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☆ Goldman Sachs expects commodities supercycle
▼ + stars: | 2023-03-21 | by ( Julia Payne | ) www.reuters.com time to read: +1 min

LAUSANNE, Switzerland, March 21 (Reuters) - Goldman Sachs expects a commodities supercycle driven by China and the capital flight from energy markets and investment this month after concerns triggered by the banking sector, the U.S. bank's head of commodities said. "As losses mounted, it spilled into commodities," Jeff Currie, global head of commodities for Goldman Sachs, told the Financial Times Commodities Global Summit on Tuesday. Currie emphasised the hit was to the supply side rather than demand and he remains very bullish on copper. We have peak supply occuring in 2024...Near term we put (the copper price) at $10,500 and longer term our price target is $15,000 a tonne." Copper hit a record high $10,845 in March 2022.

☆ Citadel sees limited impact on energy demand from banking crisis
▼ + stars: | 2023-03-20 | by ( Julia Payne | ) www.reuters.com time to read: +2 min

LAUSANNE, Switzerland, March 20 (Reuters) - U.S. hedge fund Citadel expects a tighter credit environment following the latest banking crisis but so far the economic decline is not enough to plunge commodities into the abyss, its head of commodities told Reuters. The hedge fund giant, which was based in Chicago but recently moved to Miami, manages roughly $60 billion in assets. We need to have a 5-6% global GDP cut to have a major impact on commodities," he said. Citadel, run by billionaire Ken Griffin, ended 2022 with a $16 billion gain last year, the biggest profit ever earned by a hedge fund. "The macro backdrop remains an unanswered question as OPEC assesses impact on demand.

☆ G7 to hold off revising Russian oil price cap this week - EU officials
▼ + stars: | 2023-03-20 | by ( ) www.reuters.com time to read: +1 min

BRUSSELS, March 20 (Reuters) - Group of Seven Nations are not likely to revise a price cap on Russian oil this week, two European Union officials told Reuters on Monday. The G7 measure bans companies from providing transportation, insurance and financing services for Russian crude oil and oil products if they are sold at a price above the cap. In addition, the 27-country European Union halted its own imports of Russian crude oil delivered by sea from Dec. 5. The United States and Britain have also imposed restrictions on Russian oil imports. Some EU countries including Poland have sought to lower the G7 price cap level to further restrict the revenue Moscow can use to fund the war in Ukraine.

☆ Exclusive: State-backed Chinese fund buys stake in energy trader Mercuria
▼ + stars: | 2023-02-22 | by ( Julia Payne | ) www.reuters.com time to read: +3 min

LONDON, Feb 22 (Reuters) - A subsidiary of China's CNIC Corp has bought a minority stake in Swiss-based global energy trader Mercuria, sources familiar with the matter said. China's top oil producer CNOOC was in 2022 preparing to sell its stakes in assets in Britain, Canada and the United States. The CNIC subsidiary bought the stake of just under 5% in Mercuria last year, the sources said. The unit that bought into Mercuria is focused on China's energy transition and provides a foothold for Mercuria in the country as the Geneva-based trader seeks to expand its presence in clean energy sources. Founded in 2004, Mercuria is among the top five global oil traders, moving around two million barrels per day of crude oil and refined products.

[1/2] The main deck of the Floating Storage and Regasification Unit (FSRU) "Neptune" is seen during the official commissioning of the liquefied natural gas (LNG) terminal "Deutsche Ostsee" at the harbour in Lubmin, Germany, January 14, 2023. John Macdougall/Pool via REUTERSLONDON/FRANKFURT, Feb 9 (Reuters) - Germany and Oman are in advanced talks to sign a long-term deal for liquefied natural gas (LNG) lasting at least 10 years as Berlin continues its search for alternatives to Russian fuel supplies, three sources familiar with the matter said. Europe has been scrambling to replace Russian gas since last year against a backdrop of war in Ukraine, with state-run Gazprom (GAZP.MM) progressively reducing and then suspending the lion's share of pipeline supplies to Europe. Germany has been holding talks for months with the world's biggest LNG producer Qatar for additional supplies, but negotiations have been lengthy. While supply deals with Qatar would be positive for Germany, they would not offer an immediate solution to Berlin's energy crisis.

Companies Bp Azerbaijan FollowBp Plc FollowLONDON/BAKU, Feb 8 (Reuters) - BP Azerbaijan has declared force majeure on loadings of Azeri crude from the Turkish port of Ceyhan, after a series of earthquakes on Monday, the company said on Wednesday. The notice was issued to oil shippers following a temporary suspension of loading operations from the Ceyhan Marine Terminal (CMT), BP Azerbaijan spokeswoman Tamam Bayatly told Reuters by email. BP Azerbaijan operates the Azerbaijan and Georgia sections of the Baku-Tblisi-Ceyhan (BTC) pipeline. Azerbaijan uses the Turkish port of Ceyhan as its main crude export hub, with a flow of about 650,000 barrels per day (bpd). The Iraqi crude pipeline to Turkey's Ceyhan oil export hub resumed flows on Tuesday evening and a tanker docked to load Iraqi crude at Ceyhan earlier in the day.

A massive earthquake that struck Turkey and Syria early on Monday had halted operations at Ceyhan and stopped key crude oil flows from Iraq and Azerbaijan. A trading source said the vessel was given the all clear to load Iraqi oil from storage. While Iraqi crude flows and exports have resumed, exports of Azeri crude were still stopped. The Azeri BTC pipeline was however still working and sending oil to storage in Ceyhan, two sources said. The Alfa Baltica and the Nordlotus tankers were waiting in the area for the Azeri crude BTC terminal at Ceyhan to reopen.

☆ Western tankers ramp up Russian oil shipments under price cap
▼ + stars: | 2023-02-01 | by ( ) www.reuters.com time to read: +4 min

The Group of Seven nations (G7), Australia and the 27 European Union countries placed a price limit on Russian crude oil of $60 per barrel on Dec. 5. The cap allows non-EU countries to import seaborne Russian crude oil, but prohibits Western shipping and insurance companies from handling cargoes of the crude unless it is sold at or below that price. Russia has said it will not accept an oil price cap. GREEK RELIEFGreek-owned ships run by Greek management firms handled at least 21 voyages of Russian crude in January to a range of destinations. NGM said its tanker, the Ace, had discharged crude oil in Bulgaria.

Brent <LCOc1> futures fell 94 cents, or 1.1%, to settle at $84.98 a barrel. U.S. West Texas Intermediate (WTI) crude fell 70 cents, or 0.9%, to settle at 79.48. Markets at first reacted positively to U.S. data, which showed retail sales and manufacturing production declined more than forecast in December, on hopes the Fed would now ease up on interest rate hikes. Supporting oil prices early in the session, China reported economic data that beat forecasts after the country started rolling back its zero-COVID policy in early December. Rystad said the losses were at about 500,000 barrels per day and that India and China remain key buyers of Russian crude.

Summary China's reopening set to drive record 2023 oil demand -IEAChinese oil demand to rebound in 2023 -OPECRecord U.S. shale oil output seen in Feb -EIAAPI reports due at 4.30 p.m. ET (2130 GMT)LONDON, Jan 18 (Reuters) - Oil prices rose on Wednesday to their highest since early December on optimism that the lifting of China's strict COVID-19 curbs will lead to a fuel demand recovery in the world's top oil importer. China's economic growth slowed sharply to 3% in 2022, missing the official target of "around 5.5%" and marking its second-worst performance since 1976. Analysts polled by Reuters see 2023 growth rebounding to 4.9%. But OPEC kept its 2023 global demand growth forecast unchanged.

Brent futures rose 72 cents, or 0.8%, to $86.64 a barrel by 11:46 a.m. EST (1646 GMT), while U.S. West Texas Intermediate (WTI) crude rose 94 cents, or 1.2%, to $81.12. But the data still beat analysts' forecasts after China started rolling back its zero-COVID policy in early December. The lifting of COVID-19 restrictions in China is set to boost global oil demand to a record high this year, according to the International Energy Agency (IEA), while price cap sanctions on Russia could dent supply. A report showing U.S. retail sales fell more than expected in December provided some counterintuitive support for oil prices. A weaker dollar can boost demand for oil, as dollar-denominated commodities become cheaper for holders of other currencies.

Jan 17 (Reuters) - Montfort has emerged as the top bidder for Uniper Energy's oil refinery in the UAE that produces low-sulphur fuel oil for the shipping industry, multiple sources familiar with the matter said this week. The companies are finalising the deal, some of the sources said, although one source said the deal has been closed. Other companies that were also in the running were Vitol and BB Energy, the sources said. The Fujairah plant processes mainly African sweet, or low-sulphur, crude oil, producing about 5 million tonnes per year of very low-sulphur fuel oil (VLSFO), according to Uniper and Refinitiv data. Montfort has a bunker supplier licence in Fujairah under the entity of Montfort Trading FZE.

The sale of the plant to a consortium, led by Cypriot private equity firm G.O.I. The sale process is in contrast to Germany's confiscation of Rosneft's Schwedt refinery and Gazprom Germania, or Russia's takeover of Sakhalin 1 from Exxon Mobil (XOM.N). Energy is run by Michael Bobrov, who is also CEO of Israeli firm Green Oil that holds a major stake in Israel's biggest refiner Bazan Group. The deal marks an expansion into the refining sector for Trafigura that concluded a similar deal with Prax in 2021 for a refinery in Britain. Trafigura also holds a 3% stake in Italian refiner Saras, an indirect stake in India's major Nayara refinery and runs two small refineries via its subsidiary Puma Energy.

MILAN, Dec 8 (Reuters) - Russia's Lukoil (LKOH.MM) and U.S. private equity firm Crossbridge are close to a deal for the sale of the Russian group's refinery in Sicily, Italy, three sources with knowledge of the matter said on Thursday. The Lukoil-owned site in Sicily refines a fifth of Italy's crude and directly employs about 1,000 people in an economically depressed area. Last week, Rome laid down a scheme to place the plant in the hands of trustees to protect jobs and domestic refinery capacity from the embargo. read moreThe possibility that the refinery may end up under a trusteeship has accelerated negotiations between Lukoil and Crossbridge, one of the sources said. ($1 = 0.9480 euros)Additional reporting by Angelo Amante; Editing by Leslie AdlerOur Standards: The Thomson Reuters Trust Principles.

☆ Azerbaijan's SOCAR halts Russian crude supplies to Turkish refinery
▼ + stars: | 2022-12-08 | by ( ) www.reuters.com time to read: 1 min

LONDON/MOSCOW, Dec 8 (Reuters) - The trading arm of Azerbaijan's state oil firm SOCAR has paused purchases of Russian crude oil for its Turkish refinery as the industry grapples with EU sanctions on shipping and crude, sources familiar with the matter said. Turkish refineries, including SOCAR's STAR plant, had increased purchases of Russian crude after Russia's invasion of Ukraine. Russian flows to Turkey had already dropped last month to their lowest since February, according to Refinitiv Eikon data, and a source said SOCAR was reviewing the situation in order to remain compliant with Western sanctions. Reporting by Reuters reporters, Rowena Edwards and Julia Payne in London; Editing by Susan FentonOur Standards: The Thomson Reuters Trust Principles.

LONDON, Dec 5 (Reuters) - The market for old oil tankers is booming, and it's all down to efforts by Western nations to curb trade in Russian crude. The European Union banned all seaborne Russian crude imports from Dec. 5, with a fuel import ban to follow in February. PRICE SURGEMajor Western oil companies typically stop using tankers when they are about 15 years old, and many would be scrapped. More tankers are now being used for voyages taking weeks, shipping Russian oil from the Baltic and Black Sea to Asia, whereas Russian oil was mainly sold in Europe previously and the voyages only took a few days. Ship broker Braemar also said that some of the vessels involved in shipping Iranian and Venezuelan oil were shifting to transporting Russian oil.

☆ Energy trader Gunvor expands leadership team
▼ + stars: | 2022-11-24 | by ( Julia Payne | ) www.reuters.com time to read: +1 min

Companies Gunvor Group Ltd FollowLONDON, Nov 24 (Reuters) - Geneva-based energy trader Gunvor Group has widened its executive committee to 14 people including its chief executive, reflecting the growing importance of gas trading for the firm, the company’s website showed on Thursday. Gunvor has a separate company, Nyera, set up in 2021 to invest in renewable energy sources. As one of the world's top five oil traders, the company traded about 3.1 million barrels per day of oil last year. It posted a record profit in 2021 and a record first half of this year on the back of record energy price volatility. The leadership changes also come amid talks with Abu Dhabi National Oil company (ADNOC) to acquire the whole or a stake in Gunvor.

Russia has said it will not sell oil to countries that endorse the price cap. A G7 plan to take effect on Dec. 5 will allow the shipping industry to help export Russian oil but only at a set price - the price cap. That would leave a shortfall of 110 tankers should Moscow seek to fully skirt the price cap, Gromov added. POOLING RESOURCES WITH BUYER COUNTRIESRussia may seek to bypass the restrictions by pooling its shipping resources with those of top buyer countries that have yet to endorse the G7 price cap. Between 1 million and 2 million bpd of Russian crude and refined products exports could be shut in, a U.S. Treasury official said.

The G7, including the United States, as well as the whole of the European Union and Australia, are planning to implement the price cap on sea-borne exports of Russian oil on Dec. 5. India has emerged as the second-largest single buyer after China of Russian oil since the conflict began in February. Indian refiners have taken the place of refiners in countries that have imposed sanctions on Russian crude imports, or have steered clear of Russian crude to avoid negative publicity. That means even the delivered cargoes are about the same level as the price cap. The U.S. Treasury guidance does not allow buyers in countries that have imposed sanctions on Russian crude imports, such as in the United States and the European Union, to buy Russian oil even under the price cap.

LONDON, Nov 18 (Reuters) - European refiners have found themselves oversupplied with crude as an expected shortage owing to the looming EU ban on Russian oil has yet to materialise. The front-month Brent crude futures spread narrowed sharply this week, reflecting better supply in the physical oil market as fears over the EU embargo on Russian crude begin to subside. Reuters Graphics"There's too much oil around," one European crude trader said. A G7 price cap on Russian crude also comes into effect on Dec. 5. ALTERNATIVES SOURCESTraders said refiners have adjusted to living without Russian crude, which had been a mainstay of Europe's refining system.

REUTERS/Maja Smiejkowska/File PhotoCommodity trade finance covers many types of loans, typically from banks, that facilitate global movement of goods from wheat to gasoline. Most trade finance loans are short-term, less than a year. Traders’ credit lines became strained last year when natural gas prices sky-rocketed in the fourth quarter. ‘DESIRE TO DIVERSIFY’Lending for commodity trade finance has become more diverse, with non-bank financial institutions (NBFI) stepping in. The underlying issue was the retreat of major banks from commodity financing after some 2020 defaults in the sector while Russian banks Sberbank and Gazprombank that were set to expand have now been shut out of Europe.

Commodity trade finance covers many types of loans, typically from banks, that facilitate global movement of goods from wheat to gasoline. Most trade finance loans are short-term, less than a year. The involvement of hedge funds in commodity trade finance has created a lifeline for smaller firms, deemed to be higher risk for banks due to strict capital requirements and clean energy goals. 'DESIRE TO DIVERSIFY'Lending for commodity trade finance has become more diverse, with non-bank financial institutions (NBFI) stepping in. The Swiss firm specialises in financing small to mid-sized commodity merchants and has achieved returns between 6% to 10% over the last 10 years.

☆ Oil climbs 4% as dollar slips and EU ban looms
▼ + stars: | 2022-11-04 | by ( Julia Payne | ) www.reuters.com time to read: +3 min

Both contracts were supported by a weaker dollar , which can boost oil demand because it makes the commodity cheaper for those holding other currencies. While demand concerns weighed on the market, supply is expected to remain tight because of Europe's planned embargoes on Russian oil and a slide in U.S. crude stockpiles. "The slight weakness in the dollar, the upcoming ban on Russian oil sales are certainly supportive as focus is shifting from recession fears to supply issues," said PVM Oil Associates analyst Tamas Varga. "The main catalyst, however, is reports that China may ease its zero-Covid restrictions, which would be a boon to its economy and oil demand." The EU ban on Russian crude imports is due to take effect from Dec. 5.

☆ EXCLUSIVE Energy trader Mercuria buys back ChemChina stake
▼ + stars: | 2022-10-25 | by ( Julia Payne | Loucoumane Coulibaly | ) www.reuters.com time to read: +1 min

LONDON, Oct 25 (Reuters) - Trading house Mercuria Energy Group has bought back the minority stake that Chinese state-owned ChemChina held in the Geneva-based company since 2016, a spokesperson for Mercuria said on Tuesday. ChemChina was China's largest chemical group and owned 530,000 barrels per day (bpd) of refining capacity when it bought a 12% stake in Mercuria during an expansionary phase by many Chinese firms. ChemChina bought Swiss fertiliser and pesticide maker Syngenta the same year for $43 billion. Before the merger, ChemChina was poised to increase its stake in Mercuria in 2018. In return, Mercuria was set to gain a stake in the Chinese giant, but the deal did not go ahead.

Estimates that 80-90% of Russian oil will continue to flow outside the cap mechanism are not unreasonable, a U.S. Treasury official told Reuters. "Oil traders dealing in Russian oil are no longer in Switzerland, Geneva or London. P&I services heeding EU law insure 95% of the world's shipborne oil trade, meaning the EU move could have halted most of Russia's exports. Insurance and shipping industry figures still saw themselves at risk of sanctions which could upend the trade even in the G7 price cap workaround. The EU ratified the price cap this month but details on implementing it remain forthcoming.

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