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Source: OPEC+ will agree to another accelerated increase in oil production for June
A source said that eight OPEC+ nations will meet on Saturday and agree to a new accelerated oil production increase for June, of 411,000 barrels a day. This was shortly before a meeting online of the countries. The eight countries increased their output in May by 411,000 barrels per day more than they had planned. This, combined with the U.S. tariffs on trade, drove oil prices to a record low of $60 a barrel. Sources made the comment just before countries began an online meeting to determine June output after bringing the meeting forward by one day. Four other sources had earlier stated that the accelerated increase was likely to be approved. Oil prices dropped over 1% Friday, as traders prepared for more OPEC+ supplies. Concerns about an economic slowdown due to a trade conflict between the U.S. Brent crude futures closed Friday at $61.29, down 84 cents or 1.4%. This week, it was reported that Saudi Arabian officials, de facto leaders of OPEC+ and allies, had informed industry officials and other officials that they were unwilling to support oil markets by cutting further supplies. Sources have reported that Riyadh is angry because Kazakhstan and Iraq are producing more than their OPEC+ target. Helima Croft, an analyst at RBC Capital Markets, said that "discussions seem to be pointing in the direction of a third three-month rise". Croft added, "Compliance appears to be the main focus. Kazakhstan, Iraq, and Russia continue to miss their compensation goals, although to a lesser degree." OPEC+ (which includes the Organization of the Petroleum Exporting Countries, as well as allies like Russia) is cutting production by more than 5 million bpd. Many of the cuts will remain in place through the end of 2026. The group intends to hold a full-ministerial meeting on 28 May. (Reporting and writing by Alex Lawler; Editing and writing by Barbara Lewis.
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Sources say that OPEC+ is set to increase oil production again in June.
Four sources familiar with the matter said that eight OPEC+ nations will likely agree on Saturday to a further accelerated increase in oil production for June. This is the latest step of a plan designed to undo the most recent layer of cuts made by the group. The eight countries increased their output by 411,000 barrels a day in May. This decision, along with the U.S. tariffs on trade, helped drive oil prices to a 4-year low below $60 per barrel. After moving the meeting from Monday to today, the countries will hold an online discussion to decide on June's output at 1000 GMT. Four sources told Reuters that a similar hike to the one approved in May is likely to be approved by the four countries for June. Oil prices dropped over 1% Friday, as traders prepared for more OPEC+ supplies. Concerns about an economic slowdown due to a trade conflict between the U.S. Brent crude futures closed Friday at $61.29, down 84 cents or 1.4%. This week, it was reported that Saudi Arabian officials, de facto leaders of OPEC+ and allies, had informed industry officials and other officials that they were unwilling to support oil markets by cutting further supplies. Sources have reported that Riyadh is angry because Kazakhstan and Iraq are producing more than their OPEC+ target. Helima Croft, an analyst at RBC Capital Markets, also said that she didn't think a decision had been finalized but "discussions seem to be leaning towards another three-month hike". Croft added, "Compliance appears to be a key focus. Kazakhstan, Iraq, and Russia continue to miss their targets for compensation. OPEC+ (which includes the Organization of the Petroleum Exporting Countries, as well as allies like Russia) is reducing output by more than 5 million bpd. Many of these cuts will remain in effect until the end of the year 2026. The group intends to hold a full-ministerial meeting on the 28th of May. (Reporting and editing by Barbara Lewis, Maha El-Dahan, and Ahmad Ghaddar)
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US worker safety agency informs employees of terminations
The Trump administration terminated employees late Friday of a worker safety and health agency, which provides services and research for coal miners and firefighters, despite pleas from a Republican lawmaker to keep its programs. According to a copy of these notices, the National Institute for Occupational Safety and Health employees received notices of reduction in force that stated the job losses would be necessary to reshape workforce of Department of Health and Human Services. The union representing NIOSH's employees reported that, while nearly all employees were put on administrative leave during February, around 40 employees who were responsible for coal mining and firefighter safety had been asked to temporarily return to work a few days earlier. Two of these employees have been terminated. U.S. U.S. After regular business hours, the Department of Health and Human Services (which oversees NIOSH) did not respond immediately to a comment request. A spokesperson said earlier this week that NIOSH functions will join multiple agencies in the new Administration for a Healthy America. It is not known if any of the terminated staff will be relocated. Last month, it was reported that the NIOSH key services had been halted, which meant vital health and safety programmes for coal miners were no longer available, including mobile health screenings and lung screenings. Another program, to move miners with black lung to less dusty areas of a mine, has also been discontinued. In the past decade, black lung disease has resurged among coal miners of all ages. The President Donald Trump is leading a high profile campaign to revive coal use and mining in the U.S., which was declining.
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PD Ports Outlines Plans to Develop UK Offshore Wind Hub
U.K.-based PD Ports has outlined its plans to develop one of the U.K.’s largest offshore wind manufacturing and installation hubs - the Teesport Offshore Gateway.The proposed project could unlock 180 acres of development potential for a range of offshore manufacturers, assembly, marshalling and supply chain support services.Representing a multi-million-dollar investment in the River Tees, the Teesport Offshore Gateway would include an up to 1 km long deep-water riverside quay, permitting unrestricted access to the North Sea and suitable for both floating and fixed bottom offshore wind development. Set within the heart of PD Ports’ Teesport industrial port complex, the U.K.’s sixth largest port, the site offers a strategically located position for development, supported by quality infrastructure, strong road and rail links and a skilled workforce. While the plans are at an early stage and subject to a variation of existing deep water berth development consents, it is anticipated that development of Teesport Offshore Gateway could cost in the region of $267 million and would secure critical port facilities in support of the Government’s offshore wind development ambitions.PD Ports is looking to engage with the offshore renewables sector to explore the potential of the proposals, working with original equipment manufacturers (OEM), developers, the UK Government and industry experts to shape the strategic direction of the site and identify opportunities for collaboration and funding. It is hoped that by announcing the initiative at an early stage, insight from the offshore sector will aid the design of more detailed plans to meet future industry requirements. The site has already secured both planning consent and marine consent, subject to amendments, to extend an existing riverside berth to develop the 15.5m deep-water mooring, which would be large enough to accommodate all current and planned offshore installation vessels available globally.The creation of a new deep-water berth for Teesport will also future-proof the port, opening up wider opportunities for additional bulk and container facilities, in support of PD Ports’ existing Teesport Container Terminal and the Tees Bulks Quay. “As the U.K. and the wider world turns its attention to large-scale renewable energy sources, here at PD Ports we see the opportunity – and the responsibility – to play our part by offering an offshore wind development site that is perfectly positioned to unlock the capability of our region, not only as a hub for trade and industry, but also to deliver the clean energy revolution.“Teesport and the River Tees has everything required to successfully operate what we believe will be one of the largest offshore wind manufacturing and assembly hubs on the east coast of the UK, offering unrivalled access to the North Sea.“Although these proposals are at an early stage, we are confident that this development will support the UK Government’s ambitions for future offshore wind power generation,” said Frans Calje, chief executive officer of PD Ports.
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Shareholder returns from Big Oil show a split in production strategies
Big Oil's earnings for the first quarter of 2018 show a clear division in how companies are positioning themselves to weather a downturn caused by the drop in oil prices, which reached a four-year-low in April. Investors focused on the question of whether companies would reduce share repurchases because lower crude prices would mean that they would have less cash available to fund these programs. Investors' interest in the oil sector is largely driven by buybacks and dividends. Exxon Mobil, a US oil company, and Shell in the UK kept up their share buybacks. Chevron, a U.S. oil company, and BP (a UK-based oil company) said that they would decrease buybacks during the second quarter. The differences reflect where each company is at in its business cycle. Exxon's Guyana oilfield has produced prolifically, making it the largest offshore oil discovery in more than a decade. Exxon, a major player in both the Permian basin, the largest U.S. oilfield in terms of production, and in Guyana, has increased its production by 20 percent year-over-year. Exxon CEO Darren Woods said that both areas are highly lucrative and the company is trying to reduce its operational costs. Woods stated in the first-quarter earnings report of his company that "in this uncertain market our shareholders can have confidence in knowing that we are built for it." This week, oil prices fell to their lowest monthly level since 2021 as investors priced the impact of U.S. President Donald Trump’s trade policies on the global economy and fuel demand. Exxon had a net debt-to-capital of 7%. Kim Fustier of HSBC's European Oil and Gas Research said that Exxon was the only integrated company to not have increased its net debt in the third quarter. Chevron's oil and gas production in the first quarter of the year was the same as the previous one, due to a combination of growth in Kazakhstan and Permian and a loss from the sale assets. In an attempt to streamline the business and reduce costs by up to $3 billion, Chevron announced earlier this year that it would be laying off up to 20 percent of its employees. Chevron wants to get into the Guyana game by acquiring Hess, one of Exxon’s minor partners in the project. Exxon has been in arbitration for that deal and claims the right of refusal over Hess stake in the project. Exxon bought $4.8 billion worth of shares in the first quarter. This puts it on track to reach its annual goal of $20 billion. Chevron announced that it would reduce its buybacks from $3.9 billion to $2 billion-$3.5 billion during the current quarter. This is a reduction of $3.9 billion made between January and march. Jake Behan is the head of capital market at Direxion, a financial products company. He said that Exxon was able to maintain its buybacks due to low production costs, while Chevron reduced theirs as oil prices fell. Shell impresses, BP disappoints In Europe, Shell’s first-quarter results exceeded analyst expectations. The company announced that it would buy $3.5 billion of shares in the next three month, marking the 14th quarter in a row of a program worth at least $3 billion. BP's profit fell by 48% to $1.4 billion, missing earnings expectations. It also reduced its share buyback from $1.8 billion a quarter to $750 millions a quarterly. Biraj Borkhataria is an analyst with RBC Capital Markets. He said that after the disappointing results BP may miss consensus expectations by 20% for the second quarter earnings. He wrote: "The combination (of a weaker free cash flow), higher leverage and patchy implementation leaves us more conservative on the name in comparison to peers." After a failed effort to aggressively move towards a low-carbon business model, the British oil major has shifted its strategy back to oil and gas. BP underperformed before the recession, which made it a possible takeover target. Shell CEO Wael Sawan stated on Friday that he would prefer to buy more shares of his own company than bid for BP. Shell's investment budget for the year was between $20 billion to $22 billion, while BP announced that it would cut its spending by $500,000,000, to a budget of $14.5 billion. BP has also said it may sell more assets this year, upping its forecast for sales to between $3 and $4 billion from $3 billion. Reporting by Sheila Dang, Houston; Shadia Nasralla, London; editing by Rod Nickel
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The US jobs report and signs of an easing in trade tensions have led to a rise in world stocks.
Wall Street and European shares rallied, and U.S. Treasury Yields surged Friday as investors' risk appetite was boosted by a positive employment report and indications that China is willing to negotiate tariffs. The three major U.S. indexes all advanced by more than 1% in the session. Financials, transports, and microchips, which are sensitive to the economy, outperformed the overall market. The three indexes all rose this week. The S&P 500 has posted nine consecutive sessions of gains. This is its longest winning streak since over twenty years. According to the Labor Department's report, the U.S. economy created more jobs last month than was expected, and wage inflation was below consensus. This prompted a rise in U.S. Treasury benchmark yields. Paul Nolte is a senior wealth advisor and market strategist with Murphy & Sylvest, located in Elmhurst. He said, "The jobs data was very positive; it shows that the economy's doing well." "There is still discussion about the impact of tariffs but, so far, this data hasn't shown up in many of the numbers." China's Commerce Ministry announced that Beijing was evaluating Washington’s offer to have talks about President Donald Trump’s crippling tariffs. This could signal a possible de-escalation in the market-shaking trade war. Jed Ellerbroek is a portfolio manager with Argent Capital Management, St. Louis. He said that both China and the U.S. were taking small but consistent steps towards negotiation and reconciliation. "It seems the spiraling-out-of-control phase ended." Ellerbroek said that "the market doesn't believe the current tariffs will last very long." The latest quarterly earnings report shows that the lack of clarity surrounding U.S. China trade duties contributed to a marked decline in long-term expectations for U.S. companies. Apple and Amazon.com released their quarterly earnings on Thursday night with disappointing estimates, including Apple’s estimated $900,000,000 in tariff costs. These reports have taken some of the wind out of the sails for the Magnificent 7 group of megacap stocks related to artificial intelligence, which enjoyed a recovery this week. General Motors has warned that earnings will be hit by $4-5 billion dollars and American Airlines has withdrawn its profit forecasts. The Dow Jones Industrial Average rose by 564.47, or 1.39 %, to 41.317.33, the S&P 500 gained 82.49, or 1.47 %, to 5,686.63 while the Nasdaq Composite climbed 266.99, or 1.51% to 17,977.73. European shares surged as investors regained confidence after a busy week of earnings, fueled by renewed hopes for Sino-U.S. Trade Negotiations and strong employment data. The MSCI index of global stocks rose by 13.23 points or 1.58% to 848.38. The pan-European STOXX 600 Index rose 1.67% while Europe's broad FTSEurofirst 300 Index rose 36.55 point, or 1.75%. Emerging market stocks increased by 23.83 points or 2.14% to 1,135.80. MSCI's broadest Asia-Pacific share index outside Japan closed up by 2.44% to 595.08 while Japan's Nikkei gained 378.39 or 1.04% to 36,830.69. Treasury yields increased as investors reduced their bets that the Federal Reserve would cut rates in June due to strong employment numbers. The yield on the benchmark U.S. 10 year notes increased 7.7 basis points from 4.231% to 4.308% late Thursday. The 30-year bond rate rose by 5.2 basis points, from 4.737% to 4.7889% late Thursday. The yield on the 2-year bond, which is usually in line with expectations of interest rates for the Federal Reserve (Fed), rose by 12.5 basis points, to 3.826% from 3.701%, late Thursday. Dollar dropped in wake of positive U.S. employment report. The dollar index (which measures the greenback in relation to a basket of currencies, including the yen, the euro and others) fell by 0.14%, while the euro rose 0.12%, reaching $1.1304. The dollar fell 0.3% against the Japanese yen to 144.99. Crude continued to fall as investors positioned ahead of a decision expected by OPEC+ boosting output. U.S. crude dropped 1.60%, settling at $58.29 a barrel. Brent, however, settled at $61.29 a barrel, down by 1.35%. The gold price reversed gains earlier and was headed for a loss of a week amid eased trade tensions. Spot gold dropped 0.24% to $3232.60 per ounce. U.S. Gold Futures increased 0.47% to an ounce of $3,225.00.
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Goldman Sachs predicts a 410,000-bpd increase in OPEC+ supply for June
Goldman Sachs said on Friday that it expects OPEC+ will announce a second consecutive supply increase for June on July 1 due to the modest compliance of Kazakhstan, lower than expected OECD inventory levels, and Saudi Arabia’s ability to deal with lower oil prices. The Wall Street bank expects the Organization of the Petroleum Exporting Countries and its allies (OPEC+) to announce a 410,000-barrel-per-day (bpd) increase in supply for June in its meeting on Saturday, from its prior estimate of 140,000 bpd, according to a note. Three sources said on Friday that the OPEC+ summit was moved from Monday to Saturday. Three sources told Friday that the expected increase will be three times higher than the December level to begin unwinding of cuts. Goldman Sachs' previous OPEC forecast was based on a substantial increase in compliance with the production cuts. However, Kazakhstan's compliance is only modest, according to it. Moreover, inventories for the Organisation for Economic Co-operation and Development countries (OECD) for April fell short of the bank's expectation by 28 million barrels because supply missed in Venezuela and U.S. shale. Goldman Sachs economists also found that Saudi Arabia can survive lower oil prices. Goldman Sachs stated that "this week's decline in oil prices and the increases in implied volatility, put skew and put spread suggest that the central expectation of the market has also converged towards a 410,000 bpd rise." Brent crude settled at $61.29 a bar on Friday, and West Texas Intermediate crude (WTI) futures at $58.29 a bar. This is the biggest weekly loss since the end March. Goldman's oil price forecast is unchanged. It expects Brent to average $63 per barrel and WTI to average $55 for the rest of 2025. Brent will be $58 in 2026 and WTI will be $55. The bank predicted that a global slowdown, or a complete reversal in the voluntary OPEC+ reductions of 2.2 million bpd could push Brent into the 40s by 2026 and even below $40 under an extreme scenario. (Reporting and editing by Marguerita Chy in Bengaluru)
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US EPA to cut staff back to 1980s levels and dissolve the research office
As part of an overhaul of the U.S. Environmental Protection Agency, the agency announced on Friday plans to cut its budget by $300,000,000 in fiscal year 2026. It also plans to reduce its staffing levels to those of 1980s and dissolve its Research and Development office. The reorganization will consolidate key offices and reflect President Donald Trump's executive order to reduce regulatory red tape, promote energy development, and cut down on bureaucracy. In a press release, EPA Administrator Lee Zeldin stated that the reorganization would bring needed efficiencies in incorporating science into rulemaking and sharply focus on our work to provide the cleanest air and water possible for our communities. The agency has said that its staffing levels will drop to a level seen last in the 1980s when Ronald Reagan was president of the United States and the EPA was headed by an administrator critical of the agency. In 1984, there were just over 11,400 EPA staffers. By 2024, that number will rise to 15,100. After weeks of speculation, Zeldin announced the cancellation of EPA grant money worth billions. Major changes to the agency's structure include shifting scientific research from the Office of Research and Development to different program offices, such as a new office of applied science that would align research with the politically-appointed administrator's policy priorities. Researchers at ORD had warned against dissolving ORD's research unit, arguing that it would undermine the scientific independence of the organization. It said that the EPA would also raise issues such as cybersecurity, emergency response and water reuse and conservancy. (Reporting and editing by Leslie Adler, Ni Williams, and Valerie Volcovici)
Andy Home: Tin bulls retreat as Myanmar flags the return of a key mine
The Wa State in Myanmar, a semiautonomous region, has finally broken a year-long silence about the fate of Man Maw Tin Mine.
The mine is a jewel in Myanmar's crown of tin and its suspension, since August 2023 ostensibly to conduct an audit, has cut the flow of raw tin materials into Chinese smelters thereby reducing the output of refined metal.
The Wa authorities now say they are ready for applications to be submitted for mining and processing licenses at Man Maw. This indicates that it is likely to return in the second half of this year.
The International Tin Association confirmed the news and the London Metal Exchange's (LME) tin prices have fallen.
MAN MAW RETURNS
Myanmar, after China and Indonesia, is the third largest producer of tin in the world. Man Maw was the largest tin mine until it was suspended.
As the Wa State, which controls Myanmar’s tin industry, does not have smelters, all of the tin mined is sent over to China’s Yunnan Province.
The raw material shipment patterns were not much different in the first few months after the suspension of Man Maw operations, as the above-ground stock was processed.
China's imports of Myanmar products have dropped significantly in the last nine-month period, from 54,900 metric tons during the first half of this year to 94,600 metric tons for the previous year.
Some smaller tin mining operations have reopened but they are nowhere near as important as Man Maw.
Chinese producers have tried compensating by reducing imports of other countries, such as Australia, Bolivia and the Democratic Republic of Congo.
The total imports of raw tin materials in 2024 were down 36% on an annual basis, and were at 156.700 tons the lowest since 2010.
Lack of raw materials has impacted smelter margins, and is a major factor in China's refine metal production.
BULLS WITH WRONG-FOOTED
Unsurprisingly, the news of Man Maw’s return caused a sale in London's tin market.
LME's three-month metal soared to a four month high of $33,790 a ton on the 21st of February. Tin was the top performer of the LME base materials with gains to date of 15.8%.
Funds have been increasing their bull bets steadily on higher prices. At the end of last weekend, long positioning had reached a new record of 5,172 contracts. This is equivalent to nearly 26,000 tons.
Last week, after the ITA confirmed that Man Maw would return, the price of a ton dropped to $31,050. This week it has risen to as high as $32,145.
It is not unreasonable to expect a partial price recovery, given that it could be several months until the mine starts producing tin once again.
RISK OF STRUCTURAL SUPPLY
The Wa State's announcement that it is ready for licenses is just the first step in a complete reopening.
The ITA states that even after licenses have been granted, it may take a few months for workers, mainly those from China, in order to obtain work permits and return to Myanmar.
After such a long period of suspension, it is likely that the mine will need to be dewatered. This means that the shipments into China will only begin to pick up in the second half.
Chinese smelters continue to face a shortage of raw materials and the production of refined metal will be affected until raw material flow returns to its pre-suspension level.
The M23 rebels' advances to the east of Congo is a major concern for the tin supply market.
So far, the Bisie mine in this country, which produced 17,324 metric tons of tin-contained concentrates last year, is unaffected.
The mine is about 200 km west of the insurgent-controlled area, but Alphamin Resources Corp. has warned the increased risk at Bisie.
This highlights tin’s structural supply issues. The market, which is touted to be a major beneficiary of the energy transition as well as the internet of things, is still dependent on a small number of global suppliers.
The structural supply risk is not changed by the return of Man Maw.
The author is a columnist at
(source: Reuters)