PdV, Sulzer to swap refinery work for products

: Crude oil, Oil products, Petroleum coke
19/08/14

Venezuelan state-owned PdV is preparing to sign a barter agreement with Swiss contractor Sulzer to repair its refineries in exchange for the supply of fuel oil, asphalt and petroleum coke, according to presidential palace, oil ministry and PdV officials in Venezuela.

The pending agreement is PdV's second such arrangement in recent weeks with contractors based or partly based in China and Russia, the embattled Venezuelan government's two leading international patrons.

PdV has a nominal 1.3mn b/d of refining capacity in Venezuela, but almost all of it is inoperable because of years of underinvestment and a lack of spare parts and feedstock.

Under the planned contract, Sulzer would work alongside Chinese contractor Wison Engineering, which signed a separate downstream barter agreement with PdV at the end of July.

Sulzer's office in Switzerland did not immediately reply to a request for comment. An official in the company's Bogota office said the firm could not work in Venezuela from the Colombian affiliate because of US sanctions.

The contractors are expected to prioritize repair of the 940,000 b/d CRP refining complex, once considered a world-class downstream complex. The facility, located on the Paraguana peninsula in Falcon state, consists of the 635,000 b/d Amuay and nearby 305,000 b/d Cardon refineries.

Russian group Renova holds a minority 48.83pc stake in Sulzer since April 2018.

Moscow and Beijing continue to recognize Venezuelan president Nicolas Maduro as the Opec country's legitimate head of state. Washington and most western countries recognize opposition leader Juan Guaido as Venezuela's interim president in place of Maduro.

The barter deals are aimed at recovering PdV's capacity to produce motor fuel and other refined products that have been in short supply across Venezuela for months. The fuel deficit has been aggravated by US financial and oil sanctions that have cut off US supply of products to Venezuela and US purchases of Venezuelan crude. Before the oil sanctions were imposed in late January, the US had been the largest products supplier to Venezuela and the largest market for the country's heavy crude. Almost all of Venezuelan crude exports are now going to China and India.

Current gasoline production of roughly 40,000 b/d at the CRP is supplemented by Russian suppliers providing about 25,000 b/d of finished gasoline imports, two oil union officials told Argus.

Venezuela has nameplate capacity to produce around 250,000 b/d of gasoline.

Sulzer will repair crude distillation units and industrial services infrastructure including electricity, water and steam.

Wison will repair fluidized catalytic crackers, a flexicoker at Amuay, hydrodesulfurization units, distillation towers and other equipment.

Sulzer and Wison also will repair the 140,000 b/d El Palito refinery in Carabobo state, which has been shut down since 2017, to restart its catalytic cracker, distillation units and industrial services infrastructure.

Wison, which already has a upgrade contract for the 190,000 b/d Puerto La Cruz refinery with Korean firm Hyundai Engineering since 2013, has also agreed to accelerate efforts to complete the long-delayed expansion which now costs over $8bn, the ministry and palace officials said.

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25/04/01

Singapore’s base oil imports edge up in February

Singapore, 1 April (Argus) — Singapore's base oil imports increased for the third consecutive month in February, GTT data show, supported by stable demand in the city state. Import growth slowed in February, in line with a drop in industrial performance. The country's manufacturing output fell by 1.3pc on the year, and by 7.5pc on a seasonally adjusted month-on-month basis, according to data from the Economic Development Board. The overall manufacturing sector grew for the 18th consecutive month, but PMI slipped from 50.9 to 50.7 in February, data from the Singapore Institute of Purchasing and Materials Management show, in line with growing uncertainties over global trade flows. A PMI reading above 50 indicates expansion. Supplies from South Korea recovered from January's five-month low, in line with higher exports from the northeast Asian country, but remained below the five-year monthly average of 12,300t. Lower South Korean volumes were balanced by higher receipts of Taiwanese cargoes, which were likely boosted by delays in customs clearance a month earlier. South Korea and Taiwan are major producers of Group II base oils. Zero imports were recorded from Japan for the third consecutive month. Exports from the Group I supplier have fallen ahead of a series of plant maintenances by Japanese refiners ENEOS and Idemitsu that will affect around 925,000t/yr of refining capacity over February-November. Increased Saudi Arabian cargoes made up for the shortfall in Japanese volumes, with imports recorded for the 10th consecutive month. Saudi Arabia produces Group I and II base oils, but supplies to Singapore likely comprise of mainly Group I volumes because of the regional shortage from permanent plant closures in Japan. By Tara Tang Singapore's base oil imports t Feb'25 m-o-m ± % y-o-y ± % Jan-Feb'25 y-o-y ± % Qatar 23,135.0 -12.2 22.6 49,488.0 74.2 South Korea 9,090.0 30.2 -18.2 16,074.0 -9.3 Taiwan 12,458.0 NA 825.6 12,458.0 119.0 Saudi Arabia 5,306.0 76.9 5.7 8,306.0 65.5 Thailand 5,046.0 -16.4 152.8 11,081.0 234.3 Total 77,915.0 1.9 75.7 154,392.0 129.6 Source: GTT Total includes all countries, not just those listed Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US base oil export fell nearly 10pc in Dec

25/03/28

US base oil export fell nearly 10pc in Dec

Houston, 28 March (Argus) — December US base oil and lubricant exports fell nearly 10pc from year-earlier levels on lower supply and more attractive domestic pricing. The decline in export volumes was driven by weaker demand in Europe as buyers there worked to draw down inventories. Demand also fell in Brazil as a key domestic producer lowered its prices. Several US refiners were uninterested in lowering base oil prices to sell into the export market in December. Multiple turnarounds and less light-grade supplies made inventory building more attractive. Other refiners exported higher volumes in November in preparation for tax assessment season in the end of December. Exports to Mexico were the highest on record for the month of December and the second highest monthly total for 2024. Base oil exports to West coast South America fell for a third consecutive month on muted buying interest because of sufficient domestic supplies. By Karly Lamm Dec US base oil exports unit 24-Dec m-o-m ± % y-o-y ± % Mexico 1,990,000 13.1 13.2 Brazil 195,000 -26.7 -70.0 India 118,000 -8.5 -4.8 Europe 326,000 5.2 -43.4 WSCA 169,000 -41.9 11.0 Monthly total 3,848,000 -1.0 -9.9 Energy Information Administration (EIA) *Total includes all countires, not just those listed *WCSA includes Chile, Ecuador and Peru *Europe includes Belgium, France and the Netherlands Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Global energy mix evolves as electricity demand surges

25/03/28

Global energy mix evolves as electricity demand surges

Climate change is becoming a bigger factor behind electrification, but cleaner energy use is slowing the growth in global emissions, writes Georgia Gratton London, 28 March (Argus) — A substantial increase in electricity demand — boosted by extreme weather — drove an overall rise in global energy demand in 2024, lifting it well above the average pace of increase in recent years, OECD energy watchdog the IEA announced this week. This led to a rise in natural gas consumption, although renewables and nuclear shouldered the majority of the increase in demand, leaving oil's share of total energy demand below 30pc for the first time. Global energy demand rose by 2.2pc in 2024 compared with 2023 — higher than the average demand increase of 1.3pc/yr between 2013 and 2023 — according to the Paris-based agency's Global Energy Review . Global electricity consumption increased faster, by 4.3pc, driven by record-high temperatures — that led to increased cooling needs — as well as growing industrial consumption, the electrification of transport and the rapid growth of power-hungry data centres needed to support the boom in artificial intelligence, the IEA says. Renewables and nuclear covered the majority of growth in electricity demand, at 80pc, while supply of gas-fired power generation "also increased steadily", the IEA says. New renewable power installations reached about 700GW in 2024 — a new high. Solar power led the pack, rising by about 550GW last year. The power generation and overall energy mix is changing, as economies shift towards electrification. The rate of increase in coal demand slowed to 1.1pc in 2024, around half the pace seen in 2023. Coal remained the single biggest source of power generation in 2024, at 35pc, but renewable power sources and nuclear together made up 41pc of total generation last year, IEA data show. Nuclear power use is expected to hit its highest ever this year, the agency says. And "growth in global oil demand slowed markedly in 2024", the IEA says, rising by 0.8pc compared with 1.9pc in 2023. A rise in electric vehicle (EV) purchases was a key contributor to the drop in oil demand for road transport, and this offset "a significant proportion" of the rise in oil consumption for aviation and petrochemicals, the IEA says. Blowing hot and coal Much of the growth in coal consumption last year was down to "intense heatwaves" — particularly in China and India, the IEA found. These "contributed more than 90pc of the total annual increase in coal consumption globally", for cooling needs. The IEA repeatedly noted the significant effect that extreme weather in 2024 had on energy systems and demand patterns. Last year was the hottest ever recorded, beating the previous record set in 2023, and for CO2 emissions, "weather effects" made up about half of the 2024 increase, the watchdog found. "Weather effects contributed about 15pc of the overall increase in global energy demand," according to the IEA. Global cooling degree days were 6pc higher on the year in 2024, and 20pc higher than the 2000-20 average. But the "continued rapid adoption of clean energy technologies" restricted the rise in energy-related CO2 emissions, which fell to 0.8pc in 2024 from 1.2pc in 2023, the IEA says. Energy-related CO2 emissions — including flaring — still hit a record high of 37.8bn t in 2024, but the rise in emissions was lower than global GDP growth. Key "clean energy technologies" — solar, wind and nuclear power, EVs and heat pumps — collectively now prevent about 2.6bn t/yr CO2 of emissions, the IEA says. But there remains an emissions divide between advanced and developing economies. "The majority of emissions growth in 2024 came from emerging and developing economies other than China," the agency says, while advanced economies such as the UK and EU cut emissions last year and continue to push ahead with decarbonisation. Global energy suppy by fuel EJ Growth ±% 2024 2023 2022 24/23 23/22 Total 648 634 622 2.2 1.8 Renewables 97 92 89 5.8 3.1 Nuclear 31 30 29 3.7 2.2 Natural gas 149 145 144 2.7 0.7 Oil 193 192 188 0.8 1.9 Coal 177 175 172 1.2 2.0 Global power generation by fuel TWh Growth ±% 2024 2023 2022 24/23 23/22 Total 31,153 29,897 29,153 4.2 2.6 Renewables 9,992 9,074 8,643 10.0 5.0 Nuclear 2,844 2,743 2,684 3.7 2.2 Natural gas 6,793 6,622 6,526 2.6 1.5 Oil 738 762 801 -3.2 -4.8 Coal 10,736 10,645 10,452 0.9 1.8 Global power generation by country TWh Growth ±% 2024 2023 2022 24/23 23/22 World 31,153 29,897 29,153 4.2 2.6 US 4,556 4,419 4,473 3.1 -1.2 EU 2,769 2,718 2,792 1.9 -2.6 China 10,205 9,564 8,947 6.7 6.9 India 2,059 1,958 1,814 5.2 7.9 Global CO2 emissions by country mn t Growth ±% 2024 2023 2022 24/23 23/22 World 37,566 37,270 36,819 0.8 1.2 US 4,546 4,567 4,717 -0.5 -3.2 EU 2,401 2,455 2,683 -2.2 -8.5 China 12,603 12,552 12,013 0.4 4.5 India 2,987 2,836 2,691 5.3 5.4 *includes industrial process emissions — IEA Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

UK EAC to explore airport expansion, net zero conflict

25/03/28

UK EAC to explore airport expansion, net zero conflict

London, 28 March (Argus) — UK parliament's cross-party environmental audit committee (EAC) has begun an inquiry into whether the country's airport capacity expansion could be achieved in line with its climate and environment targets. "The aviation sector is a major contributor to the UK's carbon emissions, and on the face of it, any expansion in the sector will make net zero even more elusive," EAC chair Toby Perkins said. Any expansions must meet strict climate and environment commitments, the UK government has said. The government in January expressed support for a third runway at London's Heathrow airport — the country's largest. UK transport minister Heidi Alexander said in February that she was "minded to approve" an expansion at London's Gatwick airport, ahead of a final decision in October. The expansion would involve Gatwick making its northern runway operational. It is currently only used as a back-up option. The government is also "contemplating decisions on airport expansion projects at London Luton… and on the reopening of Doncaster Sheffield," Perkins said. "It is possible — but very difficult — for the airport expansion programme to be consistent with environmental goals," Perkins said. "We look forward to exploring how the government believes this can be achieved." The UK has a legally-binding target of net zero emissions by 2050. Its carbon budgets — a cap on emissions over a certain period — are also legally binding. The government must this year set levels for the UK's seventh carbon budget , which will cover the period 2038-42. The committee has invited written submissions on the possible airport expansions and net zero, with a deadline of 24 April. It will report in the autumn. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Oil, biofuel groups meet to align on RFS policy

25/03/27

Oil, biofuel groups meet to align on RFS policy

New York, 27 March (Argus) — Energy and farm groups met last week at the American Petroleum Institute to negotiate a joint request for President Donald Trump's administration as it develops new biofuel blend mandates, according to five people familiar with the matter. The private meeting involved groups from across the supply chain, including representatives of feedstock suppliers, biofuel producers, fuel marketers, and oil refiners with Renewable Fuel Standard (RFS) obligations. The groups coordinated earlier this year around a letter to the Trump administration on the need to update the RFS and are now seeking agreement on other program elements. According to the people familiar with the matter, the groups agree on pushing the Environmental Protection Agency (EPA) to set higher blend mandates under the program's D4 biomass-based diesel and D5 advanced biofuel categories. Groups support slightly different volume targets that are nevertheless all in "a rounding number of each other" in the D4 category, according to one lobbyist. But there is still disagreement about whether to ramp up mandates quickly in 2026 or provide a longer runway to higher volumes. Clean Fuels Alliance America and farm groups have publicly supported a biomass-based diesel mandate of at least 5.25bn USG starting next year, which could justify a broader advanced biofuel mandate above 9bn USG, according to the people familiar, though others worry about fuel cost impacts if mandates spike so quickly. The current mandate for 2025 is 7.33bn USG in the advanced biofuels category, including a 3.35bn USG mandate for the biomass-based diesel subcategory, so the volumes being pushed for future years would be a steep increase. The RFS, highly influential for fuel and commodity crop prices, requires oil refiners and importers to blend annual amounts of biofuels into the conventional fuel supply or buy Renewable Identification Number (RIN) credits from those who do. The idea behind the groups' coordination is that the Trump administration might more quickly finalize RFS updates if lobbyists with a history of sparring over biofuel policy can articulate a shared vision of the program's future. One person familiar said the effort comes after the Trump administration directed industry to align biofuel policy goals, though others said they understood the coordination as largely voluntary. EPA did not provide comment. There is less agreement around the program's D6 conventional biofuel category, which is mostly met by corn ethanol. Oil groups have in the past criticized EPA for setting the implied D6 mandate at 15bn USG, above the amount of ethanol that can feasibly be blended into gasoline, though excess biofuels from lower-carbon categories can be used to meet conventional obligations. Ethanol interests support setting the D6 mandate even higher than 15bn USG, which could be a tough sell. The discussions to date have not involved targets for D3 cellulosic biofuels, a relatively small part of the program. A proposal to lower 2024 volumes has hurt D3 credit prices, signaling that future mandates are effectively optional, according to frustrated biogas executives , and has reduced the salience of the issue for other groups. A proposal from President Joe Biden's administration to create a new category called "eRINs" to credit biogas used to power electric vehicles has similarly not come up. "We're not expecting to see any attempt to include eRINs in this next [RFS] proposal," Renewable Fuels Association president Geoff Cooper told Argus earlier this month. The meeting last week was largely oriented around the RFS, though a National Association of Truck Stop Operators representative raised the issue of tax policy too. The group has been frustrated by the expiration of a long-running blenders credit and the introduction this year of a less generous credit for refiners, which is only partially implemented and has spurred a sharp decline in biomass-based diesel production. But others involved in negotiations, while they acknowledge tax uncertainty could hurt their case for strong mandates, are trying to avoid contentious topics and focus mostly on volumes. Republican lawmakers are separately weighing whether to keep, repeal, or adjust that credit to help out fuel from domestic crops, and there is no telling how long that debate might take to resolve. Another thorny issue discussed at the meeting is RFS exemptions for small refineries. Biofuel producers strongly oppose such waivers and say that exempted volumes should at least be reallocated among facilities that still have obligations. Oil groups have their own views, though it is unclear how involved the American Fuel and Petrochemical Manufacturers — which represents some small refiners and has generally been more critical of the RFS than the American Petroleum Institute — are in discussions. EPA is aiming to finalize new volume mandates by the end of this year , people familiar with the administration's thinking have said, though timing for a proposal is still unclear. Future conversations among energy and farm groups to solidify points of unity — and strategize around how to downplay disagreements — are likely, lobbyists said. RIN prices rally Speculation over the trajectory of the RFS, and the potential for higher future volumes, supported soybean oil futures and widened the bean oil-heating oil (BOHO) spread. The BOHO spread maintains a positive correlation with D4 RIN prices as a widening value raises demand for D4 credits as biofuel producers look to offset higher production costs. Thursday's session ended with current-year ethanol D6 credits valued between 79¢/RIN and 82¢/RIN, while their D4 counterparts held at a premium and closed with a range of 84¢/RIN to 89¢/RIN. These gains each measured more than 5.5pc growth relative to Wednesday's values. By Cole Martin and Matthew Cope Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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