Energy Journal: Oil Gains as Fate of Iran Nuclear Deal Remains Uncertain

What to Watch

Oil Extends Advance Ahead of Trump Iran Decision

Crude prices hit a fresh three-year high on Thursday ahead of a U.S. decision on whether to extend temporary waivers on sanctions against Iran.

Brent crude, the global oil benchmark, rose 0.3% to $69.40 a barrel on London’s ICE Futures exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading up 0.5% at $63.88 a barrel.

U.S. President Donald Trump is set to review whether to waive or reimpose sanctions on Iran this week, a decision that has implications on Iran’s oil exports.

“It will be very important for the oil market to see what he does with Iran considering that in the past sanctions regime a large portion of exports was disrupted,” said Giovanni Staunovo, commodity analyst at UBS Wealth Management.

Oil prices have been grinding higher and higher, spurring forecasters to predict they could hit $80 a barrel this year.

Energy Journal Exclusive

In Poland, U.S. Shale Boom Displaces Iran and Russia Oil

 For decades, the East European nation of Poland has largely relied on crude supplies from Russia, a powerful neighbor that’s also the world’s largest oil producer, writes Benoit Faucon.

But in 2016, Warsaw scooped up Iranian oil after nuclear sanctions against Tehran were lifted. Now Iran and Russia are facing a new rival in town: U.S. crude that’s being sold abroad  after export restrictions were ended to take advantage of booming U.S. shale output.

A tanker of 1 million barrels is currently sailing from Houston on its way to Poland, according to shipping tracker Kpler, bringing American shipments to the European nation to 3.2 million barrels in the past three months.

Energy News

New York City Sues Oil Companies Over Climate Change

 New York City Mayor Bill de Blasio said Wednesday his administration had filed a lawsuit against five major oil companies as part of an effort to fight climate change. The city filed the suit against oil companies BP PLC, Chevron Corp., ConocoPhillips, Exxon Mobil Corp. and Royal Dutch Shell PLC.

The lawsuit, filed late Tuesday, asks for billions of dollars to protect the city from changing weather patterns blamed on the consumption of fossil fuels. San Francisco and Oakland filed similar suits in September against the same five companies

London Loses Oil Futures Listings as Mifid II Bites

Intercontinental Exchange plans to transfer trading in hundreds of energy futures contracts from London to the U.S., as customers seek to escape new Mifid II rules governing European financial markets,the Financial Times reports.

“OPEC is committed to what they have decided when we met in November…to continue this for a full year”

Suhail al-Mazrouei, Energy Minister of the United Arab Emirates

Rio Is Said to Drop Bid for $5 Billion Lithium Miner Stake

Rio Tinto Group has dropped out of the bidding for a stake in Soc. Quimica & Minera de Chile SA, one of the world’s top lithium producers, as it pursues other ways to capitalize on the electric-car boom, Bloomberg reports.

WSJ Energy In-Depth

French Ex-Presidents Tell Saudis of Concern About Billionaire’s Arrest

 Two former French presidents have expressed concern to Saudi Arabia’s crown prince that the arrest and detention of billionaire Prince al-Waleed bin Talal has raised worries among foreign investors, write Benoit Faucon and Summer Said.

The messages from François Hollande and Nicolas Sarkozy, France’s two most recent previous presidents, highlight the business uncertainty caused by the arrests of hundreds of people in early November in what Saudi authorities said was an anticorruption campaign.

The arrests came amid Saudi Arabia’s attempt to open up to the world on multiple fronts.

Crown Prince Mohammed bin Salman is heading the plan to weed out corruption and diversify the kingdom’s oil-dependent economy.

Saudi authorities have announced plans this year to lift the world’s only ban on women driving, to allow cinemas to open for the first time in decades and to publicly list the country’s giant state oil firm, Saudi Arabian Oil Co.

Big Number

65 billion

The Trump administration’s proposal to open up almost all U.S. offshore waters to oil and gas drilling could unlock up to 65 billion barrels of oil equivalent, Reuters reports.

FutureCurve

Friday: Oil-services firm Baker Hughes Inc. releases its count of active drilling rigs, a bellwether for production in the U.S. oil industry.

Tuesday: The American Petroleum Institute releases its forecast of U.S. crude inventories.

Wednesday: The U.S. Energy Information Administration releases its weekly petroleum status report.