2024.10.31

OPEC+ May Delay Planned Oil Production Increase Amid Weak Demand and Rising Supply

OPEC+ is considering delaying a planned oil production increase in December due to concerns over weak oil demand and rising supply. The group, which includes OPEC members and allies like Russia, had planned to raise output by 180,000 barrels per day (bpd) but may postpone this due to market conditions, particularly weak macroeconomic realities in China. OPEC+ has already cut output by 5.86 million bpd, about 5.7% of global demand. A decision could be made as early as next week, with a meeting scheduled for December 1 to discuss future policy steps.

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U.S. Gasoline Stockpiles Hit Two-Year Low Amid Rising Demand and Falling Imports

Last week, U.S. gasoline stockpiles fell to a two-year low due to increased demand, according to the Energy Information Administration (EIA). Crude oil inventories also saw an unexpected decrease as imports declined. Notably, U.S. crude oil imports from Saudi Arabia dropped to their lowest level since January 2021, with significant reductions in imports from Canada, Iraq, Colombia, and Brazil. Analyst Matt Smith from Kpler highlighted that the drawdown in gasoline inventories was driven by higher implied demand and lower imports, which also contributed to the minor draw in crude oil inventories.

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U.S. Saudi Crude Imports Plummet as West Coast Refineries Favor Canadian Oil via TMX Pipeline

U.S. imports of Saudi crude oil have reached a near four-year low, largely due to increased oil flows from Canada’s Trans Mountain pipeline (TMX) to the U.S. West Coast. The TMX expansion, which began in May, has significantly boosted capacity, leading to record-high imports of Canadian crude. As a result, West Coast refiners have drastically reduced their reliance on Saudi crude. Despite this shift, Saudi crude shipments to the U.S. Gulf Coast are expected to continue. The drop in Saudi imports is also influenced by Saudi Aramco’s strategic redirection of oil to Asia and Europe and domestic needs.

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Colombian Court Lifts Suspension on Major Gas Well, Mandates Community Consultation

A Colombian court has overturned a previous order that had suspended activities at the Sirius-2 gas well, also known as Uchuva-2, off the Caribbean coast. The suspension was initially prompted by complaints from Indigenous communities concerned about the impact on their way of life. Industry groups warned that halting the well could jeopardize Colombia’s energy self-sufficiency and gas reserves. The project, owned by Ecopetrol and Petrobras, can now proceed with drilling operations. The court also mandated that Colombia’s interior ministry conduct a prior consultation process with local communities within a month.

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California and U.S. Airlines Commit to Major Increase in Sustainable Aviation Fuel Use by 2035

California and major U.S. airlines have agreed to significantly increase the use of sustainable aviation fuel (SAF). The California Air Resources Board (CARB) and Airlines for America aim to boost SAF availability to 200 million gallons by 2035. it is more than 10 times current levels and meeting 40% of intrastate travel demand . SAF, a low-carbon alternative, currently makes up only 0.1% of global aviation fuel. The agreement is part of broader efforts to reduce aviation emissions, with the White House targeting net-zero emissions by 2050. The Energy Department has approved nearly $3 billion in loans for SAF projects. CARB and airlines will collaborate on incentives and permitting to accelerate SAF deployment.