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Chevron cuts 2023 Venezuela oil outlook

  • Market: Crude oil
  • 30/05/23

US oil major Chevron is lowering its estimated year-end oil production target in Venezuela from 200,000 b/d to 175,000 b/d, according to sources familiar with operations, citing severe problems with oil-transportation infrastructure in western Venezuela.

The general state of disrepair in the Lake Maracaibo navigation channel in Zulia state, which limits the size of oil tankers Chevron can use to ship oil out, remains a major concern, according to the sources. The poor condition of oil storage facilities in Zulia are also a factor.

General disrepair of Venezuela's energy infrastructure was expected to be a limit on any plans to increase production following the US easing some sanctions on Chevron's Venezuela operations last year. Chevron is currently producing around 120,000 b/d from its four Venezuelan projects.

Chevron declined to comment on details of its Venezuelan operations.

The downward revision followed a meeting Monday between Chevron's top in-country representative, Javier La Rosa, and oil minister/president of state-owned PdV Pedro Tellechea.

Venezuela claims the country as a whole is producing more than 800,000 b/d and plans to reach 1mn b/d come August, but many observers call those figures unrealistic. Argus estimates Venezuela's April production at around 750,000 b/d.


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12/11/24

Cop: Carbon credit standards key step, work continues

Cop: Carbon credit standards key step, work continues

Baku, 12 November (Argus) — The adoption of new standards for creating carbon credits under the Paris Agreement on the first day of the UN Cop 29 climate summit yesterday is a key step, but work continues on Article 6. Cop parties agreed yesterday on standards that will cover credits for greenhouse gas (GHG) emissions removals under Article 6.4 of the Paris accord. The new standards set requirements for developing and assessing projects and establish rules covering carbon removal projects. Cop 29 lead negotiator Yalchin Rafiyev said the decision is a critical step towards concluding Article 6 negotiations. "This will be a game-changing tool to direct resources to the developing world and help us save up to $250bn/yr when implementing our climate plans," Rafiyev reiterated. "[The] centralised UN mechanism for markets looks at the projects that are not financially feasible currently and how it can help in providing some stream of revenue," chair for the supervisory body Maria al-Jishi said. UN climate body UNFCCC chief Simon Stiell said that yesterday's breakthrough was a good start but pointed out that this was "the product of over 10 years of work within the process" and that more work remains to be done. Cop parties must reach a deal on other aspects of implementing 6.4 and 6.2, which together govern how countries can use carbon credits to meet their GHG emissions-reduction pledges, known as nationally determined contributions (NDCs). Remaining issues include the nature of credit registries, the guidance for inclusion of removals and a solution for dealing with reporting inconsistencies and credit authorisations. Overlapping articles 6.4 and 6.2 elements are still under discussion and will require a decision at Cop 29, including on how governments and host parties choose to interact with 6.4 on credit authorisation and how national credit registries can interact with the 6.4 registry, al-Jishi said. By Bachar Halabi Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Cop: Azerbaijan president criticises ‘petrostate’ label


12/11/24
News
12/11/24

Cop: Azerbaijan president criticises ‘petrostate’ label

Edinburgh, 12 November (Argus) — Azeri president Ilham Aliyev remonstrated a room packed with world leaders at the UN Cop 29 summit in Baku about calling his country a "petrostate", given its small share of global oil and gas production. He said that it was "not fair" to label Azerbaijan a "petrostate", adding that it might have been "acceptable" when the country produced more than half of global oil output in the 19th century. He said the country accounts for 0.7pc of global oil production and 0.9pc of global gas production today. He also said that Azerbaijan's share of global greenhouse gas emissions is only 0.1pc. Azerbaijan's oil output reached 480,000 b/d in October. "Right after Azerbaijan was elected as a host country of Cop 29 we became a target of co-ordinated, well-orchestrated campaign of slander and blackmail," he said. The Azeri president reiterated that oil and gas is a "gift of god" and that countries rich in natural resources should not be blamed for bringing them to the markets as they are needed. He pointed out again that eight of the 10 countries that are supplied with Azeri gas are in Europe and that the EU asked Azerbaijan to double its gas supply to the bloc by 2027. Natural gas output in Azerbaijan reached a new high of 132mn m³/d in 2023, and the country aims to increase it further. Upping exports to the EU to 20bn m³/yr by 2027, from the current 12bn m³/yr, has been a key government commitment since 2022, when Europe was desperate for alternative gas suppliers. The UAE, Azerbaijan and Brazil — the Cop presidencies Troika — face scrutiny for pushing for increased global climate ambitions, but at the same time seemingly avoiding the question of fossil fuels in relation to their own new climate targets. The Troika countries look at fossil fuels through the lens of their own national circumstances — with their economies being heavily reliant on them. Azerbaijan's increasing gas exports spurred an economic boom, with GDP increasing tenfold over 2003-13. "As a president of Cop 29, I will be a strong advocate for the green transition, but at the same time we must be realistic," he said. He listed green projects in Azerbaijan, either in the pipeline or already operating, including an agreement to be signed at Cop 29 with BP to build a 240MW solar power station. By Caroline Varin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Opec trims oil demand growth forecasts again


12/11/24
News
12/11/24

Opec trims oil demand growth forecasts again

London, 12 November (Argus) — Opec has cut its global oil demand growth forecasts for 2024 and 2025 for a fourth month in a row, citing China as the main reason. In its Monthly Oil Market Report (MOMR) today the producer group revised down its 2024 demand growth projection by 110,000 b/d to 1.82mn b/d. It cut its demand growth forecast for China to 450,000 b/d in 2024, from 580,000 b/d in last month's MOMR. Opec's global oil demand growth forecast for 2024 is now 430,000 b/d lower than the 2.25mn b/d it had long projected until it made its first downward revision for 2024 in August. But its demand forecasts are still much higher than many others. The IEA's latest oil demand projection for 2024 is 860,000 b/d, while the EIA's 920,000 b/d. For 2025, Opec downgraded its demand growth forecast by 100,000 b/d to 1.54mn b/d, again mainly due to China. This is 310,000 b/d lower than its long-held 1.85mn b/d growth projection for next year, which it also first downgraded in August. On the supply side, the group kept its non-Opec+ liquids growth estimate for 2024 and 2025 unchanged at 1.23mn b/d and 1.11mn b/d, respectively. Opec+ crude production — including Mexico — increased by 215,000 b/d to 40.34mn b/d in October, according to an average of secondary sources that includes Argus . This is about 2.36mn b/d below Opec's projected call on Opec+ crude for this year, which is 42.7mn b/d. By Aydin Calik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Cop: UN chief reiterates economic force of transition


12/11/24
News
12/11/24

Cop: UN chief reiterates economic force of transition

London, 12 November (Argus) — "Doubling down on fossil fuels is absurd", given that solar and wind power are the cheapest forms of new electricity, UN secretary-general Antonio Guterres told the UN Cop 29 climate summit in Baku, Azerbaijan today. The "economic imperative is clearer and more compelling — with every renewables roll out, every innovation, and every price drop", Guterres added. Global investment in renewables and grids last year overtook the amount spent on fossil fuels for the first time, he noted. "The clean energy revolution is here. No group, no business and no government can stop it," Guterres said. Guterres and Simon Stiell, head of the UNFCCC — the UN's climate body — today both gestured to geopolitical challenges. Cop 29 is focused on climate finance — already a fraught topic — and environmental groups have expressed concern about the impact on climate action of Donald Trump's re-election . The UNFCCC process "is strong, it's robust and it will endure", Stiell said today. Guterres and Stiell also emphasised the financial implications of failing to cut emissions or address climate change. "The climate crisis is fast becoming an economy-killer", Stiell said. "Unless all countries can slash emissions deeply, every country and every household will be hammered even harder than they currently are," he added. The G20 group of countries should lead on emissions reduction, Guterres said. And both he — warning against "a tale of two transitions" — and Stiell called for action on climate finance. Countries must decide at Cop 29 on the next stage of a climate finance goal. Developed countries agreed to deliver $100bn/yr to developing countries over 2020-25, but agreement is yet to be reached on the next iteration. Guterres called for more concessional public finance, higher lending capacity for multilateral development banks (MDBs), greater transparency, and for "tapping innovative sources, particularly levies on shipping, aviation, and fossil fuel extraction. Polluters must pay", he said. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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IAEA chief sees ‘good sign’ ahead of Iran visit


12/11/24
News
12/11/24

IAEA chief sees ‘good sign’ ahead of Iran visit

Baku, 12 November (Argus) — The director general of the UN nuclear watchdog, the International Atomic Energy Agency (IAEA), said today that he has seen good signs from the new Iranian administration ahead of his visit to the Iranian capital on 13 November. Speaking to reporters in Baku, Rafael Grossi said he and his colleagues at the IAEA are looking forward to what he described as "a very important visit" with the aim of "re-establishing contact" with the Iranian authorities. The visit will be Grossi's first to Iran since Iranian President Masoud Pezeshkian took office in late July, and comes at a time of increased tensions in the Middle East region. Israel's offensive against Gaza-based militia group Hamas that was triggered by the group's deadly 7 October 2023 cross-border attack on Israel has since expanded into Lebanon and, to an extent, drawn Iran into the fray, with Tehran and Tel Aviv having now traded missile strikes twice in recent months. Israel's latest strike in October has raised fears that Iran could respond not only in kind, but also by speeding up its work to enrich uranium and move the country ever closer to possessing weapons-grade nuclear material. This is despite Iranian officials, not least Iran's supreme leader Ayatollah Ali Khamenei, insisting that Iran has no intention of building or possessing nuclear weapons. "We are looking forward to that [meeting]. It's high time we establish or re-establish contact with the government," Grossi said. "We have been preparing for this meeting for quite a long time." Grossi said he saw it as "a good sign" that the new Iranian administration is showing "a disposition to talk." "Of course, we have to give content and meaning to the conversations. But I am encouraged by the fact that we seem to be having a good agenda in front of us." Damage limitation The meeting comes after the IAEA's board of governors in June passed a resolution calling on Iran to step up its co-operation with the agency, and reverse a decision to restrict access to nuclear sites by de-designating inspectors. Tehran at the time rejected that resolution as "politically biased", prompting a swift denial from Grossi , saying that the agency does not adhere to an "anti-Iran policy". Asked today whether Donald Trump's election victory last week could impact relations with Iran, Grossi admitted that while it will "undoubtedly" have an influence, he expected that the incoming administration would work well with the IAEA, as was the case during Trump's first term. "We will adjust to that," Grossi said. A diplomatic source with knowledge of the situation described the ongoing tensions in the Mideast Gulf region as "out of control," and said they are hopeful Grossi's visit to the Iranian capital will help "keep a lid on the situation" and help to find some badly-needed "solutions". If Grossi achieves what he set out to do on this visit, it could lay the groundwork for any co-operation that the agency may have with the new administration around how best to deal with the Iranian nuclear threat, the source said. By Bachar Halabi and Nader Itayim Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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