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Brent slips as Libyan supply increases

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NEW YORK – Brent crude edged down towards $106 a barrel on Tuesday as Libyan supply picked up and as the restart of Iranian oil shipments appeared to get closer.

Recent weak economic data from the US has also dampened the outlook for fuel demand in the world’s largest oil consumer.

February Brent crude had edged down 10 cents to $106.65 a barrel early on Tuesday after closing down 0.47% in the previous session. US crude for February delivery was at $91.85, up 5 cents after settling at a two-session low on Monday.

“Oil markets seem to have weakened in the last few days because of lower US economic indices like employment data and a rise in oil exports from Libya,” said Ken Hasegawa, a commodity sales manager at Newedge Japan.

Major powers and Iran have also moved a step closer to resolving a long standoff over Tehran’s nuclear ambitions after endorsing a deal that will come into force on 20 January.

The parties are likely to start talks on a final settlement in February, a diplomatic source said on Monday.

A resolution to the issue could see western powers lifting sanctions on the Opec producer’s oil exports, increasing global supply.

Libya’s production has also risen to 600,000-650,000 barrels per day , with output at the El Sharara field back up to 300,000 bpd, its oil minister said. Wrecked by months of domestic protests, the Opec producer’s output is still below the 1.2 million bpd it was producing in July.

Britain’s biggest oilfield, Buzzard, where an outage last week temporarily boosted Brent, is expected to return to normal output in coming days, its operator Nexen confirmed on Monday.

“There are no positive factors to buy oil except if you are short-covering or bargain-hunting,” Hasegawa said, adding that Brent and West Texas Intermediate (WTI) were supported on technical charts at $106 and $91.20-$91.30 respectively.

Prices could come under further pressure if oil product stockpiles rose in the US last week, reinforcing concerns of lower demand after it posted the weakest monthly job growth in three years in December, Hasegawa said.

Analysts in a preliminary Reuters poll said US crude inventories likely rose last week for the first time in seven weeks, up by an average of 500,000 barrels.

In the refined products sector, distillate stocks, which include heating oil and diesel fuel, were forecast to have risen 1.6 million barrels on average, while gasoline stocks were seen to have increased by 2.7 million barrels last week, the poll showed.

– SWEETCRUDE REPORTS

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Oil

FG Introduces New Incentives To Revitalize Nigeria’s Oil & Gas Industry

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In a strategic move to revitalize Nigeria’s oil and gas sector, the Federal Government has unveiled two key fiscal incentives aimed at attracting investment and enhancing energy security.

The announcement was made by Mr. Wale Edun, the Minister of Finance and Coordinating Minister of the Economy on Wednesday.

The first initiative, the Value Added Tax (VAT) Modification Order 2024, introduces critical exemptions for essential energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.

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These exemptions are designed to reduce living costs for Nigerians, promote energy security, and accelerate the transition to cleaner energy alternatives.

The second initiative, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production, offers new tax relief options for deep offshore exploration projects.

This measure aims to position Nigeria’s deep offshore basin as a premier destination for international oil and gas investments, boosting the country’s appeal to foreign investors.

These reforms are part of a broader set of policy initiatives, known as Policy Directives 40-42, endorsed by President Bola Ahmed Tinubu.

The directives reflect the administration’s commitment to fostering sustainable development in the energy sector and enhancing Nigeria’s competitive edge in the global oil and gas market.

 

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Tinubu set to approve ExxonMobil-Seplat oil deal, expands CNG bus initiative

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By Yemie Adeoye

NIGERIA’s President Bola Tinubu has announced that the protracted ExxonMobil-Seplat upstream oil divestment will be formally approved by the Minister of petroleum within a matter of days, just as he announced his government’s intention to expand the Compress natural Gas, CNG buses initiative.

The President who stated this during his Independence day nationwide broadcast stated that the move is in line with his administration’s commitment to free enterprise, free entry and free exit in investments which is the hallmark of his administration investment policy.

“Fellow compatriots, our administration is committed to free enterprise, free entry, and free exit in investments while maintaining the sanctity and efficacy of our regulatory processes. This principle guides the divestment transactions in our upstream petroleum sector, where we are committed to changing the fortune positively. As such, the ExxonMobil Seplat divestment will receive ministerial approval in a matter of days, having been concluded by the regulator, NUPRC, in line with the Petroleum Industry Act, PIA. This was done in the same manner as other qualified divestments approved in the sector.”

The President also seized the opportunity to plead with Nigerians to be patient with his administration’s reform policies. “As your President, I assure you that we are committed to finding sustainable solutions to alleviate the suffering of our citizens. Once again, I plead for your patience as the reforms we are implementing show positive signs, and we are beginning to see light at the end of the tunnel”.

“Our energy transition programme is on course. We are expanding the adoption of the Presidential Initiative on Compressed Natural Gas for mass transit with private sector players. The Federal Government is ready to assist the thirty-six States and FCT in acquiring CNG buses for cheaper public transportation.

Fellow Nigerians, while we are working to stabilise the economy and secure the country, we also seek to foster national unity and build social harmony and cohesion. Our economy can only thrive when there is peace”. he enthused.

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Oil

ExxonMobil To Invest $10bn In Nigeria’s Deep-Water Oil Operations

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As part of the administration’s push to improve Ease of Doing Business (EoDB), Nigeria’s Vice President Kashim Shettima has expressed support for ExxonMobil’s plan to invest $10 billion in the country’s deep-water oil sector.

Speaking on Wednesday, September 25, 2024, during a meeting with ExxonMobil executives at the 79th United Nations General Assembly (UNGA) in New York, Shettima called the investment “a clear testament to the administration’s economic reforms and investor-friendly policies.”

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This announcement follows news that international maritime company DP World intends to develop a multibillion-dollar port project in Nigeria.

Stanley Nkwocha, Senior Special Assistant to the President on Media and Communications, shared the development in a statement on Wednesday. He quoted Shettima as saying: “ExxonMobil’s potential investment aligns with the vision of President Bola Ahmed Tinubu’s administration for a more investment-friendly Nigeria.

We are committed to fostering an environment that supports such transformative projects.”Shettima also discussed the administration’s broader efforts to improve the ease of doing business, highlighting the “Renewed Hope Agenda,” which aims to simplify bureaucratic processes, enhance transparency, and offer fiscal incentives to attract global investors.

“Our administration has taken bold steps to unify the exchange rate, remove fuel subsidies, and implement tax reforms. These measures, though challenging in the short term, are intended to create a stable and predictable business environment in the long term,” he added.

On the oil and gas sector, Shettima mentioned that the government is revising the fiscal framework for deep-water operations to attract investment while ensuring fair returns for the Nigerian people.

 

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