Latest news with #Sahdev
Time of India
24-06-2025
- Business
- Time of India
Iran's oil is stuck, China's refineries are down — Is a global price shock coming?
New Delhi: Oil prices, which had shown signs of spiking amid rising tensions between Iran and Israel, have eased back below $70 per barrel following an unexpected ceasefire announcement. According to energy consultancy Rystad Energy, this truce came earlier than markets anticipated and has shifted the global oil narrative from supply shock fears to questions around long-term price stability. 'Assuming the ceasefire holds, it reinforces our view that de-escalation was more likely than a full blockade of the Strait of Hormuz,' said Mukesh Sahdev, Global Head of Commodity Markets – Oil at Rystad Energy. The Strait of Hormuz is a strategic chokepoint through which about 20 per cent of global oil flows. What does this mean for oil prices going forward? With fears of escalation receding, markets are now focusing on US-Iran negotiations . Rystad expects Brent crude to hover near $70 per barrel, as the market digests how long the ceasefire will hold and whether it leads to a renewed nuclear agreement or easing of sanctions on Iranian crude exports. The key question, Sahdev said, is no longer how high oil can go, but where it will settle — with possibilities ranging between the low $60s and mid-$70s depending on how events unfold. How is Iran connected to oil prices? Iran exports up to 2.2 million barrels of crude per day, with China being its main buyer. Almost all of Iran's oil exports go to China, often at discounted rates. But recent US sanctions on China's teapot refineries (small private players) and some Singapore-based traders have reduced flows by half — down to 1 million barrels per day. Iranian tankers have been seen waiting near Shandong ports, and much of the crude has moved to floating storage, as Chinese demand has slowed due to maintenance outages and subdued refining activity. If the ceasefire holds and sanctions ease, Iranian oil could find new buyers. But if Chinese demand doesn't pick up, Iran would need to diversify its buyers, as it did in 2018, when it exported to more than 10 countries. What's happening in China's oil market? China imported around 11 million barrels per day of crude recently, with Iranian oil accounting for 10-15 per cent of that. However, China's refinery runs in May were at 14.27 million bpd, the lowest this year, due to scheduled maintenance and reduced operations by teapot refiners. Despite this slowdown, China has built up crude stocks in recent months, enough to cover 90–100 days of demand. As a result, analysts say China will not need to engage in panic buying, even if Iranian supply is interrupted. That said, product inventories like gasoline and diesel are at five-year lows, suggesting China will ramp up refining activity between June and September, which could raise demand slightly. Where will Iran's crude go if China slows buying? With production steady at 4.2 million bpd, and about 2 million bpd available for export, Iran would need to redirect volumes if China pulls back. Historically, countries across Asia-Pacific and the EU were buyers, but current sanctions and market dynamics make this difficult. Rystad expects India could become a key buyer of Iranian LPG, if sanctions ease or trade dynamics shift. Iran's medium sour crude matches many global refineries' requirements, and declines in Venezuela and Russia's output could open space for Iranian barrels — provided political roadblocks are cleared. What's the role of OPEC+ in stabilising the market? Rystad notes that OPEC+ is likely to remain cautious, gradually unwinding production cuts to maintain price stability without pushing the market into contango (a state where future prices are higher than spot prices). The IEA has raised its call on OPEC+ crude by 300,000 bpd for 2025, aligning with the group's current output plans. Despite easing tensions, Iran and Russia's crude flows will remain key in determining supply balance in the second half of the year. How is US shale responding to current prices? Even though prices are near $70 per barrel, US shale production is unlikely to ramp up significantly. Rystad forecasts only a 300,000 bpd increase in US crude and condensate production this year. The oil rig count in the US has declined, and while gas rigs have risen slightly, producers are cautious. The market structure — with backwardation in WTI crude (spot prices higher than futures) — makes it difficult for producers to hedge, reducing the incentive to expand output. Meanwhile, US crude inventories have dropped by 36 million barrels year-on-year, and a 6.5 million-barrel draw is expected for the week ending June 20. The drawdown may help support WTI prices temporarily, but volatility remains high. What does this mean for India? For India, which imports over 85 per cent of its oil, any easing in crude prices provides some relief on import bills and fuel inflation. The return of Iranian barrels to the global market, either through direct trade or indirect displacement, could improve supply availability. However, a large part of the equation depends on US policy towards Iran, OPEC+ production decisions, and China's refining behaviour in the coming months. What lies ahead? The next few weeks will be crucial. The ceasefire's durability, progress on a US-Iran agreement, and reshuffling of crude flows — especially from Iran and Russia — will determine whether oil remains stable or re-enters a volatile phase. For now, the market is balanced but sensitive. Any policy misstep, supply disruption or diplomatic breakdown could shift prices quickly. As Rystad Energy puts it, 'Signals remain uncertain, and geopolitical risks persist, keeping volatility high, even as some progress towards peace is made.'
Yahoo
16-06-2025
- Business
- Yahoo
Rystad: Oil Prices To Remain Below $80 Despite Escalating Middle East Tensions
Oil prices are likely to remain capped below $80 per barrel despite the escalating Israel-Iran conflict, research firm Rystad Energy said on Monday, as Iran and Israel continue to trade strikes with the escalation now in its fourth day. 'Based on our earlier disruption simulations, we see oil prices capped below $80 per barrel,' Mukesh Sahdev, Rystad Energy's Global Head of Commodities Markets – Oil, said in a market update, carried by Africa Oil+Gas Report. The conflict appears likely to be contained and the United States could potentially play a central role, according to Sahdev. The worst fear in the market is a potential closure of the Strait of Hormuz, the world's most critical crude flow lane where more than 20 million barrels of crude pass every day—equal to a fifth of global daily oil consumption. While disruption to Strait of Hormuz flows could be devastating and would send oil prices spiking and add further tensions, it is an unlikely scenario for many observers and analysts, including those at Rystad Energy. 'A blockade remains the key risk that could push markets into uncharted territory,' Janiv Shah, Rystad Energy's Vice President, Commodities Markets – Oil, said. However, 'Given its interest in keeping prices closer to $50, the US could play a stabilizing role,' Shah added. 'We maintain our view that this is likely to remain a short-lived conflict, as further escalation risks spiraling beyond the control of key stakeholders,' Shan said. Despite Israel and Iran hitting each other's energy sites over the weekend, the targets are not material to global oil production or crude flows. Following the oil price jump on Friday after the start of the Israeli strikes on Iran, oil was muted in early trading on Monday, with both benchmarks falling by around 1% and trading in the low $70s per barrel as key oil flows from the Middle East remain unaffected. By Charles Kennedy for More Top Reads From this article on
Yahoo
16-05-2025
- Business
- Yahoo
Why filling the Strategic Petroleum Reserve could be the secret to success of Trump's Middle East visit
President Trump visited the Middle East this week to much fanfare, pomp and, of course, circumstance as he aims to lower prices at the pump with more oil production from OPEC. Saudi Arabia, the United Arab Emirates, and other OPEC countries are in agreement—they also want to churn out more oil and gain global market share—aftre years of voluntary cutbacks. But they decidedly do not want to lower oil and fuel prices because of their need to balance big national budgets. So, what's the solution? Using increased OPEC volumes to fill the depleted U.S. Strategic Petroleum Reserve (SPR), says Mukesh Sahdev, global head of oil commodity markets for consulting form Rystad Energy. The idea is that using Middle Eastern crude oil to fill the Texas and Louisiana salt caverns that comprise the SPR would help the Saudis and the rest of OPEC without dragging already weak oil prices much lower. That's because the barrels would be kept out of commercial marketplaces and have a limited impact on worldwide supply and demand. 'I know this has not been talked much about in his visit, but I can clearly see a strategic play," Sahdev told Fortune. "OPEC will increase production, and that increased production could be bought by the U.S. to fill the SPR and be ready for the summer.' The increased OPEC output combined with Trump's fixation on lower gasoline prices also fit in with all the massive and lofty promises the Saudis and UAE made this week. Those countries need the funds to make good on their pledges for business partnerships with America, including Saudi Arabia's pledge to invest $600 billion in the U.S. and Abu Dhabi's commitment to build a huge data center complex. 'If Trump wants the money out of the Middle East and into the U.S., they have to earn it as well,' Sahdev said. 'If oil prices fall much further, then they will not earn that money. 'I think the signal is very clear that extra OPEC barrels will flow into the U.S. market," he added. The European benchmark for oil that's closely watched by OPEC is currently hovering near a relatively low $65 per barrel. The Saudis need $80 per barrel to safely balance the kingdom's budget. And, if prices dip further, then the U.S. oil sector suffers and really starts to scale back more dramatically. Trump's visit to the Middle East coincides with a renewed U.S. demand for the region's oil thanks to a confluence of other economic factors. The U.S. refining system is mostly configured to run heavier or medium barrels of sour crude oil, as opposed to the light, sweet oil that comes out of West Texas shale. The U.S. exports lots of its shale oil, but also imports heavier barrels from Canada, Mexico, Venezuela, and the Middle East to run through its refineries. Tariffs, sanctions, and financial struggles have led to fewer of those heavier barrels coming from the Americas. That means the U.S. needs more Middle Eastern crude for its refineries, Sahdev said. Already, Saudi Arabia and Iraq have ramped up exports to the U.S. ahead of the busy summer driving season. 'With the summer peak demand coming, they need the right kind of crude oil,' he said. 'And, for any strategic, geopolitical, or military ventures, the SPR in the U.S. needs to be filled.' Sahdev believes it is 'no coincidence' the pending—but currently stalled—U.S. House budget seeks $1.5 billion to replenish and maintain the SPR. The salt cavern facilities have the capacity to store about 727 million barrels, and the SPR currently holds just 400 million barrels. The SPR sat at nearly 700 million barrels when Trump first took office in 2017 and then dipped down to 638 million barrels when Biden took office. The Biden administration then began selling it off more rapidly to help lower fuel prices coming out of the pandemic. Relying on more barrels from select OPEC nations also gives Trump more leeway with oil sanctions on key producers Venezuela, Iran, and Russia. The could potentially prevent those nations from exporting more barrels, and further help steady oil prices. OPEC and its key allies, a group called OPEC+, already shocked oil markets in April—the same time Trump announced his new tariff policy—with pledges to raise production volumes by more than 2 million barrels per day by late 2025. But context is important, said Michael Cohen, BP chief US economist and head of oil and refining, speaking at a Houston energy conference this week. 'It's very clear there's been a significant sacrifice in the market share' from OPEC, especially Saudi Arabia, since 2017, Cohen said. 'That's only a fraction of the total amount OPEC has taken off the market.' Collectively, OPEC+ has taken 5.86 million barrels per day of oil offline since 2022 until this year—more than 5% of global demand—to help strengthen oil markets, partly in response to rising U.S. production and because of slowing global demand growth. Meanwhile, the U.S. was 'blowing all of that out of proportion' and growing from 8.8 million barrels of oil a day at the beginning of 2017 to nearly 13.3 million barrels daily in 2024, essentially a whopping 50% increase to new record highs. The Saudis can easily produce more than 10.5 million barrels per day, but the kingdom has held production to 9 million barrels per day or less since mid-2023 until now. The Saudis are now ramping up to about 9.5 million barrels daily by late fall. 'That's not that big of an increase,' Cohen said. This story was originally featured on
Hans India
14-05-2025
- Hans India
Gurugram: Four held for providing bank accounts to cyber fraudsters
Gurugram: A cybercrime police station in Manesar of the Gurugram Police has arrested four accused for allegedly providing bank accounts for cyber fraud, police said. The accused were identified as Honey Garg, Sahdev, and Sandeep, all residents of village Tatarpur, district Palwal, and Rahul Tiwari resident of Bawa Colony, Ludhiana (Punjab), currently residing in village Tatarpur, district Palwal. According to the police, on March 15, a person complained to the cybercrime police station, Manesar in Gurugram, regarding fraud in the name of earning profit by investing. On this complaint, a case was registered under the relevant sections in Police Station Cyber Crime Manesar, Gurugram. Taking action under the leadership of Priyanshu Diwan, Assistant Commissioner of Police (ACP) Cyber Crime, Gurugram, the police team arrested four accused from Gurugram on May 13. During police interrogation, it was found that the accused had opened the bank account used in the fraud in the name of another person and made it available to the cyber fraudsters. In return, the accused had received Rs 18,000, police said. Meanwhile, a cybercrime police team of the Gurugram Police had recently arrested 16 suspects in cyber fraud cases and disclosed fraud of about Rs 44.4 crore across India. According to the police, after reviewing the data of the 12 mobile phones and 1 SIM card recovered from the accused by the police from the Indian Cyber Crime Coordinate Center (I4C), it was found that the accused were involved in fraud of about Rs 44.4 crore, and around 10,697 complaints were registered against them across India. Around 379 cyber fraud cases were registered against 16 unknown suspects across India, of which around 25 cases were registered in Haryana, and 5 of those cases were registered against them.
