2025-01-29 12:14
ASTANA, Jan 29 (Reuters) - Kazakhstan will make a final decision on oil production cuts after the next joint OPEC+ meeting, the Central Asian country's Energy Minister Almasadam Satkaliyev said on Wednesday. Kazakhstan has persistently exceeded its output quota of 1.468 million barrels per day (bpd) under the production-curbing deal struck by the Organisation of the Petroleum Exporting Countries and allies such as Russia - together known as OPEC+. In response, Kazakhstan has pledged to make cuts to compensate for its overproduction until the end of June 2026. It would be challenging for Kazakhstan to restrain oil production given its plans to raise it this year and as Chevron (CVX.N) , opens new tab had started output at a $48 billion expansion of the giant Tengiz oilfield, which will bring the country's output to around 1% of global crude supply. Kazakhstan plans to boost its oil and gas condensate production this year to 96.2 million tons (around 2 million bpd) from 87.56 million tons in 2024. Gas condensate, a type of light oil, is not included in the country's OPEC+ quota. A monitoring panel of OPEC+, which is holding back 5.86 million bpd of production, or about 5.7% of global demand, is set to meet next Monday amid U.S. President Donald Trump's call for lower oil prices. Oil prices have risen this year, with Brent crude reaching almost $83 a barrel on Jan. 15, its highest since August, supported by concern about the supply impact of U.S. sanctions on Russia. Prices were trading below $77 on Wednesday. Sign up here. https://www.reuters.com/business/energy/kazakhstan-decide-oil-output-cuts-after-opec-meeting-2025-01-29/
2025-01-29 11:40
Jan 29 (Reuters) - Indian steelmaker Jindal Stainless (JIST.NS) , opens new tab reported a 5.3% fall in third-quarter profit on Wednesday, hurt by lower prices amid discounted imports from China as well as rising expenses. The company's consolidated profit after tax declined to 6.54 billion rupees (about $76 million) for the quarter ended Dec. 31 from 6.91 billion rupees a year earlier. Indian steelmakers have been battling an influx of discounted Chinese steel, with shipments hitting an all-time high during the April-December period. Jindal Stainless said the dip in profit happened as stainless steel prices have been declining globally, while incessant low-priced imports pressured margins in both domestic and export markets. Its earnings before interest, taxes, depreciation, and amortization fell to 12.08 billion rupees in the quarter, down 5.3% on-year. Domestic sales grew 20% in the quarter, driven by higher sales to the automobile industry, while exports fell 22%. The company's net revenue rose 8.5% to 99.07 billion rupees, while total expenses jumped 10% to 91.02 billion rupees. ($1 = 86.5280 Indian rupees) Sign up here. https://www.reuters.com/markets/commodities/indias-jindal-stainless-posts-q3-profit-drop-falling-steel-prices-2025-01-29/
2025-01-29 11:31
Spain's parliament rejects extension of windfall tax Moeve plans to start green hydrogen production in 2027 Moeve's 2 gigawatt green hydrogen target by 2030 unchanged LONDON, Jan 29 (Reuters) - Spain's decision not to extend an energy windfall tax provides the regulatory certainty, Moeve, the country's second-largest oil company, needed to start building its flagship green hydrogen project this year, the company's chief executive said. Spain's parliament last week rejected several decrees put forward by the country's minority left-leaning government, including one to extend a 1.2% windfall tax imposed in late 2022 on energy companies with a turnover of at least 1 billion euros ($1.04 billion). "We've had some regulatory issues in Spain around tax levels and that has slowed down the industry...putting an end to the idea of a windfall tax will allow the industry to invest," Chief Executive Maarten Wetselaar said in an interview with Reuters. "A responsible thing to do is to kick-start industry. We would like to start building (the green hydrogen project in Huelva) this year and by 2027, we would have the first 400 megawatt (MW) (plant) in the world by 2027," Wetselaar said. In October 2024, Wetselaar said Moeve would delay investments worth 3 billion euros in its 2 Gigawatts (GW) electrolysis plant in southern Spain if the windfall tax became permanent. Wetselaar has been among the most vocal critics of Spain's windfall tax on energy companies' domestic sales. It had to pay 566 million euros in 2023 and 2024 for this tax. Moeve is building the project in phases. It has a target to produce 2GW of green hydrogen from the project by 2030, he said. "We continue to see the south of Spain as the best place in Europe to make green hydrogen and its derivatives, and since Europe is going to need a lot of this, we are in the right zip code," he added. Owned by Abu Dhabi fund Mubadala and U.S.-based private equity firm the Carlyle Group CG.O, Moeve is investing up to 8 billion euros to shift to low carbon energy and sustainable mobility, focusing on green hydrogen, which is produced without using fossil fuels, as well as biofuels and electric mobility. Moeve, which in Oct. 2024 rebranded from its former name, aims to make most of its profits from sustainable activities by the end of this decade. The European Commission has set out targets to produce up to 10 million metric tons of renewable hydrogen by 2030 and import a further 10 million tons. The non-binding goals are part of the bloc's plans to end its reliance on Russian energy imports. Sign up here. https://www.reuters.com/business/environment/spains-moeve-set-start-work-green-hydrogen-plant-this-year-2025-01-29/
2025-01-29 11:26
BRUSSELS, Jan 29 (Reuters) - The European Commission did not propose a ban on Russian liquefied natural gas in its latest package of sanctions because member states raised concerns about first securing alternatives including from the United States, EU diplomats said. "First you have to have a deal because otherwise you will be left without gas from Russia and without the U.S.," one of the diplomats said. In June last year, the European Union banned transshipments of Russian LNG in a further package of restrictions on Russia imposed over its 2022 full-scale invasion of Ukraine. Moscow had been using northern European ports to do ship-to-ship transfers of LNG for onward journeys to Asia. Since the ban took effect, more Russian LNG has stayed in Europe, prompting some member states to push for tighter rules and an all-out ban. However, the Commission did not propose tougher measures after pushback from some member states. EU sources said the cold winter weather, gas stocks drawdown and the timing of the Feb. 23 German election put a further dampener on the idea. "There was never an original measure, so I don't think it's useful to talk about it in terms of watering down," one European diplomat told Reuters. "The general idea was floated by the Commission in confessionals in order to test the waters...Apparently one or more member (state) signalled enough opposition for the Commission not to deem it opportune to propose such a measure now." U.S. President Donald Trump said he wants the EU to buy more U.S. LNG and that he will make more of it available. It is unclear when the EU could secure more U.S. LNG in the short term as exports are already at full capacity. Trump overturned a moratorium on new LNG projects put in place by his predecessor as president, Joe Biden, but major new capacity will not come onstream until 2030. The U.S. exported 70% of its LNG to Europe in December. Sign up here. https://www.reuters.com/world/europe/eu-wont-ban-russian-lng-until-it-secures-alternatives-diplomats-say-2025-01-29/
2025-01-29 11:13
Valero to kick off Q4 US refiner earnings on Thursday Soft fuel demand continues to weigh on Q4 refining margins US gasoline futures crack spread hit one-year low in December Investors to focus on refiners' plans to limit impact of Trump's tariffs NEW YORK, Jan 29 (Reuters) - Wall Street is bracing for a sharp decline in U.S. oil refiners' fourth-quarter profits as fuel demand softened, while seeking clarity on the sector's preparations for President Donald Trump's threatened tariffs on crude imports from Canada and Mexico. U.S. refiners have seen earnings slide from record levels in 2022, when a recovery in demand following the COVID-19 pandemic and Russia's invasion of Ukraine drove up fuel prices. That demand has since slowed, and now Trump's promise to set a 25% tariff on oil imports from Canada and Mexico by Feb. 1 could further hit profits by driving up the cost of crude. U.S. gasoline retail prices decreased for the second consecutive year in 2024. Weaker demand for the transport fuel, the most consumed oil product in the U.S., during the summer of 2024 compared to 2023 helped to build inventories. In the second half of 2024, prices averaged 10% lower , opens new tab than in the second half of 2023, according to the U.S. Energy Information Administration (EIA). The U.S. gasoline futures crack spread, or price difference with the U.S. benchmark West Texas Intermediate crude , which is a theoretical measure of a refinery's profit margin, fell below $11 a barrel to a one-year low in December. The ultra-low sulfur diesel futures crack spread eased to a nearly two-month low of under $22 a barrel during the month. "Refining margins have really come off the boil a lot and crack spreads are quite low," said Stewart Glickman, equity research analyst at CFRA Research. "We expect earnings performance in the fourth quarter to be pretty tepid," he said. 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 profits of 7 cents per share, down from $3.55 per share a year ago, according to data from LSEG. Marathon Petroleum (MPC.N) , opens new tab, which is the top U.S. refiner by volume, is forecast to report per share profit of 12 cents, compared with $3.98 per share a year ago, LSEG estimated. Phillips 66 (PSX.N) , opens new tab is expected to report earnings of negative 23 cents per share, compared with $3.09 per share a year ago, according to LSEG estimates. Oil majors BP (BP.L) , opens new tab and Exxon Mobil (XOM.N) , opens new tab earlier this month signaled that weaker refining margins in the fourth quarter would also dent their profits. Shares of Valero slipped more than 6% in 2024, while Phillips 66 fell more than 15% during that period. Shares of Marathon Petroleum closed 2024 down 8% for the year. TARIFF CONTINGENCIES Investors are also keen to hear from U.S. refiners in the earnings season on how they are preparing for the potential impact of the tariffs on imports from Canada and Mexico, which the White House on Tuesday said Trump still planned to go ahead with on Feb. 1. Canada has been the top source of U.S. oil imports for over two decades and supplied more than half , opens new tab of the total U.S. crude imports in 2023, according to the EIA. The new tariff could drive up the cost of crude for refiners, particularly in the Midwest that processes about 70% of the 4 million barrels per day (bpd) of crude imported from Canada. "Obviously, refiners have to plan for the scenario," said Brian Kessens, portfolio manager at Tortoise Capital. Many U.S. refining facilities are configured to run heavier oil grades - like those from Mexico and Canada. Some were buying an outsized amount of Canadian crude at year-end to help cushion against potential tariff impacts. U.S. crude oil imports from Canada rose by 689,000 barrels a day in the week ended Jan. 3 to 4.42 million bpd, the highest on record going back to June 2010, EIA data showed. U.S. refiners HF Sinclair , Phillips 66 and Par Pacific Holdings (PARR.N) , opens new tab have "elevated exposure" to Canadian crude, while Delek (DK.N) , opens new tab and Valero have limited exposure, TD Cowen analysts said in a note. Sign up here. https://www.reuters.com/business/energy/wall-street-braces-oil-refiners-lower-q4-earnings-tariff-plans-2025-01-29/
2025-01-29 11:11
RIO DE JANEIRO/BRASILIA, Jan 29 (Reuters) - Brazilian miner Vale's (VALE3.SA) , opens new tab CEO held his first official meeting with President Luiz Inacio Lula da Silva on Tuesday, the company said, where he highlighted that there was "enormous convergence" between its projects and the country's development agenda. WHY IT'S IMPORTANT Vale Chief Executive Gustavo Pimenta has been seeking to improve the mining group's relationship with the government since he took over the job in October replacing Eduardo Bartolomeo. The company has been criticized by Lula and cabinet members in the past. Lula's mining minister last year complained about a lack of investment in Brazil and delays to a repair deal over a 2015 dam collapse, which was ultimately sealed in October. KEY QUOTES In the meeting with Lula, Pimenta "discussed Vale projects that contribute to boosting Brazil to a global leadership position in the energy transition and decarbonization agenda," the miner said in a statement late on Tuesday. "Gustavo Pimenta highlighted his optimism about the company's future and the certainty that there is enormous convergence between Vale's strategic projects and Brazil's development agenda," the statement said. ADDITIONAL CONTEXT A source familiar with the hour-long meeting said Lula told Pimenta that Vale and the government needed to work together, noting that there had been some "noise" in the past but there was no reason for it to happen again. Vale was privatized in the 1990s. One of its main shareholders includes a pension fund operated by state-run lender Banco do Brasil (BBAS3.SA) , opens new tab. Vale on Tuesday reported its highest annual iron ore production since 2018, even after a decline in output in the fourth quarter when the company prioritized higher-margin products. Sign up here. https://www.reuters.com/markets/commodities/vale-ceo-meets-brazils-lula-touts-convergence-with-government-agenda-2025-01-29/
