The rebranding of the crude has cut transportation costs for Venezuelan crude and facilitated U.S. sanction circumvention, the report noted. Before, traders resorted to ship-to-ship transfer at sea to mask the crude but now they have taken to manipulating vessels’ location signals to make it look like they are travelling from Brazilian ports instead of Venezuelan ones, data from TankerTrackers.com has shown, per Reuters.
Crude has slid since Trump took office on concerns that his global trade war will dent economic growth and slow energy demand. Adding to the bearishness, OPEC+ has decided to revive idled output faster than expected. Already, the drop in oil prices is spurring American shale producers to cut spending in the Permian Basin.
Oil futures curve has formed a rare “smile” shape, a structure Morgan Stanley says was last seen briefly in February 2020 just before the infamous oil price crash. On Wednesday, Brent futures’ July contract was trading at a premium of 74 cents to the October contract, a market structure known as backwardation, foreshadowing immediate tight supply. However, prompt prices from November have formed a contango, with forward prices flipping to a discount, indicating oversupply as traders predict Trump’s tariffs will eventually weaken oil demand. Having backwardation and contango together leads to the rare “smile” shaped curve.
“President Trump is trying to lower inflation, and lowering energy prices is the crux of that strategy,” said Simon Wong, an analyst at Gabelli Funds. Subdued inflation would empower the Federal Reserve to cut interest rates, which would allow Trump to refinance trillions in debt at reduced rates, he added.
The Novorossiysk port is a key export route for Russian crude oil and petroleum products and any significant disruptions to loadings may affect the nation’s production flows. However, last month, 23 crude tankers loaded there to carry Russian barrels abroad. All of them loaded at berths 1, 1a or 2, according to vessel tracking data compiled by Bloomberg and shipping industry data.
With interest rates at 27 percent and inflation easing to 23.5 percent in January, Asiama said better monetary and fiscal policy-coordination should help cool price pressures as the country puts the economic trauma of its 2022 debt default behind it. Africa’s biggest gold producer had to seek a $3 billion bailout from the International Monetary Fund and restructure its debt after defaulting on its obligations.
The effect of this primary tariff exchange was immediate, with Chinese energy traders beginning to redirect cargos of liquefied natural gas to Europe, which has been more than happy to take in any spare LNG as it reels from the first real winter in three years. Crude oil exports from the United States to China will also be affected by the 10% duty. According to some, however, the effect of the tariff war will be most palpable in coal.
Shafaq News / The U.S. Energy Information Administration confirmed today, Tuesday, that Iraq’s oil exports to the United States reached approximately 84 million barrels during the first eight months of 2023.