Reports

The November Brent Futures contract has seen stronger price action this morning, reaching a peak around $71.86/bbl at 08:30 BST before retracing slightly and again rallying up to trade at $71.83/bbl at the time of writing (11:20 BST), as major producers extend production cuts and evacuations in the Gulf of Mexico. In recent developments, the US Bureau of Safety and Environmental Enforcement (BSEE) reported that 46% of the Gulf of Mexico’s 371 manned platforms and 60% of personnel from five rigs have been evacuated, with four rigs moved off location due to Hurricane Francine. The loss of production amounts to approximately 675kb/d, and contributed to prices rising this morning, especially with Libyan production remaining largely offline but nonetheless despite bearish EIA data emerging yesterday. In other news, Saudi Aramco has signed additional agreements with China’s Rongsheng Petrochemical and Hengli Group, advancing talks on refining and petrochemical sector cooperation. Aramco signed a Development Framework Agreement with Rongsheng, exploring the joint development of Saudi Aramco Jubail Refinery Company (SASREF) and potential cross-investments. Rongsheng may acquire a 50% stake in SASREF, while Aramco could acquire 50% in Rongsheng’s Ningbo Zhongjin Petrochemical Co. Ltd. At the time of writing, the Nov/Dec and Nov/May’25 Brent spreads are at $0.55/bbl and $1.41/bbl, respectively.

The November Brent Futures contract has seen a stronger morning, steadily climbing to $70.84/bbl at the time of writing (11:20 BST) following the sharp sell-off yesterday, amid expectations that Hurricane Francine may disrupt oil and gas production in the Gulf of Mexico. We noted that Brent fell yesterday amid no visible changes in fundamentals as risk aversion gripped markets; this was evidenced in gold moving higher and bond yields declining markedly. In headlines, Exxon is planning to cut production at its 523 kb/d Baton Rouge refinery to 20% ahead of Francine’s expected landfall, as reported by Reuters.

The November Brent futures contract has seen a weak morning, falling from $71.70/bbl at 07:00 BST to $70.78/bbl levels at 11:20 BST (time of writing). In headlines, Exxon Mobil has withdrawn from bidding on Galp Energia’s 40% stake in Namibia’s offshore Mopane oil discovery, estimated to contain at least 10 billion barrels of oil and gas worth over $10 billion. According to Reuters, over 12 oil companies, including Shell and Petrobras, had shown interest in the stake, though reasons for Exxon’s exit are unclear. Separately, oil and gas production in the Gulf of Mexico could face disruption unless the US National Marine Fisheries Service updates its endangered species protection regulation by December 20, following a court ruling. Without an update, the regulatory process to ensure oil and gas operations are carried out following the Endangered Species Act would become more cumbersome and complicated, potentially affecting production, as highlighted by the API. The Gulf currently produces 15% of the nation’s oil and employs over 400,000 people. At the time of writing, the Nov/Dec and Nov/May’24 Brent spreads are at $0.43/bbl and $1.16/bbl, respectively.