Oil prices fell on Thursday as COVID-19 cases continued to spike in the U.S., which the IEA highlighted as a major threat to oil markets in today’s report, but prices were quick to return to the $40 mark on Friday.
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Friday, July 10th, 2020
Oil posted a price correction on Thursday on fears of the rising coronavirus numbers in the U.S., something that the IEA warned about in its latest Oil Market Report out today. In early trading, prices firmed up, with WTI holding onto $40 per barrel.
IEA raises demand forecast; warns about risk. The IEA hiked its demand forecast for 2020 but also warned that the spreading coronavirus in the U.S. poses downside risks. The agency said demand could be 400,000 bpd higher than previously thought this year due to a rapid bounce back in many economies around the world, particularly in China and India. Also, oil supply fell by 2 mb/d in June, further tightening the market.
COVID hits Texas refineries. Marathon Petroleum’s (NYSE: MPC) Galveston Bay refinery in Texas City, the second-largest refinery in the country, has over 100 confirmed cases of Covid-19, according to Bloomberg. At least four other refineries have also reported positive cases. Related: Iraq Considers A String Of Massive Oil Deals With China
U.S. offshore wind to take off. Investment in U.S. offshore wind could soon match total investment levels in offshore oil and gas. A new study from Wood Mackenzie projects offshore wind investment could reach $78 billion this decade, compared to $82 billion for offshore oil and gas. In the decade ending in 2010, wind saw virtually nothing while offshore oil and gas received $154 billion.
Libya lifts force majeure. Libya’s National Oil Corp. lifted force majeure on its oil exports, raising the prospect of additional supply coming back to the market.
Oklahoma Supreme Court ruling raises questions for oil. The U.S. Supreme Court ruled that a large swathe of Oklahoma remains in control of Native American tribes. The decision raises questions about whether oil and gas sites will no longer fall under the control of Oklahoma regulators, instead potentially reverting to federal control with tribes as beneficiaries.
Permian gas pipeline inches forward. Global Infrastructure Partners announced a $345 million initial investment in the Whistler pipeline, which would carry natural gas from Waha in West Texas to the Gulf Coast. The pipeline is slated to come online in late 2021.
Iran’s oil storage is almost full. Iran has cut oil production to its lowest level in four decades as storage tanks fill up, according to Reuters.
Shell to become a “power company.” Royal Dutch Shell (NYSE: RDS.A) chairman Chad Holliday said that the company would transition to become “more of a power company than an oil…