Latest News
-
Engie buys DNO's Norwegian gas production for four years
The Norwegian company DNO announced on Wednesday that it had sold all of its gas production from the Norwegian continental shelf over a period of four years to French utility Engie at an undisclosed price. The deal was facilitated by an American bank loan, as U.S. banks are increasing funding for the fossil fuel sector. It also said it is in talks over a similar agreement and financing facility related to its North Sea oil production. The agreement will take effect on October 1, and it covers DNO’s increased gas production following its March acquisition of assets from Sval Energi. Sval's purchase quadrupled DNO’s North Sea production, which now stands at about 80,000 barrels equivalent of oil per day. About half of this is natural gas. Engie didn't immediately respond to our request for comment. DNO has not disclosed the exact volume of its four-year contract to Engie. However, DNO and Sval Energi produced 1,82 bcm from the Norwegian continental Shelf last year. DNO has entered a financing agreement with an unnamed U.S. Bank for up to 500 million dollars. This money will be used for Sval Energi’s debts as well as for general corporate purposes. In a press release, DNO Executive Chairman Bijan Mossavar Rahmani stated that "we have received strong interest from buyers to prepurchase the enlarged North Sea Production". (Reporting from Nerijus Adomiaitis and America Hernandez, Paris; editing by Barbara Lewis.)
-
The yuan strengthens as tariff uncertainty is offset
The price of copper rose on Wednesday, as the weaker dollar and stronger yuan in China, a major metals consumer, offset concerns about trade tensions around the world. By 1025 GMT, the price of three-month copper at the London Metal Exchange had risen by 0.2% to $9,951 per metric tonne. On Tuesday, the metal used in construction and power, which is valued at $10,000, tested the psychological threshold for the first three months, as positive manufacturing data from China, the top consumer, improved sentiment. Analyst Carsten Menke of Julius Baer said that this spike was due to a persistent premium in U.S. Copper Futures amid expectations that Section 232 tariffs would be imposed on imports to the United States in the future, assuming the investigation will conclude imports threaten U.S. National Security. This has led to a spike in U.S. imports of copper this year. The metal is now scarcer outside the U.S. The LME copper contract with a shorter maturity is trading at a higher premium than those with a longer maturity. Goldman Sachs stated in a report that they expect China's demand for refined Copper to increase by 6% between 2025 and 2050. They also see upside risks for their August LME copper prediction of $10,050 due to the competition for copper from China and America. Julius Baer is worried about the future demand for copper due to the pre-buying by U.S. importers. The U.S. Dollar was near its lowest level since February 2022 as traders weighed the impact of President Donald Trump’s spending bill and the looming deadlines for trade tariffs. The yuan is nearing an eight-month-high against the dollar, amid hopes of a easing in U.S. China trade tensions. LME aluminium dropped 0.2% to $2.593.50 per ton. Zinc rose 0.4% at $2.725.50. Lead increased 0.4% at $2.046.50. Tin fell by 0.6%, to $33,430, and nickel rose by 0.1%, to $15,220. (Reporting and editing by David Evans; Polina Devitt)
-
Allianz: Heatwaves could reduce GDP in Europe by 0.5 percentage points
A report by Allianz Research found that recent heatwaves in Europe could slow the economic growth of Europe by half a point by 2025. The report compared a day where temperatures exceeded 32 degrees Celsius with half a days worth of strikes. In Europe, the GDP loss ranges from 0.1 percent points in Germany to 1.4 percent points in Spain, where summer temperatures are approximately ten degrees warmer. Climate change increases the frequency and intensity for heatwaves, wildfires and droughts. This has far-reaching effects on the economy. Allianz Research reported that the global heatwaves have reduced GDP by 0.6 percentage points in this year. The Allianz Research report stated that China, Spain and Italy could all see GDP declines of almost one percentage point each due to current heatwaves. Meanwhile, the U.S. might face a drop of around 0.6 percentile points and France by up to a quarter of a percentage point. Heat stress is also a factor that reduces productivity. According to the International Labour Organization, heat stress worldwide will decrease total working hours by 2,2% by 2030. Allianz Research says that heat-related productivity losses can be reduced by taking structural measures in cities to adapt to the climate and adapting workplaces.
-
German wind power increases as spot prices fall.
German and French baseload electricity prices for the day ahead fell by around 20% on Wednesday, as a cooling heatwave in Europe is expected to reduce demand. Meanwhile, increased wind power production in Germany will increase supply. LSEG data show that the German baseload day-ahead contract fell 19.3% to 86.75 Euro per Megawatt Hour (MWh) at 1011 GMT. The equivalent French contract, at 82.50 Euros/MWh, was 19.7% less expensive. The benchmark European power price has exceeded 100 euros per Megawatt Hour (MWh) for the first since April, as a heatwave early in summer spreads across Europe and increases electricity demand. Prices began to fall on Tuesday as the wind was predicted to increase and temperatures to drop. They then continued their decline on Wednesday. According to LSEG, the average daily temperature for Germany is expected to fall by 6.3 degrees Celsius (43.34degF), compared to Wednesday. In France, it's forecast to drop 2.6 degrees. In a recent note, LSEG analyst Guro Wyller stated that wind power generation is expected to increase day-to-day in Germany by 10 gigawatts. This is "well above normal for the time of year", she said. On the demand front, German consumption is expected to fall by 450 MW on Thursday to 56.4 GW, while French demand will drop by 3.7 GW, to 47.5 GW. Data compiled by revealed that 78% of France's nuclear power was operational, up from only 72% two days ago. EDF has shut down the reactor No. 1, which is 1,300 MW, at Golfech Nuclear Power Plant in Southwest France. The EDF shut down the 1,300 MW reactor no. 1 on Sunday night due to the anticipated increase in temperature of the Garonne River during the heatwave. The other reactor of the plant was already off-line for maintenance. The German baseload price for the year ahead was up 1.0% to 87.40 Euro/MWh. This increase was supported by the strength of other energy markets. The benchmark contract on the European carbon markets increased by 2.3%, to 72.22 Euros per metric ton. The European Commission proposed a climate target for 2040 on Wednesday that will for the first allow countries to use credits from developing nations as part of their emission goal.
-
Dutch climate tech company Dexter Energy raises 23,5 million Euros
Dexter Energy is an Amsterdam-based climate technology firm that has raised $27.1 million via a round of funding to expand its AI driven services for renewable energy sources and batteries. The company announced this on Wednesday. Why it's Important: This investment is a reflection of the increasing reliance on AI technology to navigate Europe’s volatile renewable energy market and accelerate the clean-energy transition. KEY QUOTES "We are excited to welcome Klima as well as Mirova on board. "They share our belief that AI has become essential infrastructure for a grid powered increasingly by renewables and energy storage," said Luukveeken, CEO of Dexter Energy. By the Numbers: Dexter Energy claims that its AI-driven trading solutions for renewable energy producers can increase wholesale market revenue by as much as 30%. Alantra, a financial services company, led the latest round of funding. Mirova, ETF Partners, and Newion are also among the investment firms that participated in this funding round. WHAT'S NEXT: Dexter intends to expand its service in the Netherlands and on other European markets. The company, founded in 2017, uses AI technology to trade on the power markets. The company claims that its price forecasting models are based on more than 12 sources including weather models and data from the market.
-
Venezuelan oil exports are on the increase as more cargoes go to China
According to shipping documents and data, Venezuela exported 844,000 barrels of crude oil and fuel per day in June. This is an 8% rise from the previous months, as more cargoes were sent to China to offset the loss of U.S. markets and European ones. Washington terminated in late May a grouping of licenses which had authorized partners, such as Chevron and Repsol of the oil company PDVSA to transport Venezuelan crude for U.S. or European refineries. Since then, the state-owned firm has increased its exports to Asia. It sells its crude oil and fuels through little-known middlemen who make deals with independent Chinese refiners. According to PDVSA internal documents, the cargoes included shipments of Boscan crude oil, which had previously been exported to the U.S. by Chevron. The data revealed that 27 tankers left Venezuelan waters during June. They carried an average of 844,000 barrels per day (bpd) of crude oil and refined products, and 233,000 tons of petrochemicals and byproducts. In May, oil exports averaged 779 000 bpd. In May, the country exported 329,000 metric tonnes of petrochemicals and byproducts. According to data and documents, exports to China were 90% of June's total. In May, it was 75%. PDVSA shipped 8,000 bpd of petroleum coke and methanol to Europe and India, as well as a few cargoes to Cuba. Three cargoes of heavy grade Boscan crude used in asphalt production were shipped to Asia, boosting June's exports. These exports are crucial for PDVSA in order to avoid a production cutback at the Boscan oilfield. It is one of the largest oilfields in Venezuela. PDVSA did not import diluents during June, despite having filled its tanks with imported refined product ahead of the cancellation of licenses.
-
EU adds international CO2 credits as part of next climate goal
The European Commission proposed a climate target for the EU for 2040 on Wednesday. For the first time, countries will be able to use credits for carbon from developing nations in order to reach a small portion of their emission goal. The European Union executive has proposed a legally binding target of cutting net greenhouse gas emission by 90% by 2040 from 1990 levels. This is to keep the EU on track to achieve its core climate goal to reach zero net emissions by 2050. The Commission, however, after facing opposition from France, Germany and other governments, including Italy, Poland, the Czech Republic and France, proposed flexibility to the 90 percent emissions target for European industry. The EU has some of the most ambitious climate goals among major economies. EU emission targets are based on only domestic emissions reductions. Carbon credits purchased from other countries via a U.N. supported market can cover up to three percentage points of Germany's 2040 target, reducing the amount of effort needed by the domestic industry. Carbon credits will be phased-in from 2036. The EU will propose legislation in the next year that will establish the quality standards for the credits and who can buy them. Wopke Höstra, EU Climate Commissioner, said that the new climate targets would provide investment certainty to industries and governments. He also stated that purchasing foreign carbon credits can help EU diplomacy. "We will continue to pursue a clean transition." Hoestra stated in a press release that we know the reasons for our clean transition - economic, geopolitical and security. A draft of the proposal was previously published. The countries would also have more flexibility in choosing the sectors of their economy that contribute most to the 2040 target. Climate change has made Europe one of the fastest-warming continents in the world. A severe heatwave last week caused wildfires, disruption and chaos across the continent. But Europe's aggressive policies to combat the temperature rise has stoked tensions among the 27 member bloc. The European Commission's climate agenda is marketed as a means to increase Europe's security and competitiveness. However, certain governments and legislators say that industries already struggling with high energy prices and U.S. tariffs cannot afford stricter emission rules. Climate science advisors from the EU warned against counting foreign carbon credits towards the 2040 goal, saying that spending money on them would divert investment away from local industries. Carbon credits can be generated through projects that reduce CO2 emission abroad, such as forest restoration projects in Brazil. These carbon credits then raise money for these projects. Investigations have revealed that some credits did not deliver the claimed environmental benefits. EU legislators and countries must agree on the 2040 target. This lawmaking process may take many years, but by mid-September the EU must submit to the U.N. its new 2035 climate goal - which should be derived directly from the current 2040 target - as the Commission had stated. (Reporting and editing by Barbara Lewis; Kate Abnett)
-
Malaysia reduces green electricity tariff premium rates up to 80% starting July 1
Malaysia has reduced its green energy tariff premium rates up to 80% starting July 1, in an attempt to diversify the green electricity supply options available to companies so they can meet their ESG obligations. In a Wednesday statement, the Energy Transition and Water Transformation Ministry announced that premium rates previously set according to user categories would now be combined in one single pricing tier. Users will pay 5 cents a kilowatt-hour for contracts lasting one year, 4 cents a kWh for agreements lasting two years, and 3 cents a kWh for commitments lasting three years. Green electricity tariff (GET), a programme to offer renewable energy to Tenaga Nasional Berhad customers who wish to reduce their carbon footprint, was launched in 2021. The government set a quota for the 2025 GET Programme of at least 6,600 gigawatt-hours, with premium rates as low as 10 cents/kWh for domestic users and non-domestic users of low voltage and medium voltage and 20 cents/kWh for non-domestic users of high voltage and medium voltage. The Ministry stated that as these new provisions include structural changes and costs implications, users will be able to cancel existing subscriptions until August 31, without penalty. In response to the demand of data center operators, industrial and commercial users as well as the Ministry itself, the GET GreenPath Programme was launched to provide "tenant accounts" with formal recognition for their green electricity consumption through Renewable Energy Certificates. TNB will implement this enhanced version of its existing GET program and open subscriptions on August 1.
China continues to lift petroleum stockpiling amidst weak refinery runs: Russell
The world's. biggest crude importer has actually had a soft start to the year.
China added more than 1 million barrels daily (bpd) of. petroleum to stockpiles in May as soft imports were exceeded. by even weaker refinery processing volumes.
An overall of 1.08 million bpd was added to China's commercial. or tactical stocks in May, up from 830,000 bpd in April,. according to computations based on official data.
Over the very first 5 months of 2024, China improved stockpiles. by 790,000 bpd from the exact same duration in 2023, and the rate of. stock constructs is speeding up, rising from 700,000 bpd in the. initially 4 months of the year.
The rise in crude streaming into storage, coupled with a. decrease in oil imports in the very first five months of the year,. undermines expectations that China's unrefined need will grow. highly in 2024.
China does not disclose the volumes of crude flowing into or. out of tactical and commercial stockpiles, but a quote can. be made by deducting the amount of crude processed from the. overall of unrefined available from imports and domestic output.
The overall crude available to refiners in May was 15.33. million bpd, consisting of imports of 11.06 million bpd and. domestic output of 4.27 million bpd.
The volume of crude processed by refiners was 14.25 million. bpd, leaving a surplus of 1.08 million bpd to be contributed to. storage tanks.
Refinery throughput dropped from 14.30 million bpd in April. and from 14.60 million bpd in May last year.
May was likewise the 2nd consecutive month that refinery. processing decreased from the same month a year earlier.
For the very first five months of the year refineries processed. 301.77 million metric loads, according to information released on Monday. by the National Bureau of Stats, up 0.3% from the exact same. period in 2023.
However, converting the refinery processing to barrels per. day shows a rate of 14.49 million bpd in the January to May. period, which is really down from the 14.54 million bpd in the. same duration in 2015, which was one day shorter since of the. leap year in 2024.
BETTER 2ND HALF?
Crude oil imports were 11.0 million bpd in the first 5. months of the year, down 130,000 bpd or 1.2% from the very same. duration in 2023.
Refinery processing has dropped by 50,000 bpd, and 790,000. bpd has been contributed to inventories.
There are some short-term aspects behind a few of the weak. outcomes, such as a number of significant refineries going through scheduled. maintenance in May, but it's difficult to leave the conclusion that. so far this year China's oil need is falling well except. expectations.
The Organization of the Petroleum Exporting Countries (OPEC). is still anticipating that China will drive global oil need. development in 2024, accounting for 720,000 bpd of the world overall. boost of 2.2 million bpd.
While OPEC's June regular monthly report does show the manufacturer. group is expecting a more powerful 2nd half in China, it also. programs that the first half is running well behind expectations.
OPEC forecast China's oil need growth at 570,000 bpd in. the 2nd quarter, which would require a surge in June imports,. given the soft outcomes in April and May.
While OPEC stays bullish on China's need, other. forecasters are more scrupulous, with the International Energy. Agency anticipating need growth of around 500,000 bpd in 2024.
Even this more modest forecast will require a strong 2nd. half, and will be dependent on China's economy not only gaining. momentum, however doing so in locations that improve the intake of. fine-tuned products.
This means construction will have to increase to increase diesel. need, flight will have to continue to recuperate to raise jet. fuel sales, and manufacturing will need to strengthen to. boost need for petrochemicals.
A stronger Chinese economy stays likely in the 2nd. half, but the concern is whether it will be strong enough to. permit the bullish expectations for oil need to be correct.
The viewpoints expressed here are those of the author, a columnist. .
(source: Reuters)