Act Of God. The Energy Report 07/15/2024

US and global political turmoil averted by what can only be described as an act of God. The assassination attempt on President Donald Trump came at a critical time in world history as people of reason question the institutions of the United States after criminal attempts to take down President Trump.

They used fake FISA warrants against US citizens, fake Russian collusion investigations that was started by the Hillary Clinton campaign and admission by both the CIA and FBI that they had abused their powers. The weaponization of the Justice Department to go after Donald Trump while downplaying proven crimes by his political opponents has created disorder in the government and distrust among its people.

This has been aided and abetted by major parts of the mainstream press that has conspired with the government to push knowingly false narratives against President Trump and has openly allowed him to be unfairly demonized to the public. Biden, who once said that when you are President ‘words matter’, said that it was time to “put Trump in a bullseye” and sadly someone took that literally. That, along with many in his party, called Trump a threat to democracy.

Now an unrepentant press continues to attack President Trump. They refuse to acknowledge widespread voter fraud and withheld evidence from the January 6thdebacle that would have kept innocent Americans out of jail. The press continues to spew their venom. They failed to confirm the validity of the Hunter Biden laptop that contained evidence of real crimes.

While an act of God saved Donald Trump, sadly one supporter who was probably derided by some as ‘extreme MAGA’ was killed. We need to pray for a hero retired firefighter Corey Comparator who was killed during the attempted assassination as he tried to shield his family from the assassins’ bullets. We also need to pray for America and pray for our leadership in their quest for power is enough. Pray for America.

Oil prices and commodity prices have enough information so on the Sunday opening, no risk premium was put in. Oil dipped Friday on China’s oil demand concerns but as far as oil demand, India is trying to pick up where China left off.

Oil dipped Friday on a report that China’s oil products imports slumped 33.2% from May to a 20-month low of 2.97 million mt in June, data from the General Administration of Customs showed July 12, as independent refineries cut feedstock fuel oil purchases. Independent refineries’ fuel oil imports fell 15.2% on the month to 939,000 mt in June, S&P Global Commodity Insights data showed.

The average utilization rate of independent refineries in Shandong was 52% in June, the lowest since the pandemic first struck the country in 2020, according to local information provider JLC. The utilization rate was previously lower at 43.8% in February 2020.

This comes as the Wall Street Journal reports that, “China’s economy slowed sharply in the second quarter, piling pressure on the country’s leaders to act more aggressively to rev up growth as they gather in Beijing to chart the course of the economy over the next half-decade.

Gross domestic product expanded 4.7% in the second quarter compared with the same quarter a year earlier, China’s National Bureau of Statistics said Monday. The result was weaker than the 5.3% growth rate recorded in the first quarter and lower than the 5.0% figure expected by economists polled by The Wall Street Journal.

On a quarter-to-quarter basis, growth more than halved, sliding to just 0.7% versus a revised 1.5% previously. The world’s second-largest economy is losing momentum thanks to a festering property slump, tepid consumer spending and rising trade tensions with the rest of the world. Yet in India oil demand contuse to grow. Jodi reported that India crude imports rose by 510 kb/d and was up 8.1% y/y

In the BP Outlook they say that Idia’s oil consumption is projected to rise to 7 million barrels per day (mbd) by 2030 from 5 mbd in 2022 in the ‘current trajectory’ scenario of the latest BP’s Energy Outlook.

China’s oil consumption is projected to rise to 17 mbd from 14 mbd in the same period while the oil demand in the US is expected to decline to 18 mbd from 19 mbd. India will remain the world’s third-largest oil consumer in 2030, behind the US and China, as it is today.

Iraq admitted it was cheating on its OPEC production cuts but they promised to do. S&P global reported that Iraq acknowledged it produced 184,000 b/d over its OPEC+ quota in June, based on secondary sources estimates, and pledged to compensate for its excess output by a September 2025 deadline under the latest OPEC+ agreement by making additional cuts of equivalent volume.

Now OPEC’s second largest oil producer has habitually pumped cruder than allowed for under its OPEC+ quota, drawing the ire of other members, but said in a statement that it will adhere to the 4 million b/d limit for the coming months. Iraq has not yet publicly revealed its compensation plan.

“Iraq affirms its complete commitment to the agreement and to the voluntary adjustments, and will compensate for any overproduction since the beginning of 2024,” the statement from Iraq’s oil ministry said.

Iraq in June cut output by 60,000 b/d to 4.22 million b/d, according to the latest Platts OPEC+ survey from S&P Global Commodity Insights, one of seven secondary sources used by the producer alliance to monitor member production.

The OPEC+ joint ministerial monitoring committee, co-chaired by Saudi Arabia and Russia, is scheduled to meet online Aug. 1. Among its duties, it assesses member compliance with quotas and can also recommend changes to OPEC+ production policy. The full 22-country OPEC+ alliance is scheduled to meet Dec. 1.

The oil spreads continued to look pretty strong and while oil seems to be based on WTI to build the base, the focus is going to be on demand for products.

Gasoline demand week to week has been erratic but it’s been slowly creeping above the four-week moving average for this time of year as gasoline prices have remained somewhat stable this summer it should improve the demand prospects as we head towards the end of summer can’t up demand for gasoline seems to be something that the market is starting to talk about.

Global markets are increasingly pricing in a supply deficit and that should keep products supported this week we are looking for draws of 3,000,000 barrels in crude oil 3,000,000 barrels in distillate inventories, and three-million-barrel drop in gasoline. Refiners have been running at a high pace and we expect them to continue with refinery runs unchanged from the week before.

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