What to Watch

OPEC Cuts Output While U.S. Shale Steams Ahead

Major oil producers involved in an effort to limit global oil supply said their crude oil output fell last month, even as the world’s total oil flows continued to rise on the back of U.S. shale growth, writes The Wall Street Journal’s Christopher Alessi.

In its closely watched monthly oil market report, the Organization of the Petroleum Exporting Countries said Thursday the group’s total crude output declined by 201,000 barrels a day in March, month-on-month, to average 31.96 million barrels a day.

The lessened output was mostly due to lower production in Angola, Venezuela, Algeria and Saudi Arabia.

But the oil cartel said that the world’s total oil supply rose by 180,000 barrels a day last month, because of higher output from non-OPEC producers like the U.S., Norway and the UK.

Energy News

Oil Holds Near Three-Year High on Geopolitical Tensions

Turmoil in the Middle East propelled oil prices to a more than three-year high on Thursday, amid concerns that hotspots in the region might cause disruptions to the global oil supply.

A series of exchanges between  President Donald Trump and Moscow raised the prospect of a clash between U.S. and Russian military forces in Syria.

Meanwhile, Saudi Arabia said it shot down missiles fired by pro-Iranian rebels based in Yemen. The conflict in Yemen has pitched Riyadh and Tehran, both oil-rich members of the Organization of the Petroleum Exporting Countries, against each other. Analysts are concerned that an escalation of hostilities might complicate efforts by OPEC to eliminate global supply.

Coal Is About to Lose Face in China 

China’s state-led interventions to help the coal industry may all come to naught, as coal-derived power producers such as Huaneng Power International are posting big quarterly losses, writes Nathaniel Taplin for Heard on the Street.

“It’s hard to see the timing of the latest Houthi strike on Saudi Arabia as purely coincidental.”

– Hani Sabra, founder of Alef Advisory

President Trump May Help U.S. Ethanol Farmers 

The Trump administration is considering tinkering with the petroleum mix by allowing the sale of a higher corn-derived ethanol fuel blend, Reuters reports.

Big Number

9,900

China is setting up vast gas storage facilities, Reuters reports. State-firm PetroChina will fill one such gas storage facility located 9,900 ft. under a mountain in Myanmar

Reporter’s Notebook

Friday: The International Energy Agency issues an oil market report

April 18–19: IQPC hosts the Oil & Fuel Theft Summit in Geneva. Speakers include Mahmoud Al-Bayati, the director general for counter-terrorism for Iraq, William J. Waggoner, the chief executive of the Mexico Petroleum Company and Daniel Gianfalla, a member of the national maritime security advisory committee at the U.S. Department of Homeland Security.