Oil Updates — Crude eases; Britain awards 20 offshore carbon storage licenses
RIYADH: Oil prices fell on Thursday as traders watched for signs of progress on talks to raise the US debt ceiling, after surging nearly 3 percent in the previous session on optimism over fuel demand from the North American country.
Brent crude futures dipped 27 cents, or 0.35 percent, to $76.69 a barrel as of 11:40 a.m. Saudi time.
US West Texas Intermediate crude dropped 28 cents to $72.55 a barrel.
A sharp plunge in US gasoline inventories due to demand surging to the highest levels since 2021, and optimism surrounding negotiations over the US debt ceiling, helped the main crude benchmarks settle more than $2 higher on Wednesday.
President Joe Biden and top US congressional Republican Kevin McCarthy on Wednesday underscored their determination to reach a deal soon to raise the federal government’s $31.4 trillion debt ceiling and avoid an economically catastrophic default.
Sinopec agrees on terms for potential Kazakhstan polyethylene investment
China’s Sinopec and Kazakh state-owned oil and gas company KazMunayGaz have agreed on key terms for a potential investment in a polyethylene plant in Kazakhstan’s western Atyrau region, according to a statement on Thursday.
The agreement was signed on the sidelines of the ongoing China-Central Asia Summit in Xian, where Chinese President Xi Jinping met with Kazakh President Kassym-Jomart Tokayev. A final decision on the proposed investment will be made in 2024, the Sinopec statement said.
Britain awards 20 offshore carbon storage licenses to 12 firms
Twelve companies were awarded a total of 20 licenses to develop carbon dioxide storages offshore in Britain’s first licensing round for such projects, the North Sea Transition Authority said on Thursday.
Britain aims to use carbon capture and storage technology, which involves filtering planet-warming carbon from industrial smokestacks before it hits the atmosphere and storing it underground, to hold 20 million to 30 million tons of CO2 by 2030.
Injection into the first storage sites, consisting of a mix of depleted oil and gas fields and porous rock formations, could start within six years, the NSTA said, but first operators still need to obtain a number of leases and approvals.
The new licenses come on top of a handful of other planned carbon capture and storage projects that were part of a government pilot scheme and for which negotiations on commercial details are ongoing.
Nineteen companies had applied for licenses.
Some of the 13 areas that were initially offered have been split to reach 20, an NSTA spokesperson said.
The names of successful bidders cannot be announced until they officially accept the award, the spokesperson added. Eni, Equinor and Neptune Energy have said they applied for the license.
Brazil environment agency rejects Petrobras’ request to drill at Amazon
The Brazilian environmental protection agency Ibama said on Wednesday it had rejected a request from state-run oil company Petrobras to drill a well at the mouth of the Amazon river.
The much-awaited decision follows a technical recommendation by the agency’s experts to reject the proposal.
Petrobras has for years been trying to open up a new exploration front on the coast of Amapa state in northern Brazil near Guyana, where ExxonMobil has made important discoveries.
A technical report from Ibama had previously advised against the request, citing discrepancies in environmental studies, inadequate measures for communicating with indigenous communities, and insufficiencies in Petrobras’ plan to safeguard the region’s wildlife.
Petrobras had several opportunities to solve controversial points of its project, but it was still presenting “worrying inconsistencies” for the operation in a new exploratory frontier of “high socio-environmental vulnerability,” Ibama said in a statement.
(With input from Reuters)