Oil Prices Surge Amid Ongoing Drone Attacks on Iraqi Kurdistan Fields

Oil prices rose by over $1 per barrel after a fourth consecutive day of drone attacks on oilfields in Iraqi Kurdistan, disrupting more than half of the region's production. Brent settled at $69.52 and WTI at $67.54 as Iran-backed militias were suspected in the strikes, though no group claimed responsibility. Analysts warned the incidents highlight the vulnerability of oil infrastructure, especially with mounting geopolitical risks and uncertainty around U.S. tariffs. The market also reacted to a larger-than-expected 3.9 million barrel drop in U.S. crude inventories, indicating strong demand. Despite weather concerns in the Gulf of Mexico, no significant storm development was expected to impact supply.

___________________________________

Slovakia Ends EU Sanctions Block After Receiving Gas Supply Assurances

Slovakia has agreed to lift its veto on the EU’s 18th sanctions package against Russia after securing guarantees from the European Commission to mitigate potential disruptions in Russian gas supply. Prime Minister Robert Fico stated that all negotiation options had been exhausted and continuing to block the sanctions would harm Slovakia’s national interests. The EU package includes measures targeting Russian banks and energy revenues, such as a proposed $45 oil price cap. Initially critical of the Commission’s offer, Fico later accepted assurances covering gas prices, transport fees, and emergency mechanisms. Although Russian gas now makes up less than half of Slovakia’s imports, the country remains reliant on supplies through the TurkStream pipeline under a Gazprom contract lasting until 2034.

___________________________________

India Unconcerned by US Threats of Tariffs on Russian Oil Buyers

India remains confident in its energy security despite US President Trump's threat to impose 100% secondary tariffs on buyers of Russian oil if Moscow does not agree to a peace deal with Ukraine within 50 days. Indian oil minister Hardeep Singh Puri stated that the country could turn to alternative suppliers like Brazil, Canada, and Guyana to offset any disruption. India has expanded its sourcing from 27 to about 40 countries, reflecting a broader diversification strategy. Russian oil, which accounted for negligible imports pre-2022, surged to 2.2 million bpd in May 2023 and remains India’s largest crude source. The EU’s 2022 sanctions on Russian oil exports significantly reshaped global tanker flows, positioning India and China as key buyers.

___________________________________

India’s ONGC Considers New 200,000-240,000 bpd Refinery Project in Gujarat

India’s state-owned Oil and Natural Gas Corporation (ONGC) is conducting a pre-feasibility study to build a refinery with a capacity of 200,000 to 240,000 barrels per day in Jamnagar, Gujarat. The company has not yet made the project public, according to a source who declined to be identified. This potential development aligns with India’s broader goal of expanding refining capacity and becoming a global refining hub. India is currently the world’s third-largest oil importer and consumer.

___________________________________

Saudi Oil Exports Surge in Early July Amid Regional Tensions and Output Increase

Saudi Arabia’s seaborne oil exports averaged 6.43 million bpd in the first half of July, on track for a 16-month high following a production boost in June amid regional tensions. The surge came after Saudi Arabia reported output of 9.752 million bpd to OPEC, exceeding its quota but remaining compliant by excluding storage-bound oil from official figures. Much of the increase is attributed to precautionary stockpiling outside the kingdom due to heightened concerns over the Strait of Hormuz. Shipments to China and India are on course to reach multi-year highs if current rates persist through July. However, flows into Egypt’s Sumed pipeline system declined to their lowest level this year, signaling shifting storage strategies.

___________________________________

KRG to Resume Oil Exports via SOMO Under New Deal Amid Ongoing Drone Strikes

Baghdad announced that the Kurdistan Regional Government (KRG) has agreed to resume oil exports to Turkey via the state oil marketer SOMO, marking a potential end to a two-year halt in flows. The deal includes an immediate delivery of 230,000 bpd for export and allocates 50,000 bpd for local consumption, with KRG covering related costs. This comes despite ongoing drone strikes—attributed by officials to Iran-backed militias—that have disrupted production and reduced regional output by up to 150,000 bpd. The KRG has acknowledged a joint understanding with the federal government but awaits financial details, and past similar deals have failed to fully materialize. Key international oil producers in the region have not responded, though they previously demanded contract assurances and resolution of nearly $1 billion in unpaid debts. The U.S. has been urging both sides to reach an agreement amid broader regional tensions, including recent strikes on oilfields operated by DNO and Hunt Oil.

___________________________________

Qatar Lifts al-Shaheen Crude Price to 5-Month High on Strong Demand

QatarEnergy has raised the term price for September-loading al-Shaheen crude to $3.33 per barrel above Dubai quotes, marking an 85-cent increase and the highest level in five months, according to sources. The price hike reflects strong spot premiums for Middle Eastern crude, driven by robust refining margins, particularly for diesel. The pricing followed QatarEnergy’s sale of five al-Shaheen cargoes to buyers including PetroChina, Vitol, and Idemitsu Kosan. Additionally, QatarEnergy sold one Qatar Marine and one Qatar Land crude cargo to Thailand's PTT at premiums between $2.20 and $2.30 per barrel. The trend underscores heightened demand for regional grades amid favorable market fundamentals.

___________________________________

Japan’s Crude Oil Imports Climb in June, While LNG and Coal Decline

Japan's crude oil imports rose 12.3% year-on-year in June to 2.14 million bpd, according to preliminary data from the Ministry of Finance. Despite higher volumes, the value of crude imports fell 17.6%, reflecting softer prices. Meanwhile, LNG imports dropped 2.8% to 4.44 million tonnes, and thermal coal imports declined by 10.7% to 6.04 million tonnes. The total value of mineral fuel imports fell 19.1% from the previous year. Imports of gasoline and naphtha also declined both in volume and value, signaling overall subdued energy demand.

___________________________________

Petrobras Considers Shifting Oil Exports to Asia Amid New U.S. Tariffs

Petrobras may divert oil shipments away from the U.S. toward Asia and the Pacific following a newly announced 50% U.S. tariff on Brazilian goods. CEO Magda Chambriard downplayed the impact, noting that the U.S. only accounts for about 4% of Petrobras’ oil exports and is not a critical market. Analysts also noted that U.S. oil imports from Brazil make up less than 3% of its 2025 consumption so far. There is still uncertainty over whether the tariffs will include oil, which was previously exempt. Even if oil products are affected, Petrobras is expected to easily redirect those volumes to alternative markets.

___________________________________

Chevron Shifts Permian Focus from Growth to Cash Flow as Output Plateaus

Chevron is approaching its long-term production goal of 1 million barrels of oil equivalent per day in the Permian Basin and plans to maintain this level through 2040, shifting its focus from growth to cash generation. By reducing drilling rigs and fracking crews, the company expects to increase annual free cash flow from the region to $5 billion by 2027, assuming $60 Brent crude. Chevron’s ability to sustain production while lowering capital expenditures is attributed in part to its unique mineral rights holdings, which provide about 15% of its output without added costs. Analysts view this transition as a strategic maturation of assets rather than a reaction to market pressures. The move is seen as aligning with investor expectations for stronger returns rather than production expansion.

___________________________________

World's First Ethanol-to-Jet Fuel Plant Set to Launch

LanzaJet's $200 million plant in Georgia, the world’s first designed to convert ethanol into sustainable aviation fuel (SAF), is now expected to begin operations by the end of September after facing equipment-related delays. The project, backed by U.S. government funding, is seen as a key test case for the emerging ethanol-to-jet sector. Despite U.S. tax credit restrictions that exclude Brazilian sugar-cane ethanol—the plant's initial feedstock—LanzaJet plans to proceed with production using it due to limited qualifying U.S. supply. The company aims to eventually transition to North American sources and is pushing for a more lenient emissions-reduction threshold. Once operational, the facility will produce 10 million gallons of SAF and renewable diesel annually.

___________________________________

Turkish Buyer Acquires Russia-Trading Suezmax Tankers at Discounted Price

Two suezmax tankers linked to Russian crude trades, Ijemo and Adebomi, have been sold for $40 million in an en-bloc deal—over $10 million below VesselsValue estimates. Both ships, managed by Istanbul-based Navegar Ship Maritime Management, have recently called at Russian ports, and Ijemo's master was sanctioned by Ukraine in April for alleged dark activities and AIS manipulation. Despite their trading history and sanctions exposure, the vessels attracted buyer interest at a reduced valuation. Previous sales occurred in 2022 and 2023 at higher prices, highlighting the impact of geopolitical risk on asset values. The deal suggests discounted pricing continues to influence the secondhand market for Russia-linked tonnage.

___________________________________

Kazakhstan’s Kazmortransflot Plans Aframax Tanker Orders Amid Record Oil Transport Volumes

Kazakhstan’s state-owned Kazmortransflot is considering ordering new aframax tankers to expand its fleet under a joint venture with Abu Dhabi’s AD Ports Group. The company currently operates 15 vessels, including two existing aframaxes, and transported a record 13.2 million tonnes of oil in 2024, up from 10.8 million tonnes in 2023, due to increased deliveries from the Tengiz and Karazhanbas fields. Since its inception in 1998, Kazmortransflot has moved roughly 110 million tonnes of oil in the Caspian Sea and another 100 million tonnes in open waters.

___________________________________

Second U.S.-Sanctioned LNG Tanker Docks at Russia’s Arctic LNG 2 Plant

A second U.S.-sanctioned LNG vessel, the Voskhod, arrived at Russia's Arctic LNG 2 terminal this week, suggesting that loadings at the heavily sanctioned site may have resumed. The Voskhod was unloaded en route and docked on Wednesday, following the June 26 arrival of another sanctioned vessel, the Iris, which carried the ninth cargo from the plant. The Arctic LNG 2 project, majority-owned by Russia’s Novatek, was originally expected to produce 19.8 million metric tons annually but has faced export difficulties under Western sanctions. The Voskhod, previously known as North Mountain, had its commercial manager changed to Igarka OOO in May, a Moscow-based entity. Despite ownership and management changes, contact details for the companies involved remain unavailable.