Thin liquidity is the mother of all current evils in the oil market, OilPrice said.
On paper, this week has provided ample reasons for an uptick – the easing of Chinese coronavirus restrictions, a US oil spill halting pipeline deliveries from Canada, and a massive queue of tankers that cannot pass the Turkish Straits. However, it seems nothing can bring oil prices back onto a growth trajectory this month. After all, whoever has made their profits over the course of 2022, risking them in such an unpredictable market would be quite unnecessary, which means $75-78 per barrel Brent might be here for longer than expected.
Saudi Arabia and China become strategic partners. Chinese President Xi Jinping visited Saudi Arabia this week, heralding a new era in Sino-Arabic relations as the two sides signed deals worth $30 billion, covering green energy, cloud services, transport, and construction as well as a 5G coverage deal for Huawei Technologies.
ExxonMobil and Chevron hike capital spending. The two largest US oil firms ExxonMobil and Chevron have both raised their 2023 project investment budget – Exxon’s is up to $23-25 billion ($22 billion this year) whilst Chevron increased it to $17 billion (from $15 billion this year). French energy company TotalEnergieshas decided to write down its 19.4% stake in Russian LNG producer Novatek worth $3.7 billion and withdraw its representatives from the company’s board, marking the end of its gradual Russia exit.