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Libya's largest oil field almost completely offline

  • Spanish Market: Crude oil
  • 05/08/24

Libya's largest crude field, El Sharara, has almost completely ceased production, a source with direct knowledge of its operations told Argus.

Some crude is being kept online so the 640MW power plant at Ubari can continue to generate electricity. This plant usually burns around 10,000-15,000 b/d of crude.

El Sharara was producing around 260,000-270,000 b/d before it was ordered to shut down on 3 August.

State-owned NOC has not declared force majeure on shipments of the field's Esharara export grade crude from the Zawia terminal, as is customary under such circumstances, sources said.

Argus understands the shutdown is being orchestrated by the Tobruk-based Libyan National Army (LNA), which controls much of the country's east and south including El Sharara in the southwest. Sources said the order to shut the field came from Saddam Haftar, son of LNA head General Khalifa Haftar. The reason for the shutdown is unclear. The field has been a frequent target of armed groups in the past decade for reasons ranging from local grievances to national political ambitions.

Libya's rival Tripoli-based government said on 4 August that attempts to close El Sharara were "political blackmail."

Field operator Akakus Oil Operations said on 4 August that production was being gradually wound down and that it would stop piping crude to Zawia. Akakus is a joint venture between Spain's Repsol, TotalEnergies, Austria's OMV, Norway's state-controlled Equinor and NOC.

Eight cargoes totalling 5mn bl of Esharara crude are scheduled to be exported from Zawia in August, according to loading programmes. A 630,000 bl cargo chartered by Equinor departed on 3 August, Kpler data showed.

A prolonged shutdown would force NOC to halt operations at its 120,000 b/d refinery at Zawia, which runs on crude from El Sharara, potentially leading to higher imports of refined products.

The forced production outage at El Sharara is the third under NOC chairman Farhat Ben Gudara. The field was most recently shutdown in January, for three weeks.

Opec member Libya typically produces around 1.2mn b/d of crude, but output in recent weeks had increased to about 1.25mn b/d. Some of these gains had been due to Repsol-led development work at El Sharara.

The front-month October Brent contract stood at $76.55/bl at 16:31 BST (15:31 GMT), compared to $76.81/bl at close of trade on Friday, 3 August.


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05/08/24

Iran gathers envoys to lay ground for Israel response

Iran gathers envoys to lay ground for Israel response

Dubai, 5 August (Argus) — Iran's foreign ministry on Monday convened a meeting of foreign ambassadors and representatives to lay down a "legal case" for retaliation it is planning against Israel for the assassination of Palestinian group Hamas' chief in Tehran last week, according to a source with knowledge of the matter. Iran's acting foreign minister Ali Bagheri-Kani "was mostly trying to lay down the case that would justify Iran's response [to the assassination of Ismail Haniyeh]," the source said. "He said the response would be definite and decisive, but did not say when it would come or how." The meeting came as numerous countries, in the Mideast Gulf and elsewhere, pressed on with round-the-clock efforts to try to contain the situation. Haniyeh was killed on 31 July while in Tehran for the inauguration of Iran's new president, Masoud Pezeshkian, the day prior. State television had shown him present at the ceremony. Israel has not explicitly acknowledged its involvement. But Iranian officials have little doubt that Israel was behind the hit, particularly given rising tensions emanating from the war between Israel and Hamas in Gaza. "All the evidence and indications clearly show that the Zionist regime is behind this vile and despicable act," foreign ministry spokesman Nasser Kanaani said today at his weekly press briefing, referring to Israel. Jordan's foreign minister Ayman Safadi was in Tehran on Sunday, 4 August, to discuss escalating regional tensions with Bagheri-Kani. "We want our region to live in security, peace and stability, and want the escalation to end," Safadi said. Prior to the visit, Safadi had said Jordan would not accept being dragged into the escalation. "If there is any escalation, our first priority is to protect Jordan and the safety of Jordanians," he said. "Anyone who wants to violate our skies, we will confront that." Relations between Amman and Tehran have soured since Iran launched its first ever direct attack on Israel on 13 April , a response to an Israeli attack on an Iranian diplomatic compound in Syria. Jordan, which borders Israel, helped shoot down at least some of the more than 300 Iranian missiles and drones that had entered its airspace, headed for Israeli targets. When and how? Iranian officials are adamant that the country will retaliate for the assassination in Tehran, and will do so in a serious manner. "When the Zionists receive a strong and decisive response, they will know that they made a mistake in their calculations," Islamic Revolutionary Guard commander in chief Hossein Salami said today. There has been no clear indication from Iran about when it will carry out any retaliation, or what form this would take. "The Zionist entity will receive a strike at the appropriate place and time to understand that what it has done is foolish," Salami 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.

Yemen’s Houthis renew attacks on shipping


05/08/24
05/08/24

Yemen’s Houthis renew attacks on shipping

Singapore, 5 August (Argus) — Yemen-based Houthi militants targeted the cargo vessel Groton in the Gulf of Aden with ballistic missiles, said Houthi spokesperson Yahya Saree on 4 August. The attack is part of a "fourth round of escalation", Saree said, adding that "the hit was accurate". The Houthis targeted the Groton because of a "violation of ban decision of access to the ports of occupied Palestine by the company that owns the ship". This matches reports from the UK Maritime Trade Operation (UKMTO) of an attack on an unnamed merchant vessel that was hit by a missile in the Gulf of Aden. All crew are safe and there are no observed fires, water entry or oil leaks, UKMTO said on 4 August, adding that the vessel is proceeding to the next port of call. The latest attack marks the Houthis' first since Israel on 20 July struck the Houthi-controlled Red Sea port of Hodeidah in Yemen, in retaliation for the Houthis' drone attack on Tel Aviv . Saree had vowed an "inevitable" and "huge" retaliation to Israel's assault. Crude prices rose in response to the renewed Houthi attacks. The Ice front-month October Brent contract on 5 August was at $77.20/bl at 03:21 GMT, up by 0.51pc from its previous settlement. The Nymex front-month September crude contract was at $73.81/bl, up by 0.39pc from its previous settlement. By Tng Yong Li Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Libya’s largest oil field partially shut down


04/08/24
04/08/24

Libya’s largest oil field partially shut down

London, 4 August (Argus) — Libya's largest oil field, El Sharara, has been partially shut down as of Sunday morning, a source close to the matter told Argus . So far, the field has lost about 28,000 b/d of crude production from pre-shutdown levels of about 260,000-270,000 b/d, the source said. The shutdown is currently limited to a few of the field's production facilities. Asked if the whole field could be closed, the source said "anything is possible." Previous forced shutdowns at El Sharara have typically taken a couple of days to drive production down to zero. Argus understands the shutdowns are being orchestrated by forces loyal to the Tobruk-based Libyan National Army (LNA) which controls much of the country's east and south, including El Sharara in the southwest. The exact reason for the shutdown is unclear. El Sharara, which is spread over Blocks NC-186 and NC-115, is operated by Akakus Oil Operations, a joint venture between Spain's Repsol, TotalEnergies, Austria's OMV, Norway's state-controlled Equinor and Libya's state-owned NOC. The field has been a frequent target of armed groups over the last decade for reasons ranging from local grievances to national political ambitions. El Sharara was last shutdown in January , for a period of three weeks. Opec member Libya typically produces around 1.2mn b/d of crude, but output in recent weeks had increased to about 1.25mn b/d. Some of these gains had been due to Repsol-led development work at El Sharara. The Ice front-month October Brent crude contract settled at $76.81/bl on Friday. By Aydin Calik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Israel versus Iran: Round two looming?


04/08/24
04/08/24

Israel versus Iran: Round two looming?

The region is braced for a possible rerun of Iran's April attack on Israel, writes Bachar Halabi Dubai, 4 August (Argus) — The confrontation between the Middle East's two leading military powers — arch-enemies Israel and Iran — has entered a new phase of escalation. Israel is taking the fight to Iranian proxies in Tehran's so-called "Axis of Resistance" as the Gaza campaign dials down, and the risk of a wider conflagration is rising. The conflict between Israel and Palestinian group Hamas has been regionalised from the start, but remained contained even when Iran and Israel traded direct blows for the first time ever in April. Lebanon's Iran-backed militia group, Hezbollah, joined the war on 8 October — the day after Hamas' attack on Israel — by opening what it called a "support front" for Hamas. Iraqi Shia militias and Yemen's Houthis followed suit by claiming to target Israel through a mix of drone and missile strikes, or by attacking global shipping lanes in the Red Sea. But, over the past few weeks, Israel has gone on the offensive against proxy group leaders. Hamas' chief political leader Ismail Haniyeh was killed in Tehran on 31 July. Israel neither denied nor confirmed responsibility, but Iran is pointing the finger.The attack in Tehran came only hours after Israel claimed responsibility for a strike in the suburbs of the Lebanese capital Beirut that targeted Hezbollah's most senior military commander and one of its founding fathers, Fuad Shukr. And Israel's military on 20 July struck Yemen's Houthi-controlled Red Sea port of Hodeidah, in a first-of-its-kind attack by the Israeli side, in retaliation for a drone attack by the Iran-backed militant group on Tel Aviv a day earlier. "I think when you put them all together, this is really a message to Iran, which has been operating more or less on seven fronts against Israel — Iraq, Iran, Yemen, Syria, Lebanon, the West Bank and Gaza," former US assistant secretary of state for near eastern affairs David Schenker tells Argus. But he also attributes Israel taking things into its own hands to the reticence of the US administration. "There is a division of labour [among Israel and the US] and the Israelis are responsible for their close enemies, while the US is responsible for the Houthis." Calculations trump ceasefire A regional diplomatic source sees a different impetus: "I think [Israel's] bold moves are the result of the withdrawal of President Biden from the presidential race" which frees him from electoral calculations. Israeli prime minister Benjamin Netanyahu "has no intention of reaching a ceasefire in Gaza before the outcome of the US election is known. He believes that a potential Trump administration would be more understanding of Israel's future plans for Gaza", the source says. The region is now bracing for a possible rerun of Iran's 13 April attack on Israel, except that the risk of miscalculation is higher, with the axis vowing revenge. "We are looking for a real response, not a performative response," Hezbollah's secretary general Hassan Nasrallah said on 1 August. The US, EU and many Mideast Gulf countries are trying to contain the situation. "Hezbollah and Iran want to avoid a full-scale war with Israel and their responses to the recent wave of assassinations will be measured to avoid dragging themselves into a situation of total regional war that could also drag in the US," the diplomatic source says. Iran, however, finds itself in a tough situation, with what happened in Tehran being "incredibly embarrassing for Iranian officials", according to Schenker. The questions now are when and how it might respond. With Israel also targeting Hezbollah in Beirut, the group might yet lead that response. "They're going to do something big… but they're going to try to calibrate [it] with not going for a full-scale war," Schenker predicts. The axis' retaliation could come within days, or it could take weeks. How Netanyahu then reacts to it could shape the regional confrontation for months or years to come. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

China to set hard targets for curbing CO2 emissions


02/08/24
02/08/24

China to set hard targets for curbing CO2 emissions

San Francisco, 2 August (Argus) — China is planning a shift in the way it controls greenhouse gases, specifically carbon dioxide (CO2) emissions, in a move that could support progress in its national emissions trading scheme (ETS), although it is unclear what emissions levels will be targeted. The country currently measures CO2 against economic growth, or emissions per unit of GDP in what is known as carbon intensity. This allows it to tout progress despite rising emissions so long as these do not rise faster than GDP. But it plans to change this. Beijing aims to incorporate CO2 indicators and related requirements into national plans and establish and improve local carbon assessments in a goal to improve CO2 statistical accounting. This will affect sectors including the power, steel, building materials, non-ferrous metals, and petrochemicals sectors, according to a state council work plan issued on 2 August. It will evaluate CO2 emissions of fixed asset investments and conduct product carbon footprint assessments while local governments will implement provincial carbon budgets that could enter trials in 2025. The latter will involve a wide range of industries including oil, petrochemicals, coal-to-gas, steel, cement, aluminium, solar panels manufacturing and electric vehicles, among others. Beijing is hoping such measures will allow it to set hard targets for CO2 emissions from 2026-2030, although the government will still prioritise intensity control in the meantime in what it calls a ‘dual-control mechanism' — switching from controlling intensity to actual emissions of CO2. Provinces are expected to be allowed to further refine this dual control mechanism, suggesting it will may give localities some leeway to adjust. China's ETS currently includes only the power sector due in large part to challenges collating accurate CO2 emissions data from other sectors, although it is expected to include other sectors like aluminium into the scheme soon. China unveiled new regulations for its ETS earlier this year, aiming to crack down on falsification of data. It sees the ETS as a tool to help it meet a goal to peak carbon emissions before 2030 and reach carbon neutrality before 2060. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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