2024.08.05

Oil Prices Hit Lowest Since January Amid U.S. and China Economic Concerns

Oil prices dropped to their lowest levels since January due to weaker-than-expected U.S. job growth and disappointing Chinese economic data. Brent crude fell by 3.41% to $76.81 per barrel, while U.S. West Texas Intermediate crude decreased by 3.66% to $73.52 per barrel. The U.S. unemployment rate rose to 4.3%, raising recession fears. Additionally, reduced manufacturing activity in China further pressured prices. Despite this, OPEC’s oil output increased in July, driven by higher Saudi Arabian supply and minor increases from other members, reaching 26.70 million barrels per day. It's up 100,000 bpd from June.

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U.S. Energy Firms Cut Oil and Gas Rigs Amid Market Challenges

U.S. energy firms reduced the number of oil and natural gas rigs for the first time in three weeks, with the total rig count falling by three to 586. This marks an 11% decrease from the same time last year. Oil rigs remained steady at 482, while gas rigs dropped by three to 98. The rig count has declined by about 20% in 2023 due to lower oil and gas prices, higher costs, and a focus on debt reduction and shareholder returns. U.S. oil futures have risen by 2% in 2024, while gas futures have decreased by 24%. Recent data showed a decline in U.S. crude oil and natural gas production. Exxon Mobil increased its profit in Q2, raised its capital expenditure guidance, and plans significant share buybacks.

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Yemeni Houthi rebels launch ship attacks after Israeli's strikes

Yemen’s Iran-aligned Houthi movement claimed responsibility for attacking a Liberia-flagged container vessel, MV Groton, in the Gulf of Aden with ballistic missiles. This marks their first attack on shipping lanes since Israel’s retaliatory airstrike on Hodeidah port on July 20. The attack occurred 125 nautical miles east of Yemen’s port of Aden, with no water entry or oil leaks reported. The Houthis have been targeting international shipping near Yemen since last November in solidarity with Palestinians, leading to U.S. and British retaliatory strikes and disruptions in global trade.

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 Slovakia and Hungary have rejected the EU's recommendation to substitute Russian oil via the Croatian pipeline.

Slovakia and Hungary have declined the European Commission’s suggestion to use Croatia’s JANAF pipeline as an alternative route for Russian oil, citing high costs and reliability concerns.

The halt of supplies from Russia’s Lukoil through Ukraine has led to this situation, with both countries seeking alternative solutions.

The rejection has caused political tensions between Hungary, Slovakia, and Croatia, with disputes over transit fees and capacity.

Despite the challenges, discussions continue about securing alternative oil supplies and long-term partnerships.

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Hurricane Debby Threatens Florida

 Tropical Storm Debbie is making landfall in Florida's Big Bend region on Monday, causing residents across the South to evacuate ahead of a week of potential disaster.While the storm will cause widespread power outages in parts of Florida, it is not expected to cause a major shock to energy markets as it is too far east to affect offshore oil and natural gas operations in the western Gulf of Mexico.