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Since August, the US sanctions have hit India, Russian Urals prices in India have tripled.
Three sources in the oil trade reported that discounts for Russian Urals crude have tripled in Indian ports since August compared to Brent dated as U.S. sanction drive key buyers from Moscow-supplied fuel. Last month, the United States imposed their toughest sanctions to date on Russia's oil sector. They targeted Lukoil & Rosneft. The deadline for companies is Friday to end all business with the two oil producers. Urals crude is a staple feedstock for Indian refiners, since 2023 when Moscow diverted flows to Asia following the European Union's ban on Russian energy. Traders said that supplies to India will fall dramatically as most refiners stop buying. Reliance Industries, India’s largest private refiner and India’s largest refinery, has stopped importing Russian crude to its Jamnagar facility in Gujarat as of November 20, according to a spokesperson for the company. RUSSIA OIL IMPORTS FROM WESTERN POINTS ARE NEAR OPTIMAL LEVELS Despite sanctions, Russia’s oil exports to western ports are still near their peak, thanks to OPEC+ production allowances, and refinery shutdowns caused by drone strikes in Ukraine. According to traders, the December Urals cargoes are currently trading at a discount of $5-$6 per barrel compared to Brent. This is about three times greater than the $1-2 seen in August. Prices for Russian oil delivered into Indian ports are usually set on a "delivered-ex-ship" basis. This means that the price does not include transport costs or other charges paid by the seller. Traders said that the price of Urals crude on board at Russian ports depends on the cargo and supplier. It is estimated to be around $20 per barrel. The majority of shipments are handled on "shadow fleets" linked to Russia, which allows Moscow to keep a portion of the differential in price. The freight rates are stable despite the sanctions against vessels. Aframax tankers carrying 700,000 barrels to Baltic ports cost around $7.5 million per one-way trip, while Suezmax trips are between $8 and $8.5 million, traders reported. They added that Russian oil shipments are still expensive but manageable, as there are enough ships available and Urals is trading below the EU's $60 barrel price limit. Conor Humphries (Reporting and Editing)
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Sources: US threatens to cut off intel and weapons to force Ukraine into peace agreement
Two people with knowledge of the situation said that the United States had threatened to reduce intelligence sharing and arms supplies to Ukraine in order to pressure it to agree to the framework for a U.S. mediated peace deal. Sources, who spoke on condition of anonymity said that Washington was exerting greater pressure than in previous peace talks, and that it wanted Ukraine to sign the framework of the agreement by next Thursday. One source said, "They want the war to end and they want Ukraine to pay for the price." Washington presented Ukraine with a plan of 28 points, which endorsed some of Russia's main demands during the war. These included that Kyiv cede more territory, reduce the size of its army, and be banned from joining NATO. A senior U.S. delegation met with President Volodymyr Zelenskiy on Thursday in Kyiv to discuss the path to peace. The U.S. ambassador to Ukraine and the Army Public Affairs chief traveling with the delegation described it as a successful meeting and said Washington was seeking an "aggressive deadline" for signing a document between U.S.A. and Ukraine. (Reporting and writing by Tom Balmforth; editing by Philippa Fetcher and Peter Graff).
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Freeport LNG Texas's export plant will take in more natural gases on Friday, according to data.
LSEG data, as well as regulatory filings, show that the U.S. liquefied gas company Freeport LNG was on schedule to receive more natural gas in Texas on Friday. This is a sign of one of three liquefaction train's return to service following its Thursday shutdown. Freeport has been one of the most closely monitored U.S. LNG plants in the world because its changes in operations have caused price fluctuations in global gas markets. Gas prices in the U.S. typically fall when flows to Freeport decrease due to a reduced demand for fuels from the export facility. Prices in Europe usually rise due to the drop in LNG supply available on global markets. The Freeport outage contributed to a 2% decline in futures prices on Thursday in the U.S. Freeport is not responsible for the drop in prices that occurred in Europe. Freeport informed Texas environmental regulators on Friday that Train 1 was shut down Thursday because of a problem with the compressor system. Freeport officials had no comment to make on the incident, but did note that the plant has loaded its 1,000th shipment this week. LSEG reported that gas flow to Freeport was on track to increase to 1.9 billion cubic foot per day (bcfd), up from 1.3 bcfd Thursday. This compares to an average of 1.9 billion cubic feet per day over the previous seven days. Three liquefaction plants at Freeport can convert about 2.4 billion cubic feet per day of gas to LNG. A billion cubic feet of natural gas can supply five million U.S. households for one day. Reporting by Scott DiSavino. (Editing by David Goodman, Mark Potter and Mark Potter.)
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Sources: US threatens to cut off intel and weapons to force Ukraine to a peace deal
Two people with knowledge of the situation said that the United States had threatened to reduce intelligence sharing and arms supplies to Ukraine in order to pressure it to agree to the framework for a U.S. mediated peace deal. Sources, who spoke on condition of anonymity said that Washington was exerting greater pressure than in previous peace talks, and that it wanted Ukraine to sign the framework of the agreement by next Thursday. One source said, "They want the war to end and they want Ukraine to pay for the price." A senior U.S. delegation met with President Volodymyr Zelenskiy on Thursday in Kyiv to discuss the path to peace. The U.S. ambassador to Ukraine and the Army Public Affairs chief traveling with the delegation hailed the meeting as successful and stated that Washington was seeking an "aggressive deadline" for signing a document between U.S.A. and Ukraine. (Reporting and writing by Tom Balmforth; editing by Philippa Fetcher and Peter Graff).
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BA owner IAG confirms its interest in buying stakes in Portugal's TAP
British Airways' owner IAG submitted a formal statement of interest to buy a minority stake (up to 5%) in Portugal's flag airline TAP. However, it said that some issues needed to be resolved before the company would consider investing. IAG has become the third airline in Europe to express interest in privatising TAP. It joins Air France-KLM, and Germany's Lufthansa. A spokesperson for IAG confirmed on Friday that the airline had submitted a declaration of interest to the state-owned holding Parpublica "in accordance with the process of the government for the partial privatisation of TAP". The spokesperson said that "However, there are several conditions IAG would have to address before it could make an investment." PORTUGAL WANTS TO SELL 44.9% OF STAKE Portugal has relaunched its long-delayed TAP privatisation in July. It is looking to sell a stake of 44.9% to an airline that can boost the company's international scale and competitiveness. A further 5% will be offered to TAP staff. TAP's main assets are its connections with Brazil, Portuguese-speaking African nations and the United States, all from Lisbon, the hub that the government is keen to maintain and expand. "We think TAP's potential is significant within IAG. IAG stated that its decentralised model offers industry-leading margins, and is aligned with the Portuguese Government's goal of protecting TAP. Analysts often criticize IAG for its potential bid because the hub in Lisbon is so close to Iberia's base in Madrid, which is owned by IAG. Long-term, IAG could divert routes to Madrid from Lisbon, decreasing the importance of Portugal's hub. IAG, however, said that its record of investment shows "how it invests to strengthen airlines and benefit customers, employees, regional economies, and shareholder". (Reporting and editing by Paul Sandle, Conor Humphries and Sergio Goncalves)
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Schiphol Airport invests $1.2 billion in foreign investment by 2035
A spokesperson for Amsterdam's Schiphol Airport confirmed a report in Financieele Dagblad on Friday that the airport planned to set aside around 1 billion euro ($1.15 billion), to purchase airport assets overseas between 2035 and 2045. A spokesperson for the airport operator said that it was looking to diversify revenues. It owns stakes at two airports located in Australia and other airports situated in the Netherlands. The spokesperson stated that there is no concrete plan yet, but the operator wants to "focus on the areas where the Netherlands have strong social, historic, or economic ties". Schiphol Airport is Europe's 4th largest airport by number of passengers. A mixed post-pandemic recovery in tourism, with leisure travel recovering more slowly than business, has led to a flurry of mergers and purchases by operators looking to diversify their markets or reduce exposure to certain ones. ($1 = 0.8691 euro) (Reporting and editing by Bart Meijer, Inti landauro)
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Two British teenagers plead not guilt to London Transport Cyberattack charges
Two teenagers have pleaded no contest to charges of hacking over a cyberattack in 2024 on London's public transportation system. One of the teens has also denied charges relating to two US health systems. In August 2024, Transport for London (TfL), the British capital’s tube and bus network that operates millions of trips each day was targeted. TfL stated at the time of the attack that personal data about customers was accessed. Thalha Jubair and Owen Flowers appeared before London's Southwark Crown Court on charges of conspiring to commit acts unauthorised against TfL under the Computer Misuse Act. Flowers has also been charged with crimes relating to California’s Sutter Health System, one of the biggest health systems in the U.S. and conspiring to infiltrate SSM Health Care Corporation’s networks. Jubair faces charges of failing to provide passwords for devices that were seized in March. Both denied the charges, and they will be tried at the same court in June. (Reporting and editing by Catarina demony, Paul Sandle and Catarina Tobin)
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Two British teenagers plead not guilt to London Transport Cyberattack charges
Two teenagers have pleaded guilty to hacking charges in relation to a cyberattack that took place on London's transport system in 2024. One of the teens has also denied charges related to health systems from the United States. In August 2024, Transport for London (TfL), the British capital’s tube and bus network that operates millions of trips each day was targeted. TfL stated at the time of the attack that personal data about customers was accessed. Thalha Jubair and Owen Flowers appeared before London's Southwark Crown Court on charges of conspiring to commit acts unauthorised against TfL under the Computer Misuse Act. Flowers is charged with crimes relating to California’s Sutter Health System, one of the biggest health systems in the U.S. and conspiring to infiltrate SSM Health Care Corporation’s networks. All charges were denied. (Reporting and editing by Catarina demony; Sam Tobin, Reporting)
Asia spot prices slightly rise amid high inventories and muted demand
The Asian spot price of liquefied gas rose slightly last week but remained in the $11 range due to well-stocked inventories.
Average LNG price for delivery to North-East Asia in January
Toby Copson is chairman of Davenport Energy Partners. He said, "The APAC Market remains largely flat or bearish. This is due to (a) a later start to the winter and unseasonably warm temperatures, which are muting seasonal heating demand."
He added that "Geopolitical risks premiums have been mostly priced in. So, unless there are any new supply bottlenecks it will trade within this range until we see an extreme and prolonged drop in temperature."
The premium of Asian spot gas to European prices at the TTF hub has been increasing for months. This is mainly due to an increase in charter rates, which meant that bringing cargos from Europe to Asia would be more expensive. Alex Froley said, Senior LNG analyst at ICIS.
The wholesale gas prices in Europe fell on Friday morning, as the demand for gas was curtailed by warmer temperatures and expectations of a stronger wind output. Prices increased earlier this week due to a cold snap that drove up heating demand.
Froley stated that the spot gas prices at TTF hub have remained fairly stable, and the first cold snap of winter has not caused them to significantly increase.
Aly Blakeway is the manager of Atlantic LNG for S&P Global Energy. She said that while Europe's storage inventories have decreased, they are still lower than in previous years.
On the back of a strong demand for gas to generate electricity, LNG demand is continuing to grow in the East Mediterranean, including Turkey, Greece and Cyprus. Blakeway explained that this, combined with Egypt's rapid procurement of some cargoes, forced sellers to hold back their offers in order to compete for these premium markets.
S&P Global Energy's daily North West Europe LNG Marker price benchmark (NWM) for cargoes to be delivered in January, on an ex ship (DES) basis, was $9.994/mmBtu as of November 20. This represents a $0.49/mmBtu reduction from the price at TTF hub.
Spark Commodities set the price for December at $10.60/mmBtu.
Seb Kennedy, an independent gas analyst, noted that the number of hedge funds trading TTF derivatives reached a record high of over 450 in the past week. This shows the popularity of the EU market for commodity investments.
He added that funds bought more TTF-short positions during the week ended November 14, bringing their net position to near zero.
According to Spark Commodities analyst Qasim Afghan, the U.S. arbitrage for the front-month to North-East Asia via Cape of Good Hope points to Europe while the Panama Canal arbitrage is open strongly to Asia.
The Atlantic LNG rates have risen to their highest level since December 20, 23 at $130,750/day. Pacific rates reached their highest level since August 20,24 at $78,750/day. Marwa Rashad is the reporter. Mark Potter (Editing)
(source: Reuters)