Oil bulls remain confident despite COVID concerns.

Oil prices climbed as U.S. inventories tightened and the risk of Iran reaching a new deal and bringing extra crude online decreased. Crude prices drew hefty support from U.S. inventory dynamics, with commercial stocks falling to their lowest since January 2020 and indications that the tightening is set to continue, OilPrice said. 

Concurrently, the markets have seemingly got accustomed to the idea that there will not be any Iranian cliff-hanger as President-elect Raisi is to be sworn into office next week, mitigating erstwhile concerns that Tehran might flood the market with incremental barrels. COVID headwinds persist, however, as several European countries see rising Delta variant cases.

ADNOC to ease October 2021 production cuts. The UAE state oil company ADNOC informed its term buyers that it would ease its export nomination cuts for October 2021, bringing back 10 percentage points worth of output compared to September, a clear indication that the Emirates remains earnest in its production ramp-up drive. 

European majors leave Venezuela.France’sTotalEnergies and Norway’sEquinorhave quit their Petrocedeño joint venture, transferring their stakes to a subsidiary of PDVSA. The JV manages the Juni oil field in the Orinoco Belt and a 180 kbpd heavy crude upgrader – this was used by both companies, arguing that developing the heavy barrels is incompatible with their low-carbon strategies. 

Offshore Suriname production gets real. Two appraisal drilling programs carried out by operator TotalEnergies in Suriname’s Block 58 confirmed net black oil pays in both the Sapakara and Kwaskwasi prospects, marking another important step towards oil commercialization. This year will still see another appraisal well at the Bonboni field and a flow test of Sapakara.

Whilst gasoline cracks remain the best-performing segment of most European refiners’ slate, the derivatives market indicates that the global gasoline balance is tightening as the Eurobob oxy M1-M2 swap surged past the $20 per metric ton, the widest in almost two weeks, OilPrice said.