Trump Is Sending Mixed Signals to Oil Markets
Trump has been the single biggest oil market mover in March. On the one hand, the US President tightened Venezuela sanctions and debilitated some 20 million barrels of Iranian oil, depriving China of discounted crude and adding fuel to the oil bulls’ fire. On the other hand, the long-term impacts of tariff wars could be quite damaging for oil consumption, as the $100 billion car import tariffs could trigger retaliatory measures from Europe or Japan. Overall, crude oil is set for a third weekly gain, with ICE Brent hovering around the $73.50 per barrel mark.
. US President Donald Trump announced that he would impose a 25% tariff on automobile imports, seeking to raise $100 billion in revenue annually, however also raising concerns that such high-impact protectionist measures would stall global economic growth.
. At least 11 VLCC tankers carrying Iranian crude have been stranded in territorial waters of Malaysia, seeing floating storage in the area rising to 18 million barrels, indicating Chinese refiners continue to stave off purchases as they weigh the impacts of US sanctions.
The American Petroleum Institute and other energy organizations have tried to dissuade the Trump Administration from slapping $1.5 million levies on Chinese-built tankers calling into US ports, saying such a move would hike freight costs for US exports.
. Following months of negotiations, UK oil major BP (NYSE:BP) has received final government approval from Baghdad to begin the redevelopment of the Kirkuk fields, aiming to produce 3 billion boe through a JV that would also involve Iraq’s North Oil Company.
. China’s largest private refiner, Rongsheng Petrochemical (SHE:002493), opened an office in Calgary to facilitate its purchases of heavy barrels from Alberta pumped through the TMX pipeline, immediately buying a June-arrival cargo from Suncor Energy.
Saudi Aramco (TADAWUL:2222), the national oil company of Saudi Arabia, is in negotiations with two Indian refiners, state-controlled ONGC and Bharat Petroleum, although the deals could fall through as the Saudis insist on supplying 90% of the refineries.
. Nigeria’s state-controlled oil company NNPC is reportedly in the final stages of preparations for a much-anticipated IPO that could value the NOC at more than $300 billion, having turned into a fully commercial entity in 2021 with its government credit lines cut.
. Global commodities trader Vitol is reportedly contemplating a sale of its VTX Energy Partners subsidiary in a deal potentially worth more than $3 billion, offering some 46,000 boe/d of production across the Delaware basin located across 46,000 net acres.
The tightening of US sanctions, with Donald Trump levying a 25% tariff on anyone buying Venezuelan oil, has prompted Indian refiners, most notably privately held Reliance Industries, to halt any imports from the Latin American country beyond April.
. Gold prices rallied to another all-time this week, reaching $3,077 per ounce on Friday as the Trump administration’s automobile tariffs further sapped investors’ confidence, with US investment bank Goldman Sachs predicting a $3,300/oz price by the end of this year.
. China’s Ministry of Commerce issued the 2nd batch of product export quotas for 2025, adding 104 million barrels to this year’s total of 260 million barrels, down 4% from a year ago as higher government levies restricted export economics for refiners.
India’s government is considering lifting all import taxes on LNG imports to help lower Delhi’s $45 billion trade surplus with the United States, as Prime Minister Modi pledged to ramp up US energy purchases from $10 billion to $25 billion.
Top US electric vehicle producer Tesla (NASDAQ:TSLA) will start sales of its cars in Saudi Arabia in April, 7 years after a funding dispute between Elon Musk and the Saudi sovereign wealth fund, seeking to disrupt the Middle Eastern expansion of China’s BYD and Lucid.
. Brazil’s national oil company Petrobras (NYSE:PBR) has finished upgrading works at its Rnest refinery in Pernambuco state, boosting the plant’s capacity to 260,000 b/d and hiking the country’s diesel output by a further 82,000 b/d, needing fewer imports.
