Oil Falls 1.6% as Israel-Hamas Ceasefire Eases Geopolitical Tensions

Oil prices fell on Thursday after Israel and Hamas agreed to a ceasefire deal brokered by the U.S., easing fears of prolonged regional conflict. Brent crude settled down $1.03, or 1.6%, at $65.22, while WTI dropped $1.04, or 1.7%, to $61.51 per barrel. The agreement includes a partial Israeli withdrawal from Gaza and the exchange of hostages and prisoners, marking a major diplomatic breakthrough. Analysts said the truce could have wide-ranging effects on oil markets, including reduced Red Sea disruptions from Houthi attacks and a higher likelihood of a renewed U.S.-Iran nuclear deal. Meanwhile, OPEC+’s smaller-than-expected output hike and ongoing U.S. sanctions on Chinese and Iranian oil trade also influenced market sentiment.

___________________________________

U.S. Sanctions Chinese Refinery and 100 Entities Over Iranian Oil Purchases

The U.S. imposed sanctions on about 100 individuals, entities, and vessels, including China’s Shandong Jincheng Petrochemical Group and Rizhao Shihua Crude Oil Terminal, for facilitating Iran’s oil and petrochemical trade. The Treasury Department said the targeted companies have imported millions of barrels of Iranian oil since 2023, using Iran’s “shadow fleet” of tankers such as Kongm, Big Mag, and Voy to evade restrictions. This marks the fourth round of sanctions against China-based refineries that continue purchasing Iranian oil. Treasury Secretary Scott Bessent said the move aims to “degrade Iran’s cash flow” that funds its nuclear and militant activities. Despite these actions, Iran’s exports rose to 63.2 million barrels in September, worth about $4.26 billion, as it stockpiled ahead of potential renewed U.N. sanctions.

___________________________________

Taiwan Private Refiners Ready to Halt Russian Naphtha if EU Requests

Taiwan’s private refiners, including Formosa Petrochemical, are willing to stop importing Russian naphtha if requested by the European Union, according to Economic Affairs Minister Kung Ming-hsin. While state-owned firms ceased Russian oil imports in 2023, private companies continue to buy Russian naphtha, which remains the cheapest feedstock. Kung said discussions with refiners and the EU show that companies are prepared to comply with EU and G7 norms, potentially halting purchases next year. Formosa indicated it does not have a preference for Russian naphtha, instead buying from the lowest bidder in open market tenders; no Russian offers were made for October deliveries. Taiwan has imported about 75,000 bpd of Russian naphtha so far in 2025, slightly up from 71,000 bpd in 2024.

___________________________________

Chevron Resumes Venezuelan Oil Imports as Thenamaris Tanker Delivers First Cargo to U.S. East Coast in Six Months

The Thenamaris-owned 108,000-dwt Sealeo (built 2012) became the first tanker in six months to deliver Venezuelan crude to the U.S. East Coast, discharging Boscan crude at the PBF Paulsboro Terminal in New Jersey. The shipment marks Chevron’s resumption of Venezuelan oil imports under a new U.S. licence permitting limited trade with PDVSA, Venezuela’s state oil company. Data showed Venezuelan oil exports surged 27% in August to an average of 966,485 bpd, driven by shipments to China (85% of total) and new U.S.-bound cargoes. Around 60,000 bpd were exported to the U.S., with Cuba receiving 29,000 bpd and several methanol cargoes sent to Europe. The Sealeo has previously been chartered by Chevron, reflecting growing use of mainstream tankers under the relaxed U.S. sanctions regime.

___________________________________

BP Brings Sixth North Sea Oil Project Online in 2025

BP has started oil production at its Murlach project in the UK North Sea, marking the company’s sixth project startup this year as it refocuses on fossil fuels. The six 2025 projects, including two oil and four gas developments, are expected to add 150,000 bpd at peak, with Murlach contributing 15,000 barrels. This move aligns with BP’s strategy to increase annual oil and gas investment by 20% to around $10 billion, aiming for a total global output of 2.3–2.5 million bpd by 2030. BP’s 2025 startups also include projects in Egypt, the US Gulf Coast, Trinidad and Tobago, and West Africa, advancing its goal of adding 250,000 bpd of oil equivalent by the end of 2027. The company’s production targets remain smaller than peers like Exxon, Chevron, and TotalEnergies, but are part of a broader turnaround strategy under new leadership.

___________________________________

BPCL to Invest $11 Billion in New Andhra Pradesh Refinery by 2029

India’s state-run Bharat Petroleum Corp (BPCL) will invest $11 billion to construct a new refinery and petrochemicals complex in Andhra Pradesh, according to a state government order. The refinery will have a capacity of 180,000–240,000 bpd and is expected to start commercial operations by January 2029. The state government has allocated 6,000 acres of land for the project, valued at 968.62 billion rupees. Andhra Pradesh will provide financial incentives covering 75% of the project’s capital expenditure over 20 years to support development. BPCL, India’s second-largest state refiner, currently operates refineries with a combined capacity of 706,000 bpd.

___________________________________

Aramco Delays Domestic Chemical Expansion Amid Weak Oil, Focuses on Asia

Saudi Aramco has postponed three domestic chemicals expansion projects at Yanbu and Jubail, citing weaker oil prices and the need to prioritize international investments. The delays aim to spread out spending amid budget pressures, as Aramco reported 10 consecutive quarters of lower profits and flipped into a net debt position last year. Overseas projects in China and South Korea are prioritized because they are closer to major demand centers and more advanced. Despite deferring domestic ventures, Aramco continues investing in upstream oil and gas projects, including the Jafurah natural gas field, while planning more than $50 billion in spending this year. The company’s long-term strategy to convert 4 million bpd of crude into petrochemicals remains on track, with four international crude-to-chemicals projects set to start within three years.

___________________________________

Crude Oil on Tankers Hits Two-Year High Amid Rising Exports

The volume of crude oil at sea has reached over 1.25 billion barrels, the highest in more than two years, according to Bloomberg. This surge reflects increased shipments from OPEC+ producers and other exporters, driven by rising Middle East exports and declining regional crude consumption. Analysts say the trend boosts tanker demand, with VLCC rates having approached $100,000 per day earlier in the autumn. Maintenance at Middle East refineries and longer haul shipments from the US and West Africa to Asia are contributing to the buildup of cargoes at sea. Market participants, including Vitol, have been active buyers of North Sea crude, but global oversupply is expected to raise inventories and pressure crude prices in the coming months.

___________________________________

Fredriksen’s Frontline Rumored to Sell $1 Billion LR2 Fleet to Thenamaris

Reports suggest John Fredriksen’s Frontline may sell its 18 LR2 product tankers to Greek owner Thenamaris in a deal worth $1 billion–$1.2 billion, though both sides have publicly denied the rumors. The potential sale, valuing each vessel between $55 million and $66 million, would mark Fredriksen’s third major divestment in 14 months, following a $1 billion sale of Avance Gas to BW LPG and a $1.18 billion exit from Golden Ocean Group. The move aligns with speculation that Fredriksen wants to refocus Frontline on crude tankers, where it already operates 41 VLCCs and 22 Suezmaxes alongside the 18 LR2s. Despite ongoing asset reshuffling, Frontline CEO Lars Barstad dismissed retirement talk, saying the 81-year-old Fredriksen remains fully engaged. Industry observers note the timing coincides with optimism about a VLCC market upcycle, potentially signaling Frontline’s strategic pivot back to crude dominance.

___________________________________

EU Seeks Strong IMO Carbon Rules to Align Shipping Decarbonisation

The European Union will align its shipping decarbonisation measures, FuelEU Maritime and the Emissions Trading System (ETS), with the upcoming IMO global rules only if the regulations are stringent enough. IMO regulators meet in London from 14–17 October to discuss the framework agreement, which, if adopted, would take effect 1 January 2028, requiring shipowners to pay into a fund or switch to low-carbon fuels. The EU will review both its ETS and FuelEU acts to determine whether the IMO rules meet Paris Agreement climate goals and ensure environmental integrity and coherence with EU legislation. The European Commission emphasizes fairness and equity, including minimizing double payments for shipowners and considering food security impacts. Any legislative amendments will need approval from the EU Commission, Parliament, and Council, with detailed IMO discussions on fuel data and levy administration scheduled for completion by mid-2027.