Crude futures up ~$10/b as markets open in Asia – weekend oil news roundup
Crude oil futures are higher by ~$10/b as markets open in Asia. Weekend events point to additional supply risk, although the White House moved to mend ties with key OPEC members:
- Libya – Libyan oil production fell by 1.0mb/d from last Wednesday’s high of 1.2mb/d, as militias shut key export facilities.
- Iran – Iranian negotiations took a step forward, with the International Atomic Energy Agency and Tehran agreeing to terms on a verification process for reporting details of Iran’s uranium enrichment program; however, Russia looked to leverage their position on the UN Security Council to ask for Iran-Russia sanctions relief from Washington.
- Oil sanctions – Secretary Blinken told CNN that “we are now talking to our European partners and allies to look in a coordinated way at the prospect of banning the import of Russian oil”; importantly, this appears to be an import sanction, and would allow Russian oil to flow freely to those countries not participating in the sanction.
- Venezuela – Senior US officials traveled to Venezuela Saturday, seeking to determine whether Maduro would be willing to distance himself from Russia; the Administration did not indicate the trip addressed Venezuelan oil sanctions, though analysts speculate the OPEC member could be a source of incremental supply.
- Saudi – It was reported that Biden advisers are weighing a trip to Saudi Arabia, in hopes of repairing relations and convincing the Kingdom to pump more oil.
With US energy stocks (NYSEARCA:XLE) up ~35% and oil (NYSEARCA:USO) up ~66% year to date, investors are likely to remain focused on Russia-facing policy measures and OPEC production volumes.
