Oil jumps 4%

President Donald Trump has authorized a 90-day pause on tariffs for most countries, but has raised the tariff rate for China to 125%. This decision caused oil prices to rise over 4% after hitting four-year lows earlier. China retaliated by imposing additional tariffs on US goods, escalating the ongoing trade conflict. The US crude oil stockpiles increased last week, according to the Energy Information Administration. These developments, along with concerns about a global recession, are impacting oil prices. The OPEC+ group's decision to raise output in May is expected to push the market into surplus. Furthermore, countermeasures in Canada and the European Union are adding to the tensions. The Keystone oil pipeline system issued a force majeure notice due to a leak in North Dakota, leading to a shutdown following an oil spill. Uncertainty surrounding export markets, particularly China, is adding to the challenges faced by the oil industry.

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Caspian pipeline partially restores Kazakh oil loadings in Black Sea

The Caspian Pipeline Consortium (CPC) has resumed loading oil at two of its three moorings after a court lifted restrictions placed by a Russian regulator. This move eases concerns about a drop in Kazakhstan's oil output and exports, as the country has been exceeding its OPEC+ quotas. The resumption of loading will help maintain Kazakhstan's oil exports, although there have been revisions due to a decline in Russian oil exports via CPC. The consortium has faced operational strains due to damage and attacks on its facilities, leading to fluctuations in oil flows. Kazakhstan's increasing oil production has caused tensions within OPEC+, with calls for further production cuts to compensate for excess production. OPEC+ has recently decided to raise output, expecting non-compliant members like Kazakhstan to reduce production in the future.

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US crude stockpiles rise as exports hit Jan lows, EIA data shows

According to the Energy Information Administration, U.S. crude oil stockpiles rose by 2.6 million barrels to 442.3 million barrels, while gasoline inventories fell by 1.6 million barrels. Distillate stockpiles also decreased by 3.5 million barrels. The increase in crude inventories was attributed to higher imports and lower exports, with concerns about limited access to the Chinese market. Gasoline demand fell to 8.4 million bpd, raising fears of a slowdown in consumption. Additionally, China announced increased tariffs on U.S. goods, further impacting oil prices. Refinery crude runs increased, but utilization rates also rose to 86.7% of capacity.

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Saudi Arabia discovers 14 new oil and gas fields with small volumes

Saudi Arabian oil company Aramco has discovered 14 oil and natural gas fields in the kingdom's Eastern Region and Empty Quarter, although they contain small volumes. The discoveries include six fields and two reservoirs with 8,126 barrels per day of Arabian oil and 80.5 million standard cubic feet per day of natural gas. Additionally, 2.11 million standard cubic feet per day of associated gas was found. Saudi Arabia, the leading oil exporter, produced nearly 9 million barrels per day of crude in February, according to OPEC's March report.

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Venezuela's oil flows again, after a week of panic

After a week-long pause, tankers have returned to Venezuelan ports to resume loading crude oil, despite U.S. tariffs on oil imports. Crude cargoes are being set sail to destinations like India and China. Many vessels initially undocked in response to the tariffs but have now returned to complete their loading. PDVSA, Chevron, and Reliance are among the companies involved in these shipments. PDVSA is reorganizing its operations to focus on domestic oil refining. Meanwhile, China, Venezuela's largest oil buyer, is temporarily pausing purchases while waiting for further information on the tariffs. Analysts predict a decline in oil output if the wind-down period for buyers is not extended. Some joint venture partners are seeking exemptions to continue producing oil in Venezuela. The loading delays are benefiting Cuba, with plans for more crude cargoes to be sent to the country this month.

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Chinese suezmax tanker re-exports Venezuelan crude cargo from Cuba

Arina, a Chinese-controlled suezmax tanker, has been spotted leaving Cuba fully loaded with Venezuelan crude, destined for Asia. The tanker, operated by Higo Shipping HK of China, has a history of name and flag changes. It is believed that the cargo will be transferred to another vessel in Singapore for eventual delivery to China. This re-export may be due to the US government revoking oil export licenses for Venezuela, causing some tankers to change their loading plans. Another tanker, the Monte Serantes, was also affected by the US sanctions, cancelling a loading of Merey crude and opting for Maya crude in Mexico instead. The US treasury department has instructed companies like Repsol and Eni to cease operations in Venezuela by 27 May. Spain and Italy have been significant importers of Venezuelan crude in the past, with Spain importing 4m barrels and Italy 1m barrels so far this year.

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Iran seizes third tanker in under 10 days in oil smuggling clampdown

Iran's Islamic Revolutionary Guards Corps (IRGC) has seized a third tanker in the Middle East Gulf as part of efforts to combat fuel smuggling. The state-run Fars News Agency reported that a small vessel with six seafarers on board was intercepted, with 100,000 litres of smuggled fuel discovered. This comes after the IRGC seized two overseas-registered tankers carrying over 3m litres of diesel in early April. The ships, named Start 1 and Vintage, were engaged in organized fuel smuggling in the Persian Gulf. All 25 crew members were arrested, and the tankers were being moved to the port of Bushehr. Iran has been cracking down on fuel smuggling, with authorities intercepting vessels carrying smuggled oil. The diesel price in Iran is low, leading to smuggling to other Gulf states. Anti-smuggling efforts have been intensified in recent years.

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China petchem plants face shutdown as tariffs on US LPG loom

Chinese petrochemical makers who rely on U.S. LPG are expected to cut output or shut down as retaliatory tariffs increase costs. The industry, with over 30 PDH plants, faces a potential 15% cut in operating rates and a decrease in propane demand. China's PDH sector, already struggling, may see utilization rates drop below 50% as tariffs impact prices. The trade war has disrupted the market, with uncertainties surrounding pricing agreements between U.S. suppliers and Chinese buyers. The industry, built on cheap U.S. propane, faces challenges in finding alternative supply sources amid the ongoing trade tensions.