Oil Prices Rise as U.S. Court Blocks Tariffs and Markets Brace for Supply Shifts

Oil prices rose, with Brent crude up 1.25% to $65.71 per barrel and U.S. WTI climbing 1.34% to $62.62, after a U.S. court ruled President Trump's broad tariffs exceeded his authority. The decision boosted investor confidence, although uncertainty remains as the administration plans to appeal. Market attention is also on potential new U.S. sanctions targeting Russian oil, though analysts doubt they will significantly reduce Russian exports. OPEC+ is expected to decide soon on accelerating oil output increases for July. Meanwhile, Chevron has halted its Venezuelan operations after its license was revoked, cutting 290,000 bpd in supply—over a third of Venezuela's oil exports. Demand is forecasted to outpace supply by 0.6–0.7 million bpd between May and August, suggesting a bullish outlook. Additionally, U.S. crude and gasoline inventories fell, while distillate stockpiles rose, according to API data. Investors are now awaiting official weekly inventory reports from the U.S. Energy Information Administration.

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Venezuelan Oil Shipments to U.S.-Licensed Buyers End as Sanctions Tighten

U.S.-authorized transactions for Venezuelan oil concluded this week as licenses expired on May 27, ending crude loadings by firms like Chevron, Repsol, and Maurel & Prom. The Biden administration revoked the authorizations in March, part of a return to Trump-era sanctions on Venezuela. A major swap involving PDVSA, Maurel & Prom, and Vitol was finalized with Venezuelan crude shipped to the U.S. and naphtha discharged at Jose port. Chevron’s broader license to operate also expired, though it was allowed to retain assets and personnel in Venezuela. In April, PDVSA canceled scheduled Chevron cargoes over payment concerns tied to sanctions. As deals wrapped up, Venezuelan exports to U.S.-licensed firms dropped, though some volume shifted to obscure intermediaries moving cargo to Asia. Analysts now expect Venezuela’s oil output—averaging 1 million bpd this year—to fall 15–30% by late 2025 without U.S. authorizations. President Maduro’s administration has denounced the sanctions as part of an “economic war.”

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OPEC+ Sets 2027 Output Baseline Plan Amid Ongoing July Production Hike Talks

OPEC+ agreed to create a mechanism for determining 2027 production baselines, a crucial step ahead of possible July output hikes. The group—comprising OPEC and allies like Russia—will use maximum production capacity assessments by OPEC headquarters to set fair quotas, amid disputes between countries like the UAE and African members. Angola exited OPEC+ in 2024 over such disagreements. No existing output cut policies were changed, but eight members may increase July output by 411,000 barrels per day, continuing the faster-than-planned hikes from May and June. These moves have pressured oil prices, which dropped below $60 per barrel in April but have since rebounded to around $65. The increased supply push is partly driven by Saudi Arabia and Russia’s strategy to penalize overproducers and reclaim market share. OPEC+ has implemented three layers of cuts since 2022, two of which last until end-2026. A full group meeting is scheduled for November 30.

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Libya's Eastern Government Threatens Oil Force Majeure Amid Power Struggles

Libya’s eastern-based government, aligned with military leader Khalifa Haftar, warned it may declare force majeure on oil fields and ports due to alleged repeated attacks on the National Oil Corporation (NOC). Though not internationally recognized, the eastern government controls many key oil regions and may relocate NOC’s headquarters to safer cities like Ras Lanuf or Brega. The NOC, currently under the Tripoli-based Government of National Unity (GNU), denied any storming of its premises, calling the incident a minor personal dispute with no operational impact. GNU released video footage showing stable conditions inside NOC's headquarters. Libya’s oil sector, long plagued by political division since the 2011 fall of Gaddafi, suffered a major disruption in August 2024, losing over 700,000 barrels per day (bpd) in production. That crisis ended after a month-long shutdown, with current output recovering to 1.3 million bpd. Renewed tensions now threaten that fragile stability.

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US-Sanctioned Tankers Play Key Role in Russia-to-India Crude Oil Shipments Amid Record Imports

US-sanctioned tankers have been actively involved in the maritime supply chain transporting Russian crude oil to India, which is importing record volumes. Last week, about 1 million barrels of Russia’s Sokol crude were delivered to an Indian refinery, with half of that transferred via ship-to-ship operations involving a US-sanctioned vessel. India became Russia’s largest seaborne crude importer after Moscow’s 2022 Ukraine invasion, with imports expected to hit 2.196 million barrels per day this month. Despite US sanctions targeting Russian oil shipments and vessels, India maintains it follows only UN restrictions and denies allowing sanctioned ships to unload cargo, though enforcement appears complex. Key US-sanctioned tankers such as Viktor Titov, Captain Kostichev, and Victor Konetsky have facilitated transfers involving other UK-sanctioned ships en route to Indian refineries like Jamnagar, owned by Reliance Industries. Experts note Indian refiners manage calculated risks in navigating sanctions and that the US has not tightened enforcement recently. This complex network enables continued Russian crude flows to India amid geopolitical tensions and Western sanctions.

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Russia Reconsiders $60 Oil Price Budget Rule as Reserves Dwindle

Russian Finance Minister Anton Siluanov signaled a possible revision of the $60 per barrel oil price cut-off used in Russia's budget rule, a shift that could affect the country’s spending and reserve accumulation strategy. The budget rule currently mandates selling or buying foreign currency from the National Wealth Fund to stabilize revenue from oil and gas exports. Although Siluanov had ruled out changes for the next three-year budget, he now suggests reevaluating the cut-off to better preserve and replenish the fund. Since the 2022 invasion of Ukraine, Russia's fiscal reserves have dropped sharply—from $112.7 billion to $40.4 billion as of May 1, 2025—due to financing war-related deficits and supporting state enterprises. With Brent crude prices hovering around $60 and Russia’s Urals blend even lower, Moscow’s ability to build reserves is under strain. Lowering the budget cut-off could boost savings but would also require reduced government spending, which may prove difficult amid rising war expenditures.

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Chevron to Cut 800 Jobs in Permian Basin Amid Global Restructuring Push

Chevron Corp. will lay off nearly 800 employees at its Midcontinent campus near Midland, Texas—its largest oil production hub globally—as part of a broader restructuring plan. The layoffs are scheduled for July 15, 2025, and come as Chevron aims to simplify operations and reduce costs by $3 billion under CEO Mike Wirth. The company plans to cut up to 20% of its global workforce, or 9,000 jobs, by the end of 2026. Despite strong growth in the Permian Basin—set to reach 1 million barrels of oil equivalent per day and account for nearly one-third of Chevron’s global output—the company expects production to plateau later this decade. Severance packages and job-seeking assistance will be offered to affected staff. This move underscores Chevron’s focus on efficiency amid ongoing market volatility and lower oil price pressures.

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Tropical Depression Nears Baja California as Pacific Storm Season Begins

A tropical depression has formed off Mexico’s Pacific coast and is expected to strengthen into Tropical Storm Alvin by late Thursday, according to the U.S. National Hurricane Center. The system currently has sustained winds of 35 mph and is located about 835 miles south of Baja California. Forecasts predict the storm’s winds may peak at 65 mph by Saturday, remaining just below hurricane strength. It could weaken before potentially making landfall in Baja California on Sunday. This marks the first storm of the eastern Pacific hurricane season, which runs from May 15 to November 30. Tropical systems in this region can impact Mexico's western coastline, including major areas like Acapulco and Manzanillo. The Atlantic hurricane season begins June 1.

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Dangote Mega-Refinery Ends Nigeria’s Status as Africa’s Largest Fuel Importer, South Africa Takes Lead

Nigeria is no longer Africa’s biggest fuel importer as the Dangote mega-refinery, with a capacity of 650,000 barrels per day, ramps up production in 2024. This shift has made South Africa the continent’s top fuel importer, driven by shrinking operational refining capacity. South Africa imported 4.2 million tons of refined products in Q1 2025, surpassing Nigeria’s 3.1 million tons, according to consultancy CITAC. For the full year, South Africa is projected to import about 15.5 million tons, nearly double Nigeria’s estimated 6.4 million tons and Kenya’s 8.9 million tons. South Africa’s refining capacity has halved over the past five years due to accidents and underinvestment, with imports now covering over 60% of domestic fuel demand. The South African government bought the shuttered Sapref refinery in 2024 to boost local production. Meanwhile, traders like Glencore and Vitol are increasing fuel supplies to South Africa as refinery closures persist. Dangote’s $20 billion refinery project, though delayed and over budget, aims to reduce Nigeria’s dependence on fuel imports and exports of crude for overseas refining. This trend reflects broader efforts by African nations, including Uganda and Mozambique, to expand domestic refining capacity.

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Tanker Market Faces Summer Slowdown Despite OPEC’s Increased Supply Boost

Tanker rates and utilization are leveling off as the market enters the typical seasonal summer lull, despite OPEC and its allies increasing production. VLCC utilization has plateaued, with global crude exports to the Pacific basin tracking near the lower end of the 2016–2024 seasonal range, reflecting slower summer buying and delayed refinery maintenance in northeast Asia. Clarksons reported VLCC daily rates at $42,900, down nearly 12% from last week, while Suezmax rates rose slightly to $33,300 per day, supported by strength in West Africa. The buildup of tonnage in the Middle East Gulf has shifted bargaining power to charterers. OPEC accelerated production increases in May and June, pumping over 400,000 barrels per day more than initially planned, raising hopes for stronger tanker demand during summer, when rates usually decline. OPEC members are meeting to decide on July output, expected to approve further increases to meet rising demand and protect market share. Initial plans to phase out 2.2 million barrels per day of production cuts over 18 months starting April may be reversed as soon as November.

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Trafigura Reroutes Jet Fuel From France to Puerto Rico Amid Dangote Refinery Disruption

Trafigura has diverted two MR tankers from France to Puerto Rico to fill a jet fuel supply gap caused by maintenance at Nigeria’s Dangote refinery. In February, the Turmoil delivered 40,000 tonnes from Le Havre, followed by Nord Vanguard with 36,000 tonnes in May, both supplying Trafigura’s Puma Energy San Juan terminal. The shift is notable because France is a net importer of jet fuel. Puerto Rico had recently begun relying on Dangote’s output over traditional sources like the Middle East and India. However, maintenance on Dangote’s residual fluid catalytic cracker (RFCC) temporarily halted those exports. Dangote is expected to resume RFCC operations by June. Meanwhile, a VLCC recently delivered Brazil’s Mero crude to the refinery, suggesting growing operational confidence as heavier crude imports increase.

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Norway Leads Global Green Shipping Push as Fleet Value Hits $66 Billion

Norwegian shipowners are setting global standards in green maritime innovation, with nearly half (46%) of all vessels on order featuring dual-fuel capabilities—far surpassing the global average of 27%, according to Veson Nautical. Norway’s fleet is valued at $66.2 billion, bolstered by government-backed initiatives like Enova that support the green transition. All 39 Norwegian car carriers on order are dual-fuel, catering to automakers’ demands for cleaner transport. LPG and offshore construction vessels also show higher-than-average dual-fuel adoption. Tankers are the most valuable segment at $12.74 billion, while LNG carriers follow at $9.95 billion. On the transactional front, Odfjell led acquisitions with $685 million in chemical tankers, while Avance Gas topped the seller’s list, offloading 16 gas ships worth $1.3 billion. Knutsen OAS Shipping is the top owner by fleet value, while Wallenius Wilhelmsen leads by fleet size. Veson highlights Norway’s leadership in sustainable shipping, crediting strategic planning and robust policy support.