Resurgent US-China trade tensions have dealt a significant blow to oil sentiment, as President Trump’s reimposition of 100% import tariffs on November 1 (in addition to the 30% currently in place) bodes poorly for the global economy in 2026.
With backwardation at its shallowest since January 2024, ICE Brent at $62 per barrel feels more of a temporary level before the next big slide.
OPEC Downplays 2026 Supply Surplus. OPEC kept its demand forecast for 2025 and 2026, questioning the danger of a supply surplus next year, saying that if OPEC+ kept production at its September 2025 levels, balances would remain at a deficit.
Saudi Arabia Spends Big on Algeria. Algeria’s state-owned oil firm Sonatrach reported that it had signed a $5.4 billion contract with Saudi Arabia’s Midad Energy to develop oil and gas fields in the Illizi Basin, with a production-sharing contract signed for 30 years.
Iraq Flaunts Idea of OPEC+ Quota Review. Iraq’s prime minister, Mohammed al-Sudani, has called for a formal review of the country’s 4.43 million b/d OPEC+ production quota, citing reconstruction needs and rapid population growth as Kurdish exports restarted.
Kuwait Boosts Its Offshore Tally. Kuwait Oil Company, the upstream arm of national oil firm KPC, made an offshore gas discovery with its Jazza exploration well, with the field spanning 16 square miles and estimated to hold around 1 TCf of natural gas.
Sanctions Derail Chinese Oil Imports. Last week’s US sanctions on the key Rizhao crude oil terminal have prompted China’s leading refiner Sinopec to divert the 2-million-barrel New Vista supertanker carrying the UAE grade Upper Zakum, seeking a new port.
India Aims to Hedge Its Hydro Generation. India’s power planning authority has launched a $77 billion expansion plan to move 76 GW of hydro generation away from the Brahmaputra Basin bordering China, as Beijing could cut dry-season flows by 85%.
China Slashes September Rare Earth Exports. Chinese rare earth exports fell to 4,000 metric tonnes in September, marking a 31% decline month-over-month and the third consecutive monthly drop as Beijing tightens the screws on flows to Western buyers.
Australia Wants Key Mineral Deal with US. The Australian government is considering the introduction of mandated floor prices for critical minerals, building out a $800 million strategic metal reserve and joint funding of new mining projects with the US.
Argentina Gets Closer to Second LNG Facility. Argentina’s state-controlled YPF (NYSE:YPF) signed a final technical agreement with Italy’s ENI (BIT:ENI) to build a 12 mtpa LNG export facility, consisting of two liquefaction trains, aiming for a 2029 start.
US Feedgas Demand Hits New Record. The return of the Cove Point LNG terminal in Maryland after a three-week maintenance period has lifted US LNG feedgas demand to a new all-time high above 18 BCf/d, also buoyed by Plaquemines LNG ramping up.
Egypt Diverts LNG Cargoes to Europe. A combination of lower seasonal demand, high inventories and marginally increasing domestic supply have led Egypt to defer several LNG cargoes from Q4 to next year and resell 4-5 prompt cargoes to Europe.
US Ups the Ante on IMO Shipping Rules. The Trump administration reiterated its threat of port fees, sanctions and visa bans on countries supporting the IMO’s Net-Zero shipping framework by 2050, just as the UN body meets to discuss it, October 14-17.
Brussels Agrees to UAE’s Big Chemicals Move. According to media sources, the European Commission is set to approve ADNOC’s $17 billion takeover of German chemicals company Covestro after the former offered to adjust its articles of association.
Oilprice.com
