a 2,600 km (1,615 mile) hydrogen network and connect it to another project - the trans-European H2Med link - from the Iberian region to northwest Europe. The Spanish network should be operational around 2030, but delays of two or three years are likely for broader European infrastructure, said Arturo Gonzalo, CEO of Spanish gas grid operator Enagas. "Infrastructure is not something that happens when the market has already taken off; it is something that has to happen for the market to take off," he said. ($1 = 0.8617 euros) ($1 = 1.5340 Australian dollars) https://www.reuters.com/sustainability/climate-energy/green-hydrogen-retreat-poses-threat-emissions-targets-2025-07-23/

2025-07-23 18:46

Diesel margins boost US refiners' Q2 profits Refiners' earnings rebound from recent quarterly losses Refining stocks up 20% year-to-date NEW YORK, July 23 (Reuters) - Investors are expecting top U.S. refiners to report higher second-quarter profits, bouncing back from losses during the first three months of the year as unseasonably strong diesel margins boost earnings. Fuelmakers have reaped unexpected profits from producing key products in recent months, a respite after earnings slipped from record levels in 2022, when a recovery in demand following the COVID-19 pandemic and Russia's invasion of Ukraine lifted prices. Sign up here. Some forecasting groups had anticipated weaker margins this year as demand was expected to slow. While analysts expect a recovery from the previous quarter, profits are likely to be weaker than a year ago. "Refiners are up 20% year-to-date, with surprising counter-seasonal diesel crack strength supporting the group," said TD Cowen analyst Jason Gabelman. Product margins could potentially hold at elevated levels until autumn maintenance, Gabelman said. Diesel cracks averaged $17 per barrel during the second quarter, in line with the first quarter, but ended the three-month period higher at $21 per barrel, TPH & Co analyst Matthew Blair said in a note. U.S. distillate inventories reached five-year lows in early May thanks to strong exports and improving demand, which supported margins, Blair said. U.S. refinery distillate yields have also been low, likely due to a lighter crude slate. Valero (VLO.N) , opens new tab, the second-largest U.S. refiner by capacity, is set to kick off refiner earnings on Thursday, with analysts forecasting a profit of $1.75 per share, down from $2.71 per share profit a year ago, according to data from LSEG. Marathon Petroleum (MPC.N) , opens new tab, the top U.S. refiner by volume, is expected to report a per-share profit of $3.28, compared with a $4.12 per share profit a year ago, LSEG estimated. Phillips 66 (PSX.N) , opens new tab is expected to report a profit of $1.69 per share, versus $2.31 per share profit a year ago, according to LSEG estimates. Both Marathon and Phillips 66 reported losses in the first quarter. https://www.reuters.com/business/energy/us-refiners-may-see-q2-profit-recover-stronger-diesel-margins-2025-07-23/

2025-07-23 18:19

CPC's shareholders include US majors Chevron and ExxonMobil More than 2% of global oil supply could be disrupted CPC's operations have been disrupted over the year Restrictions follow contamination scare over Azeri BTC oil MOSCOW, July 23 (Reuters) - Foreign oil tankers are being temporarily barred from loading at Russia's main Black Sea ports following new regulations, two industry sources said on Wednesday, effectively blocking exports from Kazakhstan handled largely by a consortium partly owned by U.S. energy majors. The lack of port access to foreign ships, which also affected Russian oil exports from the port of Novorossiisk, could amount to more than 2% of global oil supply, according to Reuters calculations based on loadings data from the region. Sign up here. It comes days after the EU imposed fresh sanctions on Russia and complicates operations of the Caspian Pipeline Consortium, whose shareholders include Chevron (CVX.N) , opens new tab and ExxonMobil (XOM.N) , opens new tab. CPC ships oil through the pipeline, which carries more than 80% of all Kazakh oil exports, and further via Russia's Yuzhnaya Ozereevka terminal. On Monday, President Vladimir Putin signed a law under which foreign ships will require the approval of Russia's FSB security service to access the country's ports. The decree said that permission from port authorities for foreign ships to enter would need to be agreed with the FSB, which is the main successor organisation to the Soviet-era KGB. The new measures came into force immediately after the decree was published. CPC and Russia's ministry of transport declined to comment on the suspension. One of the sources said he expected the situation at the ports to be resolved in a day or two. Black Sea CPC Blend oil exports from the CPC terminal in Russia were set at 1.66 million barrels per day for August, or about 6.5 million metric tons, almost unchanged from the July export plan. Exports and oil transit via Novorossisk are seen around 2.2 million metric tons in July, according to industry sources. Mediterranean oil markets were already jittery following a contamination scare which led to delayed loadings of Azeri BTC crude oil from the Turkish port of Ceyhan in recent days. CPC's operations were also disrupted by a damaged pumping station in February in a suspected drone attack, and Russia's brief restrictions on capacity of the CPC's Black Sea terminal in April. https://www.reuters.com/business/energy/kazakh-black-sea-oil-exports-halted-by-new-russian-regulations-sources-say-2025-07-23/