Oil prices fall as trade war concerns dampen demand outlook

Oil prices fell in early Asian trading due to concerns about weakening global economic growth and fuel demand caused by President Trump's erratic tariff policies. Brent crude futures dropped to $64.08 per barrel and U.S. West Texas Intermediate crude futures fell to $60.3 a barrel, their lowest prices since April 10. Trump's tariffs and the escalating trade war between the U.S. and China have raised worries about demand and investor sentiment. Additionally, concerns about temporary U.S. economic strength due to stockpiling ahead of tariffs have emerged. U.S. consumer confidence declined in April due to growing tariff concerns. U.S. crude oil inventories rose by 3.8 million barrels last week, further weighing on oil prices. Analysts expect U.S. crude oil stockpiles to increase by 400,000 barrels. OPEC+ members are considering increasing production in June to counter the effects of the trade war on demand.

___________________________________

Vitol tanker needed hull clean after loading new Venezuelan crude blend at ageing terminal

Tankers are lining up to load a new crude blend from Venezuela before the US deadline for Western firms to cease operations in the country. The blend, called Venezuelan Blend 22, is a mix of grades from PDVSA's western fields and is being shipped from the aging and deteriorated port of La Salina. Tankers often face complications such as hull staining and limited loading capacity due to oil leaks and lack of dredging. Despite the risks, some buyers are still taking the opportunity to load the blend, causing delays and creating a bottleneck of tankers in Lake Maracaibo. Vitol has chartered a vessel to load Blend 22 for a French company, and more deals are being considered for swapping heavy naphtha for Venezuelan crude. PDVSA recently revoked Chevron's permission to load crude cargoes, leading to disruptions in the country's oil exports. Venezuela exported 650,000 barrels per day in 2024, with most shipments going to China and the US.

___________________________________

VLCC owners cashing in as China stocking up on oil

VLCCs are benefitting from increased Chinese oil demand, with rates for the largest crude tankers rising significantly. The surge in rates is attributed to China stocking up on cheap oil to meet rising demand, despite seasonal maintenance typically reducing crude demand. Market observers believe the increase in rates is due to China's strategic inventory build, as crude stockpiles are at a six-year low. Analysts note that the surge in rates is countercyclical, as it comes at a time of weak refining margins. VLCC rates began rising before the Easter holiday weekend, reaching up to $62,800 per day. Opec and its allies decided to increase production for May, with potential for another increase in June. Opec is set to discuss its output plan on 5 May.

___________________________________

Vitol tanker bunkers co-processed VLSFO as trader rolls out new fuel

Energy company Vitol has introduced a new FuelEU Maritime-compliant ship fuel produced in the UAE. The fuel is loaded on Vitol's own tanker Elandra Falcon in Fujairah and will be marketed by Vitol Bunkers. This co-processed fuel has the same quality as conventional fuel, but with reduced greenhouse gas intensity. Vitol aims to provide customers with compliant fuel options amid increasing regulations. They emphasized the importance of biofuel for both new and existing ships, with options like B100 biofuel blends being practical for meeting greenhouse gas reduction mandates. Vitol is ready to meet future regulations, including a 6% reduction in greenhouse gas emissions by 2030, by increasing biofuel usage in the maritime industry.

___________________________________

VLCC charterers undeterred by 125% tariff, as tanker unloads US crude in China

Despite a reported 125% tariff, a VLCC successfully discharged US crude in China. The 319,000-dwt Cyan Nova, owned by Zodiac Maritime, shipped oil from Texas to Ningbo and was observed at the Ningbo Shihua Crude Oil Terminal. The Chinese government may be preparing a list of tariff exemptions, and the vessel was likely discharging its cargo at a terminal co-owned by Sinopec and PetroChina. The ship loaded WTI Midland oil from Oxy and Mars crude from Shell before heading to Singapore. Charterers are responsible for tariff payments, and it is uncertain if crude oil will be exempt. VLCCs bound for China may be cancelled, diverted, or proceed as planned depending on tariff developments, with vessels like Agios Nikolas and Yuan Gui Yang loaded with US crude for China delivery potentially changing course.

___________________________________

Indian Refiners Purchase More US Crude Before Trade Talks in May

Indian refiners have significantly increased their purchases of US oil ahead of trade talks between the two countries next month. Around 11.2 million barrels of crude are expected to arrive in India from the US in June, the highest volume since last August. This surge in purchases comes as prices for West Texas Intermediate have dropped due to lower demand in other Asian countries and a geopolitical strategy by Asian buyers to use US oil as a bargaining tool to reduce tariffs. India's trade deficit widened in March, with oil imports soaring over 60% from the previous month. State refiners like Indian Oil Corp. and Bharat Petroleum Corp. have bought at least 6 million barrels of US oil for June arrival. Private refiner Reliance Industries Ltd. is also a regular buyer of US crude. These increased US oil purchases by India are displacing imports from West Africa, one of India's main sources of lighter oil. The upcoming trade negotiations between India and the US will aim to secure a bilateral trade deal and potentially reduce tariffs on both sides.