Here are some more selected news articles for the week ending 10 July 2021. Go here for Oil, Gas, And Fracking News Read 11July 2021 – Part 1.
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Mexico, state-owned oil company slammed after gas leak causes subaquatic fireball in Gulf – Environmentalists criticized Mexico’s state-owned oil company Saturday after a gas leak at an underwater pipeline unleashed a subaquatic fireball that appeared to boil the waters of the Gulf of Mexico. Greenpeace Mexico said the accident Friday appeared to have been caused by the failure of an underwater valve and that it illustrates the dangers of Mexico’s policy of promoting fossil fuels. President Andres Manuel Lopez Obrador has bet heavily on drilling more wells and buying or building oil refineries. He touts oil as “the best business in the world.” Greenpeace wrote in a statement that the fire, which took five hours to extinguish, “demonstrates the serious risks that Mexico’s fossil fuel model poses for the environment and people’s safety.” Climate activist Greta Thunberg reposted a video clip of the massive fireball on her Twitter account. “Meanwhile the people in power call themselves ‘climate leaders’ as they open up new oilfields, pipelines and coal power plants – granting new oil licenses exploring future oil drilling sites,” Thunberg wrote. “This is the world they are leaving for us.” Mexico’s state-owned oil company said Friday that an undersea gas pipeline ruptured near a drilling platform in the Gulf. Petroleos Mexicanos dispatched fire control boats to pump more water over the flames. Pemex, as the company is known, said nobody was injured in the incident in the offshore Ku-Maloob-Zaap field. The leak near dawn Friday occurred about 137 metres from a drilling platform. The company said it had brought the gas leak under control about five hours later. It was unclear how much environmental damage the gas leak and oceanic fireball had caused.
Mexican oil giant says no environmental damage from raging Gulf fire – Just days after video of a massive ocean surface blaze near a Pemex oil platform in the Gulf of Mexico went viral, Mexico’s national oil company has declared that environmental damage was avoided due to quick action by its workers. The July 2 blaze, caught on video apparently from a nearby helicopter, showed bright orange flames jumping out of the water as the fire raged a short distance from the oil platform. Pemex has previously said it took more than five hours to fully extinguish the fire.”There was no oil spill and the immediate action taken to control the surface fire avoided environmental damage,” the company said in a statement on Monday. The statement added that the blaze was sparked by an electric storm that ignited a leak of gas from a busted underwater pipeline. The fire ignited a storm of criticism over the weekend, including social media posts from climate activist Greta Thunberg and New York Mayor Bill de Blasio, among many others. The fire took place at the top producing offshore oil field operated by Pemex, which has a long track record of major industrial accidents at its facilities. Gusatvo Alanis, a board member with Mexico’s environmental law center CEMDA, told Reuters he thinks it is much too soon to conclude that the fire caused no environmental damage.
Pemex Comments on Fire – Petroleos Mexicanos has revealed that immediate actions to control a fire that occurred at the Ku asset avoided environmental damage. No oil spill occurred at the site, according to a translated statement on the company’s website, which outlined that the fire was completely extinguished after around five hours. In the statement, Pemex outlined that an electrical storm with heavy rain occurred in the platform area of the Ku asset on July 2, which it said caused pneumatic pump gas turbocompression equipment to go out of operation. At the same time, a leak was detected in the pneumatic pumping pipeline that feeds the wells of the Ku-C platform, according to Pemex, which noted that the gas outside the pipe migrated from the seabed to the surface and, due to the electric shocks and heavy rains, a fire broke out on the sea surface. The fire was extinguished by closing the submarine valve and injecting Nitrogen into the gas pipeline, Pemex noted. The company said it has started with a definitive repair program for the affected pneumatic pumping line and revealed that it is carrying out analysis to identify the root cause of the gas leak in the pipeline. Bloomberg reported the fire on July 2. The article referenced a video posted on social media, which showed three ships trying to put out a fire in the sea, but noted that a Pemex representative didn’t respond to a request for comment or confirm the footage. Pemex describes itself as the largest and most important company in Mexico. It is a sustainable, socially responsible company, with strict standards of safety, health at work, and environmental protection, its website states. The company, which traces its roots back to the 1930s, is involved in the entire production chain, from exploration, production, industrial transformation, logistics, and marketing, its site shows.
Romanian Black Sea refinery blast kills one, injures five – A blast and fire on Friday at Romania’s biggest crude oil refinery killed one person and injured five others, authorities and the company which runs the Petromidia plant on the Black Sea said. Video footage from a nearby beach in the coastal resort of Mamaia showed black smoke rising from the area next to the refinery and some tourists reported hearing a loud bang. Rompetrol Rafinare, part of KMG International Group, said the explosion was inside the diesel hydrotreating unit, and that processes had been halted safely. At 1615 GMT it said the fire had been completely put out, the incident “was neutralized successfully” and Rompetrol would continue to provide fuels for its stations in Romania and the Black Sea region. “Five of our colleagues are in medical care at Constanta County Hospital, and we are sorry to inform you that a person has been identified as deceased,” its statement added. The company declined to comment on the likely financial damage but said an assessment of the impact on technological processes will be performed to provide a clear picture and predictability in terms of restarting the refinery facilities. Petromidia is based on the shores of the Black Sea in Navodari, 20 km (12.5 miles) north of the country’s biggest port, Constanta. It said it processed a total of 1.26 million tonnes of raw materials in the first quarter of this year, a similar level to a year before, and had been running at 84% capacity. Read more at https://www.todayonline.com/world/romanian-black-sea-refinery-blast-kills-one-injures-five
Blast rocks Caspian Sea area near Azerbaijani gas field (AP) – A strong explosion shook the Caspian Sea area where Azerbaijan has extensive offshore oil and gas fields. A column of fire rose from the area, but the state oil company said none of its platforms were damaged. The state oil company SOCAR said the blaze late Sunday may have come from a mud volcano. The Caspian Sea has a high concentration of such volcanoes, which spew both mud and flammable gas. SOCAR spokesman Ibrahim Ahmadov told the Interfax-Azerbaijan news agency on Monday that the company staff found a mud volcano ablaze on the uninhabited island of Dashly, about 30 kilometers (20 miles) off the coast of Azerbaijan between the towns of Alat and Neftchala. Azerbaijan’s Emergency Ministry said that the volcano continued to burn on Monday morning, but the fire “doesn’t pose a threat either to the sea oil and gas infrastructure and other objects, or to people’s lives.”
Australia dragged before UN over historic oil spill – Australia has been forced to appear in front of the United Nations Human Rights Council after 13 Indonesian regencies lodged serious allegations of human rights violations against the Commonwealth government. The UN proceedings are a separate case to a A$300 million civil lawsuit (class action) won last year against field operator PTTEP in Australia’s Federal Court. These complaints were lodged to the UN’s special rapporteurs on human rights. These officials then make a claim against a country before the UN Human Rights Council. In August 2009 a well at the Montara oil field then operated by Thailand’s PTTEP blew out causing crude, condensate, gas, and mud to spew into the Timor Sea, offshore northern Western Australia. This continued for three months as four attempts to plug the well were unsuccessful, with 1500 barrels of oil equivalent per day pumped into the surrounding waters. A fire caused by the blowout also damaged the platform, eventually causing collapse. The complaints to the UN allege that Australia violated “the human rights of the affected communities and indigenous peoples in East Nusa Tenggara” by firstly allowing the oil spill to occur and then failing to mitigate the environmental and economic damage caused. In documents obtained by Energy News, the communities said their right to a healthy environment, life, health, bodily integrity, water, and food were infringed upon by Australia’s lack of preparedness and subsequent action following the spill. “The handling of the spill allegedly disregarded and continues to disregard the human rights of those affected,” the United Nations special rapporteurs, led by officer-in-charge Special Procedures Branch Office of the High Commissioner for Human Rights, Karim Ghezraoui, told the UN Human Rights Council.
Cargo ship spills oil after collision with dredger off Manila – A cargo vessel collided with a dredger in the waters of the South Harbor Anchorage area in Manila, the Philippines, in the early morning hours of 8 July 2021. The ships in question are the Philippine-flagged vessel MV Palawan Pearl and Cyprus-flagged utility vessel BKM 104, the Philippine Coast Guard (PCG) said. The incident caused the 345 GT Palawan Pearl, which carried 3,000 litres of diesel in its oil storage tank, to tilt and take on water. The ship also has a drum of diesel oil, 60 litres of engine oil, and 60 litres of bilge oil. The ill-fated vessel is located outside the breakwater of Baseco Beach, approximately 100 meters from Baseco Beach shoreline. The Philippine Coast Guard deployed patrol boat BRP Panglao and other assets to conduct close monitoring and provide necessary assistance to the cargo vessel. “At this time, the cargo vessel MV Palawan Pearl remains half submerged where the spread of ‘oil sheen’ is observed around it,” the PCG said, adding that containment boom was placed around the distressed ship. Based on the PCG’s initial assessment, Palawan Pearl traveled from Commander’s Wharf to Baseco Compound to El Nido, Palawan. Meanwhile, the BKM 104 was sailing in Manila Bay Anchorage area to Bulacan when the incident happened. The 375 GT BKM 104 is a foreign utility vessel contracted to perform dredging and other land development activity required for the construction of New Manila Airport. According to the skipper of Palawan Pearl, while sailing at a speed of 7 knots at three kilometers from the Pasig River, they noticed BKM 104 approximately 100 metres away from their port side (left) and traveling at the speed of 10 knots. Palawan Pearl allegedly tried to avoid BKM 104, but the latter crashed twice into the left side of the cargo vessel and almost sank it.
Nigeria records 4,919 oil spills in 6 years – Minister – Dr Mohammad Abubakar, Minister of Environment, on Monday, disclosed that Nigeria recorded 4,919 oil spills between 2015 to March 2021 and lost 4.5 trillion barrels of oil to theft in four years. Abubakar disclosed this at a Town Hall meeting in Abuja, organised by the Ministry of Information and Culture, on protecting oil and gas infrastructure. “According to the National Oil Spill Detection Agency (NOSDRA) data, the total number of oil spills recorded from 2015 to March 2021 is 4,919, the number of oil spills cost by collation is 308. “The operational maintenance is 106, while sabotage is 3,628 and yet to be determined 70, giving the total number of oil spills on the environment to 235,206 barrels of oil. This is very colossal to the environment. “Nigeria also lost approximately 4.75 trillion on oil activities in the four years between 2015 and 2018, as estimated by the Nigeria Natural Resources Charter. “Several statistics have emphasised Nigeria as the most notorious country in the world for oil spills, loosing roughly 400,000 barrels per day.
Eni Announces Significant Oil Find -Eni has announced a significant oil discovery on the Eban exploration prospect in CTP Block 4, offshore Ghana. Eban – 1X, which is the second well drilled in CTP Block 4, following the Akoma discovery, proved a single light oil column of approximately 262 feet in a thick sandstone reservoir interval of Cenomanian age, with hydrocarbons encountered down to 12,956 feet, Eni revealed. Production testing data at the well is said to show deliverability potential estimated at 5,000 barrels of oil per day, which is similar to the wells already in production at the nearby Sankofa Field, Eni highlighted. Due to its proximity to existing infrastructures, the new discovery can be fast tracked to production with a subsea tie-in to the John Agyekum Kufuor FPSO, Eni revealed. Preliminary estimates now place the potential of the Eban – Akoma complex between 500 and 700 million barrels of oil equivalent in place, according to Eni, which said the estimated hydrocarbon in place between the Sankofa field and the Eban – Akoma complex is now in excess of 1.1 billion barrels of oil equivalent. Further oil in place upside could also be confirmed with an additional appraisal well, Eni pointed out. CTP Block 4 is operated by Eni, which holds a 42.469 percent stake, on behalf of partners Vitol, which holds a 33.975 percent interest, GNPC, which holds a ten percent share, Woodfields, which holds a 9.556 percent interest, and GNPC Explorco, which holds the remaining four percent stake. Eni has been present in Ghana since 2009 and currently has a gross production of about 80,000 barrels of oil equivalent per day from the country.
BP says all other global energy crises pale in comparison to the year of Covid. These stats show why– Oil and gas giant BP on Thursday published its benchmark Statistical Review of World Energy, describing 2020 “as a year like no other” due to the impact of the coronavirus pandemic on global energy.Over the past seven decades, BP said it had borne witness to some of the most dramatic episodes in the history of the global energy system, including the Suez Canal crisis in 1956, the oil embargo of 1973, the Iranian Revolution in 1979 and the Fukushima disaster in 2011.”All moments of great turmoil in global energy,” Spencer Dale, chief economist at BP, said in the report. “But all pale in comparison to the events of last year.”To date, more than 185 million Covid-19 cases have been reported worldwide, with over 4 million deaths, according to data compiled by Johns Hopkins University. The actual tally of Covid-19 infections and fatalities is believed to be far higher – and continues to rise.The pandemic also led to massive economic loss, with global GDP estimatedto have slipped by around 3.3% last year. That represents the largest peacetime recession since the Great Depression.For global energy, the Covid pandemic has had a dramatic impact. Here are some of the highlights from the report:BP said the coronavirus crisis last year resulted in primary energy and carbon emissions falling at their fastest rates since World War II. The relentless expansion of renewable energy, however, was found to be “relatively unscathed,” with solar power recording its fastest ever increase.To be sure, the oil and gas company said world energy demand was estimated to have contracted by 4.5% and global carbon emissions from energy use by 6.3%.”These falls are huge by historical standards – the largest falls in both energy demand and carbon emissions since World War II. Indeed, the fall of over 2 Gt of CO2 means that carbon emissions last year were back to levels last seen in 2011,” Dale said.”It’s also striking that the carbon intensity of the energy mix – the average carbon emitted per unit of energy used – fell by 1.8%, also one of the largest ever falls in post-war history,” he added.
Oil prices hover above $75 as OPEC+ struggles to reach a deal. Here’s why it matters — Energy prices are hovering above the $75 level after OPEC and its allies could not reach a key deal on their oil output policy last week, amid rising tensions between Saudi Arabia and the UAE. Crude prices are seeing some volatility after an initial spike, but retreated slightly on Monday. Brent futures slipped 0.11% to $76.09 per barrel, while U.S. crude futures dipped 0.13% to $75.06 per barrel. The energy alliance, often referred to as OPEC+, will meet again on Monday after failing to reach a deal twice last week. Without a deal, oil prices could surge and threaten to derail a frail economic recovery. If talks fall through, there could also be a price war – though analysts do not think the latter scenario is likely. The United Arab Emirates blocked a deal to increase oil output and extend the expiry of the group’s broader production supply agreement to the end of next year, according to Reuters. The UAE said the extension should be conditional on revising the so-called baseline, which determines how much a country is allowed to pump. Both Brent and U.S crude shot up more than 2% to above $75 per barrel on Thursday, reaching highs not seen since 2018. The deal first fell through on Thursday, and a second meeting on Friday failed to see any breakthrough as well. Oil prices have surged more than 45% in the first six months of 2021, with demand rising as global economies reopened. The UAE – a long-time ally of OPEC’s leader Saudi Arabia – objected to the deal twice last week, according to Reuters. The deal includes an agreement to increase oil output gradually, while at the same time, extending the duration of broader cuts that the group agreed to in 2021. Last year, to cope with lower demand as the Covid crisis hit and people travel less, OPEC+ agreed to curb output by almost 10 million barrels per day from May 2020 to the end of April 2022. At last week’s meeting, OPEC kingpin and non-OPEC leader Russia also proposed extending the duration of cuts until the end of 2022, according to Reuters. Top producers Saudi Arabia and Russia had reached a preliminary agreement, which would in principle increase supply by 400,000 barrels per day from August to December 2021 in order to meet rising demand, Reuters reported, citing unnamed sources.
UAE ‘unconditionally’ supports OPEC+ supply increase, but says no to a bad deal -The United Arab Emirates has pushed back on OPEC+ leaders Saudi Arabia and Russia, claiming its “sovereign right” to negotiate fairer terms for an oil production increase. “For us, it wasn’t a good deal,” UAE Minister of Energy and Infrastructure Suhail Al Mazrouei told CNBC’s Hadley Gamble, referring to OPEC+ production cuts which were based on a “level of production that goes back to 2018.” “We knew that the UAE position in that agreement was the worst in terms of comparing our current capacity with the level of production” he said Sunday. “But an agreement is an agreement.” Asked if the UAE would be willing to walk away, the minister said “we cannot extend the agreement or make a new agreement under the same conditions. We have the sovereign right to negotiate that.” The comments come after the United Arab Emirates blocked some aspects of an OPEC+ proposal to increase output on Friday, seeking better terms for itself. “Let’s increase the production, and talk about the extension and the agreement and the conditions associated with it at a later meeting,” he said, adding that the UAE unconditionally supports a supply increase. “We are meeting on Monday, and I think we are all in agreement that we need to do something regarding the increase in production,” Al Mazrouei said. “The issue is putting a condition on that increase, which is the extension of the agreement,” he added. The high-stakes standoff comes as oil prices surge above $75 dollars a barrel for the first time in two years. Failure to reach a deal on Monday could risk the market recovery, and even unravel the fragile OPEC+ alliance if the deadlock is left unresolved. “We have plenty of time to meet and discuss the terms of the extension with justification that can involve independent bodies to review it” he said. “I’m still hopeful that by Monday we will segregate the two decisions,” he added. The UAE threatened to leave OPEC late last year, and an exit would almost certainly trigger a repeat of the OPEC+ price war that pushed oil prices to -$40 in April last year. “It’s not wise nor a target for anyone to raise prices to a level that the world economy cannot handle,” he said. “We think we need to do it and we need to do it for August” Al Mazrouei added. At the core of the current proposal is a plan to increase production by 2 million barrels per day (mb/d) between August and December in 400,000 barrels per day monthly installments. OPEC+ also plans to extend its production cut agreement from April 2022 to December 2022. “Now we think that linking the extension of the agreement for a reference that goes back to 2018, and for a period that starts from 2022, is just not realistic, because this is four years” Al Mazrouei said. “That is totally unfair.” The UAE has spent billions investing in its oil production capacity, seeking to ramp up output. With Iran also set to return to the oil market in the coming months, the UAE sees good scope to review the terms.
OPEC+ crisis talks reportedly postponed as Saudi Arabia and the UAE remain at loggerheads over oil output – A meeting between oil producer group OPEC and its partners, which was aiming to broker a deal on crude output after the groupunexpectedly failed to reach an agreement last week, has reportedly been postponed. The energy alliance, often referred to as OPEC+, on Friday voted on a proposal to increase oil production by roughly 2 million barrels per day between August and the end of the year in 400,000 barrels per day monthly installments. It also proposed to extend the remaining output cuts to the end of 2022. The United Arab Emirates rejected these plans, however, blocking an agreement for the second consecutive day to leave oil markets in limbo over the weekend. OPEC+ was set to reconvene for crisis talks via videoconference at 2 p.m. London time Monday. However, after a two-hour delay, Reuters, citing two sources, said that the meeting had been postponed with no new date set. Bloomberg also reported that it meant OPEC+ would continue with production quotas at current levels. “For us, it wasn’t a good deal,” UAE Minister of Energy and Infrastructure Suhail Al Mazrouei told CNBC’s Hadley Gamble on Sunday. He added that while the UAE was willing to support a short-term increase in oil supply, it wants better terms through 2022. Saudi Arabia’s Energy Minister Abdulaziz bin Salman called for “compromise and rationality” in order to reach a deal on Monday, Reuters reported. OPEC+, which is dominated by Middle East crude producers, agreed to implement massive crude production cuts in 2020 in an effort to support oil prices when the coronavirus pandemic coincided with a historic fuel demand shock. Led by Saudi Arabia, a close ally of the UAE, OPEC+ has since initiated monthly meetings in a bid to navigate production policy. It has resulted in a rare public stand-off between the UAE and its long-time regional ally Saudi Arabia, OPEC’s de facto leader. The dispute comes as energy market participants anxiously await policy direction that is likely to shape crude markets into next year. “UAE remains steadfast in its refusal to give ground, insisting that using the October 2018 production benchmark is fundamentally unfair. Hence, the prospect of a no-deal outcome – as well as a UAE OPEC exit – has risen materially even if it has not yet fully entered into firm base-case territory,” “Of course, in practice, the monthly meeting structure means that decisions can be reversed quickly and that no condition is permanent. On the flip side, if the talks end in utter discord, there is a risk of a return to an every-man-for-himself production scenario that could cause a reversal of this year’s oil price rally.”
Biden Team Spoke to Saudis, UAE About OPEC Talks, Oil Prices – Biden administration officials are “encouraged” by ongoing OPEC talks and have spoken with officials in Saudi Arabia and the United Arab Emirates in hopes of reaching an agreement to stem the rise in crude prices, White House Press Secretary Jen Psaki said.”We’re not a party to these talks but over the weekend and into this week, we’ve had a number of high-level conversations with officials in Saudi Arabia, the UAE and other relevant partners,” Psaki said Tuesday during a briefing at the White House. She declined to specify which U.S. officials were involved but signaled that she didn’t expect President Joe Biden to personally make calls.The U.S. hopes talks will lead to an agreement that “will promote access to affordable and reliable energy,” she said. The impact of talks on gas prices in the U.S. is of interest to the administration, she said. Saudi Deputy Defense Minister Khalid bin Salman, who’s visiting Washington, met with top Defense Department officials on Tuesday, Pentagon spokesman John Kirby said, without providing details on the talks. Khalid will take part in meetings at the State Department on Wednesday.”The president wants Americans to have access to affordable and reliable energy, including at the pump. And so that’s why our team is constantly monitoring gas prices and directly communicating with OPEC parties to get to a deal and allow proposed production increases to move forward,” Psaki said.Crude prices have soared and fluctuated as Saudi Arabia and the UAE spar over a production increase. A stall in talks raises the prospect that either nation could dump their quotas and raise supply. Existing OPEC+ production limits remain in place.
Why Biden may want to take a page from Trump’s OPEC playbook – CNN – Americans despise high gasoline prices. And fairly or not, they tend to pin the blame on whomever is in the White House. That’s why Monday’s failure by OPEC and its allies to reach a deal that would add badly needed oil barrels to the market is a major problem for President Joe Biden. Oil and gasoline prices are already at seven-year highs. They’ll go even higher until OPEC+ gets its act together. “We will see a nasty spike in crude oil and pump prices if they don’t increase production,” said Robert McNally, president of consulting firm Rapidan Energy. No president wants an oil-price spike. But the timing is particularly problematic because it could amplify inflation fears and hit Americans in the wallet just as consumer spending drives the economic recovery from Covid. US crude prices hit $76.98 a barrel Tuesday, a level unseen since November 2014, before retreating to around $73.50. Gasoline prices, which move with a lag to crude, ticked up to a national average of $3.13 a gallon on Tuesday, according to AAA. That’s up from just $2.18 a year ago when the pandemic was still roaring. ‘Playing catch-up’ Alarm bells are undoubtedly ringing in the Biden White House. A spokesperson told CNN on Monday that the administration is “closely monitoring” the OPEC+ negotiations and officials are urging a “compromise solution” that will clear the way for the group to boost output. Until now, the Biden administration has taken a hands-off approach with OPEC, in stark contrast with former President Trump, who famously was obsessed with tracking financial markets and repeatedly blasted OPEC for failing to pump enough oil. Some analysts claim the Biden Team appeared to be caught flat-footed by the drama OPEC. “They are playing catch-up,” said Helima Croft, global head of commodity strategy at RBC Capital Markets. “The early warning system for the Biden administration was not commensurate with that of the Trump administration. They may not have realized how potentially consequential that OPEC meeting was.”
OPEC+ Deal Fails, Leaving Oil Market Tighter as Prices Surge OPEC+ abandoned its meeting without a deal, tipping the cartel into crisis and leaving the oil market facing tight supplies and rising prices. Several days of tense talks failed to resolve a bitter dispute between Saudi Arabia and the United Arab Emirates, delegates said, asking not to be named because the information wasn’t public. The group didn’t agree on a date for its next meeting, according to a statement from OPEC Secretary-General Mohammad Barkindo. The most immediate effect of the breakdown is that, unless an agreement can be salvaged, the Organization of Petroleum Exporting Countries and its allies won’t increase production for August. That will deprive the global economy of vital extra supplies as demand recovers rapidly from the coronavirus pandemic. However, the situation is fluid and the group could reactivate talks at any moment. With prices up about 50% this year and climbing toward $80 a barrel, the producers’ group may feel extra pressure from consuming countries concerned about rising inflation. “Oil prices will pop if no deal means current production levels continue,” said Jason Bordoff, director of the Center on Global Energy Policy at Columbia University. “But that’s also not tenable because a price spike actually undermines the interests of the UAE, Russia and Saudi Arabia.” The failure of OPEC+ to reach a deal pushed crude higher. Brent crude jumped 1.3% to $77.12 a barrel as of 5:42 p.m. in London, the highest since 2018. The outcome is a significant failure for the producers’ group. Relations have soured between two core OPEC members to such an extent that no compromise was possible. It damages the group’s self-image as a responsible steward of the oil market, raising the specter of the destructive internal price war that caused unprecedented price swings last year. OPEC+ has already been reviving some of the crude supplies it halted last year in the initial stages of the pandemic. The 23-nation coalition decided to add about 2 million barrels a day to the market from May to July, and the question before ministers on Monday was whether to keep going in the coming months. The cartel’s own data show that once-bloated oil inventories are back down to average levels as the recovery in fuel consumption continues. Demand in the second half will be 5 million barrels a day higher than in the first six months of the year, Barkindo said last week.
Breakdown of oil output talks threatens OPEC+ unity, may trigger weaker oil prices, says strategist – The collapse of talks between OPEC and its allies highlights the risks of the group’s unity breaking down and renews concerns about a possible oversupply of oil, a commodity strategist told CNBC. The energy alliance, referred to as OPEC+, was set to resume talks Monday, but discussions have been called off indefinitely. That comes after the group twice failed to reach a key deal on their oil output policy last week. The group had sought to increase supply by 400,000 barrels per day from August to December 2021 and proposed extending the duration of cuts until the end of 2022. Last year, to cope with lower demand as Covid hit, OPEC+ agreed to curb output by almost 10 million barrels per day from May 2020 to the end of April 2022. The United Arab Emirates had indicated that, while it was supportive of the proposal to increase supply, it objected to the terms of the extension, which it said should be conditional on increasing its so-called baseline, which determines how much oil a country is allowed to pump. “I certainly think there are some risks that the market may be really sort of discounting at the moment and that is a breakdown of that unity,” Daniel Hynes, senior commodity strategist at ANZ, told CNBC on Tuesday. “That has been I think by far the biggest advantage of this alliance over the past 18 months … the picture that it presents to the market around a coordinated and very compliant agreement which hasn’t really seen any producers expand outside of that,” he added. But now the risks are rising from that conflict surrounding the baseline number, which production cuts or increases are measured against. The UAE now wants that baseline to be increased so it can produce more. It has argued that it was not alone, as Azerbaijan, Kuwait, Kazakhstan and Nigeria also requested and got new baselines approved since the deal started last year, Reuters reported, citing an OPEC+ source. Hynes said that the UAE now wanting that “side agreement” to increase their output is representing “a risk now to that unity, to that front.” “I think that brings risks to oversupply in particular over the medium term,” he said. Hynes doesn’t rule out weaker prices ahead, but said he doesn’t think there will be a price war. “I think that would obviously be at risk if we started to see producers really push their own agenda and in a sense, go outside of that supply agreement,” he told CNBC. “But you know it’s all about perception and I think if the market does perceive that they won’t adhere to those current quotas, then clearly, they’re going to assume the worst and that would see weak oil prices ultimately,” he added.
The end of OPEC? How Saudi Arabia and UAE infighting threatens the future of the oil alliance – Oil producer group OPEC has been plunged into crisis, with bitter infighting between Saudi Arabia and the United Arab Emirates raising questions about the future of the energy alliance. OPEC and non-OPEC partners, a group of some of the world’s most powerful oil producers, abruptly abandoned plans to reconvene on Monday after last week’s meetings unexpectedly failed to broker a deal on oil production policy. The group did not set a new date to resume talks. It means no agreement has been reached on a possible increase in crude production beyond the end of July, leaving oil markets in a state of limbo just as global fuel demand recovers from the ongoing coronavirus pandemic. “OPEC+ has been thrown its most serious crisis since last year’s ill-fated price war between Saudi Arabia and Russia,” Helima Croft, head of global commodity strategy at RBC Capital Markets, said in a research note. “Back-channel talks reportedly are continuing, but questions about UAE’s commitment to remaining in OPEC will likely grow in the coming days.” The UAE-Saudi dispute appeared to be about more than oil policy, Croft said, with Abu Dhabi “seemingly intent on stepping outside Saudi Arabia’s shadow and charting its own course in global affairs.” OPEC+, which is dominated by Middle East crude producers, agreed to implement massive crude production cuts in 2020 in an effort to support oil prices when the coronavirus pandemic coincided with a historic fuel demand shock. Led by Saudi Arabia, a close ally of the UAE, OPEC+ has met monthly to decide on production policy. The disarray comes after OPEC+ on Friday voted on a proposal to increase oil production by roughly 2 million barrels per day between August and the end of the year in 400,000 barrels per day monthly installments. It also proposed to extend the remaining output cuts to the end of 2022. The plans were rejected by the UAE, however, which wants a higher baseline to its quota to allow for more domestic production. “No agreement was reached and as we stand now the OPEC+ alliance, if it is still the right word to describe the group, will produce at the July level for the rest of the year,” . “The [non-] outcome of the meeting re-writes the supply-demand landscape for the near and potentially for the distant future,” he added. The rare public stand-off between the UAE and Saudi Arabia saw energy ministers from both countries engaging in a media blitz over the weekend to outline their respective positions. “For us, it wasn’t a good deal,” UAE Minister of Energy and Infrastructure Suhail Al Mazrouei told CNBC’s Hadley Gamble on Sunday. He added that while the country was willing to support a short-term increase in oil supply, it wants better terms through 2022.
Refiners to Pay More for Saudi Crude — Saudi Arabia raised oil prices for buyers from Asia to the U.S. for August after OPEC+ talks broke down just as the market was clamoring for more supply. The Saudis, along with Russia, sought over the past week to rally other members around a plan to unwind production cuts incrementally and to extend their accord through to the end of next year. The proposal collapsed when the United Arab Emirates balked at keeping in place what it says is an unfair production baseline for its quota for longer. In its main market of Asia, Saudi Aramco increased the official selling price, or OSP, for Arab Light crude by 80 cents a barrel to $2.70 above the regional benchmark. That’s the biggest month-on-month increase since January, and suggests the oil giant won’t raise supply next month even as it sees the market tightening. “With domestic demand peaking around August, there will be less crude available for exports unless they draw down from the inventories,” said Giovanni Staunovo, a commodities analyst at UBS Group AG. “As the market was looking for a slightly smaller OSP increase for Asia, Asian refineries can’t expect additional volumes from Saudi Arabia.” The kingdom sends more than 60% of its crude exports to Asia, with China, Japan, South Korea and India being the biggest buyers. Last month, it shipped 5.7 million barrels a day globally, according to preliminary data compiled by Bloomberg. Buyers in the U.S. will see smaller increases next month, with prices rising between 20 cents and 40 cents a barrel. Aramco is also raising rates for Northwest Europe by 80 cents a barrel and for the Mediterranean region by 60-80 cents. Oil futures and physical markets have strengthened with widespread virus vaccinations supporting demand. The breakdown in OPEC+ talks means current production limits will remain in place for August, likely leading to a deeper supply deficit. Crude could rise to as high as $90 a barrel without higher output, Fereidun Fesharaki, chairman of industry consultant FGE, said in a Bloomberg Television interview. He said a compromise between the feuding OPEC nations was likely. Aramco had been expected to increase the price of Arab Light by 50 cents a barrel to $2.40 more than the benchmark, according to a survey of nine traders and refiners in Asia prior to the meeting’s collapse. The company also hiked pricing for most of its other grades for sale to Asia by 80 cents, with Arab Super Light crude rising by $1 a barrel. The increase brings pricing for Arab Light to the highest since March 2020, when it sold for a premium of $2.90 a barrel. That was the last month before a brief price war caused crude to plunge as producers including Saudi Arabia discounted barrels and flooded the market just as the coronavirus was slashing demand.
US oil prices at six-year high after OPEC fails to reach deal – US oil prices jumped to six-year highs Tuesday after OPEC failed to reach a deal on oil production – raising concerns that output could fail to keep up with surging demand. Futures for West Texas Intermediate, the main US oil benchmark, advanced 1.3 percent, or about $1, to $76.16 per barrel. At one point, WTI crude reached $76.98, the highest price since November 2014. Brent crude, the global energy benchmark, traded roughly flat at about $77.04 per barrel, the highest price since late 2018. The surging prices came after talks that began last week between OPEC and its oil-producing allies, known as OPEC+, fell apart. The group’s meeting sought to establish production policy for August and the remainder of the year. But a Saudi Arabia-backed plan to raise output and let the price stabilize failed to win agreement, with the United Arab Emirates, a key OPEC member, refusing to sign off. Discussions were set to resume on Monday but got called off in a sign of simmering tensions and stalling talks. Analysts, including Warren Patterson, head of commodities strategy at ING Groep, say that a production hike is necessary as demand for oil continues to rise to pre-pandemic levels. Without a new production plan, prices are likely to continue to rise, at least in the short term. Americans are already feeling the crunch at the pump, with national average gas prices over $3 per gallon at a seven-year high. Companies involved in the energy industry saw shares rise Tuesday morning in premarket trading. Occidental Petroleum stock rose about 1.6 percent in the premarket and shares of oil-field-services firm Schlumberger rose about 1.3 percent. The US has pushed OPEC to reach a deal that would see output rise and tame the price. “Administration officials have been engaged with relevant capitals to urge a compromise solution that will allow proposed production increases to move forward,” a White House spokesperson said Monday. A maze of crude oil pipes and valves is pictured during a tour by the Department of Energy at the Strategic Petroleum Reserve in Freeport, Texas.
OPEC discord could unleash a new level of volatility in oil market – Disagreement within OPEC could trigger a more a volatile period for oil, with prices jumping on lack of new supply or sinking suddenly if member countries decide to release crude independently. Oil prices initially surged to a six-year high on news that the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, ended their meeting Monday with no action and no new meeting date. A proposed plan by OPEC, Russia and other allies to bring 400,000 barrels a day back to the market was disrupted by the United Arab Emirates’ objection to other aspects of the deal. West Texas Intermediate crude futures for August traded as high as $76.98 Tuesday before falling back to settle down 2.4% at $74.53 per barrel. Many analysts had expected oil to rise on the discord among members of OPEC, and say prices could still climb despite the sell-off. “It’s going to get worse before it gets better. I still think $85 to $90 per barrel should be the upper end,” said John Kilduff, partner with Again Capital. “You’ll see more oil produced. They’re not going to go crazy, but they’re not going to live within the current structures. Russia will lead the charge.” “It could become a free for all,” he said. Some analysts had already expected oil spikes into the $100 per barrel range over the course of the next year. The feuding between Saudi Arabia and the United Arab Emirates opens a new fissure in OPEC, which now means oil could also tank if members decide to open the spigots. “Realistically, I don’t think anybody wants to go this way. I suspect cooler heads or rational thinking will prevail,” said Bart Melek, global head of commodity strategy at TD Securities. Melek said there are some wild cards for OPEC that could affect prices. A major one is whether the U.S. and Iran strike a deal on Iran’s nuclear programming, allowing it to return more than 1 million barrels a day back to the market. Another risk is whether the variants of the Covid virus could affect the economy’s recovery and crimp demand for travel. OPEC and its partners were able to agree to return 400,000 barrels a day to the market starting in August. But the UAE sought to also have its production baseline increased from 3.1 million barrels a day to 3.8 million barrels, and that was the sticking point with Saudi Arabia. After three days of meetings, there was also a deadlock over whether the deal would include an extension of the the plan to the end of 2022, which was opposed by the UAE. Without an agreement, 5.8 million barrels a day, cut from production last year, will remain off the market even as demand rises. “I think OPEC event risk is back. We had pretty smooth sailing this year, and now this was not priced at all,” said Helima Croft, global head of commodity strategy at RBC Capital Markets. “Once people start focusing on 5.8 million barrels off the market, I think they might get nervous. How they come back will be important.” The market will be affected much differently based on whether the oil trickles back or the producing countries flood the market with supply.
Oil prices could ‘very easily’ top $100 a barrel, says ex-U.S. energy secretary Oil prices could “very easily” hit $100 a barrel in the aftermath of the failed OPEC+ talks, former U.S. Energy Secretary Dan Brouillette told CNBC on Tuesday. “You could very easily see oil hitting $100 a barrel – potentially even higher,” he told CNBC’s Hadley Gamble. On the flip side, it’s “equally possible” that prices could collapse too. “If there isn’t any agreement on production, and countries tend to go off and do their own thing, or do their own production, you could have a collapse of oil prices,” said Brouillette, who was U.S. energy secretary from 2019 to 2021. OPEC and its allies, referred to collectively as OPEC+, twice failed to reach a deal on oil output last week. On Monday, another attempt to resume talks broke down, and discussions were put off indefinitely. The energy alliance, which includes Russia, had sought to increase supply by 400,000 barrels per day from August to December 2021 and proposed extending the duration of cuts until the end of 2022. Last year, to cope with lower demand due to the pandemic, OPEC+ agreed to curb output by almost 10 million barrels per day from May 2020 to the end of April 2022. The United Arab Emirates had indicated that, while it was supportive of the proposal to increase supply, it objected to the terms of the extension. Prices soared to three-year highs following the collapse of those talks on Monday. On Tuesday during Asia trading, they surged even higher. U.S. crude pushed past $76 per barrel and international benchmark Brent was higher than $77 per barrel. Oil prices topping $100 would destroy demand, warned oil expert Dan Yergin, who said that it would not be in the interest of countries. “I think countries recognize that $100 barrel oil would not be in (their) interest,” Yergin, the vice chairman of IHS Markit, told CNBC’s Street Signs Asia on Tuesday. “You would see governments pour more incentives into electric cars, and see the impact on demand.” ‘Striking’ that UAE and Saudi are on divergent paths OPEC+ is led by Saudi Arabia, a close ally of the UAE. But the breakdown of those talks, and UAE’s objection to the terms, reflect a rare public disagreement between the allies. The discord between Saudi Arabia and the UAE has been “striking,” Brouillette and Yergin both said. “I find it striking that the UAE has stepped away from Saudi Arabia, a longtime ally within OPEC and OPEC+,” Brouillette said.
Oil touches six-year high after OPEC fails to get deal, then turns negative –Oil jumped to its highest level in six years after talks between OPEC and its oil-producing allies were postponed indefinitely, with the group failing to reach an agreement on production policy for August and beyond. On Tuesday, U.S. oil benchmark West Texas Intermediate crude futures traded as high as $76.98, a price not seen since November 2014. But those gains quickly faded, and the contract for August delivery drifted lower during the session and ultimately settled down 2.38%, or $1.79, at $73.37 per barrel. Brent crude hit its highest level since late 2018 before also reversing gains, and finished the session $2.63, or 3.4%, lower at $74.53 per barrel. Discussions began last week between OPEC and its allies, known as OPEC+, as the energy alliance sought to establish output policy for the remainder of the year. The group on Friday voted on a proposal that would have returned 400,000 barrels per day to the market each month from August through December, resulting in an additional 2 million barrels per day by the end of the year. Members also proposed extending the output cuts through the end of 2022. The United Arab Emirates rejected these proposals, however, and talks stretched from Thursday to Friday as the group tried to reach a consensus. Initially, discussions were set to resume on Monday but were ultimately called off. “The date of the next meeting will be decided in due course,” OPEC Secretary General Mohammad Barkindo said in a statement. OPEC+ took historic measures in April 2020 and removed nearly 10 million barrels per day of production in an effort to support prices as demand for petroleum-products plummeted. Since then, the group has been slowly returning barrels to the market, while meeting on a near monthly basis to discuss output policy. “For us, it wasn’t a good deal,” UAE Minister of Energy and Infrastructure Suhail Al Mazrouei told CNBC on Sunday. He added that the country would support a short-term increase in supply, but wants better terms if the policy is to be extended through 2022. Oil’s blistering rally this year – WTI has gained 57% during 2021 – meant that ahead of last week’s meeting many Wall Street analysts expected the group to boost production in an effort to curb the spike in prices. “With no increase in production, the forthcoming growth in demand should see global energy markets tighten up at an even faster pace than anticipated,” analysts at TD Securities wrote in a note to clients. “This impasse will lead to a temporary and significantly larger-than-anticipated deficit, which should fuel even higher prices for the time being. The summer breakout in oil prices is set to gather steam at a fast clip,” the firm added.
Opec meeting: Oil drops sharply after OPEC cancels meeting – Oil prices tumbled on Tuesday in a volatile session after OPEC producers canceled a meeting when major players were unable to come to an agreement to increase supply. Brent crude settled down $2.63 a barrel, or 3.4%, to $74.53, after hitting a session peak of $77.84, its highest since October 2018. U.S. West Texas Intermediate (WTI) crude futures settled down $1.79, or 2.4%, to $73.37 after touching $76.98, highest since November 2014. On Monday, ministers from OPEC+, which includes the Organization of the Petroleum Exporting Countries (OPEC), Russia and other producers, abandoned talks after negotiations failed to close divisions between Saudi Arabia, the largest OPEC producer, and United Arab Emirates. Initially, oil rallied on news of the breakdown in talks, but prices retreated as traders focused on the possibility that the strife will cause some national producers to open the taps and start exporting more barrels. “The market is concerned that the UAE will step in and unilaterally add barrels and other people in OPEC will follow suit,” said Bob Yawger, director of energy futures at Mizuho. The United Arab Emirates said it would go along with output increases but rejected a separate proposal to extend curbs to the end of 2022 from an existing April deadline. Some OPEC+ sources said they still believed the group would resume discussions this month and agree to pump more from August, though others said current curbs might remain in place. The White House said Tuesday it was closely monitoring talks by OPEC+ and was “encouraged” after conversations with officials in Saudi Arabia and the United Arab Emirates. No date for further talks has been announced. Analysts expect U.S. producers to start adding supply due to higher prices after months of subdued activity. U.S. production is currently around 11 million bpd, so output has room to increase before nearing the U.S. record of nearly 13 million bpd reached in 2019. Goldman Sachs said the collapse of the talks had introduced uncertainty into OPEC’s production path. The bank said it still saw Brent reaching $80 per barrel early next year. On Monday, Iraqi Oil Minister Ihsan Abdul Jabbar said his country did not want to see oil prices soaring above current levels and that he hoped that within 10 days a date would be set for a new OPEC+ meeting.
Oil prices stay volatile amid ongoing OPEC+ clash over output – Oil prices remained volatile in New York as traders assessed the ongoing impasse among OPEC+ nations over plans to boost output. West Texas Intermediate futures have been whipsawed as a dispute between Saudi Arabia and the United Arab Emirates stymies OPEC+ plans to revive halted supplies. The grade hit a six-year high early Tuesday before easing back. White House Press Secretary Jen Psaki said U.S. officials have been speaking to both sides, and OPEC+ delegates say consultations continue to seek a compromise. “Uncertainty seems to prevail after the surprising outcome of the petro-nations’ latest meeting and its inability to agree on the future of their supply deal,” Refiners have reaffirmed their appetite for barrels, with at least five Asian oil processors planning to seek their full contractual volumes from Saudi Arabia, even as the kingdom jacked up prices for August. Companies have been unable to source cheaper alternatives. Oil has soared in 2021 as the rollout of coronavirus vaccines permits major economies to reopen, spurring a revival in global consumption. The Organization of Petroleum Exporting Countries and its allies have returned some of the production they took offline at the height of the pandemic, but they’re struggling to agree on a way forward. Without a new deal, they’re set to keep supply steady in August, further tightening the market. Saudi Aramco increased the official selling price for Arab Light by 80 cents a barrel to $2.70 above the regional benchmark for Asia. That’s the biggest month-on-month gain since January, and suggests the oil giant won’t boost supply next month. WTI for August delivery traded up 0.6% at $73.81 a barrel on the New York Mercantile Exchange at 1:42 p.m. London time.It fell 2.4% on Tuesday as a stronger dollar spurred a sell-off across commodities. Brent for September settlement also rose 0.6% to trade at $74.97 a barrel on the ICE Futures Europe exchange.
Oil falls in volatile trade as investors seek Opec clarity – Oil prices fell more than US$1 a barrel on Wednesday in another seesaw trading session, as investors feared what this week’s collapse in Opec+ talks meant for worldwide production. Crude markets have been volatile over the last two days following the breakdown of discussions between major oil producers Saudi Arabia and United Arab Emirates (UAE). Brent crude settled at US$73.43 a barrel, falling US$1.10 or 1.5 per cent. US West Texas Intermediate settled at US$72.20 a barrel, shedding US$1.17 or 1.6 per cent. Both benchmarks rallied more than US$1 a barrel earlier in the session, similar to Tuesday’s action. The Organization of the Petroleum Exporting Countries and its allies, including Russia, known as Opec+, have restrained supply for more than a year since demand crashed during the coronavirus pandemic. The group is maintaining nearly six million barrels per day of output cuts and was expected to add to supply, but three days of meetings failed to close divisions between the Saudis and the Emiratis. For now, the existing agreement that keeps supply restrained remains in force. But the breakdown also could lead producers, eager to capitalise on the rebound in demand, to start supplying more oil previously predicted. “Some people are fearing a production war, but I think most people think that’s unlikely,” said Phil Flynn, senior analyst at Price Futures Group in Chicago. “It is possible the UAE could leave Opec and just do it’s own thing, and if that happens, then it would be a question of competition for market share.” Russia is now leading efforts to close divisions between the Saudis and UAE to help strike a deal to raise oil output in coming months, three Opec+ sources said. Saudi Energy Minister Prince Abdulaziz bin Salman dampened concerns of a price war in an interview with CNBC on Tuesday. Prices could find some support from falling US crude oil inventories
The Real Reason OPEC Talks Broke Down – Major cracks appear to be forming in the OPEC+ alliance. After several years of unprecedented cooperation between OPEC members and non-OPEC producers, the growing regional economic and power conflict between Saudi Arabia and Abu Dhabi is threatening the arrangement.While much of the analysis of the recent OPEC+ disagreement has focused on why the UAE refused to commit to the new export plan, there are other factors that have been largely overlooked. A closer look at the ongoing investments by the UAE in its upstream and downstream industry is one such example. Abu Dhabi’s national oil company ADNOC has put in place a production capacity increase that calls for a total reassessment of the underlying OPEC production baselines, which were agreed in 2018. At present Abu Dhabi is allowed to produce around 3.2 million bpd, based on the 2018 baseline, but has a capacity now of more than 3.8-4 million bpd. Looking at ongoing new projects and planned investments, production of more than 4 million bpd is possible in the coming years.The aggressive investment strategy of ADNOC means that the UAE is plenty of incentives to increase production. An extended and controlled OPEC+ export quota system would not only impact the UAE’s revenue streams but could even turn some of its multi-billion dollar investments into stranded assets in the long term.Recently, Crown Prince Mohammed bin Zayed has been pushing an independent geopolitical and economic strategy for the UAE. After years of cooperating with Saudi Arabia on everything from OPEC policy to regional geopolitical crises, the two powers are now beginning to diverge. Former cooperation on issues such as the Yemen war and the Qatar blockade has weakened drastically.At the same time, Mohammed bin Salman has been aggressively pushing Saudi Arabia’s regional power. Saudi Arabia’s Vision 2030, the Kingdom’s economic diversification plan, has driven the crown prince to take aim on other GCC countries as he attempts to force international investors and companies to set up shop in Saudi Arabia rather than Dubai or Doha. This transformation in the relationship between Saudi Arabia and the UAE certainly played a part in the recent OPEC+ conflict.Riyadh is also targeting the logistics industry, an industry that the UAE has long dominated, establishing itself as a regional hub for logistics and connecting EU-Asian commodity and trade flows. In the last couple of months, Saudi Arabia has become increasingly aggressive in this space. While there has no been a direct conflict in this area, it is generally assumed that there is not enough space in the region for two supra-regional maritime logistic hubs. MBZ and Dubai are clearly unimpressed with Saudi Arabia’s attempts to muscle in on the industry.Another area of discord between the two nations is the UAE’s increased cooperation with Israel. UAE-Israel cooperation in logistics, technology, defense, and agriculture, is a possible threat to Saudi Arabia’s Vision 2030 projects. By bringing Israeli tech and know-how to Abu Dhabi and Dubai, the UAE projects will compete with the Saudi Giga-Projects, such as NEOM, for international investment. In response to these moves by the UEA, Riyadh has blocked technology and products exports by the UAE that are linked to Israel.
The OPEC+ spat is likely to be resolved ‘sooner rather than later,’ energy analyst says – OPEC and its allies left the oil market hanging on Monday when they indefinitely postponed talks to resolve a disagreement over production curbs. Crude prices first surged to six-year highs, then retreated, and uncertainty continues to hang over future OPEC+ policy. But at least one energy analyst expects a breakthrough to come soon. “I think it’s highly likely [that] it’s going to resolve itself,” said Stephen Schork, a principal advisor at energy analysis company The Schork Group. OPEC is the strongest it has been in years, and they would not want to “upset the applecart,” he told “Street Signs Asia” on Thursday. The energy alliance met last week to discuss output policy, but the UAE unexpectedly blocked proposals to increase supply and extend the remaining production cuts to the end of 2022, instead of April 2022 as previously agreed. Suhail Al Mazrouei, UAE’s energy minister, told CNBC on Sunday that it “wasn’t a good deal” because the output cuts were measured against a baseline of 2018 production levels. The country has increased its production capacity, but cannot pump more oil while the OPEC agreement remains in place. It wants this baseline to be revised. Russia is reportedly attempting to negotiate a resolution. Neil Beveridge, a senior oil analyst at Bernstein, said OPEC policy has been focused on controlling supply to manage prices. But the UAE sees that peak oil demand is “staring OPEC in the face” and is considering chasing market share instead of high energy prices, he told “Capital Connection” on Thursday, and that’s why it wants to be given a higher quota. Observers say two scenarios are possible if OPEC doesn’t reach a new deal. The first is that of a price collapse. Beveridge noted that OPEC is sitting on nearly 6 million barrels of spare capacity now. If countries decide to increase supply and go for market share, the downside could be “significant,” he said. “We can see oil prices certainly drop back below $50 again … pretty quickly, if that [happens],” he said.
WTI Rebounds Above $72 After Gasoline Demand Hits Record High – Oil prices are down for the 3rd straight day as ‘Delta’-variant (demand) fears combine with OPEC+ cartel collapse fears as the Saudis and UAE continue their game of chicken (and see prices fall in the face of their hopes). “Obviously, the standoff between the UAE and OPEC continues, and we don’t know whether that’s going to be bullish or bearish,” After API’s report, expectations remain for a seventh straight weekly draw in crude stocks, so all eyes will be on any cracks in the recovery narrative in the official inventory/production/demand data. API:
- Crude -7.983mm (-3.9mm exp)
- Cushing +152k
- Gasoline -2.736mm
- Distillates +1.086mm
- Crude -6.867mm (-3.9mm exp)
- Cushing -614k
- Gasoline -6.075mm
- Distillates +1.616mm
Official data confirmed API with a 7th straight week of crude inventory drawdowns, but gasoline stocks tumbled far more than expected… As of right now, the moving average for gasoline demand topped 10 million b/d – a new record high… US crude production has remained notably disciplined as prices and rig counts have risen, but this last week saw it begin to accelerate (up 200k b/d last week to 11.3mm b/d) -the highest since May 2020…
Oil rises after big draw in inventories – Oil prices rose on Thursday, rebounding from early losses after the US government data showed a much bigger drop than expected in crude and gasoline inventories. Still, Brent prices remained $5 a barrel below Monday’s close, as traders were worried global crude supplies might swell following the collapse of negotiations between the Organisation of the Petroleum Exporting Countries and allies including Russia, a group known as OPEC+. Brent crude oil futures rose 29 cents to $73.72 a barrel and US West Texas Intermediate futures rose 26 cents to $72.46 a barrel. Early in the session, both contracts fell to their lowest in about three weeks. US crude inventories fell by 6.9 million barrels last week to 445.5 million barrels, Energy Information Administration data showed. Analysts had expected a four million-barrel drop. Gasoline stocks fell by 6.1 million barrels in the week to 235.5 million barrels, the EIA said. Analysts had forecast a 2.2 million-barrel drop.
Oil Prices Snap Losing Streak | Rigzone — Oil rose after a U.S. government report showed rapidly declining inventories and record-high fuel demand in the midst of the peak summer driving season. Futures advanced 1% in New York on Thursday. Domestic crude and gasoline supplies tumbled last week and a gauge of fuel demand jumped to 10 million barrels a day during the week leading up to the July 4th holiday, according to the Energy Information Administration. “Clearly in the U.S., we’re seeing a strong recovery in demand,” said Quinn Kiley, a portfolio manager at Tortoise, a firm that markets roughly $8 billion in energy-related assets. “It’s a bullish setup.” Oil prices rose 11% last month before volatile trading this week in the wake of the OPEC+ impasse. Global supplies have tightened amid strong recoveries in economies such as the U.S. and China, leading to calls for the alliance to increase supply in the coming months. In the U.S., crude supplies fell by nearly 7 million barrels last week and gasoline inventories tumbled by the most since March, according to the EIA report. The country’s crude production has remained “lackluster” despite improved prices, which suggests the crude curve will stay in backwardation, said a new research report by Goldman Sachs Group Inc. “The market did what it should do,” said Andrew Lebow, senior partner at Commodity Research Group. “It rallied to bullish news.” At the same time, OPEC+ members are also stalled over the question of how to increase supply in August and subsequent months. United Arab Emirates has blocked the agreement in a bid to raise its production quota. The ongoing stalemate has limited crude’s rally for now, said Kiley. “That’s still the overarching concern in broader markets,” he said. West Texas Intermediate crude for August delivery rose 74 cents to settle at $72.94 a barrel in New York. Brent for September settlement added 69 cents to end the session at $74.12 a barrel. Meanwhile, the spread of the delta variant is also leading to concerns. The World Health Organization urged caution on the pace of reopenings worldwide, with many regions seeing infections spreading. Countries such as Japan, Indonesia and Thailand have renewed restrictions on mobility to curb the spread.
Oil prices rise over $1 as U.S. inventories decline -Oil prices rose for a second day on Friday as data showed a draw in U.S. inventories but were heading for a weekly loss amid uncertainty over global supplies after an OPEC+ impasse. Brent crude oil futures settled 1.93%, or $1.43, higher at $75.55 per barrel. U.S. West Texas Intermediate futures settled 2.22%, or $1.62, higher at $74.56 per barrel. Prices on both sides of the Atlantic were on track for around a 1% weekly drop, dragged down by the collapse of output talks between the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, together known as OPEC+. U.S. crude and gasoline stocks fell and gasoline demand reached its highest since 2019, the U.S. Energy Information Administration said on Thursday, signalling increasing strength in the economy. “A bullish EIA stock report helped the oil market rebound into the black,” said Stephen Brennock of oil broker PVM. “Clearly, U.S. oil markets are tight. However … the only way to prevent further losses is for the threat of an OPEC+ price war to be contained,” he added. Gains in oil prices were capped by worries that members of the OPEC+ group could be tempted to abandon output limits that they have followed during the COVID-19 pandemic, with talks breaking down because of an impasse between major producers Saudi Arabia and the United Arab Emirates. The two Gulf OPEC allies are at odds over a proposed deal that would have brought more oil to the market. Russia was trying to mediate in an effort to strike a deal to raise output, OPEC+ sources said on Wednesday. The United States had high level conversations with officials in Saudi Arabia and the UAE, the White House said on Tuesday. “Price wars are almost always quite short-lived – no one wins in the long term,” consultancy Rystad Energy said in a note. “It is in the interest of the (OPEC+) group to provide some leniency to the UAE and other supply hawks to produce a bit more within the framework of the deal.” The global spread of the Delta coronavirus variant and worries it could stall a worldwide economic recovery also weighed on oil prices.
Oil Prices Post Gains in Friday Trading | Rigzone — Oil fell this week for the first time since May after days of volatile trading in the wake of OPEC+’s stalemate over a production increase in the near term. Futures in New York declined 0.8% this week, although the U.S. crude benchmark closed higher on Friday amid a broader market rebound. Prices whipsawed this week amid ambiguity over the future of the OPEC+ alliance and swings in the U.S. dollar. A stronger dollar makes commodities priced in the currency less attractive to investors. “Nobody really knows how the supply growth is going to project from here,” said Peter McNally, global head of industrials, materials and energy at Third Bridge. “The world needs more oil and was expecting more oil, so while there’s this uncertainty around supply, demand keeps growing.” Oil accelerated to a six-year high earlier this week after OPEC+ failed to ratify a production increase, spurring concerns of a supply shortfall. Fuel consumption is rising in countries such as the U.S., India and China during the summer driving season. Americans have hit the road with gusto, leading to rapidly draining inventories and U.S. refineries running close to full-bore to keep up with demand. “We’re now in the middle of what appears to be an extremely robust summer and the U.S. seeing very large stock draws, fundamentally, that we anticipate will continue to support the market,” said Michael Tran, an analyst at RBC Capital Markets. At the same time, the OPEC+ alliance and U.S. shale producers have practiced discipline toward returning supply that was shelved during the pandemic. The global oil market will remain in “deep deficit” of more than 3 million barrels per day through the third quarter of the year, according to Citigroup analysts. OPEC+ countries will need to add more oil to the market at a higher level “sooner or later,” said the report. West Texas Intermediate crude for August delivery added $1.62 to settle at $74.56 a barrel in New York, the biggest gain in a week. Brent for September settlement rose $1.43 to end the session at $75.55 a barrel on the ICE Futures Europe exchange. Before talks broke down earlier this week, Saudi Arabia proposed that the coalition gradually revive 5.8 million barrels of daily capacity in monthly installments of 400,000 barrels through to the end of next year. But the United Arab Emirates blocked an agreement, saying it will only support an extension of the pact if there are revisions to its own quota, which the country contends is outdated. If no agreement is reached, the existing one states that output will remain steady next month. The unresolved deadlock also threatens to unravel the alliance altogether and spark a fresh price war.
Fiery explosion erupts on ship at major global port in Dubai (AP) – A fiery explosion erupted on a container ship anchored in Dubai at one of the world’s largest ports late Wednesday, authorities said, sending tremors across the commercial hub of the United Arab Emirates. There were no immediate reports of casualties, and it was unclear what triggered the blast. The blaze sent up giant orange flames from a vessel at the Jebel Ali Port, the busiest in the Middle East. Jebel Ali sits on the eastern side of the Arabian Peninsula and is also the busiest port of call for American warships outside the U.S. The combustion unleashed a shock wave through the city of Dubai, causing walls and windows to shake in neighborhoods as far as 25 kilometers (15 miles) away from the port. Residents filmed from their high-rises as a fiery ball illuminated the night sky. The blast was powerful enough to be seen from space by satellite. Some 2 1/2 hours after the blast, Dubai’s civil defense teams said they had brought the fire under control and started the “cooling process.” Authorities posted footage on social media of firefighters dousing giant shipping containers. The glow of the blaze remained visible in the background as civil defense crews worked to contain the fire. The extent of damage to the sprawling port and surrounding cargo was not immediately clear. Footage shared on social media of the aftermath showed charred containers, ashes and littered debris. The sheer force and visibility of the explosion suggested the presence of a combustible substance. Dubai authorities told the Saudi-owned Al-Arabiya TV that the crew had evacuated in time and that the fire appeared to have started in one of the containers holding flammable material, without elaborating. Seeking to downplay the explosion, Mona al-Marri, director general of the Dubai Media Office, told Al-Arabiya the incident “could happen anywhere in the world” and that authorities were investigating the cause. The Jebel Ali Port at the northern end of Dubai is the largest man-made deep-water harbor in the world and serves cargo from the Indian subcontinent, Africa and Asia. The port is not only a critical global cargo hub, but a lifeline for Dubai and surrounding emirates, serving as the point of entry for essential imports. Dubai authorities did not identify the stricken ship beyond saying it was a small vessel with a capacity of 130 containers. Ship tracker MarineTraffic showed a fleet of small support vessels surrounding a docked container ship called the Ocean Trader flagged in Comoros. Footage from the scene rebroadcast by the UAE’s state-run WAM news agency showed firefighters hosing down a vessel bearing paint and logo that corresponds to the Ocean Trader, operated by the Dubai-based Inzu Ship Charter. Operated by the Dubai-based DP World, Jebel Ali Port boasts a handling capacity of over 22 million containers and sprawling terminals that can berth some of the world’s largest ships. Port officials said they were “taking all necessary measures to ensure that the normal movement of vessels continues without any disruption.”
Why Does Israel Confuse Peace with Surrender? -Israel confuses peace with surrender. Its operational military doctrine, concerned with the army’s methods of combat, emphasises the imperative to bring hostilities as early as possible into enemy territory and, if necessary, to strike preemptively.Israel’s strategic doctrine, which comprises the broad policies used to secure national objectives, seeks to preserve the state, within increasingly expansive borders, which also means the continued colonisation of Palestinian land. Both are about staying on the offensive.Israel has used disproportionate force against civilians for decades. This is explained by the fact that it has been relatively successful in minimising the human and financial cost of war for itself. Yet history is full of tragedies caused by overestimating the power of offensive doctrines.In its recent military campaign in Gaza, Israel’s ground and air forces reportedly conducted a total 1,500 strikes in 11 days, injuring 1,900 Palestinians and killing at least 254.This must be understood in the context of Israel’s strategy, which from the outset has included deliberate attacks on civilians, their economies, institutions, and infrastructure.In May 2009, Amnesty International released its country report for Israel and the occupied territories, which found that during a previous campaign, that year’s Operation Cast Lead, “Israeli forces repeatedly breached the laws of war, including by carrying out direct attacks on civilians and civilian buildings and attacks targeting Palestinian militants that caused a disproportionate toll among civilians.”Statements by Israeli officials reveal that the disproportionate destruction and violence against civilians was a deliberate policy. In October 2008, Gabi Siboni, Director of the Military and Strategic Affairs Program at Tel Aviv University’s Institute for National Security Studies (INSS), published a policy paper entitled “Disproportionate Force: Israel’s Concept of Response in Light of the Second Lebanon War.” It stated: With an outbreak of hostilities, the IDF will need to act immediately, decisively, and with force that is disproportionate to the enemy’s actions and the threat it poses. Such a response aims at inflicting damage and meting out punishment to an extent that will demand long and expensive reconstruction processes. Israel again will not be able to limit its response to actions whose severity is seemingly proportionate to an isolated incident. Rather, it will have to respond disproportionately in order to make it abundantly clear that the State of Israel will accept no attempt to disrupt the calm currently prevailing along its borders. For Israeli leaders, the periodic use of force is essential to communicate Israel’s capacity and resolve. As part of the Israeli security paradigm, when the state feels that deterrence against a particular actor is evaporating, it launches “deterrence operations” where concern for collateral damage to civilians tends to disappear.
June Deadliest Month in Afghanistan in Two Decades – Afghan authorities claim that the Afghan National Security and Defense Forces (ANDSF) have killed over 6,000 Taliban fighters in approximately one month, and the Taliban has said that the group has also inflicted major casualties on government forces. During this period the government also evacuated 120 districts following offensives by the Taliban. In the latest development, the Taliban has captured the center of Tagab district in the northern province of Kapisa. Numbers gathered by TOLOnews show that 638 military personnel and civilians were also killed in Taliban attacks during this period and 1,060 others were wounded. “The main reason for the collapse of the districts is poor leadership at the leadership level of the security and defense forces,” said MP Khan Agha Rezayee. Based on the figures, although the number of targeted attacks and explosions decreased during this period, the level of casualties among the security personnel and civilians continued to rise. The majority of casualties were reported in Baghlan, Faryab, Badakhshan, Ghazni, Takhar, Balkh, Ghor, Herat, Farah, Kunduz, Badghis and Sar-e-Pul provinces. “The lines (personnel) of the war changed, people were serving in the provinces as security commanders who weren’t familiar with the war because the government had sent the war commanders home,” said MP Ibdallullah Mohammadi. “There was no preparation to confront such a big war, we weren’t prepared for guerrilla warfare,” said MP Arif Rahmani. Meanwhile, Afghanistan’s Ministry of Defense (MoD) said that the Afghan security forces have increased airstrikes on Taliban positions in Nangarhar, Herat, Balkh, Jawzjan, Helmand, Takhar, Badakhshan, Kunduz, Baghlan and Kapisa provinces in a move to recapture the districts lost to the Taliban. “258 Taliban fighters were killed and 100 more were wounded in the operations conducted by the security and defense forces in the past 24 hours,” said Fawad Aman, deputy spokesman for the Ministry of Defense.
Taliban overtake districts in northern Afghanistan – Several of Afghanistan’s northern districts were taken by the Taliban overnight Saturday as U.S. forces continued withdraw from the region. Tajikistan’s State Committee for National Security said Sunday that more than 300 Afghan military personnel had crossed into Tajikistan while fleeing Taliban fighters advancing in Afghanistan’s northeast Badakhshan province, according to The Associated Press. Mohib-ul Rahman, a Badakhshan council member, told the AP that the Taliban’s recent gains in the area have largely resulted from low morale among outnumbered Afghan troops. “Unfortunately, the majority of the districts were left to the Taliban without any fight,” he added, saying that eight out of 10 districts in the last three days fell to Taliban control without much resistance. According to the AP, the Taliban have now taken control of about a third of the 421 total districts and district centers in the country. Afghanistan’s Interior Ministry said Sunday that the Taliban gains were temporary, though the AP noted that no plans were released on how local forces were going to make an attempt to take back the districts. Taliban spokesman Zabihullah Mujahid confirmed to the AP that no fighting occurred in the recent territorial gains. The advances are just the latest made by Taliban fighters, who have been taking control of districts since the Biden administration began removing troops in April as part of the president’s goal to remove all U.S. forces from Afghanistan by Sept. 11, the 20th anniversary of the terrorist attacks that sparked America’s longest war. While many praised President Biden’s decision to take U.S. soldiers out of the country, he also received bipartisan criticism from lawmakers who expressed fears that the Taliban would quickly seize on the diminished American presence in the region. The Pentagon declined to comment when contacted by The Hill on this weekend’s territorial gains. U.S. officials on Friday announced that American troops had vacated the Bagram Airfield in Afghanistan, formerly the U.S. and NATO’s biggest military facility.
Tajikistan mobilizes 20,000 reservists to bolster border with Afghanistan – Tajikistan President Emomali Rahmon has mobilized 20,000 military reservists to help bolster the border with Afghanistan, Reuters reported on Monday. This comes as more than 1,000 members of the Afghan security force members have fled to the country due to advances by the Taliban. The organization has taken over six districts in the northern province of Badakhshan, which borders Tajikistan and China, which led to 1,037 Afghan service members moving across the border in Tajikistan, its border guard service told Reuters. Rahmon has called multiple world leaders including Russian President Vladamir Putin and Afghan President Ashraf Ghani to discuss the situation, according to Reuters. According to a statement by Russia, Putin told Rahmon he will support Tajikistan if needed to stabilize its border. “Special attention was paid to the escalation of the situation in Afghanistan’s northern areas adjacent to Tajikistan,” Rahmon’s office said in a statement, according to the news agency. Rahmon also called Uzbekistan President Shavkat Mirziyoyev and Kazakhstan President Kassym-Jomart Tokayev for assistance and held a council meeting, his office told Reuters. A senior Afghan official told the news agency that hundreds of troops have been crossing the border, saying that the Taliban has cut off most of the border. The news comes as U.S. troops vacated the Bagram Airfield last week, as part of the country’s withdrawal from the country after 20 years. The Taliban said on Monday that they are accelerating peace talks with the Afghan government since the U.S. withdrawal.
Bagram Airfield looted as US forces leave Afghan base —American forces left Afghanistan’s Bagram Airfield over the weekend without notifying the new commander from the Kabul government – giving looters precious time to swipe anything that was not bolted down, shocking photos show. The US announced Friday that it had vacated Bagram as part of a final withdrawal the Pentagon says will be completed by the end of August. It is Afghanistan’s largest airfield and was the hub of America’s 20-year campaign to remove the Taliban from government, track down Osama bin Laden and his al Qaeda cohorts, and keep the country’s fragile elected government in place amid a Taliban resurgence. However, they apparently forgot to tell the Afghans, cutting the electricity within 20 minutes of their departure and plunging the base into darkness. That acted as a “go” signal for teams of looters who smashed through the north gate and ransacked barracks and storage tents before security forces who had been patrolling the perimeter managed to evict them. “We (heard) some rumor that the Americans had left Bagram … and finally by 7 o’clock in the morning, we understood that it was confirmed that they had already left Bagram,” said new base commander Gen. Mir Asadullah Kohistani. “In one night, they [the Americans] lost all the good will of 20 years by leaving the way they did, in the night, without telling the Afghan soldiers who were outside patrolling the area,” one Afghan soldier, who identified himself only as Naematullah, told the Associated Press.”At first we thought maybe they were Taliban,” another soldier, a 10-year veteran named Abdul Raouf, said of the looters. Raouf went on to claim American forces called from the international airport in Kabul – an hour’s drive south of Bagram – to inform their Afghan counterparts that they had left the base.
Taliban celebrate seizure of US weapons from Afghan troops -Taliban fighters can be seen in recently released videos celebrating the seizure of US Humvees, tanks and assault weapons from Afghan security forces as the Biden administration begins its troop withdrawal before the Sept. 11 deadline.The Taliban have been capturing key districts in the northern part of the war-torn country – including Kandahar and Badakhshan – with little or no resistance from Afghan national forces since the US announced the timetable for the departure in April.They are extending their control of Afghanistan from their southern strongholds by filling the void left by the departing US forces. More than a thousand Afghan soldiers fled across the border to Tajikistan after clashing with the Taliban in Badakhshan and surrendered their weapons. The Taliban are touting the capture of the US weapons as a propaganda ploy in videos released on social media, heralding their return to power after being defeated by American troops in 2001 for harboring al Qaeda and its leader Osama bin Laden and allowing the terror group to plan its 9/11 attack. The speed of the US pullout is marked by the hasty abandonment of Bagram Airfield – the hub of US military operations during the 20-year war – over the weekend without giving the Afghan government a heads up, a sudden departure that allowed looters to overrun the facility and help themselves to the numerous items left behind by the Americans. A Taliban commander told Sky News that his fighters had taken a cache of weapons from Afghan security personnel that included 70 sniper rifles, 900 guns, 30 Humvees, 20 pickup trucks and 15 armored vehicles.The report also said the Taliban had a shipping container full of satellite phones, grenades and mortars, with many having labels saying: “Property of the USA Government.” Army Gen. Austin Scott Miller, who is overseeing the withdrawal of troops from Afghanistan, said the Taliban’s advances should be a cause for worry. “We should be concerned. The loss of terrain and the rapidity of that loss of terrain has – has to be concerning, one, because it’s a – war is physical, but it’s also got a psychological or moral component to it. And hope actually matters. And morale actually matters,” he said in an interview with ABC News’ “This Week” that aired Sunday.”And so, as you watch the Taliban moving across the country, what you don’t want to have happen is that the people lose hope and they believe they now have a foregone conclusion presented to them,” he said.Miller said he fears that Afghanistan will fall into civil war once US troops are gone, noting that the Taliban are rapidly taking ground in the north.”You look at the security situation, it’s not good. The Afghans recognize it’s not good. The Taliban are on the move. We’re starting to create conditions here that won’t look good for Afghanistan in the future if there’s a push for a military takeover,” he said.
Taliban spokesman says peace talks will be ‘accelerated in the coming days’ – The Taliban on Monday said it is accelerating peace talks with the Afghan government, with written peace plans possibly coming as soon as next month.”The peace talks and process will be accelerated in the coming days … and they are expected to enter an important stage, naturally it will be about peace plans,” Zabihullah Mujahid, Taliban spokesperson, told Reuters.”Possibly it will take a month to reach that stage when both sides will share their written peace plan,” Mujahid added. “Although we [Taliban] have the upper hand on the battlefield, we are very serious about talks and dialogue.”Najia Anwari, a spokesperson for Afghanistan’s Ministry for Peace Affairs, said it was “difficult to anticipate that the Taliban will provide us with their written document of a peace plan in a month, but let’s be positive.” “We hope they present [it] so as to understand what they want,” Anwari said. The latest signals from the Taliban come as it continues to seize control of territories in light of U.S. and NATO forces withdrawing from Afghanistan. More than a thousand members of Afghanistan’s security forces have fled across the border to neighboring Tajikistan. In June, the Taliban said it was committed to peace talks, with its co-founder Mullah Abdul Ghani Baradar saying the organization was still pursuing a “genuine Islamic system.” “A genuine Islamic system is the best means for solution of all issues of the Afghans,” Baradar said. “Our very participation in the negotiations and its support on our part indicates openly that we believe in resolving issues through [mutual] understanding.”
China ramping up Afghanistan involvement amid US withdrawal -China appears to be preparing to ramp up its involvement in Afghanistan as US troops complete their final withdrawal – with Beijing eyeing the war-torn nation for investment and influence opportunities.Beijing has been vocal, especially in recent weeks, in slamming the United States for pushing forward with its troop withdrawal, citing the deteriorating situation on the ground. Still, it had not made any public commitments regarding a response.Kabul authorities, the Daily Beast reported Sunday, have become much more deeply engaged with Chinese leaders as the two work toward a deal to invest in Afghanistan’s infrastructure through China’s international “Belt and Road Initiative.”The trillion-dollar program has funded multiple projects – generally focusing on hard infrastructure like airports, roads and seaports – throughout Asia, Africa, and the Middle East.It has been used by the Chinese Communist Party to grow its influence by providing infrastructure loans to poorer countries in return for control over local resources.Citing a source close of the Afghan government, the outlet reported that the deal would extend the $62 billion China-Pakistan Economic Corridor, a flagship project of the Beijing-led initiative. “There is a discussion on a Peshawar-Kabul motorway between the authorities in Kabul and Beijing,” the source said, “Linking Kabul with Peshawar by road means Afghanistan’s formal joining of CPEC.”The US troop withdrawal from Afghanistan remains in motion, a process on which President Biden placed a Sept. 11 deadline.Biden announced that deadline in April, offering US troops an additional four months from former President Donald Trump’s order to withdraw all troops from the nation by May 1.