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Saudi Oil Minister: Global Oil Demand Could See A 97% Recovery By The End Of 2020

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Global oil demand is set to recover to near pre-covid-19 levels by the end of this year, Saudi Arabia’s energy minister Prince Abdulaziz said today prior to the OPEC+ Joint Ministerial Monitoring Committee meeting today, according to The National.

Specifically, Prince Abdulaziz expects that oil demand will recover to 97% of the levels pre-Covid.

That 97% is also the compliance rate that OPEC+ achieved in July, after promising to cut 9.7 million barrels per day off the group’s oil production levels.

Saudi Arabia has leaned hard on the members of the group that have not complied with the cuts to the same dutiful—and painful—level that Saudi Arabia has. The laggards of the group include Iraq and Nigeria, who have missed their quotas by large margins.

In response, Nigeria and Iraq—along with the other laggards Kazakhstan and Angola—have agreed to continue cut enough production to make up for ill compliance during the last couple of months.

“We should endeavor to put this temporary compensation regime behind us, by clearing all the past overproduction by the end of September,” Prince Abdulaziz said before the meeting.

But that would indeed be an ambitious undertaking for Nigeria and Iraq, who have had trouble complying to all OPEC agreements thus far, and who have not shared any specific plan to bring their oil production into compliance with the group’s agreement.

Regardless of the laggards’ poor showing, Prince Abdulaziz has noted that the oil market has shown signs of improvement with a drawdown in global inventories, a decline in floating storage, and a recovery in gasoline and diesel demand.

Oil prices were trading slightly down on Wednesday, even after the EIA reported crude oil and gasoline inventories draws for the week, and even after Prince Abdulaziz’s positive talking points.

By Julianne Geiger for Oilprice.com

Source: Oilprice.com

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TC Energy lays off staff in Canadian gas operations and projects division – CTV Toronto

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CALGARY —
Restructuring at Calgary-based TC Energy Corporation has resulted in the loss of jobs.

The move comes after the company, formerly known as TransCanada Corporation, signed a memorandum of understanding with Natural Law Energy which represents four First Nations in Alberta and one in Saskatchewan.

The deal, which is expected to be finalized later this year, will see Natural Law Energy purchase an equity stake in the Keystone XL pipeline.

“Our Canada Gas Operations & Projects team is implementing a new structure to ensure the optimal skill sets to navigate the next tranche of our expansion and operations,” said TC Energy in a statement released Tuesday afternoon. “TC Energy continually reviews our organizational structure and processes to ensure we continue to deliver safe and reliable services while meeting the needs of our customers. As ordinary course of operating our business, staffing changes are made as required to remain competitive and optimize our operations.”

TC Energy has not disclosed how many positions were cut as a result of the staffing changes.

Alberta’s opposition NDP says the layoffs are a direct result of missteps by the provincial government and are calling on the UCP to release how many TC Energy employees lost their jobs.

“Jason Kenney and the UCP gave TC Energy $7.5 billion dollars [sic] with no strings attached,” said NDP MLAs Irfan Sabir and Deron Bilous in a statement released Tuesday afternoon. “The layoffs today are a devastating example of Jason Kenney’s failure to create jobs and spur economic growth. Jason Kenney and the UCP lost 50,000 jobs before the pandemic. Now even more people are wondering how they’re going to pay their bills, put food on their table, and support their families.” 

The NDP are calling on Premier Jason Kenney to release the undisclosed details of the deal the Government of Alberta made with TC Energy earlier this year.

“Albertans deserve to know where their $7.5 billions [sic] went, what will happen if this project fails completely, and how many more jobs will be lost while rich shareholders and profitable corporations fill their pockets at the expense of Albertans,” said Irfan.

According to the NDP, the cuts at TC Energy included layoffs in management.

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Oil Prices Rise After EIA Reports Small Crude Draw – OilPrice.com

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Oil Prices Rise After EIA Reports Small Crude Draw | OilPrice.com

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

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    Oil prices stabilized today after the Energy Information Administration reported a crude oil inventory draw of 2 million barrels for the week to September 25.

    At 492.4 million barrels, inventories are still above the five-year average for the season, the EIA said. Analysts had expected a build of 1.4 million barrels.

    The EIA also reported an increase in gasoline stocks a day after the API depressed the market, with an estimated 2.325-million build in gasoline inventories.

    According to the EIA, gasoline inventories shed 700,000 barrels last week, which came after a draw of 4 million barrels estimated for the previous week. Gasoline production in the week to September 25 averaged 8.9 million bpd. This compares with an average of 9.3 million bpd a week earlier.

    In distillate fuels, the EIA reported an inventory decline of 3.2 million barrels. Distillates have been a major headache for refiners due to subdued demand. Total inventories are now close to 180 million barrels—almost a record high—and refiners don’t really have an incentive to increase production. Last week, they produced an average of 4.4 million bpd of distillates. This compares with 4.5 million bpd, also an increase on the previous week.

    Refineries processed some 13.7 million bpd of crude oil last week, compared with 13.4 million bpd a week earlier.

    Meanwhile, Total has become the latest industry major to cast a shadow over hopes for oil demand recovery. In its Energy Outlook, the French supermajor said that while it projected growth in global energy demand, this did not apply to oil demand, which would plateau by 2030.

    This added to more pandemic-induced fears as infections continued to rise in number in many key oil markets, including the United States and India, but also in a good chunk of Europe.

    At the time of writing, Brent crude was trading at $40.76 a barrel with West Texas Intermediate at $39.54 a barrel.

    By Irina Slav for Oilprice.com

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      Statistics Canada to unveil GDP reading for July – BNN

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      Canada’s economy posted a strong recovery over the summer, with more industries moving closer to pre-pandemic levels of output.

      Gross domestic product rose three per cent from a month earlier, Statistics Canada reported Wednesday. Preliminary estimates also show a one per cent expansion in August.

      Although the figures mark a deceleration from June’s 6.5 per cent growth, it’s still a steady clip. Economists were expecting output to grow by 2.9 per cent in July.

      The latest figures suggest Canada’s economy is bouncing back more quickly than originally expected, though the pace of the recovery is slowing and a recent spike in the number of COVID-19 cases in the country’s largest provinces could threaten future gains.

      Provinces like Ontario and Quebec have already reimposed some social distancing measures to prevent the second wave from getting out of control. This will likely drag out a full recovery, which still wasn’t forecast to occur for another two years.

      Based on the flash estimate, economic activity in August was about 95 per cent of output levels in February. At the nadir of the recession in April, output levels were about 82 per cent of pre-pandemic levels.

      Some parts of the economy are faring better than others. Agriculture, forestry and fishing, along with retail trade, finance and insurance an real estate have all surpassed February levels of output.

      GDP plunged by an annualized 38.7 per cent in the three months through June, adding to an 8.2 per cent drop in the first quarter, Statistics Canada reported. Third-quarter GDP is on pace for annualized growth of 48%, given the momentum from the last few months, Benjamin Reitzes, an economist at Bank of Montreal, said in a report before Wednesday’s release.

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