Latest news with #oil
Yahoo
35 minutes ago
- Business
- Yahoo
Why Big Oil Isn't Afraid of Peak Oil Demand
Big Oil firms expect global oil demand to stop growing at some point early next decade. But the decline will be very slow and gradual and will look more like a plateau than a downward spiral. The world's biggest international oil and gas companies have started to acknowledge that demand growth could slow or stop within a decade. But these firms keep pumping oil and gas more than they did earlier this decade as they expect that oil demand – regardless of a peak – isn't going the headline-grabbing surge in renewable energy capacity, solar and wind cannot replace fossil fuels in many industrial processes and production while demand for petrochemicals drives increased oil and gas consumption. The strategic shift of BP and Shell from early this decade to boost investments in renewables while scaling back oil production lasted only a couple of years. Europe's Big Oil found out firsthand that the renewables business isn't bringing the profits that the core oil and gas business is generating. Faced with the difficult task of rewarding shareholders with attractive yields and payouts and stopping the investor outflow from the industry, and with an energy crisis with soaring oil and gas prices, Shell and BP drastically scaled on their ambitions in renewables and shifted their focus on oil and gas again. Equinor of Norway, where electric vehicles hold an enormous market share and power comes from hydro and wind, also reduced investments in renewables, in order to boost returns for shareholders and adapt to an uneven energy transition. The Norwegian major, which dropped 'oil' from its name and rebranded to Equinor seven years ago with more renewables business in mind, acknowledged that market conditions in the clean energy sector have changed and the energy transition is going forward with an uncertain and uneven pace. At the same time, Equinor, which now produces a large part of the gas going to Europe via pipelines, expects to keep a high level of oil and gas production in Norway 'all the way to 2035.' 'What we are working on is to make sure that we are able to squeeze every molecule out of the Norwegian continental shelf,' chief executive Anders Opedal told the Financial Times. 'So we have to drill around 100 wells a year for the next decade.' Low returns from higher-cost renewables and the uncertain pace of the transition amid the push for security of supply have had European majors scale back plans and investments in renewables and look to grow low-cost lower-carbon oil and gas production. In the U.S., ExxonMobil and Chevron didn't have to pivot as they weren't deep into renewable energy even before the 2022-2023 energy crisis and soaring the International Energy Agency (IEA), which has just doubled down on its forecast of peak oil demand by the end of this decade, Big Oil companies don't see any peak by 2030. Some have put a peak at some point in the 2030s, but all say that oil and gas will remain essential for global economic growth and development in 2050. 'Under any credible scenario, oil and natural gas remain essential,' ExxonMobil says in its latest Global Outlook to 2050. The U.S. supermajor also believes that 'Lower-carbon technology needs policy support to grow rapidly but ultimately must be supported by market forces.' In 2050, more than 50% of global energy demand will still be met by oil and natural gas, Exxon reckons. 'The world will be different in 2050, but the need to provide the reliable, affordable energy that drives economic prosperity and better living standards, while reducing greenhouse gas emissions, will remain just as critical as it is today,' it says. Shell's CEO Wael Sawan has said that reducing global oil and gas production would be 'dangerous and irresponsible' as the world still needs those hydrocarbons. In its 2025 Energy Security Scenarios, Shell sees oil demand likely to grow by 3?5 million barrels per day (bpd) into the early 2030s, with a long but slow decline after that as petroleum remains an affordable and convenient fuel, particularly in transport, and an important feedstock for the petrochemical industry. In all three scenarios analyzed by Shell, upstream investment of around $600 billion a year 'will be required for decades to come as the rate of depletion of oil and gas fields is two to three times the potential future annual declines in demand.' In the most-discussed strategy reset this year, BP slashed spending on clean energy and boosted upstream investments. The UK-based supermajor will aim for 10 new major oil and gas projects to start up by the end of 2027, and a further 8–10 projects by the end of 2030. Production is also expected to grow: to 2.3–2.5 million barrels of oil equivalent per day (boed) in 2030, with capacity to increase to 2035. That's a stark departure from BP's previous strategy to lower oil and gas output by 2030. 'We will grow upstream investment and production to allow us to produce high margin energy for years to come,' CEO Murray Auchincloss said. Whenever peak oil demand occurs, it will not be a steep downhill in global consumption—it will be a long plateau with a soft decline afterward, Big Oil says. A steep drop could only occur if there is an aggressive political push toward net-zero emissions by 2050, Shell's head of scenario planning, Laszlo Varro, told FT. But such a push would be 'significantly outside society's current comfort zone.' By Tsvetana Paraskova for More Top Reads From this article on Erreur lors de la récupération des données Connectez-vous pour accéder à votre portefeuille Erreur lors de la récupération des données Erreur lors de la récupération des données Erreur lors de la récupération des données Erreur lors de la récupération des données
Bloomberg
5 hours ago
- Business
- Bloomberg
Oil Set for Third Weekly Advance as Trump Considers Iran Strike
Oil was on track for a third weekly gain, with President Donald Trump set to decide within two weeks whether to strike Iran. West Texas Intermediate for August held near $74 a barrel from Wednesday's close, while Brent settled below $79 on Thursday. White House spokeswoman Karoline Leavitt told reporters that the decision would take some time due to the ' substantial chance of negotiations ' with Iran, according to a dictated message from Trump. She declined to elaborate on the timeline.
Washington Post
7 hours ago
- General
- Washington Post
California is to examine its Amazon oil ties following pleas from Indigenous leaders from Ecuador
RICHMOND, California — An oil tanker sat docked at Chevron's sprawling refinery in Richmond on Thursday — a visible link between California's appetite for Amazon crude and the remote rainforest territories where it's extracted. Just offshore, bundled in puffy jackets against the Bay wind, Indigenous leaders from Ecuador's Amazon paddled kayaks through choppy waters, calling attention to the oil expansion threatening their lands.
Yahoo
10 hours ago
- Business
- Yahoo
India, Pakistan Brace for Oil Price Surge, Seek New Oil Suppliers
India and Pakistan are weighing their options in case the Israel-Iran conflict disrupts oil supplies through key chokepoints. While many analysts are still not convinced that Iran can actually afford to close the Strait of Hormuz, as it has threatened, it's a big gamble, and Indian refiners are making backup plans. Indian refiners are considering supplies from West African producers and other alternative energy sources as the world's second-largest importer of crude grows wary of the unfolding situation. Meanwhile, India's neighbor, Pakistan, is exploring pipeline oil supplies from the UAE and Saudi Arabia. The Strait of Hormuz handles more than 20 million barrels of crude per day, with the bulk of Middle Eastern oil passing through the channel en route to international markets. Top oil ministry officials and industry executives have been evaluating possible supply alternatives and scenarios if Hormuz is blocked. Approximately 40% of India's crude and 54% of LNG imports would be directly impacted if the Strait of Hormuz is closed. However, India's energy executives remain optimistic that Iran won't enforce a blockade, encouraged by historic precedent. A closure would almost inevitably send global oil prices soaring, alienating other oil-import-dependent countries and potentially drawing the United States into a direct confrontation with to estimates by the experts, oil prices could soar to $100 to $150 per barrel if the Strait of Hormuz is blocked. A top Indian executive has, however, reported that Indian refiners have yet to resort to panic buying of crude, which can potentially drive global prices higher. India imports~90% of its crude, with a little over 40% from the Gulf, 35% from Russia, and the rest from Africa, the United States, and other sources. That said, India will have a harder time finding alternative supplies for Middle Eastern gas, thanks to the global LNG market being much less evolved than crude markets. Further, India maintains strategic crude reserves but lacks strategic gas storage. According to India's oil ministry, the country's total crude and petroleum products storage capacity is enough to supply the country for 74 days, including the country's strategic reserves that can meet 9.5 days of demand. The situation appears to be less dire in Pakistan, although the country's top energy officials are also negotiating with international oil suppliers for alternative supplies. Pakistan can potentially store oil in its abandoned power plants, whose furnace oil storage is estimated to have capacity to hold up to a million tons of oil. There's a proposal to purchase these storage units, which the power sector planned to dispose of by selling as scrap. Pakistan's Prime Minister Shehbaz Sharif has established a committee to monitor the evolving situation and assess its impact on the country's oil market. Boosting Domestic Production India may resort to buying more Russian oil if the situation in the Middle East deteriorates. Last year, India surpassed China to become the biggest importer of Russian oil. Over the past three years, Indian refiners have been buying discounted Russian crude ever since the West imposed wide-ranging sanctions on Russian energy commodities following its invasion of Ukraine. For years, Russia's crude exports to India have been avoiding the Strait of Hormuz due to long-standing tensions between the United States and Iran. India could, however, decide to look in the opposite direction. Last year, Indian Prime Minister Narendra Modi said during a visit to Guyana that India views the South American nation as key to India's energy security, adding that he will encourage Indian companies to invest in Guyana. Guyana's Natural Resources Minister Vickram Bharrat said that his country is willing to become a crude supplier to India if Exxon Mobil (NYSE:XOM) agrees to the arrangement. Exxon is the main operator in Guyana's offshore oil production. 'We know Exxon has to do some amount of changes to their lifting schedule and logistics because their preference is for the very large vessels that can accommodate two million barrels mainly because of distance and cost,' Bharrat said. However, a longer-term solution for India would be to boost its domestic oil production. Earlier in the year, Indian financial services firm Motilal Oswal suggested that India could ramp up local production to circumvent tariffs by the Trump administration. Further, India's heavy reliance on oil imports weakens the rupee. Last year, S&P Global Commodity Insights provided estimates that India's four basins could hold up to 22 billion barrels of crude, more oil than the Permian Basin's remaining reserves. Currently, India has explored just 10% of its 3.36 million sq km wide sedimentary basin. By Alex Kimani for More Top Reads From this article on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
11 hours ago
- Business
- Yahoo
Transocean (RIG) Falters For 3rd Straight Day – Here's Why
We recently published a list of 10 Stocks Take A Shocking Nosedive. Transocean Ltd. (NYSE:RIG) is one of the worst-performing stocks on Thursday. Transocean dropped by 3.74 percent on Wednesday to close at $3.09 apiece as investors unloaded portfolios over the lack of fresh developments to boost buying. Wednesday's share price marked its third straight day of decline, suggesting that investors have already priced in earlier news that it secured another $100 million contract with existing client, Equinor ASA. Under the agreement, Transocean Ltd. (NYSE:RIG) will drill two more wells for Equinor ASA at the Spitsbergen rig in Norway as part of the latter's drilling extension option. The program is expected to kick off in the first quarter of 2026 in direct continuation of the rig's current program. The additional work followed their original three-well program on the Norwegian Continental Shelf (NCS), which was procured in 2024. An aerial view of an oil rig with drillers in hard hats working on the platform. Transocean Ltd.'s (NYSE:RIG) Spitsbergen rig was built in 2010 as a sixth-generation dual-derrick winterized semi-submersible rig, which is capable of drilling high-pressure and high-temperature formations. While we acknowledge the potential of RIG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey.
