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No G20 consensus on cutting fossil fuel emissions

  • Market: Biofuels, Coal, Crude oil, Electricity, Emissions, Hydrogen, Natural gas, Oil products
  • 24/07/23

G20 energy ministers failed to reach a consensus on cutting fossil fuel emissions, at the G20 Energy Transitions Ministerial Meeting in the western Indian state of Goa late last week.

The meeting, which lasted over 19-22 July, failed to produce a joint communique. An outcome document and chair summary were instead issued on 22 July.

The final release was altered compared to an earlier unreleased draft seen by Argus.

"…The importance of making efforts towards [the phasedown] of unabated fossil fuels, in line with different national circumstances was emphasised," the chair's summary of the unreleased draft had said.

But the final document included concerns some members expressed about cutting emissions: "…The importance of making efforts towards [the phasedown] of unabated fossil fuels, in line with different national circumstances was emphasised by some members while others had different views on the matter that abatement and removal technologies will address such concerns."

Other language also appeared to have been altered in the final chair's summary, possibly to reflect a lack of consensus. For example, "The G20 notes that accelerated deployment of zero and low-emission technologies including renewables play an important role in achieving energy transitions," which was part of the unreleased draft, was changed to "It was noted that accelerated deployment of zero and low-emission technologies including renewables play an important role in achieving energy transitions."

The draft "acknowledged" the "major contribution" of the energy sector to greenhouse gas emissions, but the final chair summary said the sector's contribution to emissions was "significant".

India's power and renewable energy minister RK Singh acknowledged a lack of consensus on some issues. "We had agreement on 22 out of 29 paragraphs, while seven paragraphs were the chair's summary," Singh said at a press conference following the meeting, on 22 July.

Some G20 members wanted to focus on carbon capture and storage (CCS), the minister said. "Some countries felt that instead of a ‘phasedown' (of fossils), there were also options of carbon capture and storage" Singh said. "But the larger part of G20 was for ‘phasedown'…" the minister said.

The final document did not reveal the names of the G20 member countries that expressed concerns, but Singh said a "couple of countries in the Middle East" feel CCS would be a more appropriate option for decarbonisation.

The G20 also agreed on adopting "low carbon" emissions technologies. "We stress upon expediting the voluntary transfer on mutually agreed terms, and/or co-development and adoption of clean, sustainable and low carbon/emission energy technologies," the outcome document said. Singh said there was no problem with the language as long as the emitted CO2 is captured in the form of sequestration.

Lack of consensus on renewable capacity

There also appeared to be a lack of consensus on tripling global renewable energy capacity by 2030, as well as on developed countries pledging $100bn/yr from 2020-25 to help mitigate emissions. Both paragraphs remained part of the chair's summary in the unreleased draft as well as the final document.

The outcome document as well as the chair's summary are the basis for discussions at the Cop 28 summit in Dubai, Singh said. "If this (meeting) had not been so successful, then the next COP would have been very difficult," the minister said.

India has pledged for renewables to comprise 50pc of its total power generation capacity by 2030, as well as cutting the emissions intensity of its GDP by 45pc, at the Cop 26 summit in Glasgow in 2021. India has already achieved a 43pc renewables mix as of May, power ministry data show.

The country had earlier also committed to net zero emissions by 2070.


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02/05/25

Eight Opec+ members weigh further acceleration

Eight Opec+ members weigh further acceleration

Dubai, 2 May (Argus) — A core group of eight Opec+ producers meet on 3 May to decide whether to repeat last month's surprise move to add extra oil to an increasingly weak market. The main motivation for the group of eight's decision to triple the size of their output increase for May remains, suggesting that a repeat could be on the cards for June. As the dust began to settle on last month's decision, it became clear that raising their combined output target by 411,000 b/d in one month, rather than the scheduled 137,000 b/d, was rooted not only in stronger fundamentals, as the official communique suggests, but also in a desire to send a message to those countries that have persistently breached their production targets. The main culprits are Iraq and Kazakhstan, which have consistently failed to keep their production in check since the start of last year (see graph). The two are left with a lot to do by way of compensating for those excess barrels between now and the middle of next year (see graph). Russia, too, has overproduced during that period, but to a much lesser degree relative to its overall output. That persistent overproduction has been a source of deep frustration among other countries in the group of eight — principally the core of Opec's Mideast Gulf members — that have "sacrificed", in the words of one delegate, to adhere to their targets. April's decision was a nod to those that have sacrificed and a sharp warning to Kazakhstan and Iraq to do better and to do so quickly. Two delegates stressed to Argus at the time that the coming weeks would be critical for Baghdad and Astana to show that they were serious about abiding by their quotas. Failure to do so could trigger another "surprise" move for June, they said, possibly even another three-in-one hike. It was little surprise, then, that some ill-timed comments by Kazakh energy minister Yerlan Akkenzhenov on 23 April — in which he explicitly said Astana's national interests take priority over its Opec+ commitments, and that the country simply "cannot" reduce output — triggered serious speculation about whether the eight may repeat last month's decision. March data from Iraq, too, were not ideal, in that while they showed that Iraq did produce below quota, its efforts to compensate fell well short. Timing is everything Some in the group of eight may well be tempted to go down that route, thinking a second consecutive "shock" could deliver the desired wake-up call that the first did not. Two delegate sources confirmed to Argus that another 411,000 b/d target increase for June remains a distinct possibility. But such a course of action would be risky. Crude is already trading $12/bl below where it was when the group last met, and demand-side concerns are again on the rise because of the potential impact of US trade tariffs. The Opec secretariat and the IEA downgraded 2025 oil demand growth forecasts in their latest oil market outlooks. Opec revised its forecast down to 1.3mn b/d from 1.45mn b/d in its previous report. The IEA revised down its forecast by a sizeable 310,000 b/d to 730,000 b/d for 2025, despite "robust" consumption in the first quarter. It downgraded its forecast for April-December by 400,000 b/d. Another three-in-one hike for June would be "difficult" to imagine in this market, one delegate says. With that said, the eight's options include a "standard" 137,000 b/d rise to the group's collective target for June, in line with the original schedule, or, at a push, a two-in-one hike. That would not only send that internal message to the least compliant of the group, but also act as a show of good faith towards US president Donald Trump ahead of his visit to Riyadh, Abu Dhabi and Doha on 13-16 May. Opec+ overproducers Opec+ compensation plan Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Chevron has not discussed Kazakhstan Opec+ target: CEO


02/05/25
News
02/05/25

Chevron has not discussed Kazakhstan Opec+ target: CEO

London, 2 May (Argus) — Chevron has not held discussions with Kazakhstan about the country's Opec+ targets, chief executive Mike Wirth said today. Kazakhstan's production surged to a record 1.79mn b/d in March , following the start up of a new project at the Chevron-led Tengiz field in January. This left the country 322,000 b/d above its Opec+ target of 1.468mn b/d for the month. Kazakhstan has repeatedly vowed to comply with its Opec+ commitments, and said it would ask foreign operators at its Tengiz and Kashagan fields to reduce output. "We don't engage in discussions about Opec or Opec+ targets," Wirth said on Chevron's first-quarter earnings call today. "The barrels we produce at [Tengiz] are of high value to the government, they're important to their fiscal balance and historically those barrels have not been curtailed." Tengiz production was 901,000 b/d in March, compared with around 600,000-660,000 b/d before the new project came online. Italy's Eni, which is a key partner at the 400,000 b/d Kashagan field, made similar remarks last week. "Neither the operator of the asset, nor the shareholder and the contracting company have been engaged by the authority for any production cuts," said Eni's chief financial officer Francesco Gattei. Kazakhstan is one of the Opec+ alliance's largest overproducers, and there has been no indication that it has tried to reduce output in line with its targets. Kazakhstan's continued overproduction is understood to have contributed towards the decision by eight Opec+ members to add extra crude to the market in May . The eight will meet on 3 May to decide on production levels for June. Two delegate sources told Argus that another 411,000 b/d target increase for June remains a distinct possibility. By Aydin Calik Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

Carney to meet with Trump on 6 May


02/05/25
News
02/05/25

Carney to meet with Trump on 6 May

Calgary, 2 May (Argus) — Canadian prime minister Mark Carney will meet with US president Donald Trump on 6 May to try to resolve an ongoing trade war while also discussing the future economic relationship between the two countries. Carney announced his Washington travel plans Friday in his first media appearance following his 28 April election victory , where his Liberal party won 169 of a possible 343 seats in Parliament. Carney's predecessor Justin Trudeau in late November tried to diffuse a trade war before it began in a meeting with Trump, but subsequently was on the receiving end of public taunts about Canada's sovereignty and becoming the US' 51st state. Trump did not say or insinuate that Canada should become the 51st state when they spoke this week, according to Carney. The US has imposed a 25pc tariff on Canadian steel and aluminum since 13 March and Canadian automobiles since 9 April, prompting retaliatory tariffs by Canada. The trade war sparked a wave of anti-US sentiment and became a focal point of the election, contributing to a remarkable rebound for the Liberal party who only months ago faced slim odds of returning to power. "As I've stressed repeatedly, our old relationship, based on steadily increasing integration, is over," said Carney. "The questions now, are how our nations will cooperate in the future, and where we, in Canada, will move on." Carney has vowed to make Canada the fastest growing economy in the G7 with new alliances abroad and yet-to-be decided infrastructure projects playing a key role. "Canada does have other options and that is clear," said Carney, speaking in French. Carney's new cabinet will be sworn in during the week of 12 May and Parliament will return to session on 26 May. Absent will be Conservative leader Pierre Poilievre, who suffered a surprising loss in his constituency and was painted by the Liberals as being too much like Trump. He will be on the outside looking in unless a byelection occurs, which would likely require a Conservative surrendering their seat. If the Conservatives do trigger a byelection to try to get Poilievre back into Parliament, Carney said he will ensure that it happens "as soon as possible". By Brett Holmes Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Chevron 'not surprised' Calif refineries shutting


02/05/25
News
02/05/25

Chevron 'not surprised' Calif refineries shutting

Houston, 2 May (Argus) — Chevron's chief executive said today he is not surprised that refineries in California are shutting down, because the state has made it "nearly impossible" to invest going forward. Independent refiner Valero on 16 April said it is planning to shut or re-purpose its 145,000 b/d refinery in Benicia, California, by April 2026. This comes as Phillips 66 is planning to shut its 139,000 b/d Los Angeles refinery later this year. "I'm not surprised to see the announcements that have come out," chief executive Mike Wirth said Friday on Chevron's first-quarter earnings call. Policies coming out of the state "make it nearly impossible to invest in California going forward", he said. The state inserting itself into operational matters like planning turnarounds is "an unwise move", Wirth said. Chevron operates two large refineries in the state — the 269,000 b/d El Segundo, refinery and the 245,000 b/d Richmond refinery. "We do not have any announcements on our refineries at this time," Wirth said. California governor Gavin Newsom last year signed into law AB X2-1, legislation authorizing the state's energy regulator to require refiners to maintain minimum gasoline inventories. The bill is part of a multi-year effort by Newsom to mitigate price spikes at the pump, authorizing the California Energy Commission (CEC) to regulate, develop and impose requirements for in-state refiners to maintain minimum stocks of gasoline and gasoline blending components. The agency is in the rule-making process for some of the regulations, but a vote on a refinery resupply rule was postponed last month to allow for more engagement with stakeholders. The closures of Valero's Benicia refinery and Phillips 66's Los Angeles refinery will eliminate 17pc of the state's crude refining capacity. PBF Energy, which also operates refineries in California, said Thursday that the shutdowns will cause a 250,000 b/d shortfall in gasoline in the state and lead to growing reliance on more expensive imports. Valero chief executive Lane Riggs said last week that California's regulatory and enforcement environment is "the most stringent and difficult" in North America due to 20 years of policies pursuing a move away from fossil fuels. California will require 100pc of in-state sales of new cars and trucks to be electric, plug-in hybrid or hydrogen models by 2035. Five days after Valero's announcement to shut Benicia, Newsom urged state regulators to work closely with refiners on short-term and long-term planning, including through "high-level, immediate engagement" to make sure Californians have access to transportation fuels, according to a letter sent to CEC vice chair Siva Gunda. Newsom ordered the CEC to work with a cross-agency task force to recommend by 1 July any changes in the state's approach that are needed to ensure adequate fuel supply during the state's energy transition. By Eunice Bridges Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

US adds 177,000 jobs in April, jobless rate steady


02/05/25
News
02/05/25

US adds 177,000 jobs in April, jobless rate steady

Houston, 2 May (Argus) — The US added 177,000 jobs in April, topping expectations, even as the new US administration's campaign of tariffs against allies and trading partners heightened business and consumer uncertainty. Economists surveyed by Trading Economics had forecast job gains of 130,000 for April. The unemployment rate held steady at 4.2pc in April, the Bureau of Labor Statistics (BLS) reported. Job gains for March were revised lower by 43,000 to 185,000. The unexpectedly strong job report comes two days after the government reported the economy contracted at a 0.3pc annual rate in the first quarter, largely on a surge in imports as companies sought to build inventory ahead of the impacts of President Donald Trump's import tariffs. Consumer and business confidence have tumbled and economists have raised the odds of a US recession this year. US job gains averaged 152,000 in the 12 months prior to April. Federal government employment declined by 9,000 jobs in April and has fallen by 26,000 since January as mass federal layoffs take effect. Employees on paid leave or receiving severance pay are counted as employed, BLS said, so most of the announced federal job cuts do not yet show up in the data. Health care added 51,000 jobs in April, while transportation and warehousing added 29,000 jobs, more than double the average in the prior 12 months. Financial activities added 14,000 jobs. Construction added 11,000 jobs and manufacturing lost 1,000 jobs. Leisure and hospitality jobs grew by 24,000 and health care and social assistance added 78,000 jobs. Average hourly earnings rose by a 3.8pc annual rate, unchanged from the pace in March. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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