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Cop: EU warns on fossil fuel ambition backsliding

  • Spanish Market: Crude oil, Emissions, Oil products
  • 20/11/24

The EU has warned parties at the UN Cop 29 climate summit in Baku, Azerbaijan, against going back on pledges made last year in Dubai to transition away from fossil fuels.

Language on transitioning away from all fossil fuels was included in the outcome of Cop 28 in Dubai last year in a historic first, with almost 200 countries including major fossil fuel producers agreeing to the text.

And the EU is pushing for the same commitment to be included in this year's outcomes. "No one should pretend that the previous Cop didn't happen," European commissioner for energy Wopke Hoekstra said today. "There is the clear expectation that once you've signed up to do something, you actually do it," he said, adding that "the last Cop was very specific about transitioning away from fossil fuels".

The EU views the declaration of G20 leaders, released on Tuesday morning, as an endorsement "in its entirety" of the outcomes of Cop 28, Hoekstra said. Further enhancing mitigation — reducing emissions — policies will be a "crystal clear element" that the bloc will focus on in the coming days, he said.

Failing to include language on transitioning away from fossil fuels would mean last year's Cop should be considered a failure, according to Lidia Pereira, head of the European parliament delegation in Baku. But she trusts delegates from the UAE to be strong advocates for the wording on transitioning away from fossil fuels, she said. The UAE is part of the Arab States negotiating group, which also includes Saudi Arabia, Egypt, Iraq and Libya.

Work on a mitigation outcome was rescued from the brink of collapse at the start of last week but is progressing slowly. As of last night negotiators did not have a draft text on mitigation, but must deliver one to the Cop presidency for publication around midnight.

If parties fail to come to a conclusion in mitigation talks, the text for a new finance goal may become the main space in which fossil fuel language could land. Its most recent draft, released on 16 November, includes references to transitioning away from fossil fuels.

Negotiations on climate financing — the so-called new collective quantified goal (NCQG) — to help developing countries adapt to and address climate change are central to this year's Cop. Thorny issues have included the amount of financing, which countries should contribute, the form that the financing will take and the broadening of the contributor base.

The next draft is scheduled to released around midnight on Wednesday, after negotiators have spent days working to bring parties' initial positions closer together.

Hoekstra refused to be drawn on reports, raised by Bolivia's representative, that the EU is eyeing a number of $200bn/yr for the NCQG, well below the expectations of likely recipient countries. The EU prefers to focus on other elements, including progress on Article 6 and mitigation, before having a "meaningful conversation about the exact amount", Hoekstra said.

Talks on finalising the details of an international carbon market under the Article 6 of the Paris Agreement continue to inch forward at Cop 29, but with key sticking points yet to be resolved.


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20/11/24

Cop: Developing nations deplore finance 'radio silence'

Cop: Developing nations deplore finance 'radio silence'

Baku, 20 November (Argus) — With just a few hours to go before a draft text on a new climate finance goal for developing countries is due at the UN Cop 29 climate summit, there is still "radio silence" from developed nations and an absence of plans, said Adonia Ayebare, chair of the group of 77 (G77) and China negotiating group. Parties must agree at Cop 29, in Baku, Azerbaijan, on a new collective quantified goal (NCQG) — a new climate finance target — building on the current $100bn/yr that developed countries agreed to deliver to developing countries over 2020-25. There is a strong hope that the forthcoming text will clearly define financial commitments detailing the amount, quality and mechanism for delivery, Ayebare said. A perfect text does not exist, he said, adding that developing countries have already put forth a figure that reflects their needs. They are broadly calling , for 1.3 trillion/yr while developed countries have not indicated an amount. "We need a figure for the headline of the text [in trillions], the rest will follow." The EU today insisted that the precise number for the goal will depend on agreement on other issues, including progress on mitigation and financing structure. In response to a question about uncorroborated rumours that developed countries may be considering a figure of $200bn/yr, Bolivia's negotiator Diego Pacheco said: "Is this a joke?" Developed country representatives have so far refuted this figure , or that they have settled on an amount. The "super red line" for the Like-Minded Developing Countries (LMDC) group is to not reinterpret or rewrite the Paris Agreement, said Pacheco, representing the group. The NCQG should be grounded in the mandate of the Paris accord, which states finance should flow from developed to developing countries. "Negotiations don't need to reopen the Paris agreement, but we can look at another area [such as] voluntary contributions for example, but that comes after the headline [figure], Ayebare said. Pacheco also talked about developed countries' attempts on mitigation, for example, to "move from the facilitative nature of the Paris Agreement to a prescriptive, intrusive mitigation… cherry-picking some elements of the [global stocktake]," he added. The EU and other developing nations are pushing for language on transitioning away from all fossil fuels that was included in the outcome of Cop 28 in Dubai last year to be included in this year's outcomes. By Prethika Nair and Rhys Talbot Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Tupras agrees more than 500kt 2025 bitumen tender sales


20/11/24
20/11/24

Tupras agrees more than 500kt 2025 bitumen tender sales

London, 20 November (Argus) — Turkish refiner Tupras has agreed 2025 annual tender sales totalling well over 500,000t of bitumen from its Izmit and Izmir refineries to leading international trading and supply firms. Market participants involved in the process said Rubis Asphalt and Continental Bitumen — the bitumen trading and supply unit of French construction firm Colas — had each won undisclosed volumes, with Colas taking fob and delivered (CFR) supplies. Vitol was also understood but not confirmed to have won fob volumes, with the firm a regular lifter of large cargoes at Izmit and/or Izmir for supply mainly into its Antwerp bitumen terminal in Belgium, including a cargo moved on Vitol's 36,962dwt tanker Asphalt Splendor last month. While in excess of 500,000t of fob volumes are understood to have been agreed for Tupras supply to lifters next year, tender process participants said a further seven to eight cargoes — each around 12,000t — had also been agreed for supply to Continental Bitumen on a CFR basis. The 14,786dwt Tupras bitumen tanker T Adalyn is to move those cargoes, as it has done in a similar arrangement with Continental Bitumen under the Turkish firm's 2024 tender arrangements, with the tanker delivering Tupras cargoes this year into Colas import terminals in France, Ireland and the UK, and on some occasions into other northwest European locations. Tupras tender participants said that at least some of the 2025 fob volumes had been awarded at double-digit fob discounts to fob Mediterranean high-sulphur fuel oil (HSFO) cargoes following similar indications from some tender buyers late last year regarding the 2024 Tupras tender. Such values had rarely been seen under Turkish term supply deals before this year, with the persistently weak outlook for European bitumen supply-demand fundamentals lasting into 2025 under current projections. Tupras could benefit next year from any shortfall in bitumen availability from its nearest competitor Motor Oil Hellas (MOH), which said last month that repair work on one of two crude distillation units (CDU) at its 180,000 b/d Agioi Theodoroi refinery in Corinth, Greece, will take until the third quarter of 2025 to complete after damage caused by a fire on 17 September. While the bitumen market impact of the CDU halt has been limited thus far, there could be a greater effect on Mediterranean availability next year, especially during the peak road paving and bitumen consuming season from spring to autumn. That could in turn help push up Mediterranean fob spot cargo values well above those agreed under Tupras' 2025 tender. By Keyvan Hedvat Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Baghdad clamps down on 'illegal' oil smuggling to Iran


20/11/24
20/11/24

Baghdad clamps down on 'illegal' oil smuggling to Iran

Singapore, 20 November (Argus) — The Iraqi government is clamping down on the "illegal smuggling" of crude, bitumen and other oil products to Iran. Iraq's foreign affairs ministry has asked Iranian authorities to stop trucks carrying "oil, black oil and other petroleum products" from entering Iran through border crossing areas in Iraq's semi-autonomous Kurdistan region unless the exports are licensed by state-owned Somo, according to a 12 November letter seen by Argus . The movement of bitumen and other oil products across the Haj Omran-Piranshahr border point have already halted because of the new directive, market sources said. "The Parwiz Khan and Bashmakh borders are still exporting bitumen, but if this letter is implemented fully, Iraq's bitumen exports will be disrupted since none of these producers possess a Somo licence," an Iraqi bitumen market participant told Argus . The restrictions are expected to remain in place until further notice, although some market participants expressed doubt about how effective the crackdown will be. The directive will also have a bearing on crude producers in Iraq's Kurdistan region, which have been relying on local sales since a key export pipeline to Turkey was shut last year. Foreign operators operating in Kurdistan said they have been trucking crude to local refineries since the closure, but Argus understands that Kurdish crude is also being smuggled — by truck — across the border to Turkey, Iran and Syria. Iraq's oil ministry said this month that it has secured a commitment from the Kurdistan Regional Government (KRG) to scale back its crude production to "agreed levels" to help bring overall Iraqi output back below its Opec+ production target. Tight supply Participants in Iraq's bitumen market note that the smuggling directive coincides with already tight domestic supply, caused by limited availability of vacuum residue feedstock. Not only are higher margins encouraging Iraqi refineries to blend vacuum residue to produce high-sulphur fuel oil (HSFO), but a prolonged roadblock between Erbil and Sulaymaniyah, which started before the Kurdish election in October, has made it difficult for bitumen producers to transport vacuum residue from refineries to their production units, market participants said. Manifest charges were decreased to $10/t last week to encourage bitumen producers to transport vacuum residue, down from $35/t when the roadblock started. But most Kurdish suppliers have refrained from offering fresh cargoes for export in the past three weeks. A few Indian importers told Argus that it has become increasingly difficult to secure Iraqi bitumen drums because of a lack of offers. Some bitumen suppliers took to the sidelines in the expectation that export values will increase in line with rising Iranian seaborne prices. The limited availability of vacuum residue has boosted production costs for Iraqi bitumen suppliers. Iraqi drums will be offered higher than $340/t fob Bandar Abbas in the coming days, compared with around $322-325/t last week, producers said. One major southern Iraq-based producer has not been offering drummed cargoes since the end of October as the higher production costs have made export prices less competitive for major consumers like India, market participants said. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: Countries still diverge on finance, float numbers


20/11/24
20/11/24

Cop: Countries still diverge on finance, float numbers

Baku, 20 November (Argus) — Ministers leading consultations on a new climate finance goal for developing countries — the central issue at the UN Cop 29 climate summit — said today that "divergent views" on the structure remained, but clarified on new suggestions for amounts. The outcome of the finance discussions are inextricably linked to conclusions on mitigation, or cutting emissions. Developing countries have long argued that they cannot decarbonise or implement an energy transition without adequate finance. Australian climate change and energy minister Chris Bowen said today that ministers heard three different proposals for a "provided quantum" of $900bn/yr, $600bn/yr and $440bn/yr. The provided quantum refers to the public finance "core" of the finance goal. He did not specify which parties were behind the proposals. The Cop 29 presidency appointed Bowen and Egyptian environment minister Yasmine Fouad to head up consultations on the new collective quantified goal (NCQG). This is the next iteration of the $100bn/yr in climate finance that developed countries committed to deliver to developing nations over 2020-25. But "others have mentioned a floor of [$100bn/yr] with linkages to the contributor base resolution, as well as sources and structure", Bowen said. But some countries have argued that, taking inflation into account, this would represent a drop in climate finance from previous goal. Developing countries have broadly called for $1.3 trillion to be mobilised annually, and this has not changed, Bowen confirmed. But mobilised finance could include other sources beyond public finance, such as private-sector financing. And many parties said that "certain building blocks" have to be in place before they can settle on a number, Bowen added. This is likely to refer to increased action on emissions reduction and to the contributor base pushed by developed nations. Challenging negotiations look set to continue. Bolivia, speaking for the UN negotiating bloc of like-minded developing countries, today urged the Cop presidency to "restore balance to this process". "We are also hearing in the corridors figures of [$200bn/yr] being offered by our partners for the NCQG which includes contributions from the MDBs [multilateral development banks]… this is unfathomable, we cannot accept this," Bolivia's representative added. Developed country representatives have refuted this figure, or that they have settled on an amount. A group of leading MDBs estimated last week that they could increase climate financing to $120bn/yr by 2030 for low- and middle-income countries . The group, comprising the World Bank and nine other MDBs including the European Investment Bank, hopes to leverage an additional $65bn/yr from the private sector. New draft texts on some of the key topics under discussion at Cop 29, including the NCQG and mitigation, are due to be released by the summit's presidency at midnight, local time. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: Thailand updates emissions reduction goal


20/11/24
20/11/24

Cop: Thailand updates emissions reduction goal

Baku, 20 November (Argus) — Thailand aims to raise its absolute emissions reduction goal in its updated nationally determined contribution (NDC), its minister of natural resources and environment, Chalermchai Sri-on, said at the UN Cop 29 summit in Baku, Azerbaijan. The country will raise its greenhouse gas (GHG) emissions reduction target in the third iteration of its NDC, to an absolute emissions reduction of "below 270mn t of CO2 equivalent" (CO2e) by 2035, compared with the 2019 level, said Sri-on on 19 November. He did not provide details on when this latest NDC will be submitted. Thailand is determined to enhance its mitigation actions to achieve its current NDC by reducing GHG emissions by 222mn t of CO2e by 2030, said Sri-on. Thailand's current NDC includes an unconditional emissions reduction target of 30pc by 2030, and conditional emissions reduction target of 40pc, compared with a business-as-usual scenario. Measuring against BAU scenarios — where GHG would continue to rise unlimited — leaves space for emissions to increase under climate plans. Thailand will support the implementation of its new NDC with a comprehensive green investment plan, said Sri-on, without providing more details. The country is also pushing forward its climate change act to formulate a balanced package in developing carbon pricing instruments and a climate fund, to steer its economic development towards climate resilience, he added. Thailand aims to achieve "carbon neutrality" by 2050 and net zero by 2065. Representatives from southeast Asian nations at Cop 29 last week indicated some of the challenges they face in updating their NDCs . Different models are used for different sectors and these need to be calibrated to ensure every single ministry accepts new targets, said Laksmi Dhewanthi, director general of climate change at Indonesia's ministry of environment. Finance also poses a challenge, said Ahmad Zaiemaddien, head of Brunei's climate change secretariat under the prime minister's office. Brunei, for example, needs to work with central banks and local banks, and get support from other partners to bring the cost of capital down, he said. But Indonesia nevertheless intends to submit its updated NDC ahead of the deadline in February 2025, in line with the push by the Troika — the partnership between Cop presidencies of the UAE, Azerbaijan and Brazil — to be one of the early movers in submitting updated goals. The country's NDC will be updated to cover GHGs other than CO2, including hydrofluorocarbons. It will also expand to new sectors, including the oil and gas sector. By Prethika Nair Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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